Wyndham Worldwide (WYN)

 

Employment Agreement.  In July 2006, we entered into an employment agreement with Mr. Hanning with a term expiring in July 2009. In December 2008, we executed an amendment to the agreement intended to either exempt payments and benefits under the agreement from or comply with Section 409A of the Code. The agreement provides for a minimum base salary of $550,000, a retention bonus of $700,000 (a one-time payment made in September 2006), an annual incentive award with a target amount equal to $660,000, subject to meeting performance goals, employee benefits generally available to our executive officers and grants of long-term incentive awards on terms as determined by our Board or the Committee. Under Mr. Hanning’s agreement and our 2006 Equity and Incentive Plan, grants of long-term incentive awards fully vest on a change-in-control.

 

Mr. Hanning will receive additional cash incentive compensation not to exceed $2 million for the three-year performance period from January 1, 2006 to December 31, 2008 for meeting goals relating to Wyndham Vacation Ownership’s financial performance. This provision for additional cash compensation was established in connection with our 2006 spin-off from Cendant. In consideration of the additional incentive compensation and the employment agreement, we and Mr. Hanning agreed to terminate all bonuses, commission, incentive and cash payment opportunities owed to Mr. Hanning by Cendant. The agreement provides for customary restrictive covenants including non-competition and non-solicitation covenants effective during the period of employment and for one year after termination of employment.

 

Employment Agreement.  In July 2006 we entered into an employment agreement with Mr. Hanning with a term expiring in July 2009. The agreement provides for a minimum base salary of $550,000, a retention bonus of $700,000 (a one-time payment made in September 2006), an annual incentive award with a target amount equal to $660,000, subject to meeting performance goals, employee benefits generally available to our executive officers and grants of long-term incentive awards on terms as determined by our Board or Compensation Committee. Under Mr. Hanning’s agreement and our 2006 Equity and Incentive Plan, grants of long-term incentive awards fully vest on a change-in-control.

 

Mr. Hanning will receive a long term cash bonus not to exceed $2 million for the three year period from January 1, 2006 to December 31, 2008 for meeting goals relating to Wyndham Vacation Ownership’s financial performance. The bonus is payable within 60 days of December 31, 2008. In consideration of the long term bonus and the employment agreement, we and Mr. Hanning agreed to terminate all bonuses, commission, incentive and cash payment opportunities owed to Mr. Hanning by Cendant. The agreement provides for customary restrictive covenants including non-competition and non-solicitation covenants effective during the period of employment and for one year after termination of employment.

 

Mr. Hanning’s agreement provides that if his employment is terminated by us without cause or due to a constructive discharge, he will be entitled to a lump sum payment equal to 100% of the sum of his then-current base salary plus his then-current target annual bonus, accelerated vesting and payment of the long term bonus, and payment of COBRA premiums less the contribution payable by active employees until Mr. Hanning commences new or self employment. If the payments we make to Mr. Hanning for termination without cause or for a constructive discharge give rise to a golden parachute excise tax then we will pay Mr. Hanning a gross-up payment to cover the tax.

 

 

Employment Agreement.  We entered into an employment agreement with Mr. Hanning with a term expiring in July 2009. The agreement provides for a minimum base salary of $550,000, a retention bonus of $700,000, an annual incentive award with a target amount equal to $660,000, subject to meeting performance goals and participation in benefit plans generally available to our executive officers. Mr. Hanning’s agreement provides that he will be granted an equity incentive award with a grant date value of $3 million, two-thirds of which will vest in equal installments on each of the first four anniversaries of May 2, 2006, subject to continued employment through each vesting date, and one-third of which will vest (or not vest) on May 2, 2009, subject to continued employment with us through the vesting date. Mr. Hanning’s actual 2006 equity incentive award was granted with terms and vesting schedules consistent with the other named executive officers and is described above in the Grants of Plan-Based Awards Table. Under Mr. Hanning’s agreement and our 2006 Equity and Incentive Plan, these grants fully vest on a change-in-control.

 

Mr. Hanning will receive a long term cash bonus not to exceed $2 million for the three year period from January 1, 2006 to December 31, 2008 for meeting goals relating to Wyndham Vacation Ownership’s financial performance. The bonus is payable within 60 days of December 31, 2008. In consideration of the long term bonus and the employment agreement, we and Mr. Hanning agreed to terminate all bonuses, commission, incentive and cash payment opportunities owed to Mr. Hanning by Cendant. The agreement provides for customary restrictive covenants including non-competition and non-solicitation covenants effective during the period of employment and for one year after termination of employment.

 

Mr. Hanning’s agreement provides that if his employment is terminated by us without cause or due to a constructive discharge, he will be entitled to a lump sum payment equal to 100% of the sum of his then-current base salary plus his then-current target annual bonus, accelerated vesting and payment of the long term bonus, and payment of COBRA premiums less the contribution payable by active employees until Mr. Hanning