Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On March 16, 2009, the Compensation Committee (the "Committee") of the Board of
Directors of Lodgian, Inc. (the "Company") approved the Lodgian, Inc. Executive
Incentive Plan (the "Revised Plan"), which supersedes and replaces the Lodgian,
Inc. Amended and Restated Executive Incentive Plan adopted by the Company on
April 11, 2008 (the "Previous Plan").
The Revised Plan provides for potential cash and equity awards to certain of the
Company's key employees, as determined by the Committee. Selected employees are
eligible to receive an annual cash bonus based upon achievement of net operating
income targets, or in the alternative, "market penetration" targets. Employees
would receive a cash award if the Company achieves at least 90% of its target
net operating income or the Company's market penetration index is at least 100.
If the Company achieves both the net operating income and market penetration
target, employees would receive the greater of the two cash awards associated
with the achieved targets. Market penetration is defined as the Company's
continuing operations hotels' RevPar index as reported by Smith Travel research
determined on a revenue weighted average basis. Cash awards are also subject to
increase or decrease depending upon achievement of the Company's corporate
overhead goals.
Participants under the Revised Plan are also eligible for long term incentive
awards in the form of restricted stock. Each participant under the Revised Plan
has an equity bonus target, which is approved by the Committee. 35% of the
equity bonus target is non-performance based and will be granted as long as the
employee satisfies certain conditions under the Revised Plan. The remaining 65%
of the equity bonus target is performance based and dependent upon achievement
of the Company's net operating income target, stock price performance versus a
peer group of selected companies and achievement of corporate overhead goals.
Each performance measure will account for one-third of the remaining 65% of the
equity bonus target.
Unless the Committee elects to pay the equity award in cash, any equity awards
earned under the Revised Plan will be issued under and governed by the Lodgian,
Inc. Amended and Restated 2002 Stock Incentive Plan and will vest in two equal
annual installments beginning on the first anniversary of the date of grant.
The Compensation Committee also established the applicable 2009 performance
measures for participants in the Revised Plan.
The following named executive officers of Lodgian are participants under the
Revised Plan, and their respective 2009 cash and equity bonus targets are set
forth below:
2009 Target 2009 Target
Name Position Cash Bonus Equity Bonus
James A. MacLennan Executive Vice President and Chief Financial Officer $ 140,000 $ 126,500
Daniel E. Ellis Senior Vice President, General Counsel & Secretary $ 126,500 $ 116,000
Joseph F. Kelly (1) Vice President of Hotel Operations $ 85,000 $ 65,000
Donna Cohen Vice President & Controller $ 56,438 $ 41,675
|
(1) As disclosed
on
December 15,
2008,
Mr. Kelly
became an
executive
officer of
the Company
on
December 9,
2008 and
subsequently
received an
increase in
his target
cash and
equity bonus
amounts as a
result of
the
promotion.
The foregoing summary of the Revised Plan is qualified in its entirety by the
full text of the Revised Plan, a copy of which is attached hereto as
Exhibit 99.1 and incorporated herein by reference.
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