THIRD AMENDED AND
RESTATED
EMPLOYMENT AGREEMENT
THIS THIRD AMENDED AND RESTATED EMPLOYMENT AGREEMENT , dated
this 29th day of December, 2008 (the “Agreement”), is
entered into by and between HEALTH CARE REIT, INC., a Delaware
corporation, (the “Corporation”), and ERIN C. IBELE
(the “Executive”).
WHEREAS , the Corporation and the Executive entered into an
Employment Agreement, effective as of January 1,
1997;
WHEREAS , the Corporation and the Executive entered into an
Amended and Restated Employment Agreement, effective as of
January 1, 2000;
WHEREAS , the Corporation and the Executive entered into a
Second Amended and Restated Employment Agreement, effective as of
January 1, 2004;
WHEREAS , the Compensation Committee of the
Corporation’s Board of Directors has approved certain
modifications to the terms of such Second Amended and Restated
Employment Agreement solely for purposes of compliance with the
requirements of Section 409A of the Internal Revenue Code, as
amended (the “Code”), and the rules and regulations
promulgated thereunder; and
WHEREAS, the Corporation wishes to assure itself of the
services of the Executive for the period provided in this Agreement
and the Executive is willing to serve in the employ of the
Corporation for such period upon the terms and conditions set forth
in this Agreement, which is effective as of January 1,
2009.
NOW THEREFORE , in consideration of the mutual covenants
herein contained, the parties, intending to be legally bound,
hereby agree as follows:
The
Corporation hereby agrees to employ the Executive as the
Corporation’s Vice President and Corporate Secretary, upon
the terms and conditions herein contained, and the Executive hereby
agrees to accept such employment and to serve in such positions,
and to perform the duties and functions customarily performed by
the Vice President and Corporate Secretary of a publicly traded
corporation during the term of this Agreement. In such capacity,
the Executive shall report only to the Corporation’s Chief
Executive Officer (“CEO”), and shall have the powers
and responsibilities set forth in Article IV of the
Corporation’s By-Laws as well as such additional powers and
responsibilities consistent with her position as the CEO may assign
to her.
Throughout
the term of this Agreement, the Executive shall devote her best
efforts and all of her business time and services to the business
and affairs of the Corporation.
The
current term of employment under this Agreement shall expire on
January 31, 2009. Upon the expiration of such term, the term
of employment hereunder shall automatically be extended without
further action by the parties for successive two (2) year
renewal terms, unless either party shall give at least six
(6) months advance written notice to the other of her or its
intention that this Agreement shall terminate upon the expiration
of the current term or the then current renewal term, as the case
may be.
Notwithstanding
the foregoing, the Corporation shall be entitled to terminate this
Agreement immediately, subject to a continuing obligation to make
any payments required under Section 5 below, if the Executive
(i) becomes disabled as described in Section 5(b),
(ii) is terminated for Cause, as defined in Section 5(c),
or (iii) voluntarily terminates her employment before the
current term of this Agreement expires, as described in
Section 5(d).
The
Executive shall receive a base salary during the term of this
Agreement at a rate of not less than $128,418 per annum for 2004,
and at a rate of not less than $128,418 per annum for subsequent
years, payable in substantially equal semi-monthly installments.
The Compensation Committee of the Board shall consult with the CEO
and review the Executive’s base salary at annual intervals,
and may adjust the Executive’s annual base salary from time
to time as the Committee deems to be appropriate.
The
Executive shall also be eligible to receive an annual bonus from
the Corporation each year during the term of this Agreement, with
the actual amount of such bonus to be determined by the
Compensation Committee of the Corporation’s Board, using such
performance measures as the Committee deems to be appropriate. Such
bonus, if any, shall be paid to the Executive no later than sixty
(60) days after the end of the year to which the bonus
relates.
4.
ADDITIONAL COMPENSATION AND BENEFITS
The
Executive shall receive the following additional compensation and
welfare and fringe benefits during the term of the
Agreement:
(a) Stock
Options and Other Long-Term Incentives . The Executive has been
granted incentive stock options, nonstatutory stock options, and
shares of restricted stock pursuant to the terms of the
Corporation’s 1995 Stock Incentive Plan. During the remaining
term of the Agreement, any additional stock options, restricted
stock or other awards under the 1995 Stock Incentive Plan shall be
at the discretion of the Compensation Committee of the
Corporation’s Board.
(b) Health
Insurance . The Corporation shall provide the Executive and her
dependents with health insurance, life insurance and disability
coverage on terms no less favorable than that from time to time
made available to other key employees.
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(c)
Vacation . The Executive shall be entitled to up to three
(3) weeks of vacation during each year during the term of this
Agreement and any extensions thereof, prorated for partial
years.
(d) Business
Expenses . The Corporation shall reimburse the Executive for
all reasonable expenses she incurs in promoting the
Corporation’s business, including expenses for travel and
similar items, upon presentation by the Executive from time to time
of an itemized account of such expenditures.
In
addition to the benefits provided pursuant to the preceding
paragraphs of this Section 4, the Executive shall be eligible
to participate in such other executive compensation and retirement
plans of the Corporation as are applicable generally to other
officers, and in such welfare benefit plans, programs, practices
and policies of the Corporation as are generally applicable to
other key employees, unless such participation would duplicate,
directly or indirectly, benefits already accorded to the
Executive.
5.
PAYMENTS UPON TERMINATION
(a)
Involuntary Termination . If the Executive’s
employment is involuntarily terminated by the Corporation during
the term of this Agreement, the Executive shall be entitled to
receive her base salary accrued through the date of termination,
any accrued but unpaid vacation pay, plus any bonuses earned but
unpaid with respect to fiscal years or other periods preceding the
termination date. Such payments shall be made to the Executive
within sixty (60) days following the date of involuntary
termination. The Executive shall also receive any nonforfeitable
benefits payable to her under the terms of any deferred
compensation, incentive or other benefit plan maintained by the
Corporation, payable in accordance with the terms of the applicable
plan.
If
the termination is not a termination for Cause, as described in
paragraph (c), a voluntary termination by the Executive as
described in paragraph (d), or a result of the Executive’s
death or disability, then the Corporation shall also be obligated
to make a lump sum severance payment to the Executive equal to the
present value of a series of monthly severance payments for each
month during the remaining term of this Agreement, but not less
than twelve (12) months (the “Severance Period”),
each in an amount equal to one-twelfth (1/12th) of the sum of
(i) the Executive’s annual base salary, as in effect on
the date of termination, and (ii) the greater of (A) the
annual bonus paid to the Executive for the last fiscal year
preceding the termination date or (B) a minimum bonus equal to
thirty percent (30%) of her annual base salary. Such present value
shall be calculated using a discount rate equal to the interest
rate on 90-day Treasury bills, as reported in the Wall Street
Journal (or similar publication) on the date of involuntary
termination. Such lump sum payment shall be made to the Executive
within sixty (60) days following the date of such involuntary
termination and shall be in the form of a bank cashier’s
check. If the Executive obtains a replacement position with any new
employer (including a position as an officer, employee, consultant,
or agent, or self-employment as a partner or sole proprietor), the
Executive shall be obligated to repay to the Corporation an amount
equal to all amounts the Executive receives as compensation for
services performed during the Severance Period; provided however,
that the aggregate repayment obligation shall not exceed the amount
of the lump sum payment under this
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paragraph (a).
The Executive shall be under no duty to mitigate the amounts owed
to her under this paragraph (a) by seeking such a replacement
position.
In
addition, if the termination is not a termination for Cause as
described in paragraph (c), a voluntary termination by the
Executive as described in paragraph (d), or a result of the
Executive’s death or disability, then:
(i) Any stock
options, restricted stock or other awards granted to the Executive
under the Corporation’s 1995 Stock Incentive Plan shall
become fully vested and, in the case of stock options, exercisable
in full; and
(ii) The Executive
shall be provided continued coverage at the Corporation’s
expense under any life, health and disability insurance programs
maintained by the Corporation in which the Executive participated
at the time of her termination for the remaining term of the
Agreement (but not less than six (6) months and not more than
the period during which the Executive would be entitled to
continuation coverage under Section 4980B of the Code, if the
Executive elected such coverage and paid the applicable premiums),
or until, if earlier, the date the Executive obtains comparable
coverage under benefit plans maintained by a new
employer.
(b)
Disability . The Corporation shall be entitled to terminate
the Executive’s employment if the Board determines that the
Executive has been unable to attend to her duties for at least
ninety (90) days because of a medically diagnosable physical
or mental condition, and has received a written opinion from a
physician acceptable to the Board that such condition prevents the
Executive from resuming full performance of her duties and is
likely to continue for an indefinite period. Upon such involuntary
termination, the Executive shall be entitled to receive her base
salary accrued through the date of termination, any accrued but
unpaid vacation pay, plus any bonuses earned but unpaid with
respect to fiscal years or other periods preceding the termination
date. Such payments shall be made to the Executive within sixty
(60) days following the date of involuntary termination. In
addition, the Corporation shall make a series of monthly disability
payments to Executive, each equal to one-twelfth (1/12
th ) of the sum of (i) her annual base salary,
as in effect at the time Executive became permanently disabled, and
(ii) the greater of (A) the annual bonus paid to the
Executive for the last fiscal year preceding the date of disability
or (B) a minimum bonus equal to thirty percent (30%) of the
Executive’s annual base salary. Payment of such disability
benefit shall be paid in accordance with the Corporation’s
normal payroll practices, shall commence with the month following
the month in which the involuntary termination occurs and continue
each month for the remaining current term of this Agreement (but
not less than twelve (12) months), but shall terminate at an
earlier date if the Executive returns to active employment, either
with the Corporation or otherwise. Any amounts payable under this
Section 5(b) shall be reduced by any amounts paid to the Executive
under any long-term disability plan or other disability program or
insurance policies maintained or provided by the
Corporation.
(c)
Termination for Cause . If the Executive’s employment
is terminated by the Corporation for Cause, the amount the
Executive shall be entitled to receive from the Corporation shall
be limited to her base salary accrued through the date of
termination, any accrued but unpaid vacation pay, plus any bonuses
earned but unpaid with respect to the fiscal year of the
Corporation
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most recently
ended, and any nonforfeitable benefits payable to the Executive
under the terms of any deferred compensation, incentive or other
benefit plans maintained by the Corporation. Such payments shall be
made to the Executive within sixty (60) days following the
date of termination.
For
purposes of this Agreement, the term “Cause” shall be
limited to (i) action by the Executive involving willful
disloyalty to the Corporation, such as embezzlement, fraud,
misappropriation of corporate assets or a breach of the covenants
set forth in Sections 9 and 10 below; or (ii) the
Executive being convicted of a felony; or (iii) the Executive
being convicted of any lesser crime or offense committed in
connection with the performance of her duties hereunder or
involv
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