KBR, Inc. (NYSE: KBR) revises executive severance, boosts non-CEO payouts
Filing Impact
Filing Sentiment
Form Type
8-K
Rhea-AI Filing Summary
KBR, Inc. updated severance and change in control agreements for its key executive officers, including the CEO, CFO and other senior leaders, effective July 10, 2026. The amended agreements refine definitions of “Good Reason” and “Cause,” expand retirement eligibility criteria, and adjust certain severance terms.
“Good Reason” now includes material cuts to pay, authority or responsibilities, material breaches of agreements, or relocation of the principal office by more than 50 miles without consent. “Cause” is clarified both before and after a change in control, adding willfulness standards, notice and cure processes, and explicit exclusions for strategic disagreements or missed performance targets.
For executive officers other than the CEO, the cash severance multiple increases from 1.0x to 1.5x base salary plus target bonus. Retirement eligibility is tied to age-plus-service thresholds and notice requirements, with pro-rata RSU vesting on retirement. The separate agreement for General Counsel Sonia Galindo adds enhanced non-change-in-control severance features, including pro-rata bonuses and equity vesting and a non-compete carve-out allowing the continued practice of law.
Positive
- None.
Negative
- None.
8-K Event Classification
2 items: 5.02, 9.01
2 items
Item 5.02
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers
Governance
Key personnel changes including departures, elections, or appointments of directors and executive officers.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
Non-CEO severance multiple: 1.5x (base salary + target bonus)
Prior non-CEO severance multiple: 1.0x (base salary + target bonus)
Retirement rule age-plus-service threshold: 70
+5 more
8 metrics
Non-CEO severance multiple
1.5x (base salary + target bonus)
Cash severance payment multiple for executive officers other than the CEO under amended agreements
Prior non-CEO severance multiple
1.0x (base salary + target bonus)
Previous cash severance multiple replaced by the amended agreements
Retirement rule age-plus-service threshold
70
Sum of age and years of service required for retirement eligibility
Minimum retirement age
55
Minimum age for retirement eligibility when combined with service years
Minimum years of service
5 years
Minimum service requirement for retirement eligibility
Office relocation distance
50 miles
Relocation beyond this distance can constitute Good Reason without consent
Post-change in control window
two years
Period after a Change in Control for certain Cause-related termination provisions
Retirement notice period
six months
Prior written notice required for retirement, subject to waiver
Key Terms
Good Reason, Change in Control, restricted stock units, performance based awards, +1 more
5 terms
Good Reason financial
"The definition of “Good Reason” is now amended to include any of the following"
Change in Control financial
"The Agreements do not materially modify any of the severance payments and benefits associated with a “change in control”"
A "change in control" occurs when the ownership or management of a company shifts significantly, such as through a merger, acquisition, or sale of a large part of its assets. This change can impact how the company is run and may influence its future direction. For investors, it matters because it can affect the company's stability, strategy, and value, often signaling potential changes in investment risk or opportunity.
restricted stock units financial
"RSU vesting upon retirement is now revised to include pro-rata RSU vesting"
Restricted stock units are a type of company reward where employees are promised shares of stock, but they only fully own these shares after meeting certain conditions, like staying with the company for a set time. They matter because they can become valuable assets and are often used to motivate employees to help the company succeed.
performance based awards financial
"pro-rata vesting of all performance based awards"
non-compete clause financial
"The non-compete clause includes an exception for the right to practice law"
FAQ
What executive agreements did KBR (KBR) change on July 10, 2026?
On July 10, 2026, KBR entered into amended and restated severance and change in control agreements with its principal executive officers, replacing prior versions and updating definitions, severance multiples, retirement rules and equity treatment.
How did KBR (KBR) change severance multiples for executives?
KBR increased the cash severance multiple for executive officers other than the CEO from 1.0x to 1.5x of base salary plus target bonus, under the amended severance and change in control agreements.
What is included in the new KBR (KBR) definition of Good Reason?
“Good Reason” now covers material reductions in base compensation, material diminutions in authority, duties or responsibilities, material breaches by KBR, or relocation of the executive’s principal office more than 50 miles without consent.
How did KBR (KBR) revise the Cause definition in its executive agreements?
Before a change in control, “Cause” requires willful and repeated failure to perform duties or follow lawful board directives, and excludes strategic disagreements, business outcomes or failure to meet performance targets, with additional notice and cure processes after a change in control.
What new retirement eligibility rules apply under KBR (KBR) executive agreements?
Retirement eligibility now requires an age-plus-service total of 70 or more, with age at least 55 and at least five years of service, plus six months’ prior written notice, subject to waiver.
What special provisions apply to Sonia Galindo’s KBR (KBR) agreement?
The Galindo Agreement adds enhanced non-change in control severance, including pro-rata annual bonus and equity vesting, and a non-compete clause that expressly preserves her right to practice law.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 10, 2026
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||||||||||||
| (Address of principal executive offices) | ||||||||||||||
Registrant's telephone number including area code: (713 ) 753-2000
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading symbol | Name of each exchange on which listed | ||||||
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
ITEM 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
(e) Compensatory Arrangements of Certain Officers.
On July 10, 2026, KBR, Inc. (“KBR”) and each of the executive officers of KBR with an existing severance and change in control agreement with KBR (including Mr. Stuart Bradie, President and Chief Executive Officer; Mr. Shad Evans, Executive Vice President and Chief Financial Officer; Mr. Mark W. Sopp, Executive Vice President, Strategic Transactions and Interim CEO, Mission Technology Solutions; Mr. J. Jay Ibrahim, President, Sustainable Technology Solutions; Ms. Sonia Galindo, Executive Vice President, General Counsel and Corporate Secretary; and Ms. Jenni C. Myles, Executive Vice President, Chief People Officer) entered into an amended and restated severance and change in control agreement (each, an “Amended and Restated Severance and Change in Control Agreement”), each of which replaces and supersedes the respective existing corresponding agreement for each of the executive officers. With the exception of the Amended and Restated Severance and Change in Control Agreement between KBR and Ms. Sonia Galindo (the “Galindo Agreement” and, together with all of the Amended and Restated Severance and Change in Control Agreements entered into by the other executive officers of KBR, the “Agreements”), each Amended and Restated Severance and Change in Control Agreement conforms with the form of Amended and Restated Severance and Change in Control Agreement filed hereto as Exhibit 10.1. The Galindo Agreement includes certain additional provisions to the form of Amended and Restated Severance and Change in Control Agreement and is filed hereto as Exhibit 10.2.
The Agreements do not materially modify any of the severance payments and benefits associated with a “change in control” (as defined in the Agreements). The Agreements now provide for the following changes to ensure fair and competitive treatment of current and future executive officers:
•The definition of “Good Reason” is now amended to include any of the following, in each case without the respective executive officer’s consent: (i) a material diminution of base compensation, (ii) a material diminution in authority, duties, or responsibilities, (iii) the material breach by KBR of the Agreement or any other agreement between the executive officer and KBR or its affiliates, or (iv) the relocation of the executive officer’s principal office location to more than 50 miles away.
•The definition of “Cause” (prior to a Change in Control (as defined in the Agreements)) is now enhanced to require willful and repeated failure to perform duties (other than any such failure resulting from incapacity due to physical or mental illness) or willful failure to comply with any valid and legal directive of the board of KBR. The revised definition also clarifies that “Cause” shall not include (i) differences in opinion with respect to strategy or implementation of business plans, (ii) the success or lack of success of any such strategy or implementation, or (iii) any failure to achieve any performance targets.
•The definition of “Cause” (for purposes of a termination of employment on or within two years after a Change in Control) now sets forth notice and cure processes and certain exceptions (such as any action done based upon reasonable reliance on advice of legal counsel to KBR at the direction of the Board). The revised definition also clarifies that “Cause” shall not include (i) differences in opinion with respect to strategy or implementation of business plans, (ii) the success or lack of success of any such strategy or implementation, or (iii) any failure to achieve any performance targets.
•The cash severance payment multiple for executive officers other than the CEO is now increased from 1.0x to 1.5x (base salary + target bonus).
•Retirement eligibility now includes objective age and service years criteria (sum of age and years of service is 70 or greater, where the age is at least 55 with at least five years of service) and a requirement for six months’ prior written notice, subject to waiver in whole or part.
•RSU vesting upon retirement is now revised to include pro-rata RSU vesting.
In addition to all the changes summarized above and set forth in the Agreements, the Galindo Agreement also includes the following additional revisions:
•The non-change in control severance package is further enhanced by adding provisions to include pro-rata annual bonus, pro-rata vesting of non-performance based equity awards, including restricted stock and restricted stock units, and pro-rata vesting of all performance based awards.
•The non-compete clause includes an exception for the right to practice law.
The foregoing descriptions of each of the Agreements is qualified in their entirety by reference to the full text of each of the Agreements, which are filed as Exhibit 10.1 and Exhibit 10.2 hereto and incorporated herein by reference.
ITEM 9.01 Financial Statements and Exhibits.
(d) Exhibits.
The following exhibits are filed as part of this report:
| Exhibit No. | Description | |||||||
10.1 | Form of Amended and Restated Severance and Change in Control Agreement | |||||||
10.2 | Amended and Restated Severance and Change in Control Agreement effective as of July 10, 2026, by and between KBR Wyle Services, LLC, a Delaware limited liability company, KBR, Inc., and Sonia Galindo | |||||||
| 104 | The cover page from this Current Report on Form 8-K, formatted in Inline XBRL | |||||||
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| KBR, INC. | ||||||||
| July 10, 2026 | /s/ Sonia Galindo | |||||||
| Sonia Galindo | ||||||||
| Executive Vice President, General Counsel & Corporate Secretary | ||||||||