ITEM 5.02
DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS.
On November 15, 2017, the Board of Directors (the Board) of Pacific Premier Bancorp, Inc. (the Company), following an extensive review of evolving executive compensation and corporate governance practices, investor preferences as well as discussions with various stockholders, investors and professional advisors, approved and directed the implementation of several important executive compensation and corporate governance enhancements that the Board believes are in the best interests of the Company and its stockholders. As part of the executive compensation enhancements, the Board adopted and approved updated executive compensation guidelines (the Guidelines) applicable to the Companys named executive officers (as defined pursuant to Regulation S-K under the Securities Act of 1933, as amended) (the NEOs). The Guidelines update the Companys prior executive compensation guidelines with the intention of further enhancing the link between NEO compensation and Company performance and maintaining the alignment of interests between the NEOs and the Companys stockholders.
Among other things, the Guidelines require the Company to i
ncrease performance-based incentive equity compensation from 25% to 50% of an equity incentive award grant, use a relative total shareholder return performance metric for the performance-based restricted stock unit awards, and remove the retroactive feature in the Companys restricted stock unit award agreement and provide for a three-year average performance target rather than an annual target for each separate year. In addition, the Guidelines require that certain future equity incentive awards include a double-trigger rather than single-trigger accelerated vesting, meaning that the award vests in full if an employee is terminated for cause or resigns for good reason within 24 months of a change of control. Cause, good reason and change of control are each defined in the Pacific Premier Bancorp, Inc. Amended and Restated 2012 Long-Term Incentive Plan, as amended (the 2012 Incentive Plan). The Guidelines also contemplate, and the Board adopted and approved, a clawback policy that provides for the recoupment of certain types of NEO and other senior executive incentive compensation in the event that the incentive compensation was predicated on financial results, performance goals or metrics that were augmented or materially inaccurate as a result of intentional fraud or criminal misconduct.
In order to affect the updated Guidelines, on November 15, 2017, the Board approved a Second Amendment to the 2012 Incentive Plan, as well as conforming amendments to the 2012 Incentive Plan forms of equity incentive award agreements. The Guidelines, clawback policy, Second Amendment to the 2012 Incentive Plan and conforming amendments to the form of equity incentive award agreements will apply to all applicable incentive compensation awards commencing on January 1, 2018.
The foregoing description of the Second Amendment to the 2012 Incentive Plan and the forms of Restricted Stock Award Agreement (non-NEOs), Restricted Stock Award Agreement (NEOs), Restricted Stock Unit Award Agreement, Incentive Stock Option Award Agreement and Non-Qualified Stock Option Award Agreement, are qualified by reference to the full text of such documents, copies of which are filed as Exhibits 10.1, 10.2, 10.3, 10.4, 10.5 and 10.6, respectively, to this Current Report on Form 8-K and are incorporated by reference into this Item 5.02.
2