Holiday Inn 2013 Annual Report Download - page 86

Policy on payment for loss of office
Contractual notice period and pay in lieu
All current Executive Directors have a rolling service contract
witha notice period from the company of 12 months. As an
alternative, the Company may, at its discretion, pay in lieu of
that notice. Neither notice nor a payment in lieu of notice will
be given in the event of grossmisconduct.
Payment in lieu of notice could potentially include up to
12 months’ salary and the cash equivalent of 12 months’ pension
contributions,and other contractual benefits. Where possible,
theCompany will seek to ensure that where a leaver mitigates
Exercise of discretion
The Committee would only exercise the discretions available in the
APP and LTIP plan rules relating to:
• whether an award is made or an unvested award forfeited; and
• the extent and timing of any such award or forfeiture
in exceptional circumstances, for example permanent disablement.
Notice periods would not usually be included in the pro-ration
of APP and LTIP awards for a leaver. The Committee would only
exercise its discretion to include some or all of the notice period in
such pro-ration in exceptional circumstances, such as ill health,
and would not do so in circumstances of poor performance.
their losses by, for example, finding new employment, there will
accordingly be a corresponding reduction in compensation
payablefor loss of office.
An Executive Director may have an entitlement to compensation
in respect of their statutory rights under employment protection
legislation in the UK or other relevant jurisdiction.
There were no contractual provisions agreed prior to
27 June 2012 that could affect the quantum of loss of office
payments to ExecutiveDirectors.
LTIP
Subject to the circumstances surrounding the termination,
theCommittee, in its discretion, may treat an individual as a
Good Leaver for the purposes of the LTIP. The Committee will
consider factors such as personal performance and conduct,
overall Group performance and the specific circumstances of
the Executive Director’s departure including, but not restricted
to, whether the Executive Director is leaving by mutual agreement
with the Company. If an individual is not a Good Leaver then they
will be treated as an Other Leaver, as set out above.
Policy for determination of termination payments
Reason for termination Salary and contractual benefits
APP award for year of
termination (including after year
end but before payment)
Unvested APP
deferred share awards Unvested LTIP awards
Good Leaver including:
Ill-health/injury/ disability
Redundancy
Retirement
Employing company or
undertaking transferred
outside the Group
Other reason determined
by the Committee (in the case
of LTIP only)
Paid up to termination date.
Pay in lieu of notice,
if applicable.
Pro-rated award for year
of termination.1
No accelerated payment.2
Award made 50% cash and
50% in IHG shares deferred
for three years from grant.2
Vest on usual
vesting date.3
Vest on usual vesting
date to extent
performance
conditions met.3
Number of shares
vesting pro-rated
to termination date.
Death Paid up to date of death. Pro-rated award for year
of death paid fully in
cash, accelerated.2
Accelerated vesting
of award: Committee
has discretion to
determine otherwise.
Accelerated vesting:
Committee has
discretion to determine
number of shares
vesting, taking into
account proportion
of performance period
elapsed and extent to
which performance
conditions are satisfied.
Other Leaver including:
Resignation
Gross misconduct
Paid up to termination date. No award for year of
termination. In case of
resignation after financial
year end but before award
date, cash portion only of
award will be paid.2
Forfeited.2, 4 Forfeited.2
1 Committee has discretion to exceptionally pro-rate to a later date (see below).
2 Committee has discretion to determine otherwise (see below).
3 Committee has discretion to accelerate vesting (see below).
4
In the event of a termination in connection with a takeover or reconstitution unvested APP deferred share awards will have accelerated vesting on the date of
termination, unless the Committee determines otherwise.
84 IHG Annual Report and Form 20-F 2013
Directors’ Remuneration Report continued
Directors’ Remuneration Policy continued