Starwood 2010 Annual Report Download - page 57

3. Change in Control
The following table discloses the amounts that would have become payable on account of an involuntary
termination without cause following a change in control or a voluntary termination with good reason following a
change in control.
Name
Severance
Pay
($)
Medical
Benefits
($)
Vesting of
Restricted
Stock
($)(1)
Vesting of
Stock
Options
($)(2)
Outplacement
($)
401(k)
Payment
($)
Tax
Gross-Up
($)
Total
($)
van Paasschen(3) ........ 1,000,000 5,424 12,654,882 47,582,156 — — 7,220,816 77,463,278
Avril ................ 3,487,750 31,139 8,154,609 13,074,622 150,350 — n/a 24,898,470
Prabhu ............... 3,758,750 30,519 14,390,637 13,685,101 150,350 — — 32,015,357
Siegel ................ 3,157,150 30,125 3,617,869 12,668,152 127,698 — — 19,600,994
Turner ............... 3,008,750 30,195 2,099,706 23,721,172 129,750 — n/a 28,989,573
(1) Includes values for holdings of restricted stock and restricted stock units. Includes vested but deferred restricted
stock units in accordance with the Executive Plan.
(2) Includes vested stock options. Vested stock options could be subject to loss by the Named Executive Officers in
the event of a termination for cause and certain other events but could not in the event of an involuntary
termination without cause following a change in control or a voluntary termination with good reason following
a change in control.
(3) If the amount of severance pay and other benefits payable on change in control is greater than three times certain
base period taxable compensation for Mr. van Paasschen, a 20% excise tax is imposed on the excess amount of
such severance pay and other benefits. Excludes $585,376 of Mr. van Paasschen’s nonqualified deferred
compensation that is payable upon death, disability or certain changes in control as discussed in the
Nonqualified Deferred Compensation section beginning on page 40. Because of Mr. van Paasschen’s recent
hire, his base period taxable compensation does not reflect the total value of restricted stock granted to him in
earlier years, thus artificially increasing the excise tax that would apply on a change in control and,
correspondingly, the tax gross-up payment due under the estimate.
XI. DIRECTOR COMPENSATION
The Company uses a combination of cash and stock-based awards to attract and retain qualified candidates to
serve on the Board. In setting Director compensation, the Company considers the significant amount of time that
members of the Board spend in fulfilling their duties to the Company as well as the skill level required by the
Company of its Directors. The current compensation structure is described below.
For 2010, under the Company’s Director share ownership guidelines, each Director was required to own Shares
(or deferred compensation stock equivalents) that have a market price equal to four times the annual Director’s fees
paid to such Director. If any Director fails to satisfy this requirement, sales of Shares by such Director shall be
subject to a 35% retention requirement. Any new Director shall be given a period of three years to satisfy this
requirement.
Company employees who serve as members of the Board receive no fees for their services in this capacity.
Non-employee members of the Board (“Non-Employee Directors”) receive compensation for their services as
described below.
A. Annual Fees
Each Non-Employee Director receives an annual fee in the amount of $80,000, payable in four equal
installments of Shares issued under our LTIP. The number of Shares to be issued is based on the fair market value of
a Share using the average of the high and low price of the Company’s stock on December 31 of the year prior to
grant.
A Non-Employee Director may elect to receive up to one-half of the annual fee in cash and to defer (at an
annual interest rate of LIBOR plus 11⁄2% for deferred cash amounts) any or all of the annual fee payable in cash.
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