Capital Senior Living Corporation (NYSE:CSU) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain OfficersItem 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangement of Certain Officers.
(e) Adoption of Compensatory Plan.
On March19, 2018, the Compensation Committee (the “Compensation Committee”) of the Board of Directors of Capital Senior Living Corporation (the “Company”) approved the Company’s 2018 Incentive Compensation Plan (the “Plan”). The Plan provides performance bonus opportunities to the Company’s Chief Executive Officer (“CEO”), Chief Operating Officer (“COO”), Chief Financial Officer (“CFO”), Senior Vice President, General Counsel (“SVP-GC”) and Senior Vice President, Human Resources (“SVP-HR”) (collectively, the “Participants”), based upon the Company’s achievement of four corporate goals and such Participant’s achievement of certain individual goals established by the Compensation Committee for the year ending December31, 2018.
to the Plan, the CEO, COO, CFO, SVP-GC and SVP-HR are eligible to receive a target cash performance bonus equal to 110%, 80%, 70%, 50% and 40%, respectively, of their base salaries for 2018 as follows:
| • | First, 30% of the target cash bonus under the Plan is based on the Company’s achievement of a Cash Flow From Operations (“CFFO”) per outstanding share target for 2018. Achievement of the target level of CFFO per share will result in the CEO, COO, CFO, SVP-GC and SVP-HR receiving a bonus equal to 33%, 24%, 21%, 15% and 12%, respectively, of their base salaries for 2018. |
| • | Second, 20% of the target cash bonus under the Plan is based on the Company’s achievement of an Adjusted EBITDAR target for 2018. Achievement of the target level of Adjusted EBITDAR will result in the CEO, COO, CFO, SVP-GC and SVP-HR receiving a bonus equal to 22%, 16%, 14%, 10% and 8%, respectively, of their base salaries for 2018. |
| • | Third, 10% of the target cash bonus under the Plan is based on the Company’s achievement of a net debt-to-EBITDAR ratio target for 2018. Achievement of the target ratio of net debt-to-EBITDAR will result in the CEO, COO, CFO, SVP-GC and SVP-HR receiving a bonus equal to 11%, 8%, 7%, 5% and 4%, respectively, of their base salaries for 2018. |
| • | Fourth, 20% of the target cash bonus under the Plan is based on the Company’s achievement of a same-store facility net operating income (“Facility NOI”) target for 2018. Achievement of the target level of Facility NOI will result in the CEO, COO, CFO, SVP-GC and SVP-HR receiving a bonus equal to 22%, 16%, 14%, 10% and 8%, respectively, of their base salaries for 2018. |
| • | Fifth, 20% of the target cash bonus under the Plan is based on the Participant’s achievement of certain individual goals for 2018, which are within such Participant’s sphere of influence. Achievement of the individual goals by the CEO, COO, CFO, SVP-GC and SVP-HR will result in such Participant receiving a bonus equal to 22%, 16%, 14%, 10% and 8%, respectively, of his base salary for 2018. |
With respect to the four corporate goals set forth above, achievement of 94% of the performance target (96% in the case of the Adjusted EBITDAR performance target) will result in 50% of the portion of the award subject to such performance target being earned by the Participants, and if this threshold level is attained but the target level is not attained, the earned portion of the award subject to such performance target will be prorated between 50% and 50% based upon the actual performance results. Achievement of 106% of the performance target (104% in the case of the Adjusted EBITDAR target) will result in 150% of the portion of the award
subject to such performance target being earned by the Participants, and if this maximum level is not attained but the target level is exceeded, the earned portion of the award subject to such performance target will be prorated between 50% and 150% based upon the actual performance results.
With respect to the individual goals set forth above, the Compensation Committee may award between 50% and 150% of target cash bonus to each Participant based upon such Participant’s achievement of his individual goals, as determined in the discretion of the Compensation Committee.
About Capital Senior Living Corporation (NYSE:CSU)
Capital Senior Living Corporation is an operator of senior living communities in the United States in terms of resident capacity. The Company operates over 10 senior living communities in approximately 20 states, including over 70 senior living communities, which the Company owns and over 50 senior living communities the Company leases. The Company also operates a home care agency. The Company provides senior living services to the elderly, including independent living and assisted living services, and also provides home care services at one of its communities. The Company also fosters the wellness of its residents by offering access to health screenings, such as blood pressure checks; periodic special services, such as influenza inoculations; dietary and similar programs, as well as ongoing exercise and fitness classes. It offers a range of assisted living care and services, including personal care services, around the clock staffing, support services and supplemental services.
