Exhibit 10.30
HOST HOTELS & RESORTS,
INC.
SEVERANCE PLAN FOR
EXECUTIVES
(As Amended and Restated, Effective
as of January 1, 2008)
HOST HOTELS & RESORTS,
INC.
SEVERANCE PLAN FOR
EXECUTIVES
SECTION 1 —
PURPOSE
The purpose of the Host
Hotels & Resorts, Inc. Severance Plan for Executives
(“Plan”) is to provide severance pay and benefits to
certain Executives of Host Hotels & Resorts, Inc. and its
subsidiaries (collectively the “Company”) whose
employment is terminated by the Company or by the Executive. The
severance pay and benefits available under this Plan vary depending
upon the Participant’s title and the circumstances of his or
her termination of employment, and they are contingent upon the
execution of a release in favor of the Company.
The Plan is intended to be an
“employee welfare benefit plan” as that term is defined
in Section 3(1) of the Employee Retirement Income Security Act
of 1974, as amended. Severance benefits for covered Executives
shall be determined exclusively under this Plan. All of the
corporate policies and practices regarding severance, or similar
payments upon employment termination, with respect to Executives
eligible to participate herein are hereby superseded by this Plan.
Benefits under this Plan are in no way contingent upon retirement
under any Company retirement plan. The severance pay and benefits
available under this Plan do not represent the payment of income
deferred for services performed during employment.
SECTION 2 —
DEFINITIONS
The following capitalized terms
shall have the meanings set forth in this Section 2 unless the
context clearly indicates otherwise:
2.1 “Administrator”
means the Company or its delegees.
2.2 “Average Bonus”
means the sum of the Participant’s actual paid bonus for the
three years prior to the Severance Date divided by
three.
2.2 “Base Salary” means
the Participant’s current annual base salary, excluding the
Participant’s annual bonus and all other forms of
compensation and allowances.
2.3 “Company” means Host
Hotels & Resorts, Inc. and its subsidiaries.
2.4 “Cause” means any
conduct that in the reasonable judgment of the Board of Directors
is detrimental to the interests of the Company. Such conduct shall
include, without limitation:
(A) failing to perform assigned
duties in a reasonable manner;
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(B) failing to perform assigned
duties as a result of incompetence or neglect;
(C) engaging in any act of
dishonesty or bad faith with respect to the Company or the
Company’s affairs;
(D) committing any act or crime that
reflects unfavorably on the Participant or the Company;
or
(E) engaging in any other conduct
that in the reasonable judgment of the Board justifies
termination.
A determination of Cause by the
Board of Directors shall be final and binding on the parties for
all purposes; provided however that such determination may not be
arbitrary or capricious.
2.5 “Change in Control”
means the occurrence of a “change in the ownership,” a
“change in the effective control” or a “change in
the ownership of a substantial portion of the assets” of the
Company, as determined in accordance with this Section 2.5. In
determining whether an event shall be considered a “change in
the ownership,” a “change in the effective
control” or a “change in the ownership of a substantial
portion of the assets” of an entity, the following provisions
shall apply:
(A) A “change in the
ownership” of the Company shall occur on the date on which
any one person, or more than one person acting as a group (within
the meaning of Section 13(d)(3) or 14(d)(2) of the Securities
Exchange Act of 1934, as amended (a “Person”)),
acquires ownership of the equity securities of the Company that,
together with the equity securities held by such Person,
constitutes more than 50% of the total fair market value or total
voting power of the Company, as determined in accordance with
Treas. Reg. §1.409A-3(i)(5)(v). If a Person is considered
either to own more than 50% of the total fair market value or total
voting power of the equity securities of the Company, or to have
effective control of the Company within the meaning of
Section 2.5(B), and such Person acquires additional equity
securities of the Company, the acquisition of additional equity
securities by such Person shall not be considered to cause a
“change in the ownership” of the Company.
(B) A “change in the effective
control” of the Company shall occur on either of the
following dates:
(i) The date on which any Person,
acquires (or has acquired during the 12-month period ending on the
date of the most recent acquisition by such Person) ownership of
equity securities of the Company possessing 30% or more of the
total voting power of the Company’s equity securities, as
determined in accordance with Treas. Reg. §1.409A-3(i)(5)(vi).
If a Person is considered to possess 30% or more of the total
voting power of the Company’s equity securities, and such
Person acquires
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additional equity securities of the Company, the
acquisition of additional equity securities by such Person shall
not be considered to cause a “change in the effective
control” of the Company; or
(ii) The date on which a majority of
the members of the Board of Directors is replaced during any
12-month period by directors whose appointment or election is not
endorsed by a majority of the members of the Board of Directors
before the date of the appointment or election, as determined in
accordance with Treas. Reg. §1.409A-3(i)(5)(vi).
(C) A “change in the ownership
of a substantial portion of the assets” of the Company shall
occur on the date on which any one Person acquires (or has acquired
during the 12-month period ending on the date of the most recent
acquisition by such Person) assets from the Company that have a
total gross fair market value equal to or more than 40% of the
total gross fair market value of all of the assets of the Company
immediately before such acquisition or acquisitions, as determined
in accordance with Treas. Reg. §1.409A-3(i)(5)(vii). A
transfer of assets shall not be treated as a “change in the
ownership of a substantial portion of the assets” when such
transfer is made to an entity that is controlled by the holders of
the Company’s equity securities, as determined in accordance
with Treas. Reg. §1.409A-3(i)(5)(vii)(B).
(D) Notwithstanding the foregoing,
the following acquisitions shall not constitute a Change in
Control: (i) an acquisition by the Company or entity
controlled by the Company, or (ii) an acquisition by an
employee benefit plan (or related trust) sponsored or maintained by
the Company or any entity controlled by the Company.
2.6 “Disability” or
“Disabled” means that the Participant either:
(a) has been determined to be entitled to benefits under a
disability insurance program that complies with the requirements of
Treas. Reg. §1.409A-3(i)(4), or (b) if he is not a
participant in such long-term disability insurance program, has
been determined to be totally disabled by the Social Security
Administration.
2.7 “Effective Date”
means January 1, 2008.
2.8 “ERISA” means the
Employee Retirement Income Security Act of 1974, as
amended.
2.9 “Executive” means
any active, full-time Executive of the Company. These individuals
shall include the Chief Executive Officer, Chief Financial Officer,
Chief Operating Officer, Chief Development Officer, and individuals
with the title of Executive Vice President or Senior Vice President
as determined in the sole and absolute discretion of the Company.
For purposes of this Plan, “Executive” excludes any
individual who has an individual employment or severance agreement
with the Company.
2.10 “Good Reason” means
the occurrence of any of the following:
(A) A material diminution in the
Participant’s total overall compensation opportunity, which
consists of the sum of the Participant’s Base Salary, cash
bonus incentive opportunity and historic grant date value of any
equity compensation, other than reductions applicable to executives
of the Company in general;
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(B) A material diminution in the
Participant’s authority, duties or
responsibilities;
(C) A material change in the
geographic location at which the Participant is required to perform
his duties for the Company; or
(D) Any other action or inaction
that constitutes a material breach by the Company of the terms of
Participant’s employment.
Notwithstanding the foregoing,
(i) Good Reason shall not be deemed to exist unless notice of
termination on account thereof (specifying a termination date no
later than 30 days from the date of such notice) is given no later
than 30 days after the time at which the event or condition
purportedly giving rise to Good Reason first occurs or arises and
(ii) if there exists (without regard to this clause (ii)) an
event or condition that constitutes Good Reason, the Company shall
have 30 days from the date notice of such a termination is given to
cure such event or condition and, if the Company does so, such
event or condition shall not constitute Good Reason
hereunder.
2.11 “Participant” means
an Executive who is notified by the Company in writing that he is
listed on Exhibit B hereto.
2.12 “Plan” means the
Host Hotels & Resorts, Inc. Severance Plan for
Executives.
2.13 “Plan Year” means
the calendar year.
2.14 “Pro Rata Bonus”
means the amount equal to the Participant’s full target bonus
for the current fiscal year of the Company, determined in
accordance with the applicable incentive compensation plan,
multiplied by a fraction the numerator of which is the number of
days in the incentive plan year through the Severance Date and the
denominator of which is 365.
2.15 “Release Agreement”
means the Severance Agreement and Release in the substantially form
hereto as Exhibit A and as acceptable to the Company, which shall
include a general release given by the Participant to the Company
regarding employment-related claims, covenants against competition
and the solicitation of employees and customers of the Company, and
other matters as stated therein. The Release Agreement shall bind
the Participant and the Company.
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2.16 “Severance Date”
means the termination of the Participant’s services to the
Company and all Subsidiaries, whether voluntarily or involuntarily,
in accordance with Treas. Reg. §1.409A-1(h).
2.17 “Successor” means
any employer (whether or not the employer is affiliated with the
Company) which acquires (through merger, consolidation,
reorganization, transfer, sublease, assignment, or otherwise) all
or substantially all of the business or assets of the Company, or
of a division of the Company.
SECTION 3 — ELIGIBILITY AND
PAYMENT
3.1 Subject to Sections 3.2, 3.3,
and 3.4 of this Plan, an Executive shall become a Participant if,
on or after the Effective Date, the Executive is notified by the
Company in writing that he or she is a Participant.
3.2 A Participant shall be entitled
to the severance pay set forth in Section 4 hereof,
if:
(A) he or she returns and does not
revoke a completed and executed Release Agreement to the Company
within the time period specified in Section 3.4 after such
person’s Severance Date; and
(B) he or she is not and does not
become disqualified from receiving severance pay pursuant to
Section 3.3 hereof at any time prior to such person’s
Severance Date; provided, that a Participant shall be disqualified
from receiving or retaining any severance pay hereunder if he or
she breaches the Release Agreement.
3.3 A Participant shall not be
entitled to receive or retain the severance pay set forth in
Section 4 hereof, if the Participant:
(A) fails to return a properly
signed Release Agreement to the Company in a timely manner as
required by Section 3.4;
(B) revokes such Release Agreement
within the time period specified in the Release
Agreement;
(C) prior to his or her Severance
Date, the Participant:
(i) terminates voluntarily his or
her employment other than for Good Reason;
(ii) fails to show up and properly
attend work; or
(iii) fails to adequately perform
his or her employment duties as established by the Company in its
reasonable judgment;
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(D) rejects an offer or fails to
accept an offer of another position from a Successor or from any
affiliate of the Company on or before his or her Severance Date;
provided, however, that a Participant may still receive his or her
severance benefits despite rejecting such offer if the rejection or
failure to accept is for Good Reason; or
(E) prior to the Severance Date, the
Company terminates the employment of the Participant
and:
(i) the termination is for Cause, as
determined by the Company in its reasonable judgment; or
(ii) the Company determines after
such termination that the Participant had engaged in conduct that
would have constituted Cause had such conduct been known to the
Company prior to such termination.
3.4 Prior to the
Severance Date, such Participant will receive a Release Agreement,
substantially in the form attached to this Plan as Exhibit A. Such
Release Agreement must be timely and appropriately executed and
effective on or before the 60 th day following the
Participant’s Severance Date for such Participant to qualify
for payments and benefits under Section 4.
SECTION 4 — AMOUNT AND
PAYMENT OF SEVERANCE PAY
4.1 If the Participant’s
employment with the Company is terminated by the Company for Cause
or Disability, or by reason of the Participant’s death, or by
the Participant without Good Reason, then Company shall pay the
Participant all amounts earned or accrued through the Severance
Date but not paid as of the Severance Date, including:
(A) Base Salary; and
(B) reimbursement for reasonable and
necessary expenses incurred by the Participant on behalf of the
Company during the period ending on the Severance Date;
(collectively, “Accrued Compensation”).
In addition to the foregoing, if the
Participant’s employment is terminated by the Company because
of Disability or Death, the Company shall pay to the Participant or
his beneficiaries an amount equal to the Participant’s Pro
Rata Bonus.
4.2 Except as otherwise provided in
Section 4.3, if the Participant’s employment with the
Company is terminated by the Company without Cause, or by the
Participant for Good Reason, the Participant shall be entitled to
the following:
(A) the Company shall pay the
Participant all Accrued Compensation;
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(B) the Company shall pay the
Participant as severance pay and in lieu of any further
compensation for periods subsequent to the Severance Date an amount
(the “Severance Amount”) in cash equal to:
(i) if the Participant is the Chief
Executive Officer of the Company on the Severance Date, two
(2) times the sum of the Participant’s Base Salary and
the Participant’s Average Bonus; or
(ii) if the Participant is not the
Chief Executive Officer of the Company on the Severance Date, one
(1) times the sum of the Participant’s Base Salary and
the Participant’s Average Bonus.
4.3 If during the one year
immediately following a Change in Control, the Participant’s
employment with the Company is terminated by the Company without
Cause, or by the Participant for Good Reason, then no severance
benefits shall be payable pursuant to Section 4.2, and the
Participant shall be entitled to the following:
(A) the Company shall pay the
Accrued Compensation; and
(B) the Company shall pay the
Participant as severance pay and in lieu of any further
compensation for periods subsequent to the Severance Date an amount
(the “Severance Amount”) in cash equal to:
(i) if the Participant is the Chief
Executive Officer of the Company on the Severance Date, three
(3) times the sum of the Participant’s Base Salary and
the Participant’s Average Bonus; or
(ii) if the Participant is not the
Chief Executive Officer of the Company on the Severance Date, two
(2) times the sum of the Participant’s Base Salary and
the Participant’s Average Bonus.
4.4 Participants shall have the
right to continue medical and dental benefits under the
continuation health coverage provisions of Title X of the
Consolidated Omnibus Budget Reconciliation Act of 1986 (COBRA)
after his or her Severance Date, if otherwise eligible. To the
extent that the Participant is eligible for
