Palo Alto Networks (NASDAQ: PANW) details CEO payout if control changes

Rhea-AI Filing Summary

Palo Alto Networks, Inc. (PANW) adopted an Executive Change in Control and Severance Policy covering employees at Senior Vice President level and above, including CEO Nikesh Arora, CFO Dipak Golechha, President William “BJ” Jenkins, and Chief Product and Technology Officer Lee Klarich. Outside a change in control protection period, qualifying terminations by the company provide 100% of base salary as severance for executive officers, cash incentive severance based on target bonuses, 12 months of health benefit severance, and 12 months of time-based equity vesting acceleration.

During the change in control period, defined as beginning three months before and ending 12 months after a change in control for most executives and 18 months for the CEO, qualifying terminations by the company without cause, death or disability or by the executive for good reason provide enhanced benefits. The CEO is eligible for 200% of base salary and annual target cash incentive plus 24 months of health benefit severance, and other executive officers for 150% of base salary and target cash incentive plus 18 months of health benefit severance, along with full acceleration of unvested equity awards, with performance awards treated under their individual agreements. The policy also includes a Section 280G “best net” cutback or full payment approach. The board also approved amended and restated bylaws to reflect recent Delaware law changes, clarify stockholder meeting and proxy provisions, expand authority to call special board meetings to the lead independent director, update indemnification, and make other technical and conforming changes.

Filing Explained

The bylaws take effect immediately; severance remains conditional on participation, a qualifying termination, and a signed, unrevoked release.

Palo Alto Networks reports two completed board actions: approval of an executive severance policy and adoption of amended bylaws; the policy creates contingent severance and equity-vesting obligations.

Under the policy, participation requires an executed participation agreement, and payment or vesting benefits also require a qualifying termination plus timely execution and non-revocation of a separation agreement and release.

The amended bylaws are effective immediately, including the expanded authority of the lead independent director, if any, to call special board meetings.

The filing identifies the full policy as Exhibit 10.1 and the amended bylaws as Exhibit 3.1; those exhibits contain the governing definitions and detailed mechanics.

8-K Event Classification

3 items: 5.02, 5.03, 9.01

3 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 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year Governance

The company amended its charter documents, bylaws, or changed its fiscal year.

Item 9.01 Financial Statements and Exhibits Exhibits

Financial statements, pro forma financial information, or exhibit attachments filed with this report.

Key Figures

Salary Severance outside CIC Period: 100% of base salary Health Benefit Severance outside CIC Period: 12 months Equity Acceleration outside CIC Period: 12 months +5 more

8 metrics

Salary Severance outside CIC Period 100% of base salary For executive officers, including CEO, upon qualifying termination outside the CIC Period

Health Benefit Severance outside CIC Period 12 months COBRA premium-based health, dental and vision coverage for executives upon qualifying termination

Equity Acceleration outside CIC Period 12 months Time-based equity awards vesting that would have occurred in the 12 months after termination

CEO Salary Severance during CIC Period 200% of base salary For qualifying termination during the CIC Period under the Executive Change in Control and Severance Policy

CEO Cash Incentive Severance during CIC Period 200% of annual target cash incentive Cash Incentive Severance multiple for the CEO during the CIC Period

CEO Health Benefit Severance during CIC Period 24 months COBRA premium-based health coverage for the CEO after qualifying CIC-related termination

Other Executive Officers Salary Severance during CIC Period 150% of base salary For qualifying terminations of other executive officers during the CIC Period

Other Executive Officers Health Benefit Severance during CIC Period 18 months COBRA premium-based health coverage for other executive officers after qualifying CIC-related termination

Key Terms

Change in Control, Good Reason, parachute payment, Section 280G, +2 more

6 terms

Change in Control regulatory

"period beginning three months prior to 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.

Good Reason regulatory

"or by the executive for “Good Reason” (as defined in the Policy)"

parachute payment regulatory

"constitutes a “parachute payment” under Section 280G of the U.S. tax code"

Section 280G regulatory

"parachute payment under Section 280G of the U.S. tax code"

COBRA regulatory

"multiplied by the monthly COBRA premium required to continue group health"

COBRA is a U.S. federal law that lets employees and their dependents temporarily keep employer-sponsored health insurance after job loss, reduction in hours, or other qualifying events by paying the premiums themselves. Investors should care because offering COBRA can affect a company’s cash flow, administrative costs and legal disclosures when workforce changes occur—similar to a former club member paying to keep their membership active after leaving the club.

indemnification regulatory

"update the Company’s indemnification provisions"

A contractual promise to cover losses, expenses, or legal claims that arise from specified events, such as breaches of representations or third‑party lawsuits. For investors, indemnification matters because it shifts potential financial risk and future cash outflows from one party to another, similar to a friend agreeing to pay your bill if you’re sued, and can affect deal value, expected returns, and contingent liabilities on the balance sheet.

FAQ

What executive severance benefits did PANW approve outside of a change in control?

For qualifying terminations outside the change in control period, PANW executive officers receive 100% of base salary as severance, cash incentive severance tied to annual target bonuses, 12 months of health benefit severance, and 12 months of time-based equity vesting acceleration, subject to signing a separation agreement and release.

How does the change in control protection period work for PANW executives?

The change in control protection period runs from three months before a change in control until 12 months after for most executives and 18 months after for the CEO. Enhanced severance applies to qualifying terminations during this period, including certain resignations for good reason.

What change in control severance is PANW’s CEO entitled to under the new policy?

For a qualifying termination during the change in control period, PANW’s CEO is eligible for 200% of base salary, 200% of annual target cash incentive as Cash Incentive Severance, 24 months of health benefit severance, and 100% acceleration of unvested equity awards, with performance awards governed by their agreements.

What change in control severance do other PANW executive officers receive?

For qualifying terminations during the change in control period, other PANW executive officers receive 150% of base salary, 150% of annual target cash incentive as Cash Incentive Severance, 18 months of health benefit severance, and 100% acceleration of unvested equity awards, with performance conditions handled under individual award agreements.

How does PANW’s policy address Section 280G parachute payments and excise tax?

If a participant’s benefits constitute a parachute payment under Section 280G and would trigger excise tax, PANW will either pay benefits in full or reduce them so no excise tax applies, whichever yields the greatest after-tax benefit to the participant.

What key changes did PANW make to its amended and restated bylaws?

PANW’s amended and restated bylaws align with recent Delaware law, clarify quorum and voting standards for stockholder meetings, update proxy authorization rules, allow the lead independent director to call special board meetings, update indemnification provisions, and make other ministerial, technical, and conforming changes.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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Understanding 8-K Material Events →

Available on EDGAR 08/21/2026 - 04:16 PM Accepted by SEC EDGAR 08/21/2026 - 04:15 PM Learn about SEC filing dates

0001327567 --07-31 false 0001327567 2026-08-20 2026-08-20

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)

August 20, 2026

PALO ALTO NETWORKS, INC.

(Exact name of registrant as specified in its charter)

Delaware		001-35594		20-2530195
(State or other jurisdiction of incorporation)		(Commission File Number)		(IRS Employer Identification No.)

3000 Tannery Way

Santa Clara, California 95054

(Address of principal executive offices) (Zip Code)

(408) 753-4000

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

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:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common stock, $0.0001 par value per share		PANW		The Nasdaq Stock Market LLC

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.

On August 20, 2026, the Board of Directors (the “Board”) of Palo Alto Networks, Inc. (the “Company”), upon the recommendation of the Compensation and People Committee of the Board, approved an Executive Change in Control and Severance Policy (the “Policy”). The Policy is designed to provide certain severance benefits to selected participants in connection with the involuntary termination of the participant’s employment during a specified change in control protection period, or, in certain cases, outside of a change in control protection period. Company employees with the title of Senior Vice President and above who execute a participation agreement with the Company have been designated as participants in the Policy, including the following executives: Nikesh Arora, the Company’s Chairman and Chief Executive Officer (the “CEO”), Dipak Golechha, the Company’s Chief Financial Officer, William “BJ” Jenkins, the Company’s President, and Lee Klarich, the Company’s Chief Product and Technology Officer.

Under the terms of the Policy, if an executive’s employment is terminated by the Company other than for “Cause,” death or “Disability” (each, as defined in the Policy) outside of the period beginning three months prior to a Change in Control (as defined in the Policy) and ending 12 months (or 18 months for the CEO) following a Change in Control (the “CIC Period”), then, subject to the executive’s timely execution and non-revocation of a separation agreement and release of claims with the Company, the executive will receive: (i) salary severance equal to a percentage (as described in the table below) of the executive’s base salary (“Salary Severance”); (ii) cash incentive severance equal to the sum of (a) the executive’s annual target cash incentive compensation opportunity, prorated based on the number of days elapsed in the fiscal year prior to the date of termination, minus the amount of any actual cash incentive award paid to the executive for a semi-annual performance period that occurs during such fiscal year and (b) to the extent the cash incentive award for the prior fiscal year has not been paid as of the date of termination of employment, 100% of the executive’s annual target cash incentive compensation opportunity for such prior fiscal year minus the amount of any actual cash incentive award paid to the executive for a semi-annual performance period that occurs during such fiscal year; (iii) health benefit severance equal to a number of months (as described in the table below) multiplied by the monthly COBRA premium required to continue group health, dental and vision coverage for the executive and their eligible dependents (“Health Benefit Severance”); and (iv) vesting acceleration for any time-based equity awards that otherwise would have vested for the specified number of months (as described in the table below) had the executive remained employed with the Company during such period, with equity awards subject to performance-based vesting conditions remaining outstanding and vesting, as to the portion of the award that otherwise would have vested had the executive remained employed with the Company during such period, based on actual achievement of the performance criteria upon the completion of the applicable performance period.

Participant		Salary Severance		Health Benefit Severance		Equity Acceleration
Executive Officers (including CEO)		100%		12 months		12 months

If an executive’s employment is terminated by the Company other than for Cause, death or Disability, or by the executive for “Good Reason” (as defined in the Policy) during the CIC Period, then subject to the executive’s timely execution and non-revocation of a separation agreement and release of claims with the Company, the executive will receive: (i) Salary Severance (based on the percentage described in the table below); (ii) cash incentive severance equal to a percentage (as described in the table below) of the executive’s annual target cash incentive compensation opportunity (“Cash Incentive Severance”); (iii) Health Benefit Severance (based on a number of months described in the table below); and (iv) vesting acceleration as to 100% of any equity awards that are outstanding and unvested, provided that the treatment of the performance conditions of awards that are subject to performance-based vesting conditions will be as set forth in the individual award agreement.

Participant		Salary Severance		Cash Incentive Severance		Health Benefit Severance
CEO		200%		200%		24 months
Other Executive Officers		150%		150%		18 months

If any payment or benefit payable to a participant constitutes a “parachute payment” under Section 280G of the U.S. tax code and would be subject to the applicable excise tax, then the participant’s payments or benefits will be either (i) delivered in full or (ii) delivered to such lesser extent which would result in no portion of such benefits being subject to the excise tax, whichever results in the receipt by the participant on an after-tax basis of the greatest amount of benefits.

The foregoing description of the Policy does not purport to be complete and is qualified in its entirety by reference to the full text of the Policy, which is filed herewith as Exhibit 10.1 to this Current Report on Form 8-K, and is incorporated herein by reference.

Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.

On August 20, 2026, the Board adopted amended and restated bylaws of the Company (the “Amended and Restated Bylaws”), effective immediately. Among other things, the amendments effected by the Amended and Restated Bylaws: (i) align the Company’s bylaws with recent amendments to the General Corporation Law of the State of Delaware and developments in current practice, including updates regarding notices to stockholders, stockholder lists, and Board action by consent in lieu of a meeting, (ii) clarify quorum and voting standards applicable to meetings of stockholders, (iii) update provisions regarding proxy authorizations, (iv) update provisions regarding the authority to call special meetings of the Board to include the lead independent director, if any, (v) update provisions regarding the representation of securities and interests held by the Company in other entities, (vi) update the Company’s indemnification provisions, and (vii) make certain other ministerial, technical and conforming changes.

The foregoing summary does not purport to be complete and is qualified in its entirety by reference to the full text of the Amended and Restated Bylaws, which is filed herewith as Exhibit 3.1 to this Current Report on Form 8-K, and is incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.		Description of Exhibit
3.1		Amended and Restated Bylaws of the Company, as adopted on August 20, 2026
10.1*		Executive Change in Control and Severance Policy
104		Cover Page Interactive Data File (formatted as Inline XBRL)

* Schedules (or similar attachments) have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The registrant hereby undertakes to furnish supplemental copies of any of the omitted schedules (or similar attachments) upon request by the SEC; provided that the registrant may request confidential treatment pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended, for any schedules (or similar attachments) so furnished.

SIGNATURES

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.

PALO ALTO NETWORKS, INC.
By:		/s/ Bruce Byrd
		Bruce Byrd
		Executive Vice President, General Counsel and Secretary

Date: August 21, 2026

Filing Exhibits & Attachments

5 documents

Agreements & Contracts

• EX-10.1 EX-10.1 114.2 KB

Other Documents

• EX-3.1 EX-3.1 277.8 KB
• EX-101 XBRL TAXONOMY EXTENSION SCHEMA 2.5 KB
• EX-101 XBRL TAXONOMY EXTENSION LABEL LINKBASE 18.0 KB
• EX-101 XBRL TAXONOMY EXTENSION PRESENTATION LINKBASE 11.0 KB