Item 2.02.Results of Operations and Financial Condition.
On February 11, 2021, Sunstone Hotel Investors, Inc. (the “Company”) issued a press release regarding its financial results for the fourth quarter and year ended December 31, 2020. The press release referred to supplemental financial information that is available on the Company’s website, free of charge, at www.sunstonehotels.com. A copy of the press release and the supplemental financial information are attached hereto as Exhibits 99.1 and 99.2, respectively, and are incorporated herein by this reference.
The information furnished pursuant to this Item 2.02, including Exhibit 99.1 and Exhibit 99.2, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities under that Section, and shall not be deemed to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Exchange Act, regardless of any general incorporation language in such filing.
Item 5.02.Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On February 10, 2021, the Compensation Committee of the Board of Directors of the Company approved a 2021 cash bonus program (the “2021 Program”) applicable to its named executive officers, including its chief executive officer (“CEO”), John V. Arabia, and its executive vice presidents (“EVP”), Bryan A. Giglia, Marc A. Hoffman, Robert C. Springer and David M. Klein. Prior to its approval, the Compensation Committee engaged in a review of its incentive compensation program with the assistance of its independent compensation consultant, FPL Associates.
Under the 2021 Program, the executives will be eligible to earn cash bonuses based on the Company’s 2021 one-year relative total stockholder returns. Each executive’s cash bonus will also be based on the executive’s achievement of individual performance goals, which include but are not limited to, individual department objectives, the advancement of the specified Company and departmental goals, and the advancement of various environmental, social and governance initiatives; although no minimum bonus is guaranteed and any bonus may equal zero in any given year. In determining each executive’s bonus under the 2021 Program, the goals will be weighted as follows for the CEO and EVP level executives:
| | |
| CEO | EVP |
Goal #1 One-Year Relative Total Stockholder Return | 85% | 80% |
| | |
Individual Performance Weighting | 15.0% | 20.0% |
Total | 100.0% | 100.0% |
Additionally, under the 2021 Program, Mr. Klein’s cash incentive bonus levels were increased to a threshold level equal to 60.0% of base salary, a target level equal to 102.5% of base salary, and a high level equal to 145.0% of base salary, and equity incentive award levels were increased to a threshold level equal to 150.0% of base salary, a target level equal to 212.5% of base salary, and a high level equal to 275.0% of base salary; although no minimum bonus is guaranteed and any bonus may equal zero in any given year. The bonus levels remained unchanged from the prior year for the CEO and other EVPs. The foregoing percentages are subject to annual adjustments as may be determined, modified, and approved at the sole discretion of the Compensation Committee.
Item 9.01.Financial Statements and Exhibits.
(d) The following exhibits are furnished herewith:
EXHIBIT INDEX
