HCP, Inc. (NYSE:HCP) Files An 8-K Other EventsItem 8.01 Other Events
On February 5, 2018, HCP, Inc., a Maryland corporation (the “Company”), announced that Michael D. McKee will step down from his position as Executive Chairman, effective March 1, 2018.
Contractual Severance Arrangements
Mr. McKee, as well as the Company’s President and Chief Executive Officer and each of its Executive Vice Presidents and Senior Managing Directors, have been participants in an Executive Severance Plan (the “Severance Plan”) that was adopted in May 2016, a copy of which was previously filed as Exhibit 10.3 to the Company’s Form 10-Q, filed with the SEC on November 1, 2016, and is incorporated herein by reference.
Subject to the execution of a general release of claims against the Company and compliance with certain confidentiality, non-solicitation and non-competition restrictive covenants, Mr. McKee will receive only severance benefits to which he is contractually entitled under the Severance Plan, which include approximately $6 million in cash severance to be paid over 24 months. Additionally, based on his continued service as a Company employee until March 1, 2018, a prorated 2018 cash incentive bonus payment, which is entirely at risk of forfeiture because it is based on final performance results for 2018, may be paid in 2019.
The material terms of the Severance Plan are described under the heading “Potential Payments upon a Termination or Change in Control—Severance Plans” in the Company’s Definitive Proxy Statement on Schedule 14A, filed with the Securities and Exchange Commission (the “SEC”) on March 16, 2017, and are incorporated herein by reference. The description of the Severance Plan set forth under this Item 8.01 is qualified in its entirety by reference to the complete terms and conditions of the Severance Plan.
Outstanding Unvested Equity Awards
As previously disclosed and to the contractual terms under which they were issued, Mr. McKee’s unvested equity awards vest as follows:
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(i) |
initial time-based restricted stock units (“RSUs”) granted on May 9, 2016, will remain outstanding and continue to vest and be settled in accordance with the original vesting schedule (one-third remaining to vest on May 9, 2018, and the last one-third to vest on May 9, 2019); |
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(ii) |
performance-based RSUs granted on February 13, 2017, will remain outstanding and may vest and be settled based on the Company’s total stockholder return performance during the performance period and are entirely at risk of forfeiture; and |
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(iii) |
time-based RSUs granted on February 13, 2017, will fully vest and be settled upon his departure. |
About HCP, Inc. (NYSE:HCP)
HCP, Inc. (HCP) is a self-administered real estate investment trust (REIT). The Company invests in real estate serving the healthcare industry in the United States. Its portfolio consists of investments in various healthcare segments: senior housing, post-acute/skilled nursing, life science, medical office and hospital. Its portfolio includes owned portfolio, unconsolidated joint ventures, and developments and redevelopments. It has interests in unconsolidated joint ventures representing approximately 30 properties primarily in its senior housing, life science and medical office segments. The Company has interests in approximately 530 senior housing facilities, including over 25 properties owned by its unconsolidated joint ventures. Its senior housing facilities include independent living facilities, assisted living facilities, memory care facilities, care homes and continuing care retirement communities. It has interests in approximately 310 post-acute/skilled nursing facilities.