Unassociated Document
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UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
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FORM
8-K
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CURRENT
REPORT
Pursuant
to Section 13 OR 15(d) of the Securities Exchange Act of
1934
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Date
of Report (Date of earliest event reported)
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June
26, 2009 (June 23, 2009)
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Brookdale
Senior Living Inc.
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(Exact
name of registrant as specified in its
charter)
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Delaware
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001-32641
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20-3068069
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(State
or other jurisdiction
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(Commission
File Number)
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(IRS
Employer
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of
incorporation)
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Identification
No.)
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111
Westwood Place, Suite 200, Brentwood, Tennessee
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37027
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(Address
of principal executive offices)
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(Zip
Code)
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Registrant’s
telephone number, including area code
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(615)
221-2250
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(Former
name or former address, if changed since last report.)
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Check the appropriate box below
if the Form 8-K filing is intended to simultaneously satisfy the filing
obligation of the registrant under any of the following provisions (see General Instruction
A.2. below):
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o
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
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o
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
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Section
5 — Corporate Governance and Management
Item
5.02 Departure of Directors or Certain Officers;
Election of Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers.
(e) On
June 23, 2009, Brookdale Senior Living Inc. (the “Company”) entered into an
Employment Agreement (the “Employment Agreement”) with W.E. Sheriff, the
Company’s Chief Executive Officer. The Employment Agreement amended
and restated in its entirety the employment agreement originally entered into
between the Company and Mr. Sheriff dated as of May 12, 2006 (as amended, the
“Original Agreement”). The following summary of certain provisions of the
Employment Agreement is qualified in its entirety by reference to the Employment
Agreement filed as Exhibit 10.1 hereto and incorporated herein by
reference.
Pursuant
to the Employment Agreement, Mr. Sheriff will continue to be employed as Chief
Executive Officer of the Company during the five year term of the
agreement. However, at any time during the term, Mr. Sheriff may
elect to resign as Chief Executive Officer and serve the Company as a consultant
for the balance of the term by providing the Company with at least six months’
prior notice. During the period that Mr. Sheriff serves as Chief
Executive Officer, he will continue to receive an annual base salary of $600,000
per year. He will receive a consulting fee of $300,000 per year during the
period that he serves as a consultant.
Mr.
Sheriff will continue to have an annual cash bonus opportunity of $600,000 per
year during the period that he serves as Chief Executive Officer in accordance
with the terms of the Company’s incentive compensation plan for senior executive
officers. The annual bonus opportunity will cease on the first day
that he ceases to serve as Chief Executive Officer. However, if Mr.
Sheriff resigns as Chief Executive Officer and becomes a consultant, he will be
eligible to receive a pro rata portion of the annual bonus (to the extent
earned) for the portion of the year during which he served as Chief Executive
Officer or, if his resignation as Chief Executive Officer becomes effective on
or after October 1 of such year, he will be eligible to receive the entire
annual bonus for such year (to the extent earned).
While he
continues to serve as Chief Executive Officer, Mr. Sheriff will generally be
eligible to participate in all benefit plans made available to the Company’s
senior executives. During the period that he serves as a consultant,
he will be eligible to participate in any benefit plans made available to the
Company’s similarly-situated former executives.
The
Employment Agreement provides that, in the event Mr. Sheriff’s employment or
consultancy is terminated for “cause” (as defined therein), he will receive the
following: (i) accrued base compensation through the date of termination; (ii)
any annual bonus earned but unpaid as of the date of termination for any
previously completed calendar year; (iii) reimbursement for any properly
incurred business expenses; and (iv) benefits, if any, to which he may be
entitled under the Company’s benefits plans (collectively, the “Accrued
Rights”). Mr. Sheriff will also be eligible to receive the Accrued
Rights in the event his employment or consultancy is terminated due to death or
disability.
In the
event Mr. Sheriff’s employment or consultancy is terminated by the Company
without cause, or by Mr. Sheriff for “good reason” (as defined therein), he will
receive the Accrued Rights and, upon signing a release of claims in a form
adopted by the Company and
continuing
to comply with all applicable restrictive covenants, the following severance
payments and benefits: (i) continuation of his then-current base
compensation for the lesser of 24 months from the date of termination or the
scheduled expiration of the term, (ii) to the extent that he served as Chief
Executive Officer during any portion of the year of termination, payment of a
pro rata portion of his annual bonus (to the extent earned) for the portion of
the year during which he served as Chief Executive Officer or, if his
termination occurs on or after October 1 of such year, payment of the entire
annual bonus for such year (to the extent earned), and (iii) if he is eligible
for and elects continuation of health care coverage under COBRA, the Company
will pay the employer portion of his COBRA premium payments for the length of
the COBRA coverage period.
In the
event Mr. Sheriff voluntarily resigns his employment or consultancy without good
reason, he will receive the Accrued Rights and, to the extent that he served as
Chief Executive Officer during any portion of the year of termination, payment
of a pro rata portion of his annual bonus (to the extent earned) for the portion
of the year during which he served as Chief Executive Officer or, if his
termination occurs on or after October 1 of such year, payment of the entire
annual bonus for such year (to the extent earned).
Under the
terms of the Employment Agreement, all post-termination payments and benefits
provided to Mr. Sheriff are to be structured to comply with Section 409A of the
Internal Revenue Code (the “Code”). The terms of Mr. Sheriff’s
existing restricted stock agreements will govern the treatment of any
outstanding restricted stock awards upon his termination of employment or
consultancy. However, Mr. Sheriff’s service as a consultant to the
Company shall be deemed to be continued employment for purposes of such
outstanding restricted stock awards.
The
Employment Agreement contains customary non-competition, non-solicitation,
non-disparagement and confidentiality covenants. The non-competition
and non-solicitation restrictions will continue in effect during Mr. Sheriff’s
employment and consultancy and for two years following the later of his
termination as an employee or consultant. The non-disparagement and
confidentiality obligations shall apply during his employment and consultancy
and at all times thereafter.
In
connection with entering into the Employment Agreement, Mr. Sheriff was granted
500,000 restricted stock units (“RSUs”) under the terms of the Company’s Omnibus
Stock Incentive Plan, as amended and restated (the “Stock Incentive
Plan”). The RSUs were granted pursuant to the terms of a Restricted
Stock Unit Agreement, dated as of June 23, 2009, between the Company and Mr.
Sheriff (the “RSU Agreement”). The following summary of certain
provisions of the RSU Agreement is qualified in its entirety by reference to the
RSU Agreement filed as Exhibit 10.2 hereto and incorporated herein by
reference.
Upon
vesting, each RSU represents the right to receive one share of the Company’s
common stock. Subject to Mr. Sheriff’s continued employment or
service as a consultant, the RSUs will vest in five equal annual installments
beginning on December 15, 2009. The RSUs will be payable within 45
days of each such vesting date. All unpaid RSUs which have not
previously been forfeited will be paid within 45 days following the earliest of
(i) a “change in control” (as defined in the Stock Incentive Plan), but only if
such change in control constitutes a change in the ownership or effective
control of the Company or in the ownership of a substantial
portion
of the assets of the Company under Section 409A of the Code; (ii) Mr. Sheriff’s
death; or (iii) Mr. Sheriff’s “disability” (as defined in the Stock Incentive
Plan).
If Mr.
Sheriff’s employment as Chief Executive Officer is terminated by the Company
without cause or by Mr. Sheriff for good reason prior to December 31, 2010, all
outstanding RSUs will vest and be paid in accordance with the schedule noted
above. If Mr. Sheriff resigns as Chief Executive Officer prior to
December 31, 2010, but continues serving as a consultant, the RSUs which are
scheduled to vest on December 15, 2012 and December 15, 2013 will be forfeited
and the remaining RSUs will be paid in accordance with the scheduled noted
above, provided that he continues to serve as a consultant or his consultancy is
terminated without cause or for good reason.
All
outstanding RSUs will be paid within 45 days following (i) the termination of
Mr. Sheriff’s employment by the Company without cause or by Mr. Sheriff for good
reason on or after December 31, 2010 or (ii) the voluntary termination of Mr.
Sheriff’s employment as Chief Executive Officer (whether or not he becomes a
consultant) for any reason on or after December 31, 2010.
All
unpaid RSUs will be forfeited upon (i) the termination of Mr. Sheriff’s
employment or consultancy for cause; (ii) the voluntary termination (without
good reason) of his employment (without becoming a consultant) prior to December
31, 2010; or (iii) the voluntary termination (without good reason) of his
consultancy.
Mr.
Sheriff (or his beneficiaries, if applicable) will be required to execute a
release to receive payment of any RSUs which are payable as a result of
termination of his employment or consultancy. To the extent required
under Section 409A of the Code, the payments upon a termination of employment
will be delayed for six months following the date of Mr. Sheriff’s
termination.
Section
9 — Financial Statements and Exhibits
Item
9.01 Financial Statements and
Exhibits.
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(d)
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Exhibits
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10.1
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Employment
Agreement, dated as of June 23, 2009, by and between Brookdale Senior
Living Inc. and W.E. Sheriff
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10.2
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Restricted
Stock Unit Agreement, dated as of June 23, 2009, by and between Brookdale
Senior Living Inc. and W.E. Sheriff
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SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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BROOKDALE
SENIOR LIVING INC.
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Date:
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June
26, 2009
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By:
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/s/
T. Andrew Smith
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Name:
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T.
Andrew Smith
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Title:
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Executive
Vice President, General Counsel and
Secretary
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EXHIBIT
INDEX
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Exhibit No.
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Exhibit
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10.1
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Employment
Agreement, dated as of June 23, 2009, by and between Brookdale Senior
Living Inc. and W.E. Sheriff.
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10.2
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Restricted
Stock Unit Agreement, dated as of June 23, 2009, by and between Brookdale
Senior Living Inc. and W.E.
Sheriff.
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