EMPLOYMENT AGREEMENTS
EMPLOYMENT AGREEMENTS (ARABIA, GIGLIA, HOFFMAN, SPRINGER and KLEIN)
On March 31, 2020, we entered into Fourth Amended and Restated Employment Agreements with NEOs John V. Arabia, President and CEO and Marc A. Hoffman, Executive Vice President – Chief Operating Officer, and Third Amended and Restated Employment Agreements with NEOs Bryan A. Giglia, Executive Vice President – Chief Financial Officer, Robert C. Springer, Executive Vice President – Chief Investment Officer and David M. Klein Executive Vice President – General Counsel, pursuant to which each of the Executives continue to be employed by the Company in their respective current positions (the “Employment Agreements”). The Employment Agreements supersede and replace any employment, change in control and/or employment offer letter agreements previously entered into with the foregoing NEO.
The initial term of each Employment Agreement expires on March 31, 2021. Following the expiration of the initial term, the term of each Employment Agreement automatically renews, and will continue to be renewed for successive one-year periods on each anniversary of March 31, 2021, unless either party provides the other with thirty days written notice of intent not to renew the Employment Agreement.
The Employment Agreements reflect a 2020 annual base salary for Messrs. Arabia, Giglia, Hoffman, Springer and Klein of $826,200, $520,200, $554,370, $441,660 and $361,080, respectively, and in each case, annual base salaries may be increased from time to time in the Company’s sole discretion. In addition, under the Employment Agreements, each of the NEOs is eligible to receive an annual cash performance bonus based on the attainment of performance goals determined by the Company with a threshold level equal to 75% for Mr. Arabia, 62.5% for Messrs. Giglia, Hoffman, and Springer, and 57.5% for Mr. Klein, of base salary, a target level equal to 162.5% for Mr. Arabia, 112.5% for Messrs. Giglia, Hoffman, and Springer, and 92.5% for Mr. Klein, of base salary, and a high level equal to 250% for Mr. Arabia, 162.5% for Messrs. Giglia, Hoffman, and Springer, and 127.5% for Mr. Klein, of base salary, with no guaranteed minimum (and any award may equal zero in any given year).
Under the Employment Agreements, each of the NEOs is eligible to earn annual equity awards with a threshold level equal to 175% for Mr. Arabia, 162.5% for Messrs. Giglia, Hoffman, and Springer, and 137.5% for Mr. Klein, of base salary, a target level equal to 325% for Mr. Arabia, 237.5% for Messrs. Giglia, Hoffman, and Springer, and 187.5% for Mr. Klein, of base salary, and a high level equal to 450% for Mr. Arabia, 312.5% for Messrs. Giglia, Hoffman, and Springer, and 237.5% for Mr. Klein, of base salary, with no guaranteed minimum (and any award may equal zero in any given year). Furthermore, the Employment Agreements provide that each of the NEOs is eligible to participate in welfare and fringe benefit plans, incentive plans and savings/retirement plans generally available to senior executives of the Company.
If the Company terminates the NEO’s employment without cause or the NEO terminates his employment for good reason, then (i) the NEO will receive a cash severance payment equal to the sum of: (A) two (three for Mr. Arabia) times the sum of: (x) the base salary in effect for the NEO on the date of termination, and (y) the greater of the NEO’s target annual bonus for the year in which the termination occurs and the actual annual bonus paid in respect of the last completed calendar year, (B) any earned but unpaid annual bonus for a prior fiscal year, and (C) a pro-rated bonus for the year in which the termination occurs (based on the NEO’s “target” bonus), (ii) all outstanding Company equity awards will vest to the extent such outstanding awards were scheduled to vest within the 12-month period immediately following the date of termination, and (iii) the NEO will receive Company-paid continued health insurance coverage for himself and his eligible family members for up to 18 months following the termination date. The Company’s obligation to provide these severance payments and benefits is conditioned upon the NEO’s timely execution (and non-revocation) of a general release of claims. In addition, if the Company terminates the NEO’s employment without cause or the NEO terminates his employment for good reason on or within 12 months following a change in control, then all of the NEO’s outstanding Company equity awards will fully vest.
If the Company terminates the NEO’s employment by reason of a non-renewal of the Employment Agreement upon the expiration of its term, and the NEO is willing and able, at the time of such non-renewal, to continue performing services during the renewal period, then, subject to the NEO’s timely execution (and non-revocation)