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UNITED STATES

 

SECURITIES AND EXCHANGE COMMISSION

 

Washington, DC 20549

 

SCHEDULE 14A

 

PROXY STATEMENT PURSUANT TO SECTION 14(a)
OF THE SECURITIES EXCHANGE ACT OF 1934

(Amendment No.     )

 

  Filed by the Registrant   Filed by a Party other than the Registrant

 

Check the appropriate box:
Preliminary Proxy Statement
Confidential, for Use of the Commission Only (as permitted by Rule 14A-6(E)(2))
Definitive Proxy Statement
Definitive Additional Materials
Soliciting Material under §240.14a-12

 

KBR, INC.

 

 

(Name of Registrant as Specified in Its Charter)

 

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

 

Payment of Filing Fee (Check all boxes that apply):
No fee required.
Fee paid previously with preliminary materials.
Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11.
 

 

 

STUART J. B. BRADIE

President and Chief Executive Officer

 

 

At KBR, we do things that matter.

 

KBR was named a Great Place to Work-Certified™ company in several countries around the world.

 

$10.5B

In bookings and options in 2023

 

$22B

In backlog and options at the end of 2023

 

April 1, 2024

 

Dear KBR, Inc. Stockholders:

 

KBR has had another strong year. Our performance is directly attributable to our amazing people. Once again, our team of teams has gone above and beyond, delivering for our customers and our shareholders. At KBR we do things that matter, contributing to a safer, more secure and sustainable world. Here are some highlights:

 

   
Ahead of pace on adjusted EBITDA with all segments delivering strong bottom line results
Organic revenue growth of 6% and organic revenue growth (ex-OAW)1 of 11%, year over year
$22 billion total backlog and options, up 10% year over year, with a 1.1 TTM book to bill
>75% work under contract for 2024
93% incident-free days and an industry-leading TRIR of 0.067
Recognition from EcoVadis as a gold-standard sustainability company, by USA Today as one of America’s Climate Leaders, and by MSCI with their highest ESG rating of AAA
Double-digit growth in headcount, a good indicator of sustained growth
Selection to Forbes’ list of the World’s Top Companies for Women, which underscores our commitment to fostering an inclusive and empowering environment for all our female employees
Being Great Place to Work-Certified™ in 16 countries based on employee and project hire responses from our global People Perspectives Surveys
Launching a new employee resource group, ADAPT, whose mission is to educate, empower and enhance the experiences of individuals across KBR with disabilities

 

I also want to share with you just a few of the many ways our experts are driving the knowledge economy.

 

The first is Iron Stallion, a project with the United States Department of Defense, that features KBR IP developed to digitally track satellites and space debris. It uses levels of artificial intelligence (AI) and machine learning (ML) to estimate and validate future events and to identify potential threats. That’s just one of several such solutions KBR is delivering to help maintain the safety, security and health of the space environment. Another is the work our people are doing through the Fully Integrated Lifecycle Mission Support Services contract at NASA’s Ames Research Center. Scientists, engineers, technicians, administrators and project managers from KBR are working on a wide range of activities supporting life sciences research and exploration. This includes integrating AI and ML into future space health systems and biological research on missions to low Earth orbit, the moon and Mars.

 

There’s also our ongoing work around the energy trilemma — the confluence of the need for cleaner sustainable energy sources, energy affordability, and energy security. KBR has been at the forefront of decarbonization for decades. More and more, customers are relying on our science and high-end engineering expertise and our suite of digital tools to help increase the efficiency of their assets while reducing emissions. In fact, KBR launched an incredible nine new sustainable technologies in 2023, which will not only help customers realize their net-zero targets but will also contribute to more sustainable methods of producing things like clothes and furniture, electric vehicles, more efficient batteries, and sustainable aviation fuel.

 

Finally, internally we held our inaugural global Hackathon, which saw 145 teams from around the world working together to develop and present solutions in the areas of sustainability, digitalization/AI and employer branding — all areas of critical importance to KBR. The competition was not just an incubator for innovation but was also a chance for our people to break down silos and create opportunities for connection, which is what we’re all about at KBR.

 

That includes fostering connections with all of you. Transparency with our stockholders and other stakeholders is fundamental to our corporate governance practices. We value your views and encourage you to vote. You may do so promptly via phone or internet, or you may mail your completed and signed voting card.

 

On behalf of the KBR Board of Directors, I thank you for being a KBR stockholder and for your continued support.

 

Sincerely,

Stuart J. B. Bradie

President and Chief Executive Officer

 

(1) A reconciliation of revenue (ex-OAW) to GAAP revenue is provided under “Non-GAAP Financial Information.”

 

Notice of Annual Meeting of Stockholders

 

               

When

Wednesday
May 15, 2024

 

Place

The Annual Meeting will be completely virtual and only conducted via live webcast at virtualshareholdermeeting.com/KBR2024. There will be no physical meeting location.

 

Time

8:00 a.m.
Central Daylight Time

               

 

We invite you to attend KBR’s virtual annual stockholders’ meeting and act upon the following matters:

 

Proposals   Board Vote Recommendation   For Further Details
1. Elect as directors the ten nominees named in the attached proxy statement.   “FOR” each director nominee   Page 13
2. Consider and act upon an advisory vote to approve the named executive officer compensation as described in the Compensation Discussion and Analysis.   “FOR”   Page 51
3. Ratify the appointment of KPMG LLP as the independent registered public accounting firm to audit KBR’s consolidated financial statements for the fiscal year ending January 3, 2025.   “FOR”   Page 101
4. Transact any other business that properly comes before the meeting or any adjournment or postponement of the meeting.          

 

The Proxy Statement that follows describes these items.

 

By Order of the Board of Directors, April 1, 2024

 

 

Sonia Galindo

Executive Vice President, General Counsel & Corporate Secretary

 

RECORD DATE

 

The record date for determining which stockholders are entitled to cast votes at the virtual Annual Meeting and at any adjournment or postponement of the meeting is Wednesday, March 20, 2024.

 

HOW TO VOTE

 

Via the Internet at
proxyvote.com (1)
  Mail your signed
proxy card.
         
Call toll-free
(US/Canada)
at 1-800-690-6903(1)
  Virtually during the Annual Meeting through virtualshareholdermeeting.com/KBR2024.
See page 102 for instructions.


 

1) If you hold your shares through a broker or bank rather than directly with KBR, check with your broker or bank to see if telephone or Internet voting is available to you. Voting via the Internet or toll-free call is open until 11:59 p.m. EDT on May 14.

 

www.kbr.com

2024 Proxy Statement           4

   
 

Table of Contents

 

Proxy Summary 6
Business Highlights 6
Financial Highlights 7
Sustainability Highlights 8
Information About the Board of Directors 9
Board Snapshot 10
Governance Highlights 11
Focus on Accountability 11
Independent and Engaged Board 11
Compensation Highlights 12
Corporate Governance 13
 Proposal No. 1 Election of Directors 13
Our Board 13
Nominees for Director 14
Board and Governance Structure 19
Role of the Board of Directors 19
Our Board Leadership Structure 19
Director Independence 20
Committees of the Board 21
Enterprise Risk Management 27
ERM Framework 27
ERM Program 28
Board Oversight of ERM 28
Management Succession Planning 30
Board and Committee Evaluations 30
Board Refreshment 31
Process for Selecting New Directors 31
Director Qualifications 32
Stockholder Engagement 32
Director Orientation and Education 33
Board Practices and Procedures 33
Attendance at Meetings 33
Retirement Policy 33
Service on Other Boards 33
Anti-Hedging Policy 34
Corporate Governance Materials 34
How to Contact the Board 34
Sustainability and KBR 35
Vision: to create a safer, more secure, and sustainable world. 35
Our Sustainability Pillars and ESG Focus Areas Within Each Topic 36
Measuring our Impact 37
Environmental Impact 37
KBR’s Climate Action Plan 37
People Strategy 37
Director Compensation 42
Director Stock Ownership Guidelines 44
Certain Relationships and Related Transactions 44
Related Person Policies 45
Executive Officers 46
Executive Compensation 50
 Proposal No. 2 Advisory Vote to Approve Named Executive Officer Compensation 51
Compensation Discussion and Analysis 52
Executive Summary 52
Overview of Executive Compensation Philosophy, Policies and Practices 56
Summary of 2023 Target Compensation of Named Executive Officers 60
Elements of Compensation 60
Long-Term Performance Incentives 67
Other Compensation Elements 73
Stock-Related Policies 74
Impact of Accounting, Regulatory, and Tax Requirements on Compensation 75
Impact of Executive Conduct or a Restatement of Earnings on Compensation (Clawback Policy) 75
Conclusion 75
Compensation Committee Report 76
Compensation Committee Interlocks and Insider Participation 76
Executive Compensation Tables 77
Summary Compensation 77
Grants of Plan-Based Awards 80
Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table 82
Outstanding Equity Awards at Fiscal Year End 84
Option Exercises and Stock Vested 85
Pension Benefits 86
Nonqualified Deferred Compensation 86
Severance and Change-in-Control Agreements 90
No Employment Agreements 92
CEO Pay Ratio 92
Pay Ratio Methodology and Calculation 92
Pay Versus Performance 93
Pay Versus Performance Table 93
Pay Versus Performance Relationship Disclosures 96
Important Financial Performance Measures 97
Security Ownership of Certain Beneficial Owners and Management 98
Audit Committee Report 99
Primary Responsibilities and 2023 Actions 99
Oversight of Independent Auditors 100
2023 Audited Financial Statements 100
Approved Principal Accountant Fees and Services 100
 Proposal No. 3 Ratify the Appointment of Independent Registered Public Accounting Firm 101
General Information About KBR’s Annual Meeting 102
Additional Information Available 106
Forward Looking Statements 106
Non-GAAP Financial Information 107

 

 

2024 Proxy Statement           5

   
 
Back to Contents

Proxy Summary

 

Business Highlights

 

             
             
$10.5B   1.1x   $331MM   >75%
Bookings and options awarded in 2023 – provides greater visibility of long-term growth targets   Trailing twelve-months book-to-bill as of December 29, 2023   Operating cash flows generated in 2023   Work under contract for 2024

 

Launched Sustainable Aviation Fuel (SAF) Technology

KBR partnered with Swedish Biofuels AB to extend our decarbonization and energy transition portfolio into the aviation sector with a differentiated SAF offering. In addition to processing ethanol, this technology can also convert carbon dioxide and synthesis gas to SAF, thereby expanding opportunities for KBR’s clients to utilize captured carbon toward a cleaner, greener future.

 

Pluto Train 1 LNG Facility in Western Australia

KBR awarded the engineering, procurement, and construction management (EPCm) contract by Woodside Energy, as operator for and on behalf of the Pluto Joint Venture, for modifications to Train 1 of Woodside’s Pluto LNG facility, located near Karratha, Western Australia. The modifications will enable the processing of up to three million tonnes per annum of Scarborough gas and extend the life of the plant.

         

Carbon Neutral Since 2019

On path toward operational net-zero carbon ambition by 2030. KBR’s commitment to sustainability includes leveraging our expertise to help others achieve their sustainability goals, thus creating value for all stakeholders.

 

One of The World’s Top Companies for Women 2023 Forbes Magazine (Third Consecutive Year)

KBR is one of 400 global companies to receive this prestigious award.

         

H2ACTSM Hydrogen Technology Selected for World’s First Commercial Ammonia Cracking Unit

KBR awarded a license and engineering design contract by Hanwha Impact Corporation for the world’s first commercial ammonia cracking unit using KBR’s leading H2ACTSM technology in Daesan, Republic of Korea. The plant will be designed to deliver over 200 metric tons per day of clean hydrogen as fuel for a planned power plant in Daesan, paving the way for large-scale sustainable hydrogen utilization.

 

Awarded Additional DE M-Shorad Vehicle Prototypes

KBR awarded two additional Directed Energy Maneuver-Short Range Air Defense (DE M-SHORAD) vehicle prototypes, on top of the four delivered to the Army earlier this year, underscoring the growing significance of directed energy capabilities.

 

www.kbr.com

2024 Proxy Statement           6

   
 
Back to Contents

Financial Highlights

 

REVENUE   DILUTED EARNINGS PER SHARE   OPERATING CASH FLOWS
         
   
         
ADJUSTED EBITDA*   ADJUSTED EARNINGS PER SHARE**   ADJUSTED OPERATING CASH FLOWS***
         
   

 

* EBITDA is defined as net income (loss) attributable to KBR, plus interest expense; accretion of convertible notes debt discounts; other non-operating expense (income); provision for income taxes; and depreciation and amortization. Adjusted EBITDA excludes certain amounts included in EBITDA. A reconciliation of adjusted EBITDA to net income is provided under the section titled “Non-GAAP Financial Information” at the end of this proxy statement.
** Diluted EPS reflects our net income (loss) divided by the weighted average number of common shares outstanding during the period in addition to common shares that would have been outstanding if potential common shares with a dilutive effect had been issued. Adjusted EPS excludes certain amounts included in diluted EPS. A reconciliation of adjusted EPS to diluted EPS is provided under the section titled “Non-GAAP Financial Information” at the end of this proxy statement.
*** Adjusted operating cash flows exclude certain amounts included in the cash flows provided by operating activities calculated in accordance with Generally Accepted Accounting Principles (“GAAP”). The most directly comparable financial measure calculated in accordance with GAAP is cash flows provided by operating activities. A reconciliation of adjusted operating cash flows to cash flows provided by operating activities is provided under the section titled “Non-GAAP Financial Information” at the end of this proxy statement.

 

   
Successfully settled remaining convertible notes and related warrants in cash, avoiding dilution
   

 

DIVIDENDS PAID
OUT IN 2023
TSR PEER GROUP 3-YEAR RANKING 2021-2023 QUARTERLY DIVIDEND INCREASE IN 2023
     
$72MM
1ST
12.5%
     

 

 

2024 Proxy Statement           7

   
 
Back to Contents

Sustainability Highlights

 

To reach our vision of ‘delivering a safer, more secure and sustainable world’ we are driving sustainability deep into our DNA, from the highest level of the organization through our business strategy and into our operations. Our dedication to creating positive impact for the planet and for people is delivered both through the innovative and sustainable solutions we offer our clients and in the way we conduct our day-to-day business, all of which contribute to the creation of long-term success, growth, business resilience, and shared prosperity for all.

 

We continue to increase our sustainability focused revenue through the delivery of our sustainable solutions to the key governments and customers we serve, and in 2022 we increased this revenue by 13%, reaching $2.2 billion in total.

 

Strengthening this sustainability drive is our short-term incentive plan with a sustainability performance weighting of 10%. This metric measures executive and senior leadership performance against the success of our 10 Sustainability Pillars, including safety, inclusion and diversity, and environment.

 

With an aim to further enhance our business resilience and to future-proof the organization, we have established new processes to give due consideration to sustainability and climate-related risks and opportunities that influence both our operations and the markets in which we operate, by embedding these factors into our COSO based enterprise risk management system.

 

We are proud of our employees’ dedication to aiming for Zero Harm in all that they do 24/7 and continuing to reach new heights in our aim for Zero Harm (incident free) days. In 2023, we reached a new record of 93% incident free days and recorded another consecutive year of industry-leading HSSE performance with a total recordable incident rate (“TRIR”) of 0.067.

 

The success of all this work is reflected in the external recognition we continue to receive as highlighted below.

 

Key Recognitions

 

 

More information on Sustainability and KBR is provided on page 35.

 

www.kbr.com

2024 Proxy Statement           8

   
 
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Information About the Board of Directors

 

The KBR Board of Directors is currently composed of nine directors with an extensive variety of skills, expertise, and experience who guide and support our strategy to create long-term value for our stockholders and other stakeholders. Each of our directors is independent except Mr. Bradie, our CEO. On March 13, 2024, our Board of Directors approved an increase to the size of the Board of Directors from nine members to ten members. To fill the newly created directorship, our Board of Directors nominated Joseph Dominguez for election at our 2024 Annual Meeting of Stockholders.

 

 

KBR’s Board of Directors from left: Lynn Dugle, Jack Moore, Ann Pickard, Stuart Bradie, General Lester Lyles, USAF (Ret.), Mark Baldwin, Lt. General Wendy Masiello, USAF (Ret.), Sir John Manzoni KCB, and Carlos Sabater.

 

  Mark Baldwin     General Lester Lyles, USAF (Ret.)     Jack Moore
 

Former Executive Vice President and Chief Financial Officer of Dresser-Rand Group, Inc.

Age: 70

Director since: 2014

Committees:

•  Audit (Chair)

•  Sustainability and Corporate Responsibility

   

Independent Consultant

Age: 77

Director since: 2007

Committees:

•  Cybersecurity

•  Nominating and Corporate Governance

   

Former Chairman, President and Chief Executive Officer for Cameron International Corporation

Age: 70

Director since: 2012

Committees:

•  Compensation (Chair)

•  Cybersecurity

•  Nominating and Corporate Governance

  Stuart Bradie     Sir John Manzoni KCB     Ann Pickard
 

President and Chief Executive Officer, KBR, Inc.

Age: 57

Director since: 2014

Committees: None

   

Former Permanent Secretary for the Cabinet Office, U.K. Government

Age: 64

Director since: 2022

Committees:

•  Audit

•  Cybersecurity

   

Former Executive Vice President, Arctic for Royal Dutch Shell pic

Age: 68

Director since: 2015

Committees:

•  Sustainability and Corporate Responsibility (Chair)

•  Compensation

  Lynn Dugle     Lt. General Wendy Masiello, USAF (Ret.)     Carlos Sabater
 

Former Chairperson, President and Chief Executive Officer at Engility Holdings Inc.

Age: 64

Director since: 2020

Committees:

•  Nominating and Corporate Governance (Chair)

•  Compensation

•  Cybersecurity

   

Independent Consultant

Age: 65

Director since: 2017

Committees:

•  Cybersecurity (Chair)

•  Compensation

•  Sustainability and Corporate Responsibility

   

Former Senior Global Partner for Deloitte Touche Tohmatsu Limited

Age: 65

Director since: 2021

Committees:

•  Audit

•  Nominating and Corporate Governance

 

 

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Board Snapshot

 

 

The above information describes our current Board of Directors. It does not include Lt. General Vincent R. Stewart, who served on our Board of Directors until his passing in April 2023, and it does not include Mr. Dominguez, who is a new director nominee to be considered for election to the Board of Directors at the Annual Meeting.

 

www.kbr.com

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Governance Highlights

 

Our Board of Directors believes that good corporate governance and transparent communication with our stockholders and other stakeholders are essential for KBR’s long-term success.

 

Focus on Accountability

 

Annual director elections with majority voting standards
Annual Board governance review, including review of investor feedback
Periodic independent director meetings with investors
Negative discretion applied to the 2020, 2022, and 2023 short-term incentive (“STI”) plan payouts of all our Named Executive Officers (“NEOs”)
Commitment to regular stockholder outreach and soliciting of feedback
Increased Environmental, Social and Governance (“ESG”) focus and enhanced disclosures in KBR’s Corporate Sustainability Report
Linked 10% of our NEOs’ 2021, 2022, and 2023 STI plan payout opportunity to ESG performance

 

Independent and Engaged Board

 

Significant knowledge of KBR’s industries and markets
Annual Board visits to KBR businesses or project sites
Annual assessment of Board leadership structure
         
   
          INDEPENDENT CHAIR

 

   
   
28 Independent board committee meetings held in 2023
   
26 Executive sessions held in 2023 without management present
   
1 New independent board committee chair appointment in 2023
   


 

TOTAL YEARS OF INDUSTRY EXPERIENCE

 

 

 

 

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Compensation Highlights

 

Our compensation program links pay to performance to align our senior executives’ interests with those of our stockholders. Consistent with our business strategy, our senior executives’ individual Key Performance Indicators (“KPIs”) are focused on growth and expansion, reducing costs, and increasing efficiencies and cash flow performance. The Compensation Committee set rigorous targets for 2023 for both the short-term incentive (“STI”) and long-term incentive (“LTI”) plans.

 

STRONG LINK BETWEEN PAY AND PERFORMANCE

 

The design of our compensation program establishes a strong link between senior executives’ pay and KBR’s financial and ESG performance. Our Compensation Committee periodically reviews and makes changes to our compensation programs, including changes to STI and LTI metrics in recent years, in order to maintain this strong alignment and in some cases to respond to stockholder concerns.

 

CEO HAS RECEIVED FIVE BASE SALARY INCREASES IN TEN YEARS

 

Aligned with our rigorous Executive Compensation program, our CEO’s base salary has increased only five times since he was appointed in 2014 to reward him for his demonstrated success at:

 

Positioning KBR for long-term growth by aligning and expanding our businesses.
Increasing Company performance and stockholder value.
Driving cultural change to emphasize the importance of our people, their safety, and inclusion in advancing KBR.
Advancing KBR’s sustainability strategy.

 

NAMED EXECUTIVE OFFICER TARGET 2023 COMPENSATION

 

 

(1) Ms. Myles’s base salary is approved and paid in British Pounds. STI payouts are paid in local currency, and therefore Ms. Myles’s STI payouts are also paid in British Pounds. Her 2023 base salary was £385,014, and her target 2023 STI was £365,763, but both figures have been converted to U.S. Dollars in the table above for presentation purposes using the exchange rate of £1 to $1.2748, which, for consistency, is the exchange rate used in other tables in the “Compensation Discussion and Analysis” section of this proxy statement.

 

www.kbr.com

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Corporate Governance

 

PROPOSAL NO. 1   

Election of Directors

 

At our 2024 Annual Meeting of Stockholders, ten directors are to be elected to hold office until the 2025 Annual Meeting of Stockholders. All directors are elected annually, with each nominee standing for election to a one-year term. The members of our Board of Directors hold office until their successors are elected and qualified or until their earlier resignation or removal. Our Board of Directors has approved an increase to the size of the Board of Directors from nine members to ten members and nominated Joseph Dominguez for election at our 2024 Annual Meeting of Stockholders. Mr. Dominguez was identified as a qualified director candidate by an independent executive search firm engaged by our Nominating and Corporate Governance Committee. Mr. Dominguez’s nomination resulted from a comprehensive evaluation of Mr. Dominguez’s abilities, skills, and experience following the process and criteria outlined in “Process for Selecting New Directors.” There are no arrangements between any director nominee and any other person pursuant to which such director nominee was selected as a Director nominee. All nominees besides Mr. Dominguez are incumbent director nominees.

 

Each nominee has indicated a willingness to serve, if elected. If any nominee declines to serve or becomes unavailable for any reason, or if a vacancy occurs before the election, the proxies may be voted for such substitute nominee as the Board of Directors may designate. We have no reason to believe that any of the nominees will be unable to serve if elected. Directors are elected by a majority of votes cast. This means that the number of shares voted “For” a candidate must exceed the number of shares voted “Against” the candidate. Shares present but not voting on the election of directors will be disregarded, except for quorum purposes, and will have no effect on the outcome of the vote.

 

Our Board

 

A top priority of our Board and Nominating and Corporate Governance Committee is ensuring that our Board of Directors is composed of directors who:

 

bring a variety of skills relevant to our business,
provide expertise that is useful to KBR and complementary to the background and experience of other Board members, and
effectively represent the long-term interests of our stockholders.

 

As shown below, the incumbent directors and one new director nominee (Mr./Dominguez) have a wide range of skills and experience that will enable the Board to effectively oversee management and the business of KBR.

 

  Baldwin Bradie Dominguez Dugle Lyles Manzoni Masiello Moore Pickard Sabater
Industry Experience Energy Engineering
Government
Technology
Energy
Engineering
Government
Space
Technology
Government
Space
Energy
Engineering
Government
Government
Technology
Energy Energy
Engineering
Technology
Professional
Services
  C-Suite  
CEO/CFO
       
  Cyber  
Cybersecurity/Data Privacy/IT
           
  Finance  
Accounting/Audit/Finance
 
  Risk  
Risk Management/Oversight
  Sustainability  
Climate/Environment/Sustainability
       
  Technology  
IP/Licensing/Technology
           
  Veteran  
Military Service
               
Demographics                    
Age 70 57 61 64 77 64 65 70 68 65
Tenure 9 9 0 4 16 1 6 12 8 2
Gender M M M F M M F M F M
Nationality U.S. U.K. U.S. U.S. U.S. U.K. U.S. U.S. U.S. U.S.
Race/Ethnicity White White White + Hispanic White African
American
White White White White White +
Hispanic
Generals                

 

The Board of Directors recommends that you VOTE FOR the election of all the director nominees presented on the next several pages. All proxies will be so voted unless a stockholder specifies otherwise.  

 

 

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The following biographical information about the director nominees is as of March 20, 2024.

 

Nominees for Director

 

MARK E. BALDWIN

Age: 70   |   Director since: 2014   |   Independent

KBR Board Committees: Audit Committee (Chair) and Sustainability and Corporate Responsibility Committee

Other Public Company Boards: Nine Energy Service, Inc. (Audit Committee Chair) and TETRA Technologies, Inc. (Audit Committee Chair)


Key Qualifications and Skills:      C-Suite    Finance    Risk 

Prior Business Experience

   Executive Vice President and Chief Financial Officer of Dresser-Rand Group, Inc.

   Executive Vice President, Chief Financial Officer, and Treasurer of Veritas DGC, Inc.

   Operating Partner at First Reserve Corporation

   Executive Vice President and Chief Financial Officer for NextiraOne

   Chairman of the Board and Chief Executive Officer for Pentacon, Inc.

   Variety of finance and operations positions with Keystone International Inc., including Treasurer, Chief Financial Officer, and President of the Industrial Valves and Controls Group

Education

   B.S. (Mechanical Engineering), Duke University

   M.B.A., Tulane University

   Graduate of the Stanford Executive Program


 

STUART J. B. BRADIE

Age: 57   |   Director since: 2014

KBR Board Committees: None

Other Public Company Boards: Rolls Royce Holdings Plc


Key Qualifications and Skills:    C-Suite   Risk   Sustainability   Technology 

Current Business Experience

   President and Chief Executive Officer, KBR, Inc. (since 2014)

Prior Business Experience

   Group Managing Director — Operations and Delivery for WorleyParsons

   Managing Director across Europe, Africa, Asia and the Middle East for WorleyParsons

   Managing Director for PT Kvaerner Indonesia

   Country Manager for Kvaerner Philippines

   Global experience across over 40 countries in the hydrocarbons, mining and chemicals, power and infrastructure sectors

Education

   B.S. (Mechanical Engineering), Aberdeen University

   M.B.A., Edinburgh Business School, Heriot-Watt University

 


 

 

www.kbr.com

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JOSEPH DOMINGUEZ

Age: 61   |   Director Nominee: 2024   |   Independent

KBR Board Committees: Not yet appointed

Other Public Company Boards: Constellation Energy Corp

Current Affiliations: Electric Power Research Institute (Director); Hispanics in Energy (Chair); Institute of Nuclear Power Operations (Director); and Nuclear Energy Institute (Director)


Key Qualifications and Skills:        C-Suite    Finance    Risk    Sustainability 

Current Business Experience

   President and Chief Executive Officer at Constellation Energy Corp (since 2022)

Prior Business Experience

   Chief Executive Officer at Commonwealth Edison Company (ComEd)

   Executive Vice President of Governmental and Regulatory Affairs and Public Policy at Exelon Corporation

   Partner at White and Williams, LLP

   Assistant U.S. Attorney for Eastern District of Pennsylvania

Education

   B.S. (Mechanical Engineering), New Jersey Institute of Technology

   J.D., Rutgers University School of Law


 

LYNN A. DUGLE

Age: 64  |  Director since: 2020  |  Independent

KBR Board Committees:  Nominating and Corporate Governance Committee (Chair), Compensation Committee, and Cybersecurity Committee

Other Public Company Boards: EOG Resources, Inc., Micron Technology, Inc. (Audit Committee Member and Security Committee Member), and TE Connectivity Ltd. (Audit Committee Member)

Current Affiliations: ZOE Empowers (Member)

Previous Affiliations: Avantus Federal (Member); The B2B Project (Member); The Board on Army Research and Development of the National Academy of Sciences (Member); First Light Acquisition Group, Inc. (Advisor Partner); Intelligence and National Security Alliance (Member); and State Street Corporation (Director)


Key Qualifications and Skills:     C-Suite   Cyber   Finance   Risk   Technology 

 Prior Business Experience

   Chairperson, President and Chief Executive Officer at Engility Holdings Inc.

   Corporate Vice President and President of Intelligence, Information and Services at Raytheon Company

   Vice President, Engineering, Technology and Quality, Network Centric Systems at Raytheon Company

   Vice President and General Manager, Product, Systems Software Division at ADC Telecommunications, Inc.

   General Manager, Cable Systems Division at ADC Telecommunications, Inc.

   Vice President, Support Engineering and Quality for the Defense Systems and Electronics Group at Texas Instruments, Inc.

  Education

   B.A. (Spanish), Purdue University

   B.S. (Technical Management), Purdue University

   M.B.A., University of Texas at Dallas


 

 

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GENERAL LESTER L. LYLES, USAF (RET.)

Age: 77   |   Director since: 2007   |   Chair of the Board since: 2019   |    Independent

KBR Board Committees: Cybersecurity Committee and Nominating and Corporate Governance Committee

 

Other Public Company Boards: None

Current Affiliations: American Institute of Aeronautics and Astronautics (Fellow); Frontier Technology Inc. (Director); National Air and Space Museum Board (Member); National Space Council Users’ Advisory Group administered by NASA (Chairman); JobsOhio (Director); and National Academy of Engineering (Inducted Member)

 

Previous Affiliations: Battelle Memorial Institute (Director); Defense Science Board in the Pentagon (Member); General Dynamics Corporation (Director); International Security Advisory Board at the U.S. Department of State (Member); Precision Castparts Corp. (Director); President’s Intelligence Advisory Board in the White House (Member); and United Services Automobile Association (Chair)


Key Qualifications and Skills:   Cyber   Finance   Risk   Sustainability   Veteran 

Current Business Experience

   Independent Consultant (since 2003)

Prior Business Experience

   Retired Four-Star General of the U.S. Air Force

   Commander of the U.S. Air Force Materiel Command

   Vice Chief of Staff of the Headquarters of the U.S. Air Force

   Director of the Ballistic Missile Defense Organization

   Commander of the Space and Missile Systems Center

Education

   B.S. (Mechanical Engineering), Howard University

   M.S. (Mechanical and Nuclear Engineering), Air Force Institute of Technology Program, New Mexico State University

   Defense Systems Management College, Fort Belvoir, Virginia

   Armed Forces Staff College, Norfolk, Virginia

   National War College, Fort Lesley J. McNair, Washington, D.C.

   National and International Security Management Course at Harvard University

   Honorary Doctor of Laws degrees from New Mexico State University and Urbana University


 

SIR JOHN A. MANZONI KCB    

Age: 64   |   Director since: 2022   |   Independent  

KBR Board Committees: Audit Committee and Cybersecurity Committee

 

Other Public Company Boards: Diageo plc (Audit Committee Member; Nomination Committee Member; and Remuneration Committee Member) and SSE plc (Chair; Energy Markets Risk Committee Member; Nomination Committee Chair; Remuneration Committee Member; and Safety, Sustainability, Health and Environment Committee Member)

 

Current Affiliations: Atomic Weapons Establishment (Chair); Chairman Mentors International (Mentor); Saïd Business School at the University of Oxford (Global Leadership Council Member); and World Economic Forum (Global Leader of Tomorrow)

 

Previous Affiliations: Accenture Energy (Advisor); Adamant Ventures (Advisor); Aspen Institute Corporate Values Group (Advisor); BP plc (Director); Leyshon Energy Ltd (Chair); SABMiller plc (Director); and Stanford University Graduate School of Business (Advisor)


Key Qualifications and Skills:   C-Suite   Finance   Risk   Sustainability 

Prior Business Experience

   Permanent Secretary for the Cabinet Office, U.K. Government

   Chief Executive of the Civil Service, U.K. Government

   Chief Executive of the Major Projects Authority, U.K. Government

   President and Chief Executive Officer at Talisman Energy Inc.

   Chief Executive, Refining and Marketing at BP plc

   Chief Executive, Gas and Power at BP plc

Education

   B.S. (Civil Engineering), Imperial College London

   M.S. (Petroleum Engineering), Imperial College London

   M.S. (Management), Sloan Fellow, Stanford University

   Honorary Doctorate, Aberdeen University


 

www.kbr.com

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LT. GENERAL WENDY M. MASIELLO, USAF (RET.)

 

Age: 65   |   Director since: 2017   |   Independent

 

KBR Board Committees: Cybersecurity Committee (Chair), Compensation Committee, and Sustainability and Corporate Responsibility Committee

 

Other Public Company Boards: None

Current Affiliations: Acquisition Innovation and Research Center Advisory Panel to the Office of the Under Secretary of Defense for Acquisition and Sustainment (Advisor); Air Force Studies Board of the National Academy of Sciences (Member); EURPAC Service, Inc. (Director); MRIGlobal (Director); National Contract Management Association (Past Chair); Procurement Round Table (Director); Rawls College, Texas Tech University (Advisory Council); Rebuilding Together (Director); StandardAero (Director); and Tlingit Haida Tribal Business Corporation (Director)

 

Previous Affiliations: Public Spend Forum (Advisory Council)


Key Qualifications and Skills:   Cyber   Finance   Risk   Sustainability   Technology   Veteran 

Current Business Experience

   Independent Consultant (since 2017)

 

Prior Business Experience

 

   Retired Three-Star General of the U.S. Air Force

   Director of the Defense Contract Management Agency

   Deputy Assistant Secretary (Contracting), Office of the Assistant Secretary of the Air Force for Acquisition

   Program Executive Officer for the Air Force’s $65 billion Service Acquisition portfolio

   Deployment to Iraq to lead contracting support for military forces in Iraq and Afghanistan

Education

 

   B.B.A. (Marketing), Texas Tech University

   M.S. (Logistics Management), Air Force Institute of Technology

   Defense Systems Management College, Fort Belvoir, Virginia

   M.S. (National Resource Strategy), Industrial College of the Armed Forces, Fort Lesley J. McNair, Washington, D.C.

   Senior Acquisition Course, Industrial College of the Armed Forces, Fort Lesley J. McNair, Washington, D.C.

   Joint and Combined Warfighting School, Joint Forces Staff College, Norfolk, Virginia

   Harvard Kennedy School’s Senior Managers in Government

   CERT Certificate in Cyber-Risk Oversight (March 2024), National Association of Corporate Directors


 

 

JACK B. MOORE

Age: 70   |   Director since: 2012   |   Independent

 

KBR Board Committees: Compensation Committee (Chair), Cybersecurity Committee, and Nominating and Corporate Governance Committee

 

Other Public Company Boards: Occidental Petroleum Corporation (Chair; Executive Compensation Committee Chair; and Corporate Governance and Nominating Committee Member) and ProPetro Holding Corp. (Nominating and Corporate Governance Committee Chair; and Compensation Committee Member)

Current Affiliations: American Heart Association (Member); MAM (Memorial Assistance Ministries) (Director); and University of Houston System Board of Regents (Member)

 

Previous Affiliations: American Petroleum Institute (Director); Cameron International Corporation (Chair); Rowan Companies plc (Director); United Way of Greater Houston (Executive Committee); and University of Houston’s Board of Visitors (Director)


Key Qualifications and Skills:   C-Suite   Finance   Risk 

  Prior Business Experience

 

   Chairman, President and Chief Executive Officer for Cameron International Corporation

   President and Chief Operating Officer for Cameron International Corporation

   President, Western Hemisphere of Drilling & Production Systems group for Cameron International Corporation

   Vice President and General Manager, Western Hemisphere of Drilling & Production Systems group for Cameron International Corporation

   Various management positions at Baker Hughes Incorporated

Education

   B.B.A., University of Houston

   Graduate of the Advanced Management Program at Harvard Business School


 

 

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ANN D. PICKARD

Age: 68   |   Director since: 2015   |   Independent

 

KBR Board Committees: Sustainability and Corporate Responsibility Committee (Chair) and Compensation Committee

 

Other Public Company Boards: Noble Corporation plc (Nominating and Governance Committee Chair and Safety and Sustainability Committee Member) and Woodside Energy Group Ltd. (Human Resources & Compensation Committee Member and Sustainability Committee Chair)

 

Current Affiliations: The University of Wyoming Foundation (Budget/Audit) and Chief Executive Women (Member)

 

Previous Affiliations: Advisory Council of the Eurasia Foundation (Member); Catalyst (Board of Advisors); Global Agenda Council on the Arctic for the World Economic Forum (Member); and Westpac Banking Corporation (Director)


Key Qualifications and Skills:   Cyber   Finance   Risk   Sustainability   Technology 

Prior Business Experience

 

   Executive Vice President, Arctic for Royal Dutch Shell plc

   Executive Vice President and Country Chair, Australia and New Zealand, for Royal Dutch Shell plc

   Regional Executive Vice President, Sub Saharan Africa, for Royal Dutch Shell plc

   Director, Global Businesses and Strategy and a member of the Shell Gas & Power Executive Committee for Royal Dutch Shell plc

   11-year tenure with Mobil prior to its merger with Exxon

   Significant business experience throughout South America, Australia, the countries of the former Soviet Union, the Middle East, and Africa

Education

 

   B.A., University of California San Diego

   M.A., University of Pennsylvania


 

CARLOS A. SABATER

 

Age: 65   |   Director since: 2021   |   Independent

 

KBR Board Committees: Audit Committee and Nominating and Corporate Governance Committee

 

Other Public Company Boards: Pool Corporation (Audit Committee Member and Nominating and Corporate Governance Committee Member)

 

Current Affiliations: FIU Foundation (Director)

 

Previous Affiliations: Chamber of Commerce (Director); DACF Ltd. (Director); Florida International University (Director); Kiwanis Club (Director); PDC Energy, Inc. (Director); and YMCA (Director)


Key Qualifications and Skills:   Finance   Risk 

  Prior Business Experience

 

   Senior Global Partner for Deloitte Touche Tohmatsu Limited (“Deloitte”)

   Managing Principal, Americas Region for Deloitte

   Global Managing Director Audit and Enterprise Risk Services for Deloitte

   Various senior leadership and operational roles over the course of a nearly 40-year career with Deloitte

Education

 

   B.B.A. (Accounting and Finance), Florida International University


 

www.kbr.com

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Board and Governance Structure

 

We are committed to good corporate governance and to effective communication with our stockholders. This section describes our governance policies and practices, and the roles, duties, and responsibilities of the Board of Directors and each of its committees. See the section titled “Corporate Governance Materials” to learn how to find our policies, practices, and committee charters.

 

Role of the Board of Directors

 

 

The Board of Directors represents the interests of our stockholders in maintaining a successful business. Specifically, the Board of Directors oversees the effectiveness of management’s policies and decisions, including the execution of KBR’s strategies, with a commitment to enhancing stockholder value over the long term. To this end, Board members are expected to act in the best interests of all stockholders, to be knowledgeable about our businesses, to exercise informed and independent judgment, and to understand general economic trends and conditions, as well as trends in corporate governance.

 

Our Board Leadership Structure

 

  General Lester L. Lyles, USAF (Ret.)     Stuart J. B. Bradie
  Chair of the Board     CEO
 

•  Manages the overall functioning of the Board

•  Supports the Nominating and Corporate Governance Committee with the CEO succession and director selection processes

•  Promotes open and transparent dialogue during Board and committee meetings

•  Acts as a liaison between the independent directors and management on sensitive / critical issues

   

•  Sets the strategic direction for KBR

•  Provides day-to-day leadership over KBR’s operations

•  Focuses on execution of KBR’s business strategy, growth, and development

•  Sets the tone-at-the top for the One KBR culture

•  Develops and oversees enterprise-wide initiatives

 

Our Board is led by a Chair who is recommended by the Nominating and Corporate Governance Committee and appointed by the full Board. Our Board believes that KBR and our stockholders are currently best served by a Board leadership structure in which the roles of the Chair of the Board and the Chief Executive Officer are held by different individuals and that the Chair be an independent director. This structure provides KBR with strong Board leadership and independent oversight of management and allows the Chief Executive Officer to focus primarily on the strategic direction and operational leadership of our business. The Board reviews its leadership structure from time to time to determine whether this separation continues to best serve KBR and our stockholders, considering factors such as the current composition of the Board, Board effectiveness, and the current and future needs of KBR.

 

 

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When the Chair is independent (non-executive), KBR’s Corporate Governance Guidelines provide for that individual to perform a strong role in Board leadership. An independent Chair of the Board is responsible for:

 

presiding at executive sessions of the non-executive directors at each regular Board meeting and setting the agenda for these sessions;
approving meeting agendas for each regular Board and committee meeting and approving the information to be sent to the directors with respect to each meeting;
presiding at the executive session of the Board to evaluate the performance of our CEO; and
communicating to the CEO, after approval by our Compensation Committee, the CEO’s evaluation and compensation for the next full year and the results of the Nominating and Corporate Governance Committee’s and the Board’s review and approval of management succession plans and development programs.

 

If the Chair of the Board is not independent, the Board elects an Independent Lead Director, who will have the same authority and responsibilities an independent Chair would have.

 

General Lester Lyles has served as independent, non-executive Chair of the Board since May 15, 2019, and has been elected annually by a unanimous vote of the independent directors. General Lyles has significant board experience, both at KBR and at other public companies. He has served on every one of the Board’s standing committees and has in-depth knowledge of KBR’s history and current business. During General Lyles’s service on the Board, KBR has undergone significant changes, including reorganizing into more strategically-aligned business groups and evolving from a wholly owned subsidiary with significant support from its former parent company into an independent operating company. The Board believes that General Lyles is well positioned to facilitate communications between the Board of Directors, management, and KBR stockholders.

 

Our CEO is responsible to the Board for the overall management and functioning of the Company. KBR’s Corporate Governance Guidelines provide for two important checks on the CEO’s authority:

 

The CEO may not serve on any Board committees, and
The CEO’s performance evaluation includes a review of how well he keeps the Board informed on matters affecting the Company and its operating units.

 

KBR’s Board of Directors has determined that its current leadership structure is appropriate at this time.

 

Director Independence

 

Our Corporate Governance Guidelines provide that at least two-thirds of the Board must be independent directors. Directors are considered independent if they are not involved in any material relationships with KBR, either directly or indirectly. Our Corporate Governance Guidelines set forth specific independence standards that are consistent with the requirements of the U.S. Securities and Exchange Commission (“SEC”) and the New York Stock Exchange (“NYSE”).

 

The Nominating and Corporate Governance Committee periodically reviews KBR’s definition of independence and the Board’s compliance with our independence standards.

 

Our directors complete independence questionnaires at least annually. Our Board determines the independence of its members generally and considers whether various committee members meet the heightened independence or other requirements prescribed by the NYSE and SEC. Our Board determined that all our current directors are independent except Mr. Bradie, who serves as KBR’s president and chief executive officer. Our Board determined that, if elected to the Board of Directors, Mr. Dominguez will also be independent under the standards and requirements set forth under applicable SEC and NYSE rules.

 

Our Board believes that its membership should include no more than two directors who are also employees of KBR, though this number is not an absolute limitation. We believe KBR’s chief executive officer should always be a member of the Board. Our chief executive officer has been the only executive director since KBR became an independent public company.

 

www.kbr.com

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Committees of the Board

 

KBR’s Board does a substantial portion of its analysis and work with five standing committees, each of which is composed entirely of independent directors.

 

Our Board approved charters for each of the committees that govern and set forth their respective duties, responsibilities, and actions. These charters are available on KBR’s website at kbr.com/en/who-we-are/our-company/corporate-governance. Each committee reviews its charter annually and recommends changes, as necessary, to the Board.

 

        Board and Committee
Member Meeting
Attendance Rate
  Audit
Committee
  Compensation
Committee
  Cybersecurity
Committee
  Nominating
and Corporate
Governance
Committee
  Sustainability
and Corporate
Responsibility
Committee
Mark Baldwin     100%                
Stuart Bradie       100%                    
Joseph Dominguez*                            
Lynn Dugle       90%              
Lester Lyles     93%                
John Manzoni     100%                
Wendy Masiello       100%              
Jack Moore       100%              
Ann Pickard       100%                
Carlos Sabater     100%                
Number of Meetings           10   6   4   4   4
Committee Member Attendance           100%   96%   100%   100%   100%

 

Chair of the Board Committee Chair Member Audit Committee Financial Expert

 

 

* Mr. Dominguez’s committee memberships will be determined after the Annual Meeting, subject to his election by KBR’s stockholders to the Board of Directors.

 

The information in the above table does not include Lt. General Vincent R. Stewart, who served on our Board and as Chair of our Cybersecurity Committee until his passing in April 2023.

 

 

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The composition, purpose, duties, and responsibilities of each committee are summarized on the next several pages.

 

AUDIT COMMITTEE

 

 

Members:

Mark E. Baldwin (Chair)
Sir John A. Manzoni KCB
Carlos A. Sabater

 

Meetings in 2023: 10

 

Attendance: 100%

 

Audit Committee Report:
Page 99

 

The Audit Committee:

 

•  reviews and discusses with management and the independent auditors, and recommends to the Board for approval, KBR’s annual audited financial statements, disclosures made in management’s discussion and analysis of financial condition and results of operations (“MD&A”), KBR’s internal controls report, and the independent auditors’ attestation of the report in KBR’s annual report on Form 10-K;

•  reviews and discusses with management and the independent auditors KBR’s quarterly financial statements and MD&A disclosures in KBR’s quarterly reports on Form 10-Q;

•  reviews our earnings press releases and use of any non-GAAP financial measures;

•  reviews and reports to the Board the scope and results of audits by our principal independent public accountants and our internal auditors;

•  reviews and discusses with management and the independent auditors any issues and judgments regarding KBR’s accounting principles and financial statement presentations;

•  reviews and discusses with management (including the head of internal audit) and the independent auditors the effectiveness of our system of disclosure controls and internal controls, as well as critical audit matters;

•  reviews KBR’s major financial risk exposures and risk management policies;

•  reviews and takes appropriate action with respect to any reports concerning legal and regulatory compliance or breaches of fiduciary duty;

•  reviews and oversees KBR’s internal audit function;

•  engages our independent auditing firm each year, reviews the audit and other professional services rendered by the firm, periodically reviews the firm’s qualifications, performance and independence, and reviews our policy on hiring the firm’s current or former personnel;

•  confirms the regular rotation of audit partners as required by law;

•  reviews KBR’s processes for identifying related party transactions and approves related party transactions as needed;

•  reviews and verifies compliance with our Code of Business Conduct and establishes policies on making exceptions to the code;

•  establishes procedures for the confidential and anonymous submission, receipt, retention, and treatment of complaints received by KBR regarding accounting, internal accounting controls, or auditing matters;

•  reviews with the Sustainability and Corporate Responsibility Committee and with management the internal controls, processes and disclosures relating to sustainability, human capital management, and corporate responsibility matters;

•  reviews with the Cybersecurity Committee and with management the internal controls, processes and disclosures relating to cybersecurity matters;

•  prepares and publishes an annual Audit Committee report, which is included in this proxy statement; and

•  meets periodically in separate executive sessions with management (including KBR’s Chief Financial Officer and General Counsel), the internal auditors, and the independent auditors and has such other direct and independent interaction with such persons from time to time as appropriate.

Our Board determined that each member of the Audit Committee is financially literate and qualifies as an “audit committee financial expert,” as defined in SEC rules. In addition, each member of the Audit Committee is “independent” under the standards prescribed for audit committee members by NYSE and SEC rules.

 

www.kbr.com

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COMPENSATION COMMITTEE

 

 

Members:

Jack B. Moore (Chair)
Lynn A. Dugle
Lt. General Wendy M. Masiello
Ann D. Pickard

 

Meetings in 2023: 6

 

Attendance: 96%

 

Compensation Committee Report:
Page 76

 

The Compensation Committee:

 

•  evaluates and advises the Board regarding the compensation policies applicable to our executive officers, including the specific relationship between corporate performance and executive compensation;

•  reviews and recommends to the Board the corporate goals and objectives relevant to compensation for the CEO, the CEO’s performance in light of these established goals and objectives, and the CEO’s compensation package based on this evaluation, the results of the most recent Say-on-Pay Vote and other relevant factors;

•  reviews the CEO’s recommendations with respect to, and approves, the compensation to be paid to KBR’s other executive officers consistent with the general compensation policies established by the Board and having considered the results of the most recent Say-on-Pay Vote;

•  reviews and makes recommendations to the Board with respect to incentive compensation and other stock-based plans and identifies and sets financial and/or non-financial performance related metrics as targets;

•  reviews and approves the selection of comparable peer group companies for the purpose of benchmarking CEO and other executive officers’ compensation;

•  administers KBR’s incentive compensation and other stock-based plans;

•  reviews and discusses with management the “Compensation Discussion and Analysis” and determines whether to recommend to the Board that it be included in KBR’s annual proxy statement or annual report on Form 10-K;

•  prepares and publishes an annual executive compensation report, which is included in this proxy statement;

•  reviews the risk assessment of KBR’s compensation plans to ensure that the programs do not create risks that are reasonably likely to have a material adverse effect on KBR;

•  reviews and approves the creation or revision of any clawback policy allowing KBR to recoup compensation paid to employees, including KBR’s Procedure for the Recovery of Erroneously Awarded Compensation and any other clawback policies adopted to satisfy the minimum clawback requirements adopted under the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 and the regulations thereunder or any other applicable law or securities exchange listing standard, and to oversee the implementation and enforcement of any such clawback policy;

•  periodically reviews the compensation paid to non-executive directors and makes recommendations to the Board regarding any adjustments;

•  selects an independent compensation consultant or other adviser to assist the committee in its work; and

•  approves disclosures and makes recommendations to the Board regarding the disclosures on KBR’s Advisory Vote on Executive Compensation and Advisory Vote on the Frequency of Advisory Votes on the Named Executive Compensation included in KBR’s annual proxy statement.

Our Board determined that each member of our Compensation Committee is a “non-employee director” as defined in SEC rules and an “outside director” as defined in IRS rules.

 

 

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CYBERSECURITY COMMITTEE

 

 

Members:

Lt. General Wendy M. Masiello (Chair)
Lynn A. Dugle
General Lester L. Lyles
Sir John A. Manzoni KCB
Jack B. Moore

 

Meetings in 2023: 4

 

Attendance: 100%

 

The Cybersecurity Committee:

 

•  reviews with management the status of KBR’s information technology systems and risks relating to information technology;

•  oversees global data privacy and security regulations compliance and requirements and assesses the effectiveness of the systems, controls, and procedures used to ensure compliance;

•  reviews with management KBR’s data security incident response plan and program;

•  oversees the selection, appointment, and retention of outside advisors to review KBR’s cybersecurity and data privacy program and otherwise support the Cybersecurity Committee;

•  reviews the plans and methodology for the periodic review and assessment of KBR’s data protection program by outside advisors, if applicable;

•  reviews with management and outside advisors the findings and corresponding remediation plans from reviews, assessments, and audits of KBR’s data protection program;

•  reviews with management the assessment of how KBR’s cybersecurity and data privacy programs align with industry frameworks and standards;

•  reviews with management and reports to the Board with respect to any significant cybersecurity or data privacy incident;

•  reviews with the Audit Committee and reports to the Board as appropriate any disclosures made by KBR in regards to any material cybersecurity breach or incident;

•  reviews and discusses with management the laws, regulations, and significant legislative and regulatory developments that could materially impact KBR’s cybersecurity and data privacy risk exposure, and evaluates the integrity of KBR’s information technology systems, processes, policies, and controls to maintain compliance;

•  reviews with the Audit Committee and with management the adequacy of KBR’s disclosure controls and procedures related to cybersecurity issues;

•  reviews and discusses with management the current data protection best practices utilized by government entities and companies in our industry in comparison to the practices of KBR;

•  reviews the appropriateness and adequacy of KBR’s cyber insurance coverage;

•  reviews and reports to the Board with respect to the budget and resources allocated to cybersecurity and data privacy programs; and

•  meets periodically in separate executive session with KBR’s General Counsel, Chief Information Officer, and Chief Information Security Officer.

 

www.kbr.com

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NOMINATING AND CORPORATE GOVERNANCE COMMITTEE

 

 

Members:

Lynn A. Dugle (Chair)
General Lester L. Lyles
Jack B. Moore
Carlos A. Sabater

 

Meetings in 2023: 4

 

Attendance: 100%

 

The Nominating and Corporate Governance Committee:

 

•  develops, implements, and reviews KBR’s corporate governance guidelines;

•  develops and implements a process to assess Board and committee effectiveness;

•  identifies and evaluates individuals qualified to become Board members, consistent with Board-approved criteria, NYSE listing standards, and other applicable requirements;

•  develops and updates criteria for Board membership and determines the composition of the Board and its committees;

•  reviews and makes determinations annually regarding each director’s continuation on the Board, independence status and membership on committees;

•  reviews and regularly reports to the Board on succession plans and management development programs for members of executive management and the CEO;

•  reviews and recommends to the Board the Section 16 officer determinations;

•  establishes procedures for stockholders to recommend individuals for consideration as possible candidates for election to the Board;

•  establishes and maintains a Board action plan to address shareholder activism;

•  reviews shareholder proposals submitted for inclusion in KBR’s proxy statement and recommends any responses to the Board;

•  determines stock ownership guidelines for KBR’s directors; and

•  reviews and recommends ways that KBR can enhance shareholder relations.

Our Board determined that each member of the Nominating and Corporate Governance Committee is independent as defined in NYSE listing standards.

 

 

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SUSTAINABILITY AND CORPORATE RESPONSIBILITY COMMITTEE

 

 

Members:

Ann D. Pickard (Chair)
Mark E. Baldwin
Lt. General Wendy M. Masiello

 

Meetings in 2023: 4

 

Attendance: 100%

 

The Sustainability and Corporate Responsibility Committee:

 

•  reviews KBR’s policies relating to sustainability, human capital management, and corporate responsibility (“SHCMCR”), including processes to ensure compliance with applicable laws and regulations;

•  reviews and provides feedback on the management of current and emerging SHCMCR issues;

•  oversees KBR’s activities in managing major SHCMCR risk exposures, including climate change;

•  oversees and receives presentations at least annually from KBR’s Chief HSSE Officer, Chief Sustainability Officer, and Chief People Officer;

•  reviews KBR’s political and charitable contributions and social responsibility activities;

•  reviews and oversees KBR’s SHCMCR strategies and the implementation thereof, including carbon dioxide emission neutrality and other sustainability goals;

•  reviews KBR’s public sustainability report and any other applicable public disclosures relating to SHCMCR and (in conjunction with the Audit Committee) the adequacy of KBR’s disclosure controls and procedures related to those reports;

•  oversees KBR’s development and implementation of its human capital management, including KBR’s commitment to diversity, equity, and inclusion, and discusses with management reports regarding the development, implementation, and effectiveness of KBR’s policies relating to human capital management; and

•  ensures KBR has policies and procedures and periodically reviews such policies and procedures to protect our culture and values, ensure fundamental human and workplace rights, prohibit all forms of forced labor and human trafficking, ensure we operate transparently and with integrity, support human capital management, and build a safe and resilient business that considers climate change and other sustainability issues.

 

www.kbr.com

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Enterprise Risk Management

 

ERM Framework

 

The KBR Enterprise Risk Management Organization administers a fully integrated, enterprise-wide risk management (“ERM”) framework. The framework enhances business resilience by encouraging uncertainty anticipation and resolution at all levels — from project to enterprise, globally, across all business units. The ERM team reports to the Chief Compliance Officer (who reports to the General Counsel).

 

The framework is key to enabling global, real-time visibility of KBR’s risk profile, where crucial adjustments are the result of risk-based strategy decisions, which in turn lead to value-added communications to stakeholders. KBR’s ERM mission is essential to growing a successful and sustainable business.

 

 

This inter-connected approach is a consistent, scalable, and auditable means for us to identify and manage existing and emerging risks and opportunities, both internal and external, for KBR’s current and future operations, at project, business unit, corporate function, and enterprise levels.

 

The KBR ERM Framework comprises six phases: Identification, Assessment, Analysis, Mitigation, Monitoring, and Evaluation. This approach helps leadership see KBR’s changing risk profile and enables informed strategy decisions and adjustments, better communications to stakeholders, and a common focus based on consistent and reliable data.

 

 

 

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ERM Program

 

Risk Management, as one of KBR’s 10 Sustainability Pillars (as described in the section titled “Sustainability and KBR”), is key to driving KBR to sustainable business growth. Our resilience, success, and continued evolution depends on our ability to anticipate and respond to the constantly changing risks in our existing and future operating environments. By rooting ERM principles and practices in our culture and across our operations, we can consistently visualize the entire risk landscape, mitigate threats, capitalize on opportunities, and create value and predictable outcomes.

 

Every employee is empowered to identify risks and opportunities. Under KBR’s ERM Policy, every risk and opportunity is assigned to an owner, who is accountable for the ongoing management of the risk or opportunity, including the development and implementation of mitigation plans through to successful conclusion.

 

Risks and opportunities are identified and assessed consistently at the project, business unit, and enterprise levels:

 

Stakeholder and multi-disciplinary subject-matter experts identify risks and opportunities and their owners.
Owners develop detailed description, risk window, and applicability. Risks are categorized within the two-tier risk breakdown structure (taxonomy).
Owners assess (score) risks and opportunities using a global scoring matrix for probability, commercial impact, schedule impact, reputational impact, and manageability, in three circumstances: Original (inherent, unmitigated risk), Current (residual, mitigated with existing controls and actions), and Target (acceptable position).
Owners develop responsive action plans, including due dates and action owners.
Owners and project/business unit/enterprise ERM focal points regularly review risk/opportunity status, current score, and the effectiveness of action plans.

 

All risks and opportunities are managed on our cloud-based platform, which provides consistency and real-time data analytics and reporting.

 

KBR’s Executive Leadership Team (“ELT”) convenes for dedicated risk and opportunity reviews at least three times per year. The outputs are reported to our Board twice per year, and to individual business units and projects on a regular basis. This flow of information facilitates management of risks and opportunities, on an ongoing basis, using the ERM process and tools to provide real time risk-based data.

 

The ELT review of enterprise risks and opportunities is carried out in the context of the changing risk and opportunity landscape and KBR’s strategy, which is embedded in the process such that strategy and the interconnected risks and opportunities are aligned.

 

Board Oversight of ERM

 

Risk oversight is an integral part of the role of KBR’s Board of Directors. KBR’s Board holds discussions regarding risks and opportunities throughout the year.

 

The outputs from the ERM Program are formally presented to our Board twice per year. The ERM report includes strategic, operational, HSSE, information technology and cybersecurity, financial, geopolitical, ESG and any new developing areas of risks and opportunities, as well as management’s assessment of their likelihood and impact, the perceived trend for each (whether increasing, decreasing, or stable), and the measures being taken to monitor and manage those risks and opportunities.

 

www.kbr.com

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While our Board has overall oversight responsibility for KBR’s ERM Program, various committees of the Board also have the following responsibilities for risk oversight:

 

 

 

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Management Succession Planning

 

As required by our Corporate Governance Guidelines, our Board, with input from the Nominating and Corporate Governance Committee, Chair of the Board, and CEO, regularly reviews KBR’s succession plan and management development programs for all senior management positions. One of the elements that the CEO is evaluated on each year is the robustness of the executive succession plan, including assessment and development of internal candidates for the CEO and top-level executive positions.

 

The entire Board addresses issues relating to CEO succession planning regularly, and no less than annually, facilitated by the non-executive Chair of the Board. While the Nominating and Corporate Governance Committee performs the initial review of KBR’s succession plans and makes recommendations to the Board as necessary, the entire Board has primary responsibility for CEO succession planning and develops both long-term and contingency plans for this purpose. This process necessarily involves developing and reviewing criteria for the CEO position that reflect KBR’s business strategy and identifying and developing internal candidates or recognizing the need for external candidates, as appropriate.

 

Board and Committee Evaluations

 

At the direction of our Nominating and Corporate Governance Committee, we conduct an annual evaluation process to assess the performance of and enhance the overall effectiveness of our Board and its standing committees.

 

This process begins with our non-executive directors completing questionnaires regarding the performance of our Board as a group and the performance of each Board committee they serve. The questionnaires cover matters such as the effectiveness of the Board’s or committee’s composition, the quality of discussions at meetings, the adequacy of the Board’s or committee’s risk assessments, Board and committee culture, quality of engagement with management and other directors, access to information and management support, coordination among committees, areas of contribution, and areas for further development.

 

The Nominating and Corporate Governance Committee presents the results of the questionnaires, which are compiled anonymously, to our Board and committees at regularly scheduled meetings. The Board and each committee discuss the results and findings of the questionnaires and identify areas for future focus or continued improvement, such as added meeting agenda items, further director education opportunities, and additional meetings between directors and management.

 

www.kbr.com

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Board Refreshment

 

Process for Selecting New Directors

 

The Board has delegated to the Nominating and Corporate Governance Committee the duty of selecting and recommending prospective nominees to the Board for approval. The Nominating and Corporate Governance Committee considers suggestions of candidates made by current committee and Board members, KBR management, and stockholders. The Committee also may retain an independent executive search firm to identify candidates for consideration. Stockholders may suggest candidates for nomination by contacting the Nominating and Corporate Governance Committee in the manner provided under the section titled “How to Contact the Board.” Candidates suggested by stockholders will be evaluated through the same process as candidates identified by the Nominating and Corporate Governance Committee, the Board, and KBR management.

 

BOARD REFRESHMENT

Since 2017:

 

6 NEW INDEPENDENT DIRECTORS
(including one director nominee
in 2024)
2017 1 2020 1 2021 2 2022 1 2024 1
  new director   new director   new directors   new director   new director nominee

 

 

 

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Director Qualifications

 

Candidates nominated for election or re-election to the Board of Directors should possess the following qualifications:

 

the highest personal and professional ethics, integrity and values;
an inquiring and independent mind;
practical wisdom and mature judgment;
broad training and experience at the policy-making level in business, government, or technology;
expertise that is useful to KBR and complementary to the background and experience of other Board members;
willingness to devote the required amount of time to carrying out the duties and responsibilities of Board membership;
commitment to serve on the Board for several years to develop knowledge about KBR’s principal operations;
willingness to represent the best interests of all stockholders and objectively appraise management performance; and
involvement only in activities or interests that do not create a conflict with a director’s responsibilities to KBR and our stockholders.

 

The Nominating and Corporate Governance Committee is responsible for assessing the appropriate mix of skills and characteristics required of Board members in the context of the needs of the Board at a given point in time. These criteria are periodically reviewed and updated. The Nominating and Corporate Governance Committee may consider diversity in personal background, race, gender, age, and nationality when evaluating individual candidates, but KBR does not have a formal policy with regard to any particular aspect of diversity.

 

Stockholder Engagement

 

We actively engage with our investors throughout the year. Senior executives meet with analysts and investors at our Investor Days and host Investor Calls, and our Corporate Secretary reaches out to our largest 25 investors twice a year.

 

 

www.kbr.com

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Director Orientation and Education

 

During director orientation, our new directors typically meet with the rest of our Board and senior executives before attending their first Board and committee meetings. These preliminary meetings ensure that our new directors are well-informed about KBR’s current matters in addition to the broad scope of our businesses. Our new directors also visit project sites and attend town hall meetings to gain more in-depth knowledge of our business practices, including Zero Harm.

 

Continuing education for our directors is both important and necessary due to the fast pace at which business and technology are evolving. Generally, every quarter our Board is presented with an educational program. Recent topics have included cybersecurity, data protection, data privacy, digitalization, internal controls, governance, sustainability, and workplace culture. In addition, our directors participate in continuing education outside KBR (at KBR’s expense) covering a wide range of topics, such as audit matters, board effectiveness, cybersecurity board governance, finance, and strategy and innovation.

 

Board Practices and Procedures

 

Attendance at Meetings

 

Board members are expected to make every effort to attend the meetings of the Board and the committees of the Board on which they serve, as well as annual stockholder meetings. KBR’s directors attended 97% of the aggregate of all meetings of the Board and all meetings of each of the five standing committees during 2023. All of our directors attended our 2023 Annual Meeting of Stockholders.

 

The Board of Directors meets each year immediately following the Annual Meeting of Stockholders and at least four other times per year. Additional regular meetings are scheduled as needed, and special meetings may be called by the Chair of the Board, the Chief Executive Officer, the President, the Corporate Secretary, or a majority of the directors in office. KBR’s Bylaws permit action to be taken without a meeting if all members of the Board consent to such action in writing or by electronic transmission. During 2023, the Board of Directors held seven regular meetings, three of which were conducted virtually. The Chair of the Board presides at all Board meetings.

 

During regular Board meetings, KBR’s independent non-executive directors meet in scheduled executive sessions, presided over by our independent, non-executive Chair of the Board. During 2023, the non-executive directors met without management six times.

 

Retirement Policy

 

Non-management directors may not seek re-election once they reach the age of 75; however, this retirement age may be extended under special circumstances if the Board deems it to be in the best interest of KBR. For each of the 2021, 2022, and 2023 annual meetings of stockholders, the Board approved the recommendation of the Nominating and Corporate Governance Committee to grant a 12-month extension to the mandatory retirement age for General Lester Lyles, our independent, non-executive Chair of the Board, who turned 75 in April 2021.

 

In 2024, the Nominating and Corporate Governance Committee and the Board determined that it was in the best interest of KBR to further delay General Lyles’s mandatory retirement because they believed it was crucial to maintain his leadership and benefit from his significant knowledge, skills, and industry experience, including in the government, defense, and space fields. General Lyles agreed to continue serving on the Board for another year following KBR’s 2024 annual meeting of stockholders, and the Board approved the recommendation of the Nominating and Corporate Governance Committee to grant a fourth, 12-month extension to the mandatory retirement age for General Lyles. With the fourth, 12-month extension, General Lyles will be expected to retire from the Board immediately prior to the KBR annual meeting of stockholders in 2025, unless otherwise agreed by mutual consent.

 

Management directors must retire from the Board at the same time they leave employment with KBR unless the Board approves continued service as a director.

 

Service on Other Boards

 

KBR directors may not serve on the boards of directors of more than three other publicly held companies or investment companies. In addition, directors serving on the KBR Audit Committee may not serve on the audit committees of more than two other public companies. Directors must advise the chair of the Nominating and Corporate Governance Committee before accepting an invitation to serve on another board.

 

 

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Anti-Hedging Policy

 

Our anti-hedging policy prohibits all directors, employees, and agents from speculative trading in our securities; engaging in hedging transactions using our securities; “short selling” our securities; and trading derivative securities, such as put options, call options, swaps, or collars related to our securities.

 

Corporate Governance Materials

 

To ensure that our stockholders have access to our governing documents, we provide copies of our Code of Business Conduct, Corporate Governance Guidelines, and the charters of each of our standing Board committees on our website at kbr.com/en/who-we-are/our-company/corporate-governance. Copies will be provided to any stockholder who requests them by writing to our Investor Relations Department at: 601 Jefferson Street, Suite 3400, Houston, Texas 77002.

 

Our Code of Business Conduct applies to all directors, officers, and employees of KBR, and all employees of KBR’s agents. KBR intends to satisfy SEC disclosure requirements regarding amendments to, or waivers from, any provision of the Code of Business Conduct by posting such information on our website.

 

How to Contact the Board

 

KBR invites stockholders and other interested parties to communicate with the Audit Committee and the Board of Directors. Concerns may be reported anonymously or confidentially via the KBR Ethics Hotline at ethics.kbr.com or 1-800-461-9330 (instructions for dialing internationally are provided on the ethics.kbr.com homepage).

 

You may communicate with our Board of Directors, the non-executive directors, or any Board committee by mail (Board of Directors c/o Director of Business Conduct, KBR, Inc., P.O. Box 3406, Houston, Texas 77253-3406) or e-mail (fhoukbrbod@kbr.com).

 

Our Director of Business Conduct reviews all communications directed to the Audit Committee and the Board of Directors. The Chair of the Audit Committee is promptly notified of any significant communication involving accounting, internal controls, auditing matters, or similar issues. Communications addressed to a named director are promptly sent to the director. Communications directed to the non-executive directors are promptly sent to the non-executive Chair of the Board. Communications relating to suggestions for director candidates to be considered and evaluated by the Nominating and Corporate Governance Committee are promptly sent to the Chair of the Nominating and Corporate Governance Committee. See the section titled “Board Refreshment” for more information regarding the process for selecting new directors and the qualifications director candidates should possess. A report summarizing the significant communications is sent to each director quarterly, and copies of communications are available for review by any director, except that those items addressed to the non-executive directors are not available to executive directors.

 

www.kbr.com

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Sustainability and KBR

 

Vision: to create a safer, more secure, and sustainable world.

 

Building on our strong legacy as leaders in science, technology, and engineering, we are uniquely positioned to deliver world-class solutions to help our customers build a safer, more secure, and sustainable world. Our One KBR Values underpin that mission and guide our governance, business practices, and behaviors. KBR’s Code of Business Conduct and other key policies including our Global Sustainability Policy, Global Human Rights Policy, and Global Environmental Policy define our intentions for preserving our planet and advancing society while pursuing business growth.

 

Our Sustainability Pillars — ten key areas of focus across our company spanning people, the planet, and governance — are the foundation of our sustainability efforts and closely correspond with the United Nations’ (“UN”) Sustainable Development Goals (“SDGs”). As signatories to the UN Global Compact, we are committed to ensuring that our business is firmly aligned with SDG principles and that they serve as the benchmark for accomplishing our sustainability goals.

 

 

 

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Our Sustainability Pillars and ESG Focus Areas Within Each Topic

 

 

www.kbr.com

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Measuring our Impact

 

Our top-line KPIs — support for our 10 Sustainability Pillars, including Net Zero targets — are incentivized via our short-term incentive plans for key executives. We publicly report our sustainability performance via universally recognized frameworks and standards, and we regularly engage with our key stakeholder groups as part of our materiality assessment and for continuous improvement.

 

Environmental Impact

 

We have made a significant investment in our sustainable solutions, recently launching nine new sustainable process technologies to help customers reach their own sustainability and decarbonization goals. These solutions range from improving sustainable production of clothes and furniture, to recycling batteries and utilizing waste to aviation fuel.

 

 

Our Global Sustainability Policy, Global Environmental Policy, and related procedures outline the commitments, expectations, and responsibilities for each employee and project team to meet identified targets and objectives for each area of the environment. For large scale projects, we measure, manage, and monitor our use of natural resources, including energy, water, and materials, and seek to reduce emissions and recycle waste throughout our project work. We also proactively protect and regenerate biodiversity and natural habitat in certain areas where we conduct our business.

 

KBR’s Climate Action Plan

 

At KBR, we acknowledge the immediate need for comprehensive action to address the impacts of climate change. In 2021, we established a net-zero carbon roadmap team to develop science-based targets and respective reduction programs and initiatives. Our climate risk working group supports the businesses in identifying climate risks and risk management programs in line with the Task Force on Climate-related Financial Disclosures (“TCFD”) framework.

 

Through our Climate Action Plan, we annually calculate our GHG emission inventory and baseline to formulate reduction programs and measure our progress against these reduction initiatives. We have committed to setting science-based reduction targets to reach Net Zero in line with the Paris Agreement and the Science-based Targets initiative (“SBTi”).

 

SOCIAL IMPACT

 

KBR’s extensive policies, procedures, and codes of conduct are designed and implemented to maximize social value and impact for all our stakeholder groups. Our key areas of social impact and human capital development are reflected in the “People Strategy” section.

 

People Strategy

 

Human Capital Management

 

Every day, the people of KBR help solve some of the world’s most challenging scientific, technological and engineering problems. From our promising new interns to world-renowned experts, our diverse Team of Teams delivers solutions to our customers, so in turn, we put our people first. At the end of 2023, we employed approximately 34,000 people performing diverse, complex and mission critical roles in over 30 countries. In addition, our unconsolidated joint ventures employ approximately 9,000 employees.

 

 

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Our Employee Value Proposition (“EVP”) is the unique set of experiences and offerings that help differentiate KBR from other competitors for our employees’ time and talents and describes in practical terms how we put our people first.

 

 

Purpose & Values

 

At the center of our EVP is Purpose, because at KBR, we do work that matters, helping to solve the great challenges of our time while striving to create a better, safer, more secure, and sustainable world. Our vision is to bring together the best and brightest employees to deliver technology and solutions that help our customers accomplish their most critical missions and objectives, and this important work enables us to attract and retain some of the world’s best talent, who thrive in this purposeful environment.

 

Our Values unite us across our diverse global cultures, guiding our behavior and decision making throughout KBR. We have embedded our values in our business processes, established them as a foundation for our learning and development activities and regularly celebrate employees who epitomize our values-led behavior. Our employees have told us that their experience is aligned to our values even in the ‘new normal’ of a hybrid and flexible working environment.

 

While our One KBR Values unite us, as a global business operating in distinct markets and environments, we recognize and respect that our cultures are different. Acknowledging this diversity, our sustainability culture weaves a golden thread through KBR. Our employees take enormous pride in being part of an organization with a philosophical, practical and proven commitment to Zero Harm.

 

Health and Safety

 

We are subject to numerous worker health and safety laws and regulations. Our commitment to the health and safety of each employee as well as anyone we work with is the foundation of our Zero Harm culture. We know that our employees’ willingness to implement each commitment into their daily work tasks is vital to our operations and has contributed to our strong safety performance among our customers, partners and peers.

 

The six core processes that comprise our Transactional Health, Safety, Security, Environmental (“HSSE”) Management that lead to Transformational Leadership are non-negotiable KBR safety standards that are required to be observed and followed by employees and contractors at all locations and projects. By requiring all of our employees to personally internalize and adhere to these standards, we aim to safeguard our individual health and safety and the well-being of all those around us.

 

We believe that KBR has provided the tools and processes our people need to achieve the mindset of 24/7 Zero Harm. One process known as the “Courage to Care Conversation” is instrumental in developing a continual awareness of unsafe acts through observation, intervention and conversation. A web-application to log conversations was created in-house and is available to all KBR employees. The goal of the Courage to Care Conversation is to continuously evaluate the work environment and to focus on people and their actions.

 

Thanks to our people’s commitment to our Zero Harm culture, we recorded another consecutive year of industry-leading HSSE performance, with a total recordable incident rate of 0.067.

 

Our Journey to Zero Harm has allowed us to create a company culture where safe execution is non-negotiable and people take responsibility and accountability. When it comes to safety, we strive for one number: Zero.

 

www.kbr.com

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Ethics and Compliance

 

KBR’s ethics and our Code of Business Conduct are rooted in our values and provide the standards and support to help us successfully navigate issues, make the right decisions, and conduct our business with the integrity that reflects our heritage and ethical reputation. Additionally, our Code of Business Conduct is essential to how we as a Team of Teams interact with the world around us and to our success.

 

We believe that an ethical culture, where employees are treated fairly, respectfully and without favoritism, is key to employee satisfaction and retention. We promote a speak-up culture where employees are comfortable with making reports of possible unethical behavior and workplace issues. The Business Integrity Team has implemented a Question Manager as part of our Ethics Hotline for employees to receive advice, confidentially or anonymously, on ethical or other inquiries. Employees speaking up and reporting issues enable us to address and remediate these issues early and effectively while instilling confidence that employee concerns are heard and addressed. The recent People Perspective Survey indicates that a majority of our employees feel safe to report misconduct and reflects our dedication to an ethical culture.

 

Retaliation undermines a speak-up culture and is not tolerated. Our Code of Business Conduct sets forth our anti-retaliation commitment, which is reinforced in our communications and our annual Ethics training. To further convey to the workforce that reports of unethical behavior are investigated and remediated, the Ethics training incorporates examples of past misconduct incidents.

 

Career

 

As well as providing meaningful work from Day 1, our employees and job applicants are attracted to KBR because of the opportunity to develop personally and reach their full potential. Providing the opportunity to ‘Grow’ at KBR is a key component in our EVP. We have a good reputation among our employees for providing growth opportunities and have continued to focus on enhancing these growth prospects in a number of ways throughout 2023 with the introduction of internal career fairs and expansion of global career opportunities. In addition, we invest in training our employees across a range of topics that align with and enhance our values, including programs that focus on leadership, I&D, ethics, and technical development.

 

Technical Professionals

 

For our Technical Talent, our One KBR Tech Fellows program provides funding and opportunities for these world-leading scientists and technical professionals to conduct advanced research into topics ranging from carbon capture to machine learning. Our Fellows also provide valuable input into strategy development, business development, and talent development within KBR. KBR Communities of Interest (“COIs”) are collaborative, virtual forums for subject matter experts and those who support them. Our COIs continue to evolve, ensuring that subject matter experts across the globe can connect and collaborate on Data Science & Analytics, Digital Engineering, Cloud, Cyber, and other technical specialties that inform our customers’ and society’s greatest challenges today.

 

Leadership

 

Our flagship leadership program, the Global Leadership Development Program, is designed to expand the capabilities of future executives. As well as developing strategic thinking through research projects ranging from sustainability investments to digital supply chain solutions, these leaders attended intense learning events focused on executive skills and leading courageously and with integrity. We also strengthen our future leadership by running regular Manager Excellence Programs, and in 2023, we launched our Front Line Leaders Program globally, to support employees newly transitioning into these critical roles.

 

Talent Development & Succession Planning

 

In 2023, we continued to expand the scope of our Talent Calibration conversations, covering over 4,100 KBR employees in this rigorous assessment of performance and potential. As well as providing organization-wide talent trends and data, these conversations lead to individual career plans and added rigor to our succession plans. The Board’s Nominating and Corporate Governance Committee received regular updates on this process throughout the year, culminating in detailed discussions on updated succession plans for the CEO and Executive Leadership Team.

 

Performance Management

 

2023 also saw the expansion of our new agile approach to performance management, focused on forward-looking discussions on performance and priorities between managers and their team members. Our employee survey showed that this modern, real-time performance management approach was welcomed by a majority of participants, helping us retain critical talent, so in 2023 we adopted Agile Performance & Development across KBR.

 

Inclusion & Diversity

 

At KBR, we aim to become a magnet for diverse talent, known for a culture of belonging and equality. Our commitment to Inclusion & Diversity (“I&D”) helps us innovate, helps our global Team of Teams perform and helps create an environment where everyone can belong. We believe we have made significant progress over many years and our progress is acknowledged by our employees. Their continued efforts help us to further build our reputation as a leader in this space, as exemplified by our maintaining a ranking on Forbes’s World’s Top Companies for Women list in 2023.

 

 

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To help us continue our progress in I&D, we review trends and patterns using anonymized employee demographics to ensure we are providing equality of opportunity for all. We expanded our data capture further in 2023, encompassing veteran status and sexual orientation in relevant markets. Having this data helps us monitor our I&D progress, however, we respect our employees’ right to privacy. We maintain strict confidentiality for all those who voluntarily disclose and provide opt-out options for those who prefer not to disclose their personal information.

 

As of December 29, 2023, where permitted by law, our employees voluntarily self-disclosed the following gender and race/ethnicity demographics:

 

Race / Ethnicity Gender
   

 

Our Board of Directors is 33% female and 22% ethnic or racial minority. Our Executive Leadership Team (“ELT”) is 22% female and 11% ethnic or racial minority.

 

In 2023, our I&D Council researched best practices for STEM outreach, communications, manager support, and inclusion for all. In 2024, we plan to incorporate their recommendations into our global plans as well as the local I&D Improvement Plans for every business and function.

 

Employee Engagement

 

Our annual employee survey measures our progress through the eyes of our people. We partner with Great Place to Work to conduct the survey on our behalf, enabling us to provide the survey in multiple languages and benchmark how we perform compared to other similar organizations. A significant majority of our employees who responded to the survey reported that they believe KBR is a Great Place to Work, resulting in KBR being certified as a Great Place to Work in several countries, including the U.S., U.K., Australia, and India.

 

We continue to make improvements in a number of survey focus areas, including:

 

Benefits – we improved our employee benefits offerings in 2023, such as the introduction of “Next Gen Flex Work,” which allows employees in eligible countries to work up to four weeks each year in a different location and provides an opportunity for sabbatical leave, as well as the expansion of our Employee Stock Purchase Plan to new markets. These changes and improved communications resulted in an increase in employees’ positive perception of our benefits.
Celebrations – with the introduction of One KBR Values Awards, expansion of celebratory events across different business areas and a deliberate focus on connections through our EVP, we were pleased to see survey responses improve positively for celebrating special events and for providing opportunities for special recognition. For example, in 2023 we held our first KBR Global Hackathon, which connected hundreds of employees to develop innovative solutions to challenges related to digitalization, sustainability and branding. We celebrated the achievements of the top teams in six regions, and each region’s overall winners attended the final in Abu Dhabi, during which the ELT selected the global winners. In 2024, this team will travel around the world with KBR, further building connections across business and geographic boundaries.

 

With over 16,000 employee responses, the data from our survey was reviewed in detail by different team leaders and across different business areas, resulting in tailored action plans that are already being executed across KBR.

 

www.kbr.com

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Employee Resource Groups

 

Our employees are encouraged to create and join multiple employee resource groups (“ERGs”) where they can continue to develop cultural competence across various categories of diversity, enhance their personal networks, develop leadership skills and actively contribute to workplace culture. In 2023, we continued to provide technical and professional development, networking and community outreach opportunities through IMPACT, our long-standing ERG for early career professionals. We also have OK NoW, focused on Mental Health & Fitness, and a range of I&D-focused ERGs, which come together to collaborate in the All-In Community. With events ranging from book clubs and picnics to discussions on pay equity and mindfulness, the ERGs create a vibrant community for networking, advocacy and education across KBR. We also support and partner with charitable organizations through our ERGs.

 

Total Reward

 

Competition for talent continued to be fierce in 2023, compounded by high levels of inflation in the general economy. Recognizing the impact of the fluid economic environment on our employees, at the beginning of the year, we committed to carrying out an additional mid-year salary review. By staying current with pay trends and partnering with our customers, we applied an additional increase in compensation mid-year for select employees across various levels in the organization. Throughout 2023, we introduced improved benefits packages for many employees as described above, and we continue to benchmark benefits in local markets and expand our offerings to help us attract and retain the best and brightest talent.

 

Talent Acquisition

 

While the different components of our EVP outlined above help us attract and retain some of the best talent in KBR, we recognize that the ‘war for talent’ demands continued innovation and improvement in Talent Acquisition. In 2023, we continued to raise KBR’s brand awareness while providing an attractive and streamlined candidate journey to ensure we have the right people in the right place at the right time. We appointed a global leader for talent acquisition, helping bring together our community of recruiters to identify and institute best practices from sourcing to onboarding.

 

During 2023, we also embedded our Candidate Relationship Management platform that is integrated with our HR system. This platform uses artificial intelligence to promote suitable career opportunities to candidates, helps implement ongoing marketing campaigns and enables recruiters to focus on attracting and securing talent rather than dedicating time and resources to administrative matters.

 

As a result of this innovation and team effort, we hired over 7,900 employees in 2023, supporting our ability to deliver excellent solutions for our customers and meet our strategic growth targets. Of the new hires, 25% are female and 54% are an ethnic or racial minority.

 

 

KBR’s first-ever Global Hackathon Regional Round was a resounding success, with over 36,720 hours dedicated to problem-solving and creativity. A remarkable number of 765 KBR members diligently collaborated to deliver scalable and effective solutions that KBR can implement in the coming years. Finalist teams met up in Abu Dhabi where they presented their ideas to leadership.

 

 

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Director Compensation

 

The annual compensation for our non-executive Directors is shown below. Our Compensation Committee reviews the competitiveness of the compensation paid to our non-executive Directors at least annually. The results of the most recent review were presented to our Board in May 2023. Increases were last made following reviews in November 2021 and October 2022 to bring KBR’s average non-executive director compensation closer to the median of compensation paid by our peers and to reflect the additional two meetings to be held by the Sustainability and Corporate Responsibility Committee every year.

 

Mr. Bradie does not receive any additional compensation for serving on our Board.

 

Who receives   Amount and type of compensation   How paid
All non-executive directors   $120,000 annual retainer   Quarterly cash payments made prior to the end of each quarter
Non-executive Chair of the Board   Additional $200,000 annual retainer    
Audit Committee Chair   Additional $25,000 annual retainer    
Compensation Committee Chair   Additional $15,000 annual retainer    
Cybersecurity Committee Chair   Additional $15,000 annual retainer    
Nominating and Corporate Governance Committee Chair(1)   Additional $15,000 annual retainer    
Sustainability and Corporate Responsibility Committee Chair   Additional $15,000 annual retainer    
All non-executive directors   $170,000 equity award(2)   Annual grant of restricted stock units that vest in full after six months
(1) If the non-executive Chair of the Board is concurrently serving as the Chair of the Nominating and Corporate Governance Committee, there will be no additional annual retainer for the Nominating and Corporate Governance Committee Chair.
(2) The number of restricted stock units awarded each non-employee director is equal to $170,000 divided by the closing price of our common stock on the date of grant (rounded up to the next whole share).

 

www.kbr.com

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KBR’s nonqualified elective deferral plan for non-executive Directors permits non-executive Directors to make an annual election to defer payment of some or all of their cash retainers and equity compensation for the following year. The non-executive Directors also have the option to elect to have their cash compensation converted to RSUs. For the 2023 plan year, General Lyles elected to defer 50% of his cash compensation and 100% of his equity compensation into the plan, and Ms. Dugle elected to defer 100% of her equity compensation into the plan.

 

The following table sets forth certain information with respect to KBR’s compensation for non-executive directors during the fiscal year ended December 29, 2023.

 

Name(1)  Fees Earned or
Paid in Cash
($)(2)
  Stock Awards
($)(3)
  Change in Pension Value and Nonqualified
Deferred Compensation Earnings
($)(4)
  All Other
Compensation
($)
  Total
($)
(a)  (b)  (c)  (d)  (e)  (f)
Mark E. Baldwin  145,000  170,052      315,052
Lynn A. Dugle  135,000  170,052      305,052
Lester L. Lyles(5)  320,000  170,052  24,652    514,705
John A. Manzoni  120,000  170,052      290,052
Wendy M. Masiello  131,250  170,052      301,302
Jack B. Moore  135,000  170,052      305,052
Ann D. Pickard  135,000  170,052      305,052
Carlos A. Sabater  120,000  170,052      290,052
Vincent Stewart  67,500  170,052      237,552
(1) Directors who were also full-time officers or employees of KBR received no additional compensation for serving as directors.
(2) Reflects fees earned in 2023, including fees that may have been deferred into the KBR Non-Employee Directors Elective Deferral Plan. Lt. General Stewart passed away on April 28, 2023, so he did not earn cash retainers for the full year.
(3) The amounts in column (c) represent the grant date fair value of awards granted in 2023 pursuant to the KBR Stock and Incentive Plan. The fair values were determined in accordance with FASB ASC 718, “Stock Compensation.” Assumptions used in the calculation of these amounts are described in note 1 under “Significant Accounting Policies” and note 18 under “Share-based Compensation and Incentive Plans” of our audited financial statements included in our annual report on Form 10-K for the fiscal year ended December 29, 2023. Dividends paid on the stock awards are not reported separately in this table because they are already factored into the grant date fair value. All directors were fully vested in their restricted stock units at the end of 2023 because their annual equity awards granted on February 22, 2023, vested in full on August 22, 2023, or with respect to Lt. General Stewart, on the date of his death on April 28, 2023.
(4) The amount in column (d) reflects the above-market or preferential earnings on nonqualified deferred compensation in General Lyles’s cash retainer account under the KBR Non-Employee Directors Elective Deferral Plan.
(5) General Lyles elected to defer 50% of his annual cash retainer payable for 2023 into the KBR Non-Employee Directors Elective Deferral Plan. Accordingly, he actually received only half of the amount in column (b) in cash in 2023.

 

 

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Director Stock Ownership Guidelines

 

Our Board of Directors established stock ownership guidelines for the non-executive directors to link their financial interests with those of KBR’s stockholders. Non-executive directors are required to own KBR stock in an amount equal to five times the annual cash retainer within five years of joining the Board of Directors. As shown below, all of our non-executive directors who have served at least five years are in compliance with the stock ownership guidelines.

 

STOCK OWNERSHIP WITH RESPECT TO STOCK OWNERSHIP GUIDELINES AS OF 3/1/2024

 

 

 

Certain Relationships and Related Transactions

 

We perform many of our projects through incorporated and unincorporated joint ventures. In addition to participating as a joint venture partner, we often provide engineering, procurement, construction, operations, or maintenance services to the joint venture as a subcontractor. Where we provide services to a joint venture that we control and therefore consolidate for financial reporting purposes, we eliminate intercompany revenues and expenses on such transactions. In situations where we account for our interest in the joint venture under the equity method of accounting, we do not eliminate any portion of our subcontractor revenues or expenses; however, we recognize profit on our subcontractor scope of work only to the extent the joint venture’s scope of work to the end customer is complete. We recognize revenue over time on our services provided to joint ventures that we consolidate and our services provided to joint ventures that we record under the equity method of accounting.

 

www.kbr.com

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Related Person Policies

 

Our Board of Directors has adopted a policy requiring approval of any transactions involving our directors, executive officers, nominees for director, any person who is known to be the beneficial owner of more than 5% of any class of KBR’s voting securities, and any of their respective immediate family members. This policy covers transactions, arrangements, or relationships or any series of similar transactions, arrangements, or relationships (including any indebtedness or guarantee of indebtedness) in which (1) KBR (including any of our subsidiaries) is or will be a participant, (2) the aggregate amount involved exceeds $120,000 in any calendar year, and (3) any related person had, has or will have a direct or indirect interest (other than solely as a result of being a director or holding less than a 10% beneficial ownership interest in another entity), and which is required by SEC rules to be disclosed in our public filings. The Board of Directors will only approve a transaction with related persons when the Board determines such transaction is in the best interests of KBR or our stockholders. In determining whether to approve or ratify a related person transaction, the Board of Directors will consider the following factors and such other factors as it deems appropriate:

 

whether the related person transaction is on terms no less favorable than terms generally available to an unaffiliated third-party under the same or similar circumstances;
whether the transaction is material to KBR or the related person;
the role the related person has played in arranging the related person transaction;
the structure of the related person transaction;
the extent of the related person’s interest in the transaction;
whether there are alternative sources for the subject of the transaction;
the business reason(s) for entering into the transaction;
whether the transaction would impair the independence of an otherwise independent director; and
whether the transaction would present an improper conflict of interest for any director or executive officer of KBR.

 

 

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Executive Officers

 

The following biographical information with respect to each of KBR’s executive officers is current as of March 20, 2024.

 

W. BYRON BRIGHT, JR.

 

Age: 50   |   Joined KBR in: 2010   |   President, Government Solutions U.S.

 

Current Position since: June 2020

Prior Business Experience

 

Positions with KBR

 

•  President, Government Solutions — U.S.

 

•  President, KBRwyle

 

•  Senior Vice President of Operations for U.S. Government Services

 

•  Vice President of Business Development for U.S. Government Services

 

Other Professional Experience

 

•  Supported the government services business at Jacobs Engineering Group Inc.

 

•  Officer in the U.S. Air Force, primarily working in Developmental Test and Engineering, supporting weapons development and rotary wing aircraft flight testing

 

Education

 

•  B.S. (Engineering and Mechanics), distinguished graduate, U.S. Air Force Academy

 

•  M.S. (Mechanical Engineering), Georgia Institute of Technology

 

•  Graduated from the U.S. Air Force Test Pilot School and has flown in over 25 different aircraft as a flight test engineer

     

GREGORY S. CONLON

 

Age: 55   |   Joined KBR in: 2016   |   Chief Digital and Development Officer

 

Current Position since: January 2019

Prior Business Experience

 

Positions with KBR

 

•  Executive Vice President and Chief Development Officer responsible for Strategy, Global Business Development, Marketing, and Mergers & Acquisitions

 

•  President, Asia-Pacific (“APAC”) responsible for Engineering & Construction (“E&C”) and Government Services (“GS”) in this region

 

•  President, E&C APAC

 

Other Professional Experience

 

•  Executive Vice President leading business development globally for the WorleyParsons Services business line, the largest business within WorleyParsons

 

•  Has over 25 years of experience in the E&C business, with global experience across a range of subsectors from hydrocarbons to specialist infrastructure

 

•  Various positions in the energy and resources sectors in Australia, Canada, China, Indonesia, Singapore, Thailand, and the United Kingdom

 

Education

 

•  B.S. (Mechanical Engineering), Royal Melbourne Institute of Technology

 

www.kbr.com

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SHAD E. EVANS

 

Age: 46   |   Joined KBR in: 2018   |   Senior Vice President of Finance Operations and Chief Accounting Officer

 

Current Position since: August 2020 (Interim CAO since October 30, 2020, and CAO since July 29, 2021)

Prior Business Experience

 

•  KBR Chief Financial Officer of Technology Solutions

 

•  Vice President, Finance and Business Operations Security Detection and Automation at Leidos Holdings, Inc.

 

Education

 

•  B.S. (Accounting), San Diego State University-California State University

 

•  M.B.A. (Finance), University of San Diego

     

SONIA GALINDO

 

Age: 55   |   Joined KBR in: 2021   |   Executive Vice President, General Counsel and Corporate Secretary

 

Current Position since: November 2021

Prior Business Experience

 

•  Senior Vice President, General Counsel, Secretary, and Chief Ethics and Compliance Officer at FLIR Systems, Inc. (now, Teledyne F LLC, a subsidiary of Teledyne Technologies)

 

•  General Counsel and Corporate Secretary at Rosetta Stone Inc.

 

•  Various positions in the public and private sector including at the U.S. Securities and Exchange Commission, the Bill & Melinda Gates Foundation, Keurig Green Mountain, Inc., and McCormick & Company, Inc.

 

Education

 

•  B.A. (Economics and Management), Hood College for Women

 

•  J.D., University of Illinois Chicago School of Law (formerly John Marshall Law School)

 

 

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J. JAY IBRAHIM

 

Age: 63   |   Joined KBR in: 2015   |   President, Sustainable Technology Solutions

 

Current Position since: June 2020

Prior Business Experience

 

Positions with KBR

 

•  President, Energy Solutions — Services

 

•  President, Europe, Middle East and Africa (“EMEA”) and APAC responsible for E&C and GS in these regions

 

•  President, EMEA responsible for E&C and GS in this region

 

•  President, E&C EMEA

 

Other Professional Experience

 

•  Has a wealth of senior experience developing and expanding client relationships within the energy, infrastructure, and government services sectors, with a focus on sustainability and energy transition

 

•  Has over 30 years of E&C and GS experience in both domestic and international markets, having served in a variety of engineering, project management, business development, and business management roles for KBR and previously Parsons E&C/WorleyParsons

 

Education

 

•  B.S. (Mechanical Engineering), Wichita State University

 

•  M.S. (Mechanical Engineering), Wichita State University

 

•  Diploma in Advanced Management, Harvard University

     

PAUL E. KAHN

 

Age: 58   |   Joined KBR in: 2022   |   President, Government Solutions International

 

Current Position since: July 2022

Prior Business Experience

 

•  Group Executive & Sector President, Communications & Connectivity   at Cobham Plc

 

•  President UK & CEO Airbus Group Ltd (London) at Airbus Group

 

•  President & CEO, Thales Canada Inc. (Toronto) at Thales Group

 

•  Vice President & Managing Director, Navigation and Airport Solutions   (Milan) at Thales Group

 

•  Chief Executive Officer, Thales Avionics Ltd (London) at Thales Group

 

•  Various corporate and business development management roles   (London and Paris) at Thales Group

 

•  Various project management roles for the UK Ministry of Defence   (Civil Service Faststream)

 

•  Engineering training (UK and US) at Ford Motor Company

 

Education

 

•  B.S. (Special Engineering Programme), Brunel University, London

 

•  M.E. (Special Engineering Programme), Brunel University, London

 

•  Executive M.B.A. Programme, London Business School

 

•  M.B.A. (Economics and Political Science) London Business School

 

•  International Leadership, Royal College of Defence Studies, London

 

•  Chartered Engineer

 

•  Chartered Project Professional

 

www.kbr.com

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JENNI C. MYLES

 

Age: 56   |   Joined KBR in: 2020   |   Executive Vice President, Chief People Officer

 

Current Position since: May 2020

Prior Business Experience

 

•  Group HR Director and core member of the Group Executive Committee at G4S

 

•  Chief HR Officer, Americas Region at G4S

 

•  Director of HR & Employee Engagement at G4S

 

•  Various employee relations and human resources management roles at KPMG, Northern Foods, and Ford Motor Company

 

Education

 

•  L.L.B. (Hons), University of Glasgow

 

•  Fellow of the Chartered Institute of Personnel & Development

     

MARK W. SOPP

 

Age: 58   |   Joined KBR in: 2017   |   Executive Vice President and Chief Financial Officer

 

Current Position since: February 2017

Prior Business Experience

 

•  Chief Financial Officer and Executive Vice President for Leidos Holdings, Inc., previously Science Applications International Corporation, one of the largest publicly-traded government contractors in the U.S. with significant technically-focused commercial professional services operations, including serving energy markets

 

•  Various executive positions with Titan Corporation, also involved in government contracting and commercial business areas

 

Education

 

•  B.S. (Accounting), New Mexico State University

 

•  Completed the Executive Program at UCLA Anderson School

 

 

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Executive Compensation

 

 

Proposal No. 2  Advisory Vote to Approve Named Executive Officer Compensation 51
Compensation Discussion and Analysis 52
Executive Summary 52
Overview of Executive Compensation Philosophy, Policies and Practices 56
Summary of 2023 Target Compensation of Named Executive Officers 60
Elements of Compensation 60
Long-Term Performance Incentives 67
Other Compensation Elements 73
Stock-Related Policies 74
Impact of Accounting, Regulatory, and Tax Requirements on Compensation 75
Impact of Executive Conduct or a Restatement of Earnings on Compensation (Clawback Policy) 75
Conclusion 75
Compensation Committee Report 76
Compensation Committee Interlocks and Insider Participation 76
Executive Compensation Tables 77
Summary Compensation 77
Grants of Plan-Based Awards 80
Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table 82
Outstanding Equity Awards at Fiscal Year End 84
Option Exercises and Stock Vested 85
Pension Benefits 86
Nonqualified Deferred Compensation 86
Severance and Change-in-Control Agreements 90
No Employment Agreements 92
CEO Pay Ratio 92
Pay Ratio Methodology and Calculation 92
Pay Versus Performance 93
Pay Versus Performance Table 93
Pay Versus Performance Relationship Disclosures 96
Important Financial Performance Measures 97
Security Ownership of Certain Beneficial Owners and Management 98

 

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PROPOSAL NO. 2   

Advisory Vote to Approve Named Executive Officer Compensation

 

The Board of Directors is providing our stockholders with the opportunity to cast a non-binding advisory vote to approve the compensation of our Named Executive Officers (“NEOs”) as disclosed in this proxy statement.

 

Our Compensation Committee establishes, recommends, and governs all the compensation and benefits policies and actions for KBR’s NEOs, as discussed in the “Compensation Discussion and Analysis” section of this proxy statement. Consistent with our compensation philosophy, our executive compensation program was designed to achieve the following primary objectives:

 

  provide a clear and direct relationship between executive pay and company (and business segment, as applicable) performance, both on a short- and long-term basis;
  emphasize operating performance measures;
  link executive pay to measures of stockholder value;
  support our business strategies and management processes in order to motivate our executives; and
  generally target base salary, short-term incentives, long-term incentives, and total compensation levels near the 50th percentile of the competitive market for good performance, and above the 50th percentile of the competitive market for consistent, outstanding  performance.

 

In light of these objectives, KBR provides pay that is highly dependent on performance. We continually review best practices in governance and executive compensation. Consistent with such best practices, KBR:

 

  does not maintain employment agreements with the NEOs;
  does not provide excise tax gross-ups;
  has incentive plans that discourage undue risk and align executive rewards with short- and long-term company performance; and
  requires executives to satisfy stock ownership requirements.

 

For the reasons discussed above, the Board of Directors unanimously recommends that stockholders vote in favor of the following resolution:

 

RESOLVED, that the compensation paid to KBR’s named executive officers, as disclosed pursuant to Item 402 of Regulation S-K, including the Compensation Discussion and Analysis, compensation tables and narrative discussion, is hereby APPROVED.”

 

While the resolution is non-binding, the Board of Directors values your opinion and will consider the outcome of the vote when making future compensation decisions.

 

The Board of Directors recommends that you Vote FOR the advisory vote to approve our NEOs’ compensation as disclosed in this proxy statement. All proxies will be so voted unless a stockholder specifies otherwise.

 

 

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Compensation Discussion and Analysis

 

Executive Summary

 

NAMED EXECUTIVE OFFICERS

 

This Compensation Discussion and Analysis provides a detailed description of our compensation philosophy, objectives, policies, and practices in place during 2023, and it explains the factors considered by our Compensation Committee in making compensation decisions for the following NEOs:

 

       
Stuart Bradie   Mark Sopp   Byron Bright   Jay Ibrahim   Jenni Myles
President and Chief
Executive Officer
  Executive Vice
President and Chief
Financial Officer
  President, Government
Solutions U.S.
  President, Sustainable
Technology Solutions
  Executive Vice
President, Chief People
Officer

 

These NEOs, together with the other members of our executive management team whose compensation is determined by our Compensation Committee and our Board of Directors, are referred to as our “Senior Executive Management.”

 

COMPENSATION HIGHLIGHTS

 

Key Compensation Decisions for 2023

 

Our Compensation Committee made the following key decisions related to KBR’s compensation program for 2023:

 

BASE SALARY SHORT-TERM INCENTIVE (“STI”)
PLAN PAYOUT
LONG-TERM INCENTIVE (“LTI”)
PLAN PAYOUT
Each of our NEOs received a 3% raise in 2023 to reflect their strong performances, maintain internal equity, and align with market benchmarks. 13% negative discretion was applied to the 2023 STI adjusted EPS metric payout percentage result for each of our NEOs to account for share repurchases, including the effect of the cash settlement of warrants on the adjusted share count. The three-year performance period for the 2021 Long-Term Performance Cash and Stock Awards ended December 31, 2023, and the payouts for each of our NEOs were settled at 200% of target based on job income sold (“JIS”) and relative total stockholder return (“TSR”) performance.

 

Our Compensation Committee believes all our compensation programs strongly reflect our pay-for-performance strategy.

 

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Advisory Vote on Compensation and Stockholder Engagement

 

We believe we have a well-designed executive compensation program, and KBR’s stockholders seem to agree. Our most recent say-on-pay proposal, presented during the 2023 annual meeting, garnered the support of approximately 99% of the votes cast. The Compensation Committee was gratified by this result.

 

In addition to the Compensation Committee considering the outcome of our say-on-pay proposal, our Corporate Secretary reaches out to our largest investors bi-annually to maintain an open dialogue about our compensation policies, practices, and structure, and to receive feedback on elements that could be changed to better align with stockholders’ interests. In 2023, our Corporate Secretary reached out to all of KBR’s top 25 investors, which collectively represented approximately 74% of our outstanding stock, and had calls with or heard from investors representing approximately 39% of our outstanding stock. A majority of these investors indicated that they did not have any significant concerns about our executive compensation program.

 

We will continue to consider the outcome of our say-on-pay proposal and other stockholder feedback when determining future compensation policies and decisions for our NEOs.

 

CEO Compensation and KBR Performance

 

Our CEO’s strategic actions positioned KBR for long-term growth, and we have continued to see these actions deliver strong results and improve stockholder value. Our adjusted EPS increased by 7% from 2022, and our adjusted EBITDA increased by 12% from 2022 (see reconciliation under the section titled “Non-GAAP Financial Information” at the end of this proxy statement).

 

The alignment of our CEO’s compensation with KBR’s performance and stockholder value during the past three years is summarized below and on the next two pages. These graphs are not intended to replace the disclosure required by Section 953(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 402(v) of Regulation S-K, which is presented in the section titled “Pay Versus Performance.”

 

CEO’S REALIZED COMPENSATION

 

 

* The LTI Payout for 2021 represents the 100% cash payout of the 2019 KBR Long-Term Performance Cash Award. The LTI Payouts for 2022 and 2023 represent the cash and KBR common stock payouts of the 2020 and 2021 KBR Long-Term Performance Cash and Stock Awards, with the stock valued at the closing prices on December 30, 2022, and December 29, 2023, respectively (the last trading days of the years).
   
** Diluted EPS reflects our net income (loss) divided by the weighted average number of common shares outstanding during the period in addition to common shares that would have been outstanding if potential common shares with a dilutive effect had been issued. Adjusted EPS excludes certain amounts included in diluted EPS. A reconciliation of adjusted EPS to diluted EPS is provided under the section titled “Non-GAAP Financial Information” at the end of this proxy statement.

 

 

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KBR TOTAL STOCKHOLDER RETURN*

 

 

* The KBR TSR shown above is the cumulative TSR on shares of our common stock assuming an investment of $100 on December 31, 2019, and reinvestment of all dividends.

 

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ADJUSTED EBITDA* GROWTH AND STRATEGIC ACTIONS

 

 

* EBITDA is defined as net income (loss) attributable to KBR, plus interest expense; accretion of convertible notes debt discounts; other non-operating expense (income); provision for income taxes; and depreciation and amortization. Adjusted EBITDA excludes certain amounts included in EBITDA. A reconciliation of adjusted EBITDA to net income is provided under the section titled “Non-GAAP Financial Information” at the end of this proxy statement.

 

 

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Overview of Executive Compensation Philosophy, Policies and Practices

 

KEY CONSIDERATIONS IN DETERMINING EXECUTIVE COMPENSATION

 

Our Compensation Committee regularly reviews the elements of the individual compensation packages for our NEOs, with a goal of ensuring that:

 

  Pay packages align executives’ interests with our stockholders’ interests;
  Performance metrics are sufficiently challenging;
  Target pay packages reflect an appropriate mix of short-term and long-term incentives; and
  Total compensation, as well as each individual compensation element, is targeted near the 50th percentile of the competitive market for good performance and above the 50th percentile of the competitive market for consistent, outstanding performance, taking into consideration factors like differences in our NEOs’ respective responsibilities compared to responsibilities ascribed to their counterparts  at our peers, as well as experience, retention risk, and internal equity.

 

Our executive compensation program is regularly reviewed to ensure that it remains consistent with these objectives and is administered in accordance with established compensation policies.

 

POLICIES AND PRACTICES

 

Below is a summary of our compensation policies and practices in place during 2023.

 

Clawbacks

•  We have adopted a clawback policy in compliance with Section 10D of the Securities Exchange Act of 1934(“Exchange Act”) and the NYSE rules. Pursuant to our policy, if our Compensation Committee determines that an officer or employee has been paid incentive compensation (either cash or equity) based on financial results that are later restated, the Company may seek recovery of any overpayments.

•  Certain of our officers’ award agreements also include additional clawback provisions that extend beyond the requirements of Section 10D of the Exchange Act and the NYSE rules.

Stock Ownership Guidelines •  We require our NEOs to own a significant amount of KBR stock to align their interests with our stockholders’ interests.
No Pledging •  Officers and directors may not pledge KBR stock.
No Hedging •  Officers and directors may not hedge KBR stock.
Market Comparison •  Our Compensation Committee benchmarks executive compensation against relevant peer groups of companies in our industry and companies of similar size and complexity.
Performance-Based Compensation •  A majority of our NEOs’ compensation is performance-based and varies depending on the achievement of absolute and relative performance goals.
Double-Trigger •  Our severance and change-in-control agreements require a double-trigger for a change-in-control termination (i.e., the occurrence of both a change in control and a termination of employment within two years thereafter) in order for an executive to receive change-in-control benefits.
No Employment Agreements •  Our NEOs do not have employment agreements.
No Tax Gross-Ups •  We do not provide excise tax gross-up agreements.
No Option Repricing •  We prohibit the repricing of KBR stock options.

 

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ROLE OF THE BOARD AND THE COMPENSATION COMMITTEE

 

Each year, usually in December, our non-executive directors meet in executive session to evaluate the performance of our Chief Executive Officer, considering qualitative and quantitative elements of the CEO’s performance, including:

 

  leadership and vision;
  integrity;
  keeping the Board informed on matters affecting KBR and its operating units;
  performance of the business, including such measurements as TSR and achievement of financial objectives and goals;
  development and implementation of initiatives to provide long-term economic benefit to KBR;
  accomplishment of strategic objectives; and
  development of management.

 

The CEO’s evaluation and compensation for the next full year, including an evaluation of whether the CEO has created adequate management succession programs, are communicated to the CEO by the non-executive Chair of the Board after review and approval by our Compensation Committee and the full Board of Directors (other than the CEO).

 

Based on the CEO’s recommendations and in concert with him, our Compensation Committee annually reviews and approves the compensation and incentive awards for our Senior Executive Management.

 

ROLE OF THE CEO

 

During 2023, our CEO made recommendations to our Compensation Committee regarding the compensation and incentives for our NEOs other than himself. Our CEO also:

 

  recommended performance measures, target goals, and award schedules for short-term and long-term incentive awards, and reviewed performance goals for consistency with our projected business plan;
  reviewed competitive market data for Senior Executive Management positions; and
  developed specific recommendations regarding the amount and form of equity compensation to be awarded to our NEOs other than  himself.

 

ROLE OF INDEPENDENT CONSULTANTS

 

Under its charter, our Compensation Committee is authorized to retain a compensation consultant and has the sole authority to approve the consultant’s fees and other retention terms. While we believe that retaining third-party consultants is an efficient way to remain informed about competitive compensation practices, the advice of outside professionals is just one of many factors the Compensation Committee considers. Most importantly, we design and adjust our compensation program to address the program’s intended objectives.

 

In 2023, our Compensation Committee used the services of one compensation consulting firm, Meridian Compensation Partners, LLC (“Meridian”). Our Compensation Committee engaged and managed its relationship with Meridian directly, and Meridian reported directly to our Compensation Committee. Outside of providing advisory services to our Compensation Committee, Meridian provided no other services to KBR or our affiliates.

 

Meridian’s work for KBR included advising our Compensation Committee, as requested, with respect to all executive compensation matters and various director compensation matters, including:

 

  A review of CEO pay considerations for 2023;
  A review of our short-term and long-term incentive design and peer groups for the 2023-2024 compensation cycle;
  Regular updates on notable legislative and regulatory activities;
  Competitive market studies of compensation for Senior Executive Management and for non-executive directors; and
  A review of the risk profile of our short-term and long-term incentive programs.

 

 

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In December 2023, our Compensation Committee reviewed the independence factors prescribed by the SEC (as well as other factors identified by the NYSE) as affecting the independence of a consultant or adviser, including the following:

 

  Whether Meridian provides other services to KBR;
  The amount of fees Meridian received from KBR as a percentage of that firm’s total revenue;
  Meridian’s policies and procedures that are designed to prevent conflicts of interest;
  Whether there is any business or personal relationship between an individual Meridian compensation consultant or other adviser and a member of our Compensation Committee;
  Whether there is any business or personal relationship between an individual Meridian compensation consultant, principal, or employee, or Meridian as an organization, and any of KBR’s executive officers; and
  Whether Meridian or any of its principals or employees owns any stock of KBR.

 

Based on the results of this review, our Compensation Committee confirmed Meridian’s independence and lack of any conflicts of interest in 2023 and approved the continued retention of Meridian for 2024.

 

PEER GROUPS

 

In the design and administration of our 2023 executive compensation programs for our Named Executive Officers, our Compensation Committee considered competitive market data from a new peer group (the “Peer Group”) formed by combining our former “Core” and “Diversified” peer groups used in the prior year. As discussed under the section titled “KBR Long-Term Performance Cash and Stock Awards” on page 68, the Compensation Committee also refers to a “TSR Peer Group” for limited purposes related to the NEOs’ long-term incentive awards.

 

The Peer Group comprised 20 companies (five companies overlapped between the former Core and Diversified peer groups) for the 2022-2023 compensation cycle. The Peer Group included ManTech International Corporation despite its acquisition by The Carlyle Group Inc. in September 2022 because ManTech International Corporation’s 2022 proxy statement data was available for the purpose of benchmarking 2023 compensation. ManTech International Corporation was removed from the Peer Group for the 2023-2024 compensation cycle.

 

The Peer Group was formed based on a review considering KBR’s two segments — Government Solutions and Sustainable Technology Solutions, and several factors relating to the constituent companies, including an analysis of certain financial metrics (such as revenue, net assets, market capitalization, enterprise value, and number of employees), business strategies, the effects of corporate transactions, and the availability of market data. The former Core peer group companies, bolded in the table on the next page, have primary operations that involve providing highly technical and professional services to the U.S. government and the engineering, construction, and services industry. The former Diversified peer group companies were generally selected based on revenue, size, complexity, performance, and the nature of their principal business operations, with specific emphasis on engineering and construction, information technology consulting, manufacturing, and government services. Our Compensation Committee believes the former Diversified peer group companies appropriately represent the broad market for key management and technical talent. Combined, we believe these are the companies against which KBR most competes for employees and business.

 

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The Peer Group used for 2023 compensation decisions consisted of the following companies:

 

Company            
(Data in billions — as of 12/31/2022 except as otherwise indicated)  Revenues   Assets   Market Cap 
BAE Systems plc  $21.258   $31.462   $31.691 
Booz Allen Hamilton Holding Corporation(1)  $8.364   $6.026   $13.820 
CACI International Inc.(2)  $6.203   $6.629   $7.063 
Conduent Incorporated  $3.858   $3.571   $0.874 
Dover Corporation  $8.508   $10.897   $19.005 
Flowserve Corporation  $3.615   $4.791   $4.010 
Fluor Corporation  $13.744   $6.827   $4.925 
Gartner, Inc.  $5.476   $7.300   $26.563 
Hubbell Incorporated  $4.948   $5.403   $12.604 
Huntington Ingalls Industries, Inc.  $10.676   $10.857   $9.205 
Jacobs Solutions Inc.(3)  $14.923   $14.660   $15.202 
L3Harris Technologies, Inc.  $17.062   $33.524   $39.644 
Leidos Holdings, Inc.  $14.396   $13.071   $14.378 
ManTech International Corporation(4)  $2.617   $2.649   $3.929 
Parsons Corporation  $4.195   $4.198   $4.787 
Science Applications International Corporation(5)  $7.394   $5.746   $6.060 
Teradata Corporation  $1.917   $2.169   $3.427 
Tetra Tech, Inc.  $3.504   $2.623   $7.692 
Textron Inc.  $12.869   $16.293   $14.781 
The Timken Company  $4.497   $5.772   $5.141 
MEDIAN (INCLUDING KBR)  $6.564   $6.026   $7.692 
KBR, INC.  $6.564(6)   $5.566   $7.244 
(1) Booz Allen Hamilton Holding Corporation’s revenues and assets are as of 3/31/2022 and market cap is as of 12/31/2022.
(2) CACI International Inc.’s revenues and assets are as of 6/30/2022 and market cap is as of 12/31/2022.
(3) Jacobs Solutions Inc.’s revenues and assets are as of 9/30/2022 and market cap is as of 12/31/2022.
(4) The Peer Group included ManTech International Corporation despite its acquisition by The Carlyle Group Inc. in September 2022 because ManTech International Corporation’s 2022 proxy  statement data was available for the purpose of benchmarking 2023 compensation. ManTech International Corporation’s financial data is as of August 31, 2022 (pre-merger).
(5) Science Applications International Corporation’s revenues and assets are as of 1/31/2022 and market cap is as of 12/31/2022.
(6) KBR’s revenue does not include our share of revenue from our unconsolidated joint ventures, which was approximately $1.5 billion in 2022.

 

The compensation data for our Peer Group was obtained from publicly available sources, including proxy statements and Form 4 and 8-K disclosures, and was not adjusted, and the Equilar Executive Compensation Survey (which Meridian used to analyze peer company compensation data that was not publicly available).

 

During 2023, our Compensation Committee asked Meridian to review the appropriateness of the Peer Group for assessing the competitiveness of our executive compensation programs. As a result of Meridian’s review and recommendation, our Compensation Committee maintained the same Peer Group for 2024 compensation with the exception of removing ManTech International Corporation due its acquisition by The Carlyle Group Inc. in September 2022.

 

 

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Summary of 2023 Target Compensation of Named Executive Officers

 

The table below reflects target annual compensation and is not intended to replace the more detailed information provided in the Summary Compensation table. The target dollar amounts for restricted stock units and performance cash and stock awards represent 33⅓% and 66⅔% of the long-term performance incentives, respectively. The number of restricted stock units is determined by dividing the target dollar amount by the closing price of KBR common stock on the date of grant. The target number of performance cash and stock award units that represents the right to receive one share of KBR common stock if the TSR performance metric is achieved is determined by dividing the target dollar amount of the TSR portion of the award by the closing price of KBR common stock on the date of grant. See the section titled “Long-Term Performance Incentives” for more information.

 

       Target 2023 Long-Term Performance
Incentives
     
   2023
Base Salary
   Target 2023
Short-Term
Incentive
   Time-Based
Restricted Stock
Units Target
Dollar Amount
   Performance
Cash and Stock
Award Target
Dollar Amount
   Total Target
Amount
 
Mr. Bradie  $1,227,500   $1,718,500   $2,416,667   $4,833,333   $10,196,000 
Mr. Sopp  $706,003   $670,703   $533,333   $1,066,667   $2,976,706 
Mr. Bright  $678,101   $644,196   $416,667   $833,333   $2,572,297 
Mr. Ibrahim  $616,455   $585,632   $333,333   $666,667   $2,202,087 
Ms. Myles(1)  $490,816   $466,275   $283,333   $566,667   $1,807,091 
(1) Ms. Myles’s base salary is approved and paid in British Pounds. STI payouts are paid in local currency, so Ms. Myles’s STI payouts are also paid in British Pounds. Her 2023 base salary was £385,014, and her target 2023 STI was £365,763, but both have been converted to U.S. Dollars in the table above for presentations purposes using the exchange rate of £1 to $1.2748, which was the exchange rate used when presenting her proposed 2023 STI payout in U.S. Dollars to the Compensation Committee for approval in February 2024. See the section titled “KPIs and STI Payout for Ms. Myles” for more information on her 2023 STI payout.

 

Elements of Compensation

 

Our executive compensation program has been designed to ensure that KBR can attract and retain talented executives who are motivated to pursue KBR’s strategies, focus employees’ efforts, and achieve business success. The compensation program also must align executives’ interests with stockholders’ interests. There is no pre-established formula for the allocation between cash and non-cash compensation or between short-term and long-term compensation. Instead, each year our Compensation Committee determines, in its discretion and business judgment, the appropriate level and mix of compensation to reward our NEOs for near-term superior performance and to encourage commitment to our long-range strategic business goals. When making these decisions, our Compensation Committee is always mindful of our philosophy that the majority of Named Executive Officer compensation should vary with KBR’s performance.

 

As shown below, a significant portion of our NEOs’ target annual compensation in 2023 was performance-based.

 

CEO’s TARGET COMPENSATION   AVERAGE OF OTHER NEOs’ TARGET COMPENSATION
 

 

 

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Our 2023 executive compensation program consisted of three core elements of direct compensation: base salary, short-term (annual) incentives, and long-term incentives. These elements are described on the next several pages.

 

BASE SALARY

 

We pay our NEOs market-competitive base salaries for the skills and experience they bring to their respective roles. To arrive at base salary amounts, our Compensation Committee uses its discretion to adjust market-based amounts to reflect:

 

  Leadership and individual performance;
  Internal pay equity;
  Level of responsibility;
  Experience in current role; and
  External factors involving general economic conditions and marketplace compensation trends.

 

The table below shows the base salaries for our NEOs, effective January 1, 2023.

 

    Increase
(% of 2022 Base Salary)
  2023
Base Salary
  Basis for Decision
Mr. Bradie   $ 35,750   $ 1,227,500   Market data alignment,
strong performance,
and internal equity
      (3%)        
Mr. Sopp   $ 20,563   $ 706,003  
      (3%)        
Mr. Bright   $ 19,751   $ 678,101  
      (3%)        
Mr. Ibrahim   $ 17,955   $ 616,455  
      (3%)        
Ms. Myles(1)   $ 14,296   $ 490,816  
      (3%)        

(1) Ms. Myles’s base salary is approved and paid in British Pounds. Her 2023 base salary was £385,014, but it has been converted to U.S. Dollars in the table above for presentations purposes using the exchange rate of £1 to $1.2748, which was the exchange rate used when presenting her proposed 2023 STI payout in U.S. Dollars to the Compensation Committee for approval in February 2024. See the section titled “KPIs and STI Payout for Ms. Myles” for more information on her 2023 STI payout.

 

 

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SHORT-TERM INCENTIVES (ANNUAL)

 

Our Compensation Committee established the KBR Senior Executive Performance Pay Plan (the “Performance Pay Plan”) to reward Senior Executive Management for improving financial results for our stockholders by linking cash compensation to the achievement of KBR’s short-term financial performance and individual annual goals. The Performance Pay Plan was created under the stockholder-approved Amended and Restated KBR, Inc. 2006 Stock and Incentive Plan (“KBR Stock and Incentive Plan”), which is described in more detail on page 67.

 

Incentive Award Opportunities

 

In December 2022, our Compensation Committee met to determine the 2023 target awards for our Named Executive Officers under the Performance Pay Plan. These target STI awards, which are expressed as percentages of base salary, were generally set to be consistent with the median target awards for executives in similar positions within our Peer Group. The STI award threshold (25%), target (100%), and maximum (200%) payout opportunities for 2023 are shown below.

 

    Threshold –25%
(% of Base Salary)
  Target – 100%
(% of Base Salary)
  Maximum – 200%
(% of Base Salary)
  Increase to Target
Award from 2022
  Basis for
Decision
Mr. Bradie   35%   140%   280%   10%   Market data alignment, strong performance, and internal equity
Messrs. Sopp, Bright, and Ibrahim   23.75%   95%   190%   5%  
Ms. Myles   23.75%   95%   190%   10%  

 

2023 STI Performance Metrics

 

The performance metrics we used for 2023 STI awards focus our NEOs on the key measures of success in connection with the execution of our strategic plan. No changes were made to the design of the STI Plan for 2023 because the STI Plan in effect in 2022 was still considered to be aligned with the interests of KBR and our stockholders. However, our Compensation Committee updated the specific goals for each performance metric to ensure they remained challenging and competitive.

 

The table below summarizes the 2023 performance metrics and weightings for our CEO and other NEOs. We believe these are the most important metrics for measuring our NEOs’ efforts to drive KBR’s growth and create value for our stockholders.

 

Performance Metric   Weighting   Rationale

KBR Adjusted Earnings Per Share (“EPS”)

Diluted EPS measures net income divided by the weighted average number of fully diluted shares of KBR common stock outstanding. Adjusted EPS excludes certain amounts included in diluted EPS.

    This metric helps to align our NEOs with the interests of our stockholders because strong adjusted EPS generally increases the value of our stock. We consider buybacks when reviewing adjusted EPS achievement to provide for an accurate comparison against the pre-established target.

KBR Adjusted Consolidated Operating Cash Flow (“OCF”)

KBR adjusted OCF measures the amount of cash generated by KBR’s operations.

    Our adjusted OCF target is based on KBR’s 2023 budgeted cash flows from operations and is aligned with our capital deployment strategy. This metric aims to ensure that our NEOs focus on cash management.
Key Performance Indicators (“KPIs”)

KPIs are individual performance metrics typically specific to each NEO. The KPIs are described on pages 64 through 66.

    KPIs allow us to reward individual contributions to KBR’s   key strategy focus areas.
KBR Zero Harm / Sustainability Performance Across KBR’s 10 Sustainability Pillars

Measures continued progress in KBR’s Zero Harm / sustainability performance across KBR’s 10 sustainability pillars.

    Emphasizing this metric promotes continued progress in KBR’s Zero Harm and sustainability performance across   KBR’s 10 sustainability pillars, including KBR safety, inclusion and diversity, community outreach, and environment, all of which promote a sustainable business.

 

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Target Performance Goals

 

When establishing target performance goals for the STI awards for 2023, our Compensation Committee considered, among other things, projected company performance and general business and industry conditions, as well as our strategic business objectives. At the time the target goals are established, the outcomes are intended to be substantially uncertain but achievable with better-than-expected performance from our NEOs. Our Compensation Committee adopted target performance goals for our STI metrics that maintained the same rigor as the performance goals from the prior year, especially in light of our strategic goal to position KBR for long-term growth.

 

Our Compensation Committee established the 2023 threshold, target, and maximum performance goals shown in the table below. The threshold, target, and maximum award payout levels remained at 25%, 100%, and 200%, respectively. Each performance metric can earn a result from 0% to 200% of target. Achievement less than the threshold payout level earns a 0% metric result. For achievement between threshold and target or target and maximum, the metric result is determined by linear interpolation. The actual metric result is multiplied by the metric weighting to determine the metric payout. The results and payouts were certified in February 2024.

 

2023 SHORT-TERM INCENTIVES TABLE

 

Performance Metric   Threshold – 25%   Target – 100%   Maximum – 200%   Weight   Metric Payout
KBR Adjusted EPS(1)       61.2%
KBR Adjusted Consolidated OCF(2)       50.0%
FINANCIAL METRICS FORMULAIC RESULT                   111.2%
NEGATIVE DISCRETION(3)                   (13.0%)
FINANCIAL METRICS PAYOUT(4)                   98.2%
Zero Harm / Sustainability(5)   Individual Zero Harm / Sustainability metric results shown on pages 64 through 66     Noted on pages 64 through 66
KPIs   Individual KPIs and metric results shown on pages 64 through 66     Noted on pages 64 through 66
(1) The 2023 EPS metric result of $2.91 relates to the achieved adjusted EPS for the year. A reconciliation of adjusted EPS to diluted EPS is provided at the end of this proxy statement.
(2) The 2023 OCF metric result of $463MM relates to the achieved adjusted consolidated OCF for the year. A reconciliation of adjusted OCF to OCF is provided at the end of this proxy statement.
(3) See “Negative Discretion” on the next page for more information on the negative discretion applied.
(4) The financial metrics payout percentage is not the actual payout percentage because it does not include the percentages earned with respect to the Zero Harm / Sustainability performance  metric and KPIs. The actual payouts for our CEO and other NEOs are disclosed on pages 64 through 66.
(5) The Zero Harm / Sustainability performance metric was related to continued progress across KBR’s 10 sustainability pillars, including KBR Health, Safety & Security (e.g., reduction in total recordable incident rate), Inclusion & Diversity (e.g., gender and racial/ethnic diversity balance), Community Reach (e.g., KBR’s Charity Golf Tournament), and Climate Change and Action (e.g., sustainable process technologies that help KBR’s customers reach their own sustainability and decarbonization goals). The Threshold, Target and Maximum performance goals of ME, SE, and EE, respectively, are a discretionary rating system. ME = Meets Expectations; SE= Surpasses Expectations; EE= Exceeds Expectations.

 

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Negative Discretion

 

With support from our ELT, our Compensation Committee exercised negative discretion to reduce the 2023 adjusted EPS metric payout percentage from 61.2% to 48.2% to account for share repurchases, including the effect of the cash settlement of warrants on the adjusted share count.

 

KPIs and STI Payout for Mr. Bradie

 

Target Payout
$1,718,500
(Base Salary x 140%)
  Actual Payout
$2,490,107
(Target Payout x 144.9%)
Financial Metrics
Payout
$1,687,567
98.2%
Zero Harm /
Sustainability Payout
$343,700
20%
KPI
Payout
$458,840
26.7%

 

Our Board of Directors determined that Mr. Bradie earned a 133.3% metric result—in between target and maximum level achievement —with respect to his 2023 KPIs, which resulted in a 26.7% payout for the KPI portion of his STI payout. The determination was based on evaluation of Mr. Bradie’s 2023 KPI achievements:

 

  Drove further growth in earnings, backlog, cash conversion, and margins in KBR’s Sustainable Technology Solutions business
  Supported further progress on the HomeSafe Alliance program, including through strong customer and partner engagement
  Continued to develop and support executive leadership team succession planning

 

Our Board of Directors determined that Mr. Bradie earned a 200% metric result—maximum level achievement—with respect to his 2023 Zero Harm / Sustainability performance, which resulted in a 20% payout for the Zero Harm / Sustainability portion of his STI payout. The determination was based on Mr. Bradie’s 2023 Zero Harm / Sustainability achievements:

 

  Drove KBR’s leading sustainability performance with associated increases to ESG ratings
  Sustained industry leading safety performance with year-on-year improvements
  Visibly led Inclusion & Diversity across KBR, with resulting improvement in reputation for belonging and equality

 

KPIs and STI Payout for Mr. Sopp

 

Target Payout
$670,703
(Base Salary x 95%)
  Actual Payout
$960,446
(Target Payout x 143.2%)
Financial Metrics
Payout
$658,630
98.2%
Zero Harm /
Sustainability Payout
$67,070
10%
KPI
Payout
$234,746
35%

 

 

Our Compensation Committee determined that Mr. Sopp earned a 175% metric result—in between target and maximum level achievement—with respect to his 2023 KPIs, which resulted in a 35% payout for the KPI portion of his STI payout. The determination was based on evaluation of Mr. Sopp’s 2023 KPI achievements:

 

  Provided leadership for successful Deltek Costpoint rollout for KBR’s Corporate organization for improved alignment and efficiency across businesses
  Drove upgrade and application of MS Dynamics to KBR’s UK consulting business and prepared to apply MS Dynamics for KBR’s Government Solutions International and Sustainable Technology Solutions business groups
  Delivered support for HomeSafe Alliance program, including through resourcing and internal controls
  Continued succession planning and development in finance functions
  Drove implementation of payroll modernization project

 

Our Compensation Committee determined that Mr. Sopp earned a 100% metric result—target level achievement—with respect to his 2023 Zero Harm / Sustainability performance, which resulted in a 10% payout for the Zero Harm / Sustainability portion of his STI payout. The determination was based on Mr. Sopp’s 2023 Zero Harm / Sustainability achievements:

 

  Demonstrated visible leadership of Zero Harm safety performance through site visits
  Continued to support an inclusive culture and diverse workforce throughout KBR’s Finance organization

 

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KPIs and STI Payout for Mr. Bright

 

Target Payout
$644,196
(Base Salary x 95%)
  Actual Payout
$825,859
(Target Payout x 128.2%)
Financial Metrics
Payout
$632,600
98.2%
Zero Harm /
Sustainability Payout
$64,420
10%
KPI
Payout
$128,839
20%

 

Our Compensation Committee determined that Mr. Bright earned a 100% metric result—target level achievement—with respect to his 2023 KPIs, which resulted in a 20% payout for the KPI portion of his STI payout. The determination was based on evaluation of Mr. Bright’s 2023 KPI achievements:

 

  Led startup of HomeSafe Alliance program, including implementation of a technology solution and further development of long-term strategic plan
  Drove KBR’s growth and backlog through strategic efforts in cybersecurity, FedCiv, Intel, GSI, and sustainability. Strategized KBR’s scale for early client and congressional engagement to shape and improve new sales opportunities
  Built Team of Teams between KBR’s Government Solutions International and Government Solutions US business groups and led efforts to develop revenue generating opportunities to help governments around the world meet their sustainability targets
  Supported global simplification, automation, and digitalization of KBR’s internal supply chain. Engaged outside of KBR’s Government Solutions US business group for impacts internationally and within KBR’s commercial business
  Drove global standards and harmonization in KBR’s supply chain to deliver value creation efforts for the business leaders

 

Our Compensation Committee determined that Mr. Bright earned a 100% metric result—target level achievement—with respect to his 2023 Zero Harm / Sustainability performance, which resulted in a 10% payout for the Zero Harm / Sustainability portion of his STI payout. The determination was based on Mr. Bright’s 2023 Zero Harm / Sustainability achievements:

 

  Established global standards to support sustainability goals for KBR’s supply chain
  Continued leadership of safety culture across Government Solutions US businesses
  Drove successful implementation of Inclusion & Diversity improvement plans for Government Solutions US businesses

 

KPIs and STI Payout for Mr. Ibrahim

 

Target Payout
$585,632
(Base Salary x 95%)
  Actual Payout
$926,470
(Target Payout x 158.2%)
Financial Metrics
Payout
$575,091
98.2%
Zero Harm /
Sustainability Payout
$117,126
20%
KPI
Payout
$234,253
40%

 

Our Compensation Committee determined that Mr. Ibrahim earned a 200% metric result—maximum level achievement—with respect to his 2023 KPIs, which resulted in a 40%payout for the KPI portion of his STI payout. The determination was based on evaluation of Mr. Ibrahim’s 2023 KPI achievements:

 

  Collaborated with KBR’s Team of Teams to support heritage Government business group clients, Sustainable Technology Solutions business group clients, and new clients
  Implemented One KBR program in KBR’s Saudi Arabia and Australia offices to drive synergies and revenues
  Led investments in people, project controls, training, and Inclusion & Diversity to support delivery and execution excellence in energy security and energy transition projects
  Continued succession planning and development in the Sustainable Technology Solutions business

 

Our Compensation Committee determined that Mr. Ibrahim earned a 200% metric result—maximum level achievement—with respect to his 2023 Zero Harm / Sustainability performance, which resulted in a 20% payout for the Zero Harm / Sustainability portion of his STI payout. The determination was based on Mr. Ibrahim’s 2023 Zero Harm / Sustainability achievements:

 

  Visible leadership of safety culture across multiple countries in Sustainable Technology Solutions businesses and other KBR locations
  Achieved improvement in gender balance in Sustainable Technology Solutions with personal sponsorship of diverse talent
  Continued promotion and growth of KBR solutions with customers, resulting in improved environmental impact

 

 

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KPIs and STI Payout for Ms. Myles

 

Target Payout
$466,275
(Base Salary(1) x 95%)
  Actual Payout
$675,166
(Target Payout x 144.8%)
Financial Metrics
Payout
$457,882
98.2%
Zero Harm /
Sustainability Payout
$93,255
20%
KPI
Payout
$124,029
26.6%
(1) Ms. Myles’s base salary is approved and paid in British Pounds. STI payouts are paid in local currency, so Ms. Myles’s STI payouts are also paid in British Pounds. Her 2023 base salary was £385,014, so her target STI payout was £365,763. Ms. Myles’s target STI payout and actual STI payout have been converted to U.S. Dollars in the table above for presentations purposes using the exchange rate of £1 to $1.2748, which was the exchange rate used when presenting her proposed 2023 STI payout in U.S. Dollars to the Compensation Committee for approval in February 2024.

 

Our Compensation Committee determined that Ms. Myles earned a 133% metric result—in between target and maximum level achievement—with respect to her 2023 KPIs, which resulted in a 26.6% payout for the KPI portion of her STI payout. The determination was based on evaluation of Ms. Myles’s 2023 KPI achievements:

 

  Addressed global employee survey feedback on benefits
  Continued development and implementation of early career development strategy
  Developed and implemented plan to support middle managers
  Implemented internal career fairs and other initiatives to support internal talent mobility
  Supported implementation of new payroll platform in the US and UK and selection of payroll platform solution for the rest of KBR

 

Our Compensation Committee determined that Ms. Myles earned a 200% metric result—maximum level achievement—with respect to her 2023 Zero Harm / Sustainability performance, which resulted in a 20% payout for the Zero Harm / Sustainability portion of her STI payout. The determination was based on Ms. Myles’s 2023 Zero Harm / Sustainability achievements:

 

  Visible leadership of safety culture through multiple site visits and leadership of mental health and fitness program
  Continued implementation of Inclusion & Diversity strategy, including personal engagement with Employee Resource Groups
  Supported improved ESG rankings through increase in Social ratings as a result of People Strategy implementation

 

No Changes Made to KBR’s 2024 STI Plan

 

No changes were made to the design of the STI Plan for 2024 because the STI Plan in effect in 2023 is still considered to be aligned with the interests of KBR and our stockholders.

 

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Long-Term Performance Incentives

 

Under the KBR Stock and Incentive Plan, our Compensation Committee made grants to our Named Executive Officers in 2023 in the form of KBR Long-Term Performance Cash and Stock Awards and KBR Restricted Stock Units. This section discusses the KBR Stock and Incentive Plan, the methodology used by our Compensation Committee to determine the mix of awards to grant, and the actual 2023 grants to the NEOs.

 

KBR STOCK AND INCENTIVE PLAN

 

We use long-term performance incentives to achieve three objectives:

 

  reward consistent value creation and achievement of operating performance goals;
  align management’s interests with stockholders’ interests; and
  encourage long-term perspectives and commitment.

 

Long-term incentives represent the largest component of the total executive compensation opportunity for our executives.

 

The KBR Stock and Incentive Plan provides for a variety of cash and stock-based awards, including nonqualified and incentive stock options, restricted stock/units, performance shares/units, stock appreciation rights, and stock value equivalents (also known as phantom stock). The KBR Stock and Incentive Plan allows our Compensation Committee the discretion to select from among these types of awards to establish individual long-term incentive awards.

 

Our Compensation Committee met in December 2022 to review the number of shares available under the KBR Stock and Incentive Plan for future stock-based awards and to review the CEO’s recommendations for the value of the long-term incentive awards to Senior Executive Management. The Compensation Committee met again in February 2023 to review and approve the amount and mix of long-term incentive awards to be granted to our Named Executive Officers.

 

TARGET AWARD LEVELS

 

For purposes of establishing the target dollar value of the long-term incentive awards, our Compensation Committee requested that Meridian review our NEOs’ long-term incentive compensation as part of its engagement to advise the Compensation Committee on all executive compensation matters. Based on this review and related information about our peer groups, in February 2023, our Compensation Committee approved the grant of the following long-term incentive target dollar values to our NEOs:

 

    2023 Long-Term Incentive
Target Dollar Value of
Award
  Increase
(% of Target 2022 Long-Term
Incentive Award)
  Basis for Decision
Mr. Bradie   $ 7,250,000     $ 250,000 (3.6%)    
Mr. Sopp   $ 1,600,000     $ 100,000 (6.6%)    
Mr. Bright   $ 1,250,000     $ 0 (0%)     Market data alignment
Mr. Ibrahim   $ 1,000,000     $ 0 (0%)    
Ms. Myles   $ 850,000     $ 0 (0%)    

 

These awards consist of a mix of 66⅔% KBR Long-Term Performance Cash and Stock Awards (based on target value) and 33⅓% time-based KBR Restricted Stock Units. Our Compensation Committee concluded that this allocation was consistent with KBR’s pay-for-performance objectives. In particular, KBR awarded a higher percentage of performance-based awards (66⅔%) than the companies in our Peer Group because our Compensation Committee believes that emphasizing the two performance metrics for these awards—book-to-bill (“B2B”) and relative TSR—is more likely than other forms of incentive compensation to promote a sustained increase in stockholder value.

 

 

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KBR LONG-TERM PERFORMANCE CASH AND STOCK AWARDS

 

The KBR Long-Term Performance Cash and Stock Awards are designed to provide selected executives with incentive opportunities that are contingent on the level of achievement of pre-established corporate performance objectives. In response to our stockholders’ feedback and in consultation with Meridian, our Compensation Committee decided to replace the job income sold (“JIS”) performance metric of the KBR Long-Term Performance Cash and Stock Awards with a B2B performance metric. This change was effective beginning with awards granted in 2022. The JIS performance metric remained in place for the three-year performance periods of the 2020 and 2021 KBR Long-Term Performance Cash and Stock Awards. For the awards granted to our NEOs in February 2023, our Compensation Committee selected relative TSR and B2B, each weighted 50%, as described below.

 

 

For the 2023 grants, TSR and B2B will be measured over a three-year performance period beginning January 1, 2023, and ending December 31, 2025. Our Compensation Committee believes that a three-year performance award cycle encourages retention and aligns with long-term stockholder returns.

 

When establishing target levels for the TSR and B2B performance metrics, our Compensation Committee considered, among other things, projected company performance and general business and industry conditions, as well as KBR’s strategic business objectives. At the time the target levels were established, the outcomes were intended to be substantially uncertain, but achievable.

 

The KBR Long-Term Performance Cash and Stock Awards for each NEO were allocated one-half to the B2B portion and one-half to the TSR portion. Prior to 2020, these long-term awards were settled entirely in cash. However, consistent with the change made in 2020 in response to stockholders’ preference for a compensation program more heavily weighted in stock, our 2023 awards for the NEOs will be settled in a mix of cash and stock, as described below.

 

  The B2B portion of the award is based on a $1.00 target value for each unit and will be paid out in cash. The actual value of each unit may increase to a maximum of 200% of $1.00, or $2.00, or decrease to as low as $0.00, depending on KBR’s performance in relation to the B2B performance goal.
  For the TSR portion of the award, the Compensation Committee granted a target number of units that each represent the right to receive one share of KBR common stock if the performance metric is achieved. The number of such units initially is determined by dividing the target value of the TSR portion of the award by the closing price of a share of KBR common stock on the grant date (rounded up to the next whole unit). The number of units ultimately earned may increase to a maximum of 200% of the original number of units granted, or decrease to 0, in each case depending on KBR’s performance in relation to the TSR performance objective.

 

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TSR METRIC

 

TSR is measured based on a sustained approach rather than a cumulative (point-to-point) approach. Our Compensation Committee believes that measuring TSR just from the beginning of the performance period to the end would not adequately capture stockholder value. In contrast, our sustained measurement approach considers how investors fare at different times during the three-year performance period.

 

We measure sustained performance as follows:

 

  calculate the TSR of each company in the TSR Peer Group (measured using a 20-trading-day average price) every quarter during the three-year performance period
  use each company’s 12 quarterly TSRs to calculate the company’s average TSR for the performance period
  rank KBR’s average TSR (calculated in the same manner) against those results

 

The TSR percentile is calculated by subtracting KBR’s TSR ranking as compared to the TSR Peer Group from the total number of companies in the TSR Peer Group (including KBR), dividing the difference by the number of companies (excluding KBR), and multiplying the quotient by 100%. If any companies are removed from the TSR Peer Group (e.g., due to acquisition by another company or significant divestiture), then the TSR percentiles and payout percentages will adjust for the change in the number of companies; provided, however, that the adjustment must require at least a 90.0 percentile to receive the maximum TSR payout, at least a 50.0 percentile to receive the target TSR payout, and at least a 20.0 percentile to receive the threshold TSR payout. The 2023 TSR Peer Group of 20 companies (including KBR) and corresponding TSR percentiles and payout percentages are shown in the table on the next page. The payout associated with KBR’s TSR ranking following any applicable adjustments to the TSR percentiles and payout percentages will be applied to each NEO’s TSR-based award.

 

For our CEO and any of his direct reports who are also KBR officers required to file reports with the SEC under Section 16 of the Exchange Act, if KBR’s average TSR at the end of the three-year performance period is negative, the payment of vested performance units will not exceed the target (100%) payout under the TSR Peer Group Percentile and TSR Payout Percentage Table. This provision does not apply upon a double trigger event during the three-year performance period.

 

 

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TSR Peer Group Percentile and TSR Payout Percentage Table for 2023 Awards

 

Performance Level       2023-2025
3-YR TSR Ranking
      TSR Percentile        TSR Payout
    1   100.0%   200.0%
Maximum   2   94.7%   200.0%
    3   89.5%   198.8%
    4   84.2%   185.5%
    5   78.9%   172.3%
    6   73.7%   159.3%
    7   68.4%   146.0%
    8   63.2%   133.0%
    9   57.9%   119.8%
Target   10   52.6%   106.5%
    11   47.4%   93.5%
    12   42.1%   80.3%
    13   36.8%   67.0%
    14   31.6%   54.0%
    15   26.3%   40.8%
Threshold   16   21.1%   27.8%
    17   15.8%   0.0%
    18   10.5%   0.0%
    19   5.3%   0.0%
    20   0.0%   0.0%

 

B2B METRIC

 

The remaining 50% of the KBR Long-Term Performance Cash and Stock Awards will be determined based on B2B over the same three-year performance period. B2B is appropriately measured over three years because our contracts are long-term in nature and often involve amendments and scope adjustments that might distort a shorter performance period. We believe using three-year B2B as a performance metric incentivizes the NEOs to win the right work, which is one of our key strategic priorities and a means to create long-term growth and position KBR for a strong and stable future amidst economic volatility.

 

Our Compensation Committee establishes the B2B target one year at a time—rather than setting a target for the entire three-year performance period—because it is difficult to forecast B2B beyond one year in the ever-changing market conditions. The final award for the B2B metric will be determined by the average of the B2B payout percentages achieved during each year of the performance period.

 

The 2023 performance goals and associated payouts for B2B are shown below. A B2B greater than 1.0x indicates a company has been awarded more work than the revenue recognized in the period and results in an increase in ending backlog, another financial metric used to gauge the overall health of a company. Establishing B2B targets greater than 1.0x aligns incentive compensation with KBR’s long-term stockholder value creation.

 

  Threshold   Target   Maximum
Performance Goal 0.90   1.00   ≥ 1.10
Payout %* 25%   100%   200%
* For a result between threshold and target and target and maximum, the payout is determined by linear interpolation.

 

Our Compensation Committee will set the B2B targets for the second and third years in the performance period at levels that remain rigorous.

 

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Possible Negative Discretion

 

Regardless of KBR’s TSR and B2B performance, 20% of the 2023 KBR Long-Term Performance Cash and Stock Award target opportunity was subject to forfeiture if our Compensation Committee determined, in its sole discretion, that 2023 was not a successful year for us. The possible 20% reduction is determined by our Compensation Committee on or before March 31, 2024, and the amount forfeited cannot be earned back during the three-year performance period, which runs from January 1, 2023, to December 31, 2025. There is no upside opportunity to this discretion; our Compensation Committee is not authorized to increase payouts, even if 2023 is a particularly strong year. In February 2024, our Compensation Committee determined that 2023 was a successful year for KBR and, accordingly, it did not exercise its discretion to cause a forfeiture of 20% of the KBR Long-Term Performance Cash and Stock Award target opportunity.

 

Similarly, the KBR Long-Term Performance Cash and Stock Awards that were granted to our NEOs in 2023 provide our Compensation Committee with the discretion to reduce for poor performance, but not increase, by any amount (including a reduction resulting in no payout) the payments that would otherwise be made with respect to such awards. This negative discretion may be exercised by our Compensation Committee at any time before payment is made with respect to these awards, but it may not be exercised following the occurrence of a corporate change (as defined in the KBR Stock and Incentive Plan).

 

RESULTS AND PAYOUTS FOR AWARDS FOR THE 2021-2023 PERFORMANCE PERIOD

 

In February 2024, our Compensation Committee certified the results for the KBR Long-Term Performance Cash and Stock Awards that were granted on March 1, 2021, based on the achievement of TSR and JIS performance goals.

 

Our average three-year TSR from January 1, 2021, until December 31, 2023, was 19.1% and ranked first among our TSR Peer Group that period, resulting in a 200% payout for the 2021 awards. The original 2021 TSR Peer Group of 11 companies (including KBR) was reduced to nine companies due to the removal of ManTech International Corporation and Perspecta Inc. because they were acquired by other companies. As a result, the TSR percentiles and payout percentages were adjusted for the change in the number of companies.

 

Company   2021-2023
3-YR TSR Rank
       Average 3-YR TSR
KBR, Inc.   1   19.1%
Parsons Corporation   2   12.4%
Fluor Corporation   3   11.7%
Jacobs Solutions Inc.   4   5.7%
CACI International Inc   5   5.1%
Booz Allen Hamilton Holding Corporation   6   4.0%
Science Applications International Corporation   7   3.2%
Leidos Holdings, Inc.   8   (0.6)%
Unisys Corporation   9   (5.0)%

 

JIS performance for each of the three years in the performance period exceeded the maximum goals:

 

  JIS for 2021 was $1,043MM, which was above the maximum goal of $990MM
  JIS for 2022 was $1,114MM, which was above the maximum goal of $1,100MM
  JIS for 2023 was $1,372MM, which was above the maximum goal of $1,348MM

 

Because KBR achieved maximum JIS performance for all three years, the average JIS payout ratio for the three-year performance period was 200%.

 

 

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Payout Table for 2021-2023 KBR Long-Term Performance Cash and Stock Award Period

 

2021 Long-Term Performance
Cash and Stock Award
  Average Total Stockholder Return
2021-2023
  Job Income Sold
2021-2023
Named
Executive
Officer
       Target
Performance
Cash and
Stock
Award
($)
       Target
TSR-
Related
Shares of
Stock*
(#)
       Target
JIS-
Related
Cash
Units
($)
       Avg
TSR
Payout
(%)
       Actual
Avg TSR
Payout in
Shares of
Stock
(#)
       Avg
JIS
Payout
Ratio
Payout
(%)
       Actual
Avg JIS
Payout
Ratio
Payout in
Cash
($)
Mr. Bradie   4,166,667   66,159   2,083,334   200   132,318   200   4,166,668
Mr. Sopp   1,000,000   15,879   500,000   200   31,758   200   1,000,000
Mr. Bright   766,667   12,174   383,334   200   24,348   200   766,668
Mr. Ibrahim   666,667   10,586   333,334   200   21,172   200   666,668
Ms. Myles   533,333   8,469   266,667   200   16,938   200   533,334
* The Target TSR-Related Shares of Stock is determined by dividing the target value of the TSR portion (50%) of the Target Performance Cash and Stock Award by the closing price of a share of KBR common stock on the grant date (rounded up to the next whole unit). The date of grant was March 1, 2021, and the closing price of a share of KBR common stock on that date was $31.49.

 

KBR RESTRICTED STOCK UNITS

 

The KBR Restricted Stock Units granted to our NEOs in 2023 will vest in three equal annual installments, beginning on the first anniversary of the grant date, subject to continued service with KBR. For KBR Restricted Stock Units subject to the U.S. forms of grant agreements, dividend equivalents will be paid on restricted stock units at the same time dividends, if any, are paid to common stockholders. For KBR Restricted Stock Units subject to the international forms of grant agreements, dividend equivalents will accrue on restricted stock units at the same time dividends, if any, are paid to common stockholders but will not be paid until such shares of KBR common stock underlying the restricted stock units have been settled. Our Compensation Committee determined the number of restricted stock units for each Named Executive Officer by dividing the portion of the total target long-term incentive award allocated to KBR restricted stock units (33⅓%) by $55.70, the closing price of our common stock on the date of grant (rounded up to the next whole share). Our Compensation Committee selected a three-year vesting schedule to facilitate retention and to provide incentives to enhance long-term value.

 

As with the KBR Long-Term Performance Cash and Stock Awards, 20% of the restricted stock unit grants was subject to forfeiture based on the discretion of our Compensation Committee if it determined on or before the first anniversary of the date of grant that 2023 was not a successful year for us. Any amount of restricted stock units forfeited could not be earned back during the second and third years of the three-year vesting period. On February 21, 2024, our Compensation Committee determined that 2023 was a successful year for KBR and, accordingly, it did not exercise its discretion to cause a forfeiture of 20% of the KBR Restricted Stock Units.

 

 
No Changes Made to KBR’s 2024 Long-Term Incentive Awards

 

No changes were made to the design of the LTI Plan for 2024 because the LTI Plan in effect in 2023 is still considered to be aligned with the interests of KBR and our stockholders. The TSR Peer Group for the 2024 LTI Plan includes the same companies used to benchmark the 2024 executive compensation for our NEOs.

 

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Other Compensation Elements

NONQUALIFIED DEFERRED COMPENSATION

 

We maintain two active nonqualified deferred compensation plans in which our NEOs may participate: the KBR Elective Deferral Plan and the KBR Benefit Restoration Plan. Both plans are available to all KBR employees who meet the limits imposed by the Internal Revenue Code or the Employee Retirement Income Security Act, as applicable. KBR maintains these plans because similar plans are offered by many of the companies in our Peer Group. Our NEOs do not participate in any KBR-sponsored defined benefit pension plans.

 

The KBR Elective Deferral Plan helps certain employees meet their retirement and other future income needs. No company contributions are made to fund deferrals under this plan. Benefits under this plan are payable upon a termination of employment or at a future date specified by the employee.

 

The KBR Benefit Restoration Plan provides a vehicle to restore qualified plan benefits that are reduced because of limitations imposed under the Internal Revenue Code or because an employee participates in other company-sponsored plans. Benefits under this plan are payable upon a termination of employment.

 

SEVERANCE AND CHANGE-IN-CONTROL PROTECTION

 

Our Compensation Committee offers certain members of Senior Executive Management a severance and change-in-control agreement (an “Agreement”), each of which is substantially the same for each NEO. We believe that providing termination benefits under a severance and change-in-control agreement allows KBR to be competitive with the practices of the companies in the Peer Group, as well as the general market. In addition, the specific terms for receiving termination benefits under the Agreements serve to motivate and retain key employees. The Agreements offered to our NEOs are further described in the sections titled “2023 Potential Payments Upon Termination or Change In Control” and “Severance and Change-in-Control Agreements.”

 

The Agreement requires a double-trigger change-in-control termination (i.e., the occurrence of both a change in control and a termination of employment within two years thereafter) in order for an executive to receive change-in-control benefits. None of the Agreements contain an excise tax gross-up, and our Compensation Committee has committed not to provide for such gross-ups in the future.

 

Our Compensation Committee offered the Agreement to Mr. Bradie in June 2014, to Mr. Ibrahim in May 2015, to Mr. Sopp in February 2017, and to Mr. Bright and Ms. Myles in January 2021, because each of our other members of Senior Executive Management at those times had an Agreement or to incentivize them to leave their former employer and join KBR. The Agreements terminate automatically on the earlier of (i) the executive’s termination of employment with KBR or (ii) two years after a change in control that occurs during the term of the Agreement.

 

The Agreement provides for:

 

  Severance termination benefits (prior to a change in control), which for Mr. Sopp, were graded based on service time with KBR;
  Double-trigger change-in-control termination benefits (after a change in control); and
  Death, disability, and retirement benefits.

 

As a condition of receiving these benefits (other than the death and disability benefits), the applicable executive must first execute a release and full settlement agreement.

 

The Agreement contains customary confidentiality, non-competition, and non-solicitation covenants, as well as a mandatory arbitration provision. In addition, the Agreement contains a clawback provision that allows KBR to recover any benefits paid under the Agreement if our Compensation Committee determines within two years after the executive’s termination of employment that the executive’s employment could have been terminated for “Cause,” as defined in the Agreement. The Agreement provides that in any involuntary or voluntary termination, executives forfeit all unvested stock options, stock appreciation rights, restricted stock, restricted stock units, and performance cash awards granted to such executive. Such awards will fully vest upon a double-trigger change-in-control termination.

 

OTHER BENEFITS

 

Generally, our NEOs participate in the same retirement and health and welfare programs as our other employees. In 2023, all our NEOs except for Ms. Myles participated in a 401(k) plan, under which KBR made employer matching contributions up to 5.5% of eligible compensation. In 2023, Ms. Myles received a cash payment in lieu of an 8% employer matching contribution to the KBR UK Limited Pension Plan because Ms. Myles has reached the pension tax limits imposed by the UK. Our NEOs’ health care and insurance coverage are the same as those provided to other active employees, except that the NEOs are eligible to receive an executive physical under our Zero Harm initiative and our CEO receives a global welfare plan to ensure he has easy access to medical care worldwide due to his extensive business travel.

 

 

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NEOs are eligible to receive limited financial planning advice. Otherwise, we typically do not offer perquisites to our NEOs that are not generally available to other employees. With a few exceptions, our executives do not have company cars or allowances for cars, housing, or travel, unless we ask them to relocate. Ms. Myles receives a car allowance, which is an executive employee benefit offered to our corporate employees located in the UK. In connection with a prior international assignment, Mr. Ibrahim received the standard allowances for a car, housing, school, and relocation costs, and he was included in our standard tax equalization program. He is no longer entitled to these benefits.

 

To allow for maximum efficiency and productive use of time, we have one leased car and a driver in Houston for use by our NEOs and others for business purposes. Our NEOs may use this car and the driver for limited personal use only if the car is not being used for business purposes at that time.

 

Stock-Related Policies

STOCK OWNERSHIP GUIDELINES FOR OFFICERS

 

We established stock ownership guidelines for certain of our officers and officers of our subsidiaries to link these officers’ financial interests more closely with those of our stockholders. Our Board of Directors adopted ownership guidelines for our executives at the levels indicated below.

 

Group   Ownership Level
CEO   5x base salary
Level 1 Executives (Direct reports to CEO, including all the NEOs)   3x base salary
Level 2 Executives (Direct reports to Level 1 Executives and at least a vice president)   1x base salary

 

Each executive subject to the ownership guidelines has five years after the adoption of the guidelines or his or her appointment to a covered position, whichever is later, to achieve the indicated ownership level. All beneficially owned shares of KBR common stock, as well as vested and unvested restricted stock and restricted stock units, are counted towards achievement of the ownership guidelines. For purposes of determining compliance, the value of an executive’s shares of common stock is determined based on the closing price of the common stock on the selected date. An executive who has achieved the applicable ownership level is not required to retain or purchase additional shares if a decline in the price of the common stock causes his or her holdings to fall below the requisite ownership level. For any executive other than the CEO, the Chief Operating Officer (if any), the CFO, and the General Counsel, the required ownership level is reduced by fifty percent on and after the executive’s 60th birthday.

 

All our Named Executive Officers meet our Stock Ownership Guidelines.

 

 

* Ms. Myles’s base salary is approved and paid in British Pounds. Ms. Myles’s required ownership value reflects her 2024 base salary converted to U.S. Dollars using the exchange rate of £1 to $1.2669, which was the monthly exchange rate used in KBR’s human capital / payroll system effective March 1, 2024.

 

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NO PLEDGING OR HEDGING

 

No KBR officer may pledge, hypothecate, create any lien or security interest on, or enter into a margin contract secured by, any shares, options to purchase shares, or any other interest in shares of KBR common stock. In addition, our anti-hedging policy prohibits all members of our Board of Directors, employees, and agents from (i) speculative trading in our securities; (ii) engaging in hedging transactions using our securities; (iii) “short selling” our securities; and (iv) trading derivative securities, such as put options, call options, swaps, or collars related to our securities.

 

ANNUAL AWARDS OF RESTRICTED STOCK UNITS AND STOCK OPTIONS

 

Annual stock awards approved by our Compensation Committee are generally effective two business days after KBR files a Form 10-K with the SEC in the first quarter of the grant year. Stock option grants, when approved by our Compensation Committee, are never issued with an exercise price below the fair market value of our common stock on the date of grant.

 

Impact of Accounting, Regulatory, and Tax Requirements on Compensation

 

We apply the fair value recognition provisions of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 718-10 to account for and report equity-based compensation. FASB ASC 718-10 requires that compensation expense for equity-classified awards be measured based on the grant date fair value of the award and recognized on a straight-line basis over the requisite service period or the vesting period. Compensation expense for performance-based awards settled in cash is measured based on the grant date fair value, which is re-measured at each reporting date through the settlement date. Changes in fair value during the requisite service period or the vesting period are recognized as compensation cost on a straight-line basis over that period. Compensation expense was recognized for restricted stock units, performance stock units, and cash and stock performance awards.

 

In the years when we grant stock option awards, the grant date fair value is estimated using option-pricing models. If an award is modified after the grant date, incremental compensation cost is recognized immediately before the modification. The benefits of tax deductions in excess of the compensation cost recognized for the options (excess tax benefits) are classified as addition to paid-in-capital, and cash retained as a result of these excess tax benefits is presented in the statement of cash flows as financing cash inflows.

 

We will continue to monitor issues concerning the tax deductibility of executive compensation and will take appropriate action if we believe it is warranted. Since corporate objectives and strategic needs may not always be consistent with the requirements of full deductibility, we expect, if we believe it is appropriate, to enter into compensation arrangements or provide compensation under which payments will not be fully deductible.

 

Impact of Executive Conduct or a Restatement of Earnings on Compensation (Clawback Policy)

 

If we determine at any time within two years after the termination of employment of a Named Executive Officer that such executive’s employment could have been terminated for Cause, as defined in the executive’s Agreement, we retain the right to recover any severance benefits (both cash and equity) provided under the Agreement to such executive. In such a case, the executive agrees to promptly repay such amounts to us.

 

Prior to our adoption of a clawback policy that complies with Section 10D of the Exchange Act and the NYSE rules, we included in our cash and equity incentive programs a provision that allowed our Compensation Committee to seek recovery of any incentives that are determined to be an overpayment following any restatement of our financial results that impacts the performance metrics on which the incentive awards were calculated.

 

In October 2022, the SEC adopted rules requiring that the stock exchanges, including the NYSE, establish new listing rules that set minimum standards for clawback policies that must be implemented by their listed companies. Upon adoption of the rules, effective October 2, 2023, our Board of Directors approved and adopted a clawback policy to comply with Section 10D of the Exchange Act and the NYSE rules.

 

Conclusion

 

In a highly competitive market for executive talent, we believe our customers’ and employees’ interests, as well as those of our stockholders and other stakeholders, are well served by our compensation programs. These programs are reasonably positioned among our Peer Group, encourage and promote our compensation objectives with a strong emphasis on pay for performance, and permit the exercise of our Compensation Committee’s discretion in the design and implementation of compensation packages. Going forward, we will continue to review our compensation plans periodically to determine what revisions, if any, should be made.

 

 

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Compensation Committee Report

 

Our Compensation Committee reviewed and discussed the Compensation Discussion and Analysis, as provided above, with KBR’s management. Based on its review, our Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this proxy statement. This report shall not be deemed to be “soliciting material” or to otherwise be considered “filed” with the SEC, nor shall such information be incorporated by reference into any future filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except to the extent that KBR specifically incorporates it by reference into such filing.

 

Respectfully submitted,

 

The Compensation Committee of Directors

 

Jack B. Moore, Chair
Lynn A. Dugle
Lt. General Wendy M. Masiello
Ann D. Pickard

 

March 13, 2024

 

Compensation Committee Interlocks and Insider Participation

 

As of the date of this proxy statement, no member of our Compensation Committee has served as an officer or employee of KBR. Further, none of KBR’s executive officers have served on a board of directors or compensation committee of any entity that had one or more of its executive officers serving on the Board or the Compensation Committee of KBR.

 

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Executive Compensation Tables

 

Summary Compensation

 

The following table sets forth information regarding the compensation of our Named Executive Officers for the fiscal year ended December 29, 2023, and, if the individual was an NEO for the applicable fiscal year, for the fiscal years ended December 31, 2022, and 2021.

 

Name and
Principal Position
  Year  Salary
($)(1)
  Stock
Awards
($)(2)(3)
  Non-Equity Incentive Plan
Compensation
($)(4)
  Change in Pension Value
and Nonqualified Deferred
Compensation Earnings
($)(5)
  All Other
Compensation
($)(6)
  Total
($)
(a)  (b)  (c)  (d)  (e)  (f)  (g)  (h)
Stuart J. B. Bradie
President & CEO
  2023  1,226,983  4,630,378  6,656,775  11,507  134,277  12,659,920
  2022  1,191,360  4,641,028  6,645,508  13,229  125,910  12,617,035
  2021  1,169,966  4,256,264  6,483,267  10,284  104,566  12,024,347
Mark W. Sopp
EVP & CFO
  2023  705,223  1,021,917  1,960,446  3,583  50,844  3,742,013
  2022  684,188  994,516  1,987,034  3,757  37,630  3,707,125
  2021  652,808  1,021,530  1,822,129  2,541  35,535  3,534,543
W. Byron Bright, Jr.
President, Government Solutions U.S.
  2023  677,362  798,358  1,592,527  2,857  62,067  3,133,171
  2022  657,156  828,763  1,496,189  2,859  51,144  3,036,112
  2021  624,823  783,176  1,488,169  1,863  47,643  2,945,674
J. Jay Ibrahim
President, Sustainable Technology Solutions
  2023  615,780  638,698  1,593,138  3,238  48,868  2,899,722
  2022  597,423  663,011  1,528,508  3,544  47,858  2,840,344
  2021  568,030  681,020  1,430,046  2,493  48,225  2,729,814
Jennifer C. Myles
EVP & CPO
  2023  479,195  542,879  1,208,500    64,538  2,295,112
  2022  486,144  563,578  1,080,472    60,870  2,191,064
(1) Salary equals base pay paid to each Named Executive Officer during the applicable year, including any elective deferrals into the Kellogg Brown & Root, Inc. Retirement and Savings Plan or the KBR Elective Deferral Plan. The actual salary paid may fluctuate due to the timing of payroll processing at each year end. With respect to Mr. Bradie and Ms. Myles, their 2023 salary payments were converted from British Pounds to U.S. Dollars using the exchange rate applicable for each month in the year. The exchange rates used were the rates reported by Bloomberg on the last business day of the month prior to payment. The exchange rates ranged from $1.1943 to $1.2858 during the period of January 1, 2023, through December 29, 2023.
(2) The amounts in column (d) represent the aggregate grant date fair value of awards granted in 2021, 2022, and 2023, pursuant to the KBR Stock and Incentive Plan. The fair values were determined  in accordance with FASB ASC 718, “Stock Compensation.” Assumptions used in the calculation of these amounts are described in note 1 under “Significant Accounting Policies” and note 18 under “Share-based Compensation and Incentive Plans” of our audited financial statements included in our annual report on Form 10-K for the fiscal year ended December 29, 2023, and the comparable disclosures in 2021 and 2022.
(3) With respect to the performance awards granted in 2021, 2022, and 2023, which are based 50% on TSR, and to that extent are included in the value of stock awards in column (d), the assumptions assume the probable outcome of the TSR performance condition, which is computed in accordance with FASB ASC 718 (excluding the effect of estimated forfeitures). At maximum performance, the value of the shares of KBR common stock underlying each performance award reported in column (d) would be equal to the product of twice the number of shares of KBR common stock underlying each performance award and $31.49, with respect to the performance awards granted in 2021, $48.06, with respect to the performance awards granted in 2022, and $55.70, with respect to the performance awards granted in 2023, the closing prices of KBR’s common stock on the dates of grant. This would give (i) Mr. Bradie a stock awards value under column (d) of $7,250,135 in 2023, $7,000,083 in 2022, and $6,250,041 in 2021; (ii) Mr. Sopp a stock awards value under column (d) of $1,600,150 in 2023, $1,500,049 in 2022, and $1,500,089 in 2021; (iii) Mr. Bright a stock awards value under column (d) of $1,250,075 in 2023, $1,250,041 in 2022, and $1,150,078 in 2021; (iv) Mr. Ibrahim a stock awards value under column (d) of $1,000,094 in 2023, $1,000,032 in  2022, and $1,000,059 in 2021; and (v) Ms. Myles a stock awards value under column (d) of $850,038 in 2023 and $850,085 in 2022.
(4) Amounts reportable in column (e) relate to (i) payments under our Performance Pay Plan for 2023, 2022, and 2021; and (ii) payments related to the 50% portions of the 2021, 2020, and 2019 performance awards that are based on the JIS performance measure and which were granted under our KBR Stock and Incentive Plan. Benefits under our Performance Pay Plan and the KBR Stock and Incentive Plan are payable by their terms during the first quarter of the following year.

 

 

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(5)The amounts shown in column (f) include the following:

 

Name  Year  Benefit
Restoration
  Elective Deferral  Total(A)
Bradie  2023  11,507    11,507
   2022  13,229    13,229
   2021  10,284    10,284
Sopp  2023  3,583    3,583
   2022  3,757    3,757
   2021  2,541    2,541
Bright  2023  2,857    2,857
   2022  2,859    2,859
   2021  1,863    1,863
Ibrahim  2023  3,238    3,238
   2022  3,544    3,544
   2021  2,493    2,493
Myles  2023     
   2022     
(A) Any amounts reportable here and in column (f) of the Summary Compensation Table are payable in connection with KBR’s nonqualified deferred compensation plans, including the KBR Benefit Restoration Plan (“Benefit Restoration”) and KBR Elective Deferral Plan (“Elective Deferral”). These amounts reflect above-market or preferential earnings on nonqualified deferred compensation. Ms. Myles is not eligible to participate in the KBR Benefit Restoration Plan because her compensation is not subject to the limitations imposed under the Internal Revenue Code. None of our Named Executive Officers participate in the KBR Elective Deferral Plan.
(6) The amounts shown in column (g) above include the following:

 

Name  Year  Retirement
Plan
Company
Match
  Benefit
Restoration
Award
  UK
Pension Plan
Company
Allowable(A)
  Car
Allowance(B)
  Travel(C)  Executive
Physicals(D)
  Global
Medical
Plan(E)
  Financial
Planning/
Tax
Preparation
Fees(F)
  Total
Bradie  2023  13,488  49,334      3,755  8,254  49,077  10,369  134,277
   2022  13,088  48,750          30,858  33,214  125,910
   2021  14,408  48,398          23,325  18,435  104,566
Sopp  2023  18,150  20,637      9,917  2,140      50,844
   2022  16,775  20,855              37,630
   2021  15,580  19,954              35,535
Bright  2023  18,150  19,105      9,812      15,000  62,067
   2022  16,775  19,369            15,000  51,144
   2021  14,227  18,415            15,000  47,643
Ibrahim  2023  18,150  15,718            15,000  48,868
   2022  16,775  16,083            15,000  47,858
   2021  15,675  15,400        2,150    15,000  48,225

 

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Name  Year  Retirement
Plan
Company
Match
  Benefit
Restoration
Award
  UK
Pension Plan
Company
Allowable(A)
  Car
Allowance(B)
  Travel(C)  Executive
Physicals(D)
  Global
Medical
Plan(E)
  Financial
Planning/
Tax
Preparation
Fees(F)
  Total
Myles(G)  2023      38,336  11,202        15,000  64,538
   2022      27,133  11,236        22,500  60,870
(A) The amounts in this column represent cash payments provided to Ms. Myles in lieu of KBR’s standard 8% employer contribution to the KBR UK Limited Pension Plan because Ms. Myles has reached  the pension tax limits imposed by the UK.
(B) The amounts in this column represent a car allowance provided to Ms. Myles, which is an executive employee benefit offered to corporate employees located in the UK.
(C) The travel payments for Messrs. Bradie, Sopp, and Bright relate to a spouse or child’s travel for a business trip.
(D) The amount in this column represents the cost for an executive physical offered by KBR. KBR believes the health of its leadership impacts how it delivers for the organization. Taking a proactive approach to health and wellness with a focus on prevention aligns with KBR’s Zero Harm and Wellness Program initiatives and ensures business stability.
(E) The amounts in this column represent KBR’s cost for Mr. Bradie’s self-insured global medical plan.
(F) The amounts in this column represent the costs for assistance with Mr. Bradie’s tax returns and Messrs. Bright and Ibrahim’s and Ms. Myles’s financial planning. The cost for Mr. Bradie’s tax return assistance in 2022 represents fees paid in 2022 that covered services related to the preparations of his 2019, 2020, and 2021 tax returns. The cost for Ms. Myles’s financial planning in 2022 represents fees paid in 2022 that covered services for the last three quarters in 2021 and first three quarters in 2022.
(G) Ms. Myles does not receive any U.S. income and thus is not eligible to participate in the 401(k) plan, under which KBR made employer matching contributions, or KBR Benefit Restoration Plan.

 

 

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Grants of Plan-Based Awards

 

The following table provides information regarding awards in 2023 under the KBR Senior Executive Performance Pay Plan and the KBR Stock and Incentive Plan.

 

               Estimated Future Payouts Under
Non-Equity Incentive Plan Awards(2)
  Estimated Future Payouts Under
Equity Incentive Plan Awards(2)
  All Other
Stock
Awards:
Number
Of Shares
Of Stock
Or Units
(#)(3)
  Grant Date
Fair Value
Of Stock
And Option
Awards
($)(4)
Name  Grant
Type(1)
  Grant
Date
  Approval
Date
  Number Of
Non-Equity
Incentive
Plan Units
Granted
  Threshold
($)
  Target
($)
  Maximum
($)
  Threshold
(#)
  Target
(#)
  Maximum
(#)
   
(a)  (b)  (c)  (d)  (e)  (f)  (g)  (h)  (i)  (j)  (k)  (l)  (m)
Stuart J. B. Bradie  STI        429,625  1,718,500  3,437,000         
                                    
  PAs-TSR  2/22/2023  2/10/2023          604,167  2,416,666  4,833,332    2,213,666
  PAs-B2B  2/22/2023  2/10/2023  2,416,667  604,167   2,416,667  4,833,334         
  RSUs  2/22/2023  2/10/2023                43,388  2,416,712
Mark W. Sopp  STI        167,676  670,703  1,341,406         
                                    
  PAs-TSR  2/22/2023  2/10/2023          133,333  533,333  1,066,666    488,533
  PAs-B2B  2/22/2023  2/10/2023  533,334  133,334  533,334  1,066,668         
  RSUs  2/22/2023  2/10/2023                9,576  533,383
W. Byron Bright, Jr.   STI        161,049  644,196  1,288,392         
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