Xylem Inc. filed a Form 8-K on October 27, 2026, disclosing the departure of Executive Vice President Hayati Yarkadas, a corporate reorganization into three business segments, and the terms of a Transition Services Agreement tied to planned divestitures of two business units.

Key Highlights

  • Segment elimination: Xylem is reorganizing into three business segments, eliminating the Water Infrastructure segment effective January 1, 2027.
  • Yarkadas transition: Hayati Yarkadas will cease to serve as Executive Vice President and President, Water Infrastructure and will no longer be an executive officer as of January 1, 2027.
  • Expected separation date: Mr. Yarkadas' employment is expected to terminate involuntarily without cause on the earlier of March 31, 2028 or the closing date of the last Divestiture.
  • Base salary during transition: Mr. Yarkadas will receive a base salary at an annual rate of CHF 557,469, prorated through the Transition Period.
  • Success Incentive: A special cash Success Incentive of USD 1,200,000 will be paid upon the closing of the final Divestiture, subject to continued compliance with applicable restrictive covenants.
  • Divestitures planned: Mr. Yarkadas will lead the planned divestiture of Applied Water International and Specialty Flow Control businesses during the Transition Period.
  • Q3 2026 results: The filing also references a press release issued October 27, 2026, reporting financial results for the quarter ended September 30, 2026, furnished as Exhibit 99.1.

Xylem Reorganizes Segments and Sets Yarkadas Transition Terms

According to the filing, Xylem Inc. (NYSE:XYL), a water technology company headquartered at 301 Water Street SE, Washington, DC, agreed on October 22, 2026 to a Transition Services Agreement with Hayati Yarkadas. Under that agreement, Mr. Yarkadas will remain employed by the company to support an orderly handover of his responsibilities and to lead the planned divestitures of the Applied Water International and Specialty Flow Control businesses. The filing notes that the company retains "sole discretion regarding whether and when to pursue or complete either Divestiture, the identity of the purchaser, the transaction value and other terms."

During what the filing refers to as the "Transition Period," running from January 1, 2027 through the Separation Date, Mr. Yarkadas is entitled to his prorated base salary, continued participation in employee benefit plans, a 2026 Annual Incentive Plan award subject to the Leadership Development and Compensation Committee certifying achievement of plan targets, and participation in the Executive Annual Incentive Plan specific to the divested businesses in 2027 and 2028 if applicable. The USD 1,200,000 Success Incentive is payable as soon as practicable following the closing of the final Divestiture, but no later than 30 days after that closing date. If his employment terminates involuntarily without cause, or due to death or disability before both divestitures close, the Success Incentive is paid within 30 days of his termination. No Success Incentive is payable if Mr. Yarkadas voluntarily resigns or is terminated for cause before the Separation Date.

The filing also discloses that Mr. Yarkadas will receive "Enhanced Equity Treatment" covering outstanding 2024, 2025, and 2026 long-term incentive awards, with pro-rata vesting tied to actual performance where applicable, continued vesting of restricted stock units and non-qualified stock options under the 2026 grants, and extended post-termination exercise periods for vested non-qualified stock options granted in 2025 or earlier. Upon involuntary termination without cause, he will additionally receive severance benefits consistent with the Xylem Senior Executive Severance Plan, amended and restated as of January 1, 2026, with the Leadership Development and Compensation Committee having waived the plan's divestiture exclusion in connection with these transactions.

What Was Disclosed

Xylem Inc. disclosed a corporate reorganization eliminating the Water Infrastructure segment, a Transition Services Agreement with departing executive Hayati Yarkadas setting compensation and divestiture responsibilities through a Separation Date no later than March 31, 2028, and the furnishing of third-quarter 2026 financial results.