Starwood 2012 Annual Report Download - page 31

STARWOOD HOTELS & RESORTS WORLDWIDE, INC.-2013Proxy Statement 25
APPROVAL OF THE COMPANY’S 2013 LONG-TERM INCENTIVE COMPENSATION PLAN
Types of Awards
The 2013 Plan provides for the grant of unrestricted stock, restricted stock, RSUs, performance shares, performance units, non-
qualifi ed stock options (“NQSOs”), incentive stock options (“ISOs”), SARs and other stock-based awards. ISOs may be granted only
to employees of the Company or its subsidiaries.
Award Pool
The number of shares that will be available for issuance pursuant to
awards granted under the 2013 Plan is eleven million (11,000,000)
(the “Award Pool”), subject to adjustment as described in the 2013
Plan. The shares issued by the Company under the 2013 Plan
will be authorized but unissued shares or shares currently held
(or subsequently acquired) as treasury shares, including shares
purchased on the open market or in private transactions.
Upon approval of the 2013 Plan by the stockholders of the Company,
no further grants may be made under the 2004 Plan. However, if
shares awarded or subject to issuance pursuant to awards under
the 2004 Plan are not issued or are reacquired by the Company, in
either case due to the forfeiture, cancellation or expiration of such
awards without having been exercised or settled in shares, those
shares will be available for issuance pursuant to awards under the
2013 Plan. In addition, if the withholding obligation, exercise price
or purchase price under an award under the 2004 Plan is satisfi ed
by the Company retaining shares that otherwise would have been
issued also in settlement of the award or by shares tendered by
the participant, the number of shares so retained or tendered
will be available for issuance pursuant to awards under the 2013
Plan. All shares derived from the 2004 Plan will be tracked and
counted as provided in the 2013 Plan (as explained below) and
will not trigger a deduction from the Award Pool.
Each share of restricted stock, each share-settled restricted stock
unit, each share of unrestricted stock and each other stock-
based/stock-settled award will be counted as one share subject
to an award and deducted from the Award Pool (restricted stock
units and other stock-based awards that may not be settled in
shares will not result in a deduction from the Award Pool). Each
performance share that may be settled in shares will be counted
as one share subject to an award (based on the number of shares
that would be paid for achievement of target performance) and
deducted from the Award Pool. Each performance unit that
may be settled in shares will be counted as a number of shares
subject to an award (based on the number of shares that would
be paid for achievement of target performance), with the number
determined by dividing the value of the performance unit at the
time of grant by the fair market value of a share at the time of
grant (the closing price of a share of the Company on the NYSE
on the immediately preceding trading day), and the resulting
number of shares will be deducted from the Award Pool. If a
performance share or performance unit is later settled based on
above-target performance, the number of shares corresponding
to the above-target performance, calculated pursuant to the
applicable methodology specifi ed above, will be deducted from the
Award Pool at the time of settlement; in the event that the Award
is later settled upon below-target performance, the number of
shares corresponding to the below-target performance, calculated
pursuant to the applicable methodology specifi ed above, will be
added back to the Award Pool. Performance shares and units
that may not be settled in shares will not result in a reduction in
the Award Pool. Each NQSO, ISO, and SAR that may be settled
in shares will be counted as one share subject to an award and
deducted from the Award Pool. SARs that may not be settled in
shares will not result in a reduction of the Award Pool.
If shares awarded or subject to issuance under the 2013 Plan
are not issued, or are reacquired by the Company, for reasons
including, but not limited to, a forfeiture of restricted stock or a
restricted stock unit or the termination, expiration or cancellation
of an NQSO, ISO, SAR, performance share or performance
unit or the settlement of an award in cash in lieu of shares, that
number of shares will be added back to the Award Pool. If the
withholding obligation, exercise price or purchase price under an
award is satisfi ed by the Company retaining shares that otherwise
would have been issued in settlement of the award or by shares
tendered by the participant, the number of shares so retained or
tendered will be added back to the Award Pool.