Exhibit 10.1

 

Park Hotels & Resorts Inc.

Executive Severance Plan

 

The Compensation Committee (the “Committee”) of the Board of Directors (the
“Board”) of Park Hotels & Resorts Inc. (the “Company”) has adopted this
Executive Severance Plan (the “Plan”), effective as of April 27, 2017.
Capitalized terms not otherwise defined in the Plan shall have the meanings set
forth in Exhibit A hereto.  

 

1.

Participation. Employees at the Senior Vice President level and above who are
designated for participation in the Plan by the Committee from time to time
shall participate in the Plan (collectively, the “Participants”).  

 

2.

Administration.  The Plan shall be administered by the Committee, which shall
have authority, subject to the express provisions of the Plan, to interpret the
Plan and make all other determinations necessary or advisable for the
administration of the Plan. All decisions, interpretations and other actions of
the Committee shall be final, conclusive and binding on all parties.

 

3.

Term and Amendment. The Committee may amend or terminate the Plan at any time
and for any reason, provided that (i) six months’ prior notice to affected
Participants will be required for any termination or amendment that materially
and adversely affects the rights of such Participants, and (ii) no termination
or amendment will materially and adversely affect the rights of any Participant
whose employment terminated prior to the date of such amendment or termination.

 

4.

Termination without Cause or for Good Reason.  Upon a Participant’s termination
of employment by the Company without Cause or by the Participant for Good
Reason, the Participant shall be entitled to receive the Accrued Rights.  In
addition, and subject to the terms and conditions of Section 8, the Participant
shall be eligible to receive the benefits set forth below.

 

 

(a)

The Company shall make a cash payment to the Participant equal to the product of
the severance multiple set forth in the table below and the Participant’s
Severance Basis, payable in a single lump sum as provided under Section 8.

 

Level

Severance Multiple

Executive Vice President

2.0x

Senior Vice President serving on Executive Committee

1.5x

Senior Vice President not serving on Executive Committee

1.0x

 

The “Severance Basis” is equal to the sum of (x) the Participant’s annual base
salary in effect immediately prior to termination and (y) the Participant’s
average annual bonus for the most recent two fiscal years, or, if the
Participant was eligible to receive an annual bonus for only one year prior to
termination, the bonus paid, if any, for such year.  If the Participant was not
eligible to receive an annual bonus for the year prior to termination, then (x)
the Participant’s “Severance Basis” is equal to the Participant’s annual base
salary in effect immediately prior to termination and (y) the Participant shall
remain eligible to receive an annual bonus for the year of termination
(prorated, if applicable, for the actual period of service during such year),
payable on the date such annual bonuses are paid to executives generally.

 

 

(b)

The Participant’s outstanding equity and equity-based awards shall be treated in
the manner set forth in the Company’s 2017 Omnibus Incentive Plan (the “2017
Plan”) (or any successor plan) and the applicable award agreements issued
thereunder (provided, however, that a Participant’s termination of employment
for Good Reason shall be treated as a termination by the Company without Cause
under the 2017 Plan (or any successor plan) and the award agreements issued
thereunder).

 

 

(c)

Subject to the Participant’s timely election of COBRA coverage under the
Company’s group health plan, the Company shall pay on the Participant’s behalf,
on the first regularly scheduled payroll date of each month during the 12-month
period following the Participant’s date of termination (the “Coverage Period”),
an amount equal to the difference between the monthly COBRA premium cost and the
monthly contribution paid by similarly situated active Company executives for
the same coverage. The payments described in this clause (c) shall cease earlier
than the expiration of the Coverage Period if the Participant becomes eligible
to receive group health coverage from another employer or ceases to be eligible
to receive COBRA coverage.

 

5.

Termination for Cause or without Good Reason. If a Participant’s employment is
terminated by the Company for Cause or by the Participant without Good Reason,
the Participant shall be entitled to receive the Accrued Rights and the
Participant’s outstanding

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equity and equity-based awards shall be treated in the manner set forth in the
2017 Plan (or any successor plan) and the applicable award agreements issued
thereunder.  The Participant shall not be eligible to receive any other benefits
in connection with such termination.

 

6.

Termination by Death or Disability. If a Participant’s employment terminates due
to death or Disability, the Participant shall be entitled to receive the Accrued
Rights and an annual bonus for the fiscal year of termination pursuant to the
terms of the Company’s Executive Short-Term incentive Program (the “STIP”), and
the Participant’s outstanding equity and equity-based awards shall be treated in
the manner set forth in the 2017 Plan (or any successor plan) and the applicable
award agreements issued thereunder. The Participant shall not be eligible to
receive any other benefits in connection with such termination.

 

7.

Non-Compete/Non-Solicit. During a Participant’s employment with the Company or
its Affiliates (the “Employment Term”) and for 12 months following the date the
Participant ceases to be employed by the Company or any of its Affiliates (the
“Restricted Period”), the Participant shall not, whether on the Participant’s
own behalf or on behalf of or in conjunction with any other Person, directly or
indirectly solicit, pursue or interfere with (i) the business of any then
current or prospective client or customer with whom the Participant (or his or
her direct reports) had personal dealings or involvement during the one-year
period preceding the Participant’s termination of employment, (ii) any business
or investment opportunity with which the Participant (or his or her direct
reports) had personal dealings or involvement during the one-year period
preceding the Participant’s termination of employment, or (iii) business
relationships between the members of the Company Group and any of their hotel
managers, business partners, clients, customers, suppliers, partners, members or
investors.

 

In addition, during the Restricted Period, the Participant shall not directly or
indirectly (i) provide services to a Competitor, (ii) enter the employ of a
Competitor, or (iii) acquire a financial interest in or otherwise become
actively involved with a Competitor as an individual, partner, shareholder,
officer, director, principal, agent, trustee or consultant. Notwithstanding the
foregoing, the Participant may directly or indirectly own, solely as an
investment, securities of a Competitor which is publicly traded if the
Participant (i) is not a controlling Person of, or a member of a group which
controls, such Person and (ii) does not directly or indirectly own 2% or more of
any class of securities of such Person.

During the Restricted Period, the Participant will not directly or indirectly
(i) solicit or encourage any employee of the Company Group to leave the
employment of the Company Group or (ii) hire any such employee of the Company
Group.

 

The term (i) “Business” shall mean the business of owning (but not the business
of operating, managing and/or franchising) hotel properties and (ii)
“Competitor” shall mean any publicly-traded real estate investment trust engaged
primarily in the Business (including, but not limited to, Host Hotels & Resorts,
Inc., LaSalle Hotel Properties, Pebblebrook Hotel Trust, Sunstone Hotel
Investors, Inc., Chesapeake Lodging Trust, Diamondrock Hospitality Company, RLJ
Lodging Trust and Ryman Hospitality Properties, Inc.).

 

If a judicial determination is made by a court of competent jurisdiction that
the restriction contained in this Section 7 is unenforceable against a
Participant, the provisions of this Section 7 shall not be rendered void but
shall be deemed amended to apply as to the maximum extent as such court may
judicially determine or indicate to be enforceable.  Alternatively, if any court
of competent jurisdiction finds that any restriction contained in this Section 7
is unenforceable, and such restriction cannot be amended so as to make it
enforceable, such finding shall not affect the enforceability of any of the
other restrictions contained herein.

 

8.

Conditions to Severance. Notwithstanding any provision herein to the contrary,
the payment of any amount or provision of any benefit pursuant to Sections 4, 5
or 6 of the Plan (other than the Accrued Rights) (collectively, the “Severance
Benefits”) to a Participant shall be conditioned upon (i) the Participant’s
compliance with the obligations set forth in Section 7 hereof and (ii) the
Participant’s execution, delivery to the Company and non-revocation of a release
of claims in a form acceptable to the Company (the “Release Agreement”) (and the
expiration of any revocation period contained in such Release Agreement) within
60 days following the date of the Participant’s termination of employment or
such shorter period as the Company may provide (such expiration date, the
“Release Effective Date”).  If the Participant fails to execute the Release
Agreement in such a timely manner so as to permit any revocation period to
expire prior to the end of such 60-day (or shorter) period, or timely revokes
his or her acceptance of such release following its execution, the Participant
shall not be entitled to any of the Severance Benefits.  The Company shall pay
or commence providing the Severance Benefits within 10 days following the
Release Effective Date; provided, however, that, to the extent that any of the
Severance Benefits constitutes “nonqualified deferred compensation” for purposes
of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”),
any payment of any amount or provision of any benefit otherwise scheduled to
occur prior to the 60th day following the date of the Participant’s termination
of employment hereunder, but for the condition on executing the Release
Agreement, shall not be made until the first regularly scheduled payroll date
whose cutoff date follows such 60th day, after which any remaining Severance
Benefits shall thereafter be provided to the Participant according to the
applicable schedule set forth herein.

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9.

Other Severance Benefits/Previous Plans. Participants shall not be entitled to
receive any severance payments or benefits from the Company or any of its
Affiliates upon a termination of employment, except as set forth in the Plan or
as may be approved by the Committee in its discretion.  This Plan supersedes any
and all prior severance plans or arrangements to which any Participant is
subject (including the Hilton Worldwide Holdings Inc. 2013 Executive Severance
Plan, as amended), all of which are hereby terminated as to the Participants.

 

10.

Dispute Resolution/Attorneys’ Fees. Any dispute arising as to the parties’
rights and obligations hereunder shall be resolved by binding arbitration in
accordance with the rules of The McCammon Group.  Such arbitration shall take
place in Northern Virginia.  The arbitrator shall be empowered to decide the
arbitrability of all disputes and shall apply the substantive federal, state, or
local law and statute of limitations governing any dispute submitted under the
applicable rules.  In ruling on any dispute submitted to arbitration, the
arbitrator shall have the authority to award only such remedies or forms of
relief as are provided for under the substantive law governing such
dispute.  The arbitrator shall issue a written decision that shall include the
essential findings and conclusions on which the decision is based (a standard
award).  Each party consents to the jurisdiction of the courts of the
Commonwealth of Virginia for injunctive, specific enforcement or other relief in
aid of the arbitration proceedings or to enforce judgment of the award in such
arbitration proceeding, but not otherwise.  The award entered by the arbitrator
shall be final and binding and shall not be appealable.  The fact,
circumstances, and outcome of the arbitration shall be confidential to the
maximum extent allowed by law.  The Company shall bear all fees and costs unique
to the arbitration forum (e.g., filing fees, transcript costs and arbitrator’s
fees).  The parties shall be responsible for their own attorneys’ fees and
costs.

 

11.

Successors.  This Plan shall inure to the benefit of and shall be binding upon
the Company and its successors and assigns. Any successor (whether direct or
indirect and whether by purchase, lease, merger, consolidation, liquidation or
otherwise) to all or substantially all of the Company’s business and/or assets
shall assume and agree to perform the obligations of the Company under this
Plan.  The Plan shall inure to the benefit of and be enforceable by each
Participant’s personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees, legatees or other beneficiaries. If a
Participant shall die while any amount remains payable to such Participant
hereunder, all such amounts shall be paid to the executors, personal
representatives or administrators of such Participant’s estate.

 

12.

No Right to Continued Service.  Nothing contained in the Plan shall (i) confer
upon any Participant any right to continue as an employee of the Company,
(ii) constitute any contract of employment or agreement to continue employment
for any particular period, or (iii) interfere in any way with the right of the
Company to terminate a service relationship with any Participant, with or
without Cause.

 

13.

No Duty to Mitigate.  A Participant shall not be required to mitigate the amount
of any payment or benefit provided pursuant to the Plan, nor shall the amount of
any such payment or benefits be reduced by any compensation that the Participant
receives from any other source, except as set forth in Section 4(c).

 

14.

Withholding/Section 280G and 409A Matters.  The Company shall have the authority
and right to withhold an amount sufficient to satisfy federal, state, local and
foreign taxes required by law to be withheld with respect to any payments or
benefits under the Plan. The provisions with respect to Sections 280G and 409A
of the Code on Exhibit B are incorporated into the Plan as if fully set forth
herein.

 

15.

Unfunded Plan.  The Plan is intended to be an “unfunded” plan for severance
benefits.  Nothing contained in the Plan shall give a Participant any rights
that are greater than those of a general unsecured creditor.

 

16.

No Assignment.  Each Participant’s rights under the Plan may not be assigned or
transferred in whole or in part, except as set forth in Section 11.  

 

17.

Governing Law.  The Plan shall be construed and interpreted in accordance with
the laws of the State of Delaware without reference to the conflict of laws
provisions thereof, to the extent not preempted by federal law, which shall
otherwise
control.                                                                                                                                                                                  

 

 

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EXHIBIT A

 

Certain Definitions

 

 

(a)

“Accrued Rights” means (i) all accrued but unpaid base salary through the date
of termination of the Participant’s employment, (ii) any accrued but unpaid
annual bonus for the prior compensation year required to be paid in accordance
with the terms of the STIP, (iii) any unpaid or unreimbursed expenses incurred
by the Participant in accordance with Company policy, and (iv) any benefits
provided under the Company’s employee benefit plans upon a termination of
employment, in accordance with the terms contained therein.

 

 

(b)

“Affiliate” means any Person that directly or indirectly controls, is controlled
by or is under common control with the Company. The term “control” (including,
with correlative meaning, the terms “controlled by” and “under common control
with”), as applied to any Person, means the possession, directly or indirectly,
of the power to direct or cause the direction of the management and policies of
such Person, whether through the ownership of voting or other securities, by
contract or otherwise.

 

 

(c)

“Cause” means a good faith determination of the Committee or its designee that
(i) there is “cause” to terminate a Participant’s employment or service, as
defined in and in accordance with any employment agreement between the
Participant and any member of the Company Group or an Affiliate in effect at the
time of such termination or (ii) in the absence of any such employment agreement
(or the absence of any definition of “Cause” contained therein), any of the
following has occurred with respect to a Participant: (A) such Participant has
failed to reasonably perform his or her duties to the Service Recipient, or has
failed to follow the lawful instructions of the Board or his or her direct
superiors, in each case other than as a result of his or her incapacity due to
physical or mental illness or injury, in a manner that could reasonably be
expected to result in harm (whether financially, reputationally or otherwise) to
any member of the Company Group or an Affiliate, following notice by the Company
Group or such Affiliate of such failure; (B) such Participant has engaged or is
about to engage in conduct harmful (whether financially, reputationally or
otherwise) to any member of the Company Group or an Affiliate; (C) such
Participant has been convicted of, or pled guilty or no contest to, a felony or
any crime involving as a material element fraud or dishonesty; (D) the willful
misconduct or gross neglect of such Participant that could reasonably be
expected to result in harm (whether financially, reputationally or otherwise) to
any member of the Company Group or an Affiliate; (E) the willful violation by
such Participant of the written policies of the Service Recipient or any
applicable written policies of any member of the Company Group that could
reasonably be expected to result in harm (whether financially, reputationally or
otherwise) to any member of the Company Group or an Affiliate; (F) such
Participant’s fraud or misappropriation, embezzlement or misuse of funds or
property belonging to the Company Group or an Affiliate (other than good faith
expense account disputes); (G) such Participant’s act of personal dishonesty
which involves personal profit in connection with such Participant’s employment
or service with the Company Group or an Affiliate, or (H) the willful breach by
such Participant of fiduciary duty owed to the Service Recipient.  Any act, or
failure to act, based upon prior approval given by the Board or a committee
thereof or upon the instructions or with the approval of the Participant’s
superior or based upon the advice of counsel for the Company or an Affiliate,
shall be conclusively presumed to be done, or omitted to be done, by the
Participant in good faith and in the best interests of the Company or an
Affiliate.

 

 

(d)

“Company Group” means, collectively, the Company and its Subsidiaries.

 

 

(e)

“Disability” means the Company or an Affiliate having cause to terminate a
Participant’s employment or service on account of “disability,” as defined in
any then-existing employment, consulting or other similar agreement between the
Participant and the Company or an Affiliate or, in the absence of such an
employment, consulting or other similar agreement (or the absence of any
definition of “Disability” contained therein), a condition entitling the
Participant to receive benefits under a long-term disability plan of the Company
or an Affiliate, or, in the absence of such a plan, the complete and permanent
inability by reason of illness or accident to perform the duties of the
occupation at which a Participant was employed or served when such disability
commenced. Any determination of whether Disability exists shall be made by the
Committee (or its designee) in its sole discretion

 

 

(f)

“Good Reason” means the occurrence of one or more of the following circumstances
without the Participant’s written consent, which circumstances are not remedied
by the Company within 30 days of its receipt of a written notice from the
Participant setting forth in reasonable specificity the circumstances that
constitute Good Reason (which written notice must be provided by the Participant
within 60 days of the Participant’s knowledge (whether actual or constructive,
including, without limitation, knowledge that the Participant would have
reasonably obtained after making due and appropriate inquiry) of such
circumstances): (x) a material diminution in the Participant’s duties or
responsibilities, (y) a material reduction in the

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Participant’s annual base salary or target annual bonus opportunity (other than
pursuant to an across-the-board reduction applicable to all similarly situated
executives), or (z) the relocation of the Participant’s principal place of
employment by more than 50 miles from the Company’s headquarters, or such other
place of employment at which the Participant has agreed to be based.  In order
for a Participant to terminate his or her employment for Good Reason, the
Participant must terminate employment within 30 days of the end of the cure
period if the circumstances giving rise to Good Reason have not been cured.

 

 

(g)

“Person” means any individual, corporation, association or other business
entity.

 

 

(h)

“Service Recipient” means the member of the Company Group by which the
Participant is, or following a termination of employment with the Service
Recipient for any reason (including death or Disability) was most recently,
principally employed.

 

 

(i)

“Subsidiary” means, with respect to any specified Person: (i) any corporation,
association or other business entity of which more than 50% of the total voting
power of shares of such entity’s voting securities (without regard to the
occurrence of any contingency and after giving effect to any voting agreement or
stockholders’ agreement that effectively transfers voting power) is at the time
owned or controlled, directly or indirectly, by that Person or one or more of
the other Subsidiaries of that Person (or a combination thereof); and (ii) any
partnership, limited liability company or any comparable foreign entity (A) the
sole general partner (or functional equivalent thereof) or the managing general
partner (or functional equivalent thereof) of which is such Person or Subsidiary
of such Person or (B) the only general partners (or functional equivalents
thereof) of which are that Person or one or more Subsidiaries of that Person (or
any combination thereof).

 

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EXHIBIT B

 

Section 280G and 409A Provisions

 

 

1.

Section 280G. In the event that any payment or benefit received or to be
received by a Participant pursuant to the Plan or otherwise (“Payments”) would
(i) constitute a “parachute payment” within the meaning of Section 280G of the
Code and (ii) but for this section, be subject to the excise tax imposed by
Section 4999 of the Code, any successor provisions, or any comparable federal,
state, local or foreign excise tax (“Excise Tax”), then, subject to the
provisions of this Section 1, such Payments shall be either (x) provided in full
pursuant to the terms of the Plan or any other applicable agreement, or (y)
provided as to such lesser extent which would result in no portion of such
Payments being subject to the Excise Tax (“Reduced Amount”), whichever of the
foregoing amounts, taking into account the applicable federal, state, local and
foreign income, employment and other taxes and the Excise Tax (including,
without limitation, any interest or penalties on such taxes), results in the
receipt by the Participant, on an after-tax basis, of the greatest amount of
payments and benefits provided for hereunder or otherwise, notwithstanding that
all or some portion of such Payments may be subject to the Excise Tax. Unless
the Company and the Participant otherwise agree in writing, any determination
required under this Plan shall be made by an independent advisor designated by
the Company and reasonably acceptable to the Participant (the “Independent
Advisor”), whose determination shall be conclusive and binding upon the
Participant and the Company for all purposes.  For purposes of making the
calculations required under this Plan, the Independent Advisor may make
reasonable assumptions and approximations concerning applicable taxes and may
rely on reasonable, good faith interpretations concerning the application of
Sections 280G and 4999 of the Code; provided that the Independent Advisor shall
assume that the Participant pays all taxes at the highest marginal rate.  The
Company and the Participant shall furnish to the Independent Advisor such
information and documents as the Independent Advisor may reasonably request in
order to make a determination under this Section 1.  The Company shall bear all
costs that the Independent Advisor may incur in connection with any calculations
contemplated by this Plan.  The reduction of the Payments payable hereunder, if
applicable, shall be made by first reducing the cash payments under Section
4(a), second by reducing the COBRA subsidy under Section 4(c), and lastly by
reducing any other Payments in a manner determined by the Company, in
consultation with the Participant.

 

 

2.

Section 409A.

 

 

(a)

General. The Company intends that the payments and benefits provided under the
Plan shall either be exempt from the application of, or comply with, the
requirements of Section 409A of the Code, and the Plan shall be construed in a
manner that effectuates this intent.  Neither the Company nor its respective
directors, officers, employees or advisers (other than in his or her capacity as
a Participant) shall be held liable for any taxes, interest, penalties or other
monetary amounts owed by any Participant or other taxpayer as a result of the
Plan.  Notwithstanding anything in the Plan to the contrary, the Committee may
amend the Plan, to take effect retroactively or otherwise, as deemed necessary
or advisable for the purpose of remaining exempt from or complying with the
requirements of Section 409A of the Code and the administrative regulations and
rulings promulgated thereunder.  Each payment in a series of payments under the
Plan shall be deemed to be a separate payment for purposes of Section 409A of
the Code.

 

 

(b)

Definitional Restrictions. Notwithstanding anything in the Plan to the contrary,
to the extent that any amount or benefit that would constitute non-exempt
“deferred compensation” for purposes of Section 409A of the Code (“Non-Exempt
Deferred Compensation”) would otherwise be payable or distributable under the
Plan by reason of the occurrence of a Participant’s separation from service,
such Non-Exempt Deferred Compensation will not be payable or distributable to
the Participant by reason of such circumstance unless the circumstances giving
rise to such separation constitute a “separation from service” under Section
409A of the Code and the applicable regulations.

 

 

(c)

Six-Month Delay in Certain Circumstances. In the event that, notwithstanding the
clear language of the Plan and the intent of the Company, any amount or benefit
under this Plan constitutes Non-Exempt Deferred Compensation and is payable or
distributable by reason of a Participant’s separation from service during a
period in which the Participant qualifies as a “specified employee” (as defined
in Section 409A of the Code and the final regulations thereunder), then, subject
to any permissible acceleration of payment under Section 409A of the Code:

 

 

a.

the amount of such Non-Exempt Deferred Compensation that would otherwise be
payable during the six-month period immediately following the Participant’s
separation from service under the terms of this Plan will be accumulated through
and paid or provided on the first day of the seventh month following the
Participant’s separation from service (or, if the Participant dies during such
period, within 30 days after the Participant’s death) (in either case, the
“Required Delay Period”); and

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b.

the normal payment or distribution schedule for any remaining payments or
distributions will resume at the end of the Required Delay Period.

 

 

(d)

Expense Reimbursements.  To the extent that any right to reimbursement of
expenses or payment of any benefit in-kind under the Plan constitutes Non-Exempt
Deferred Compensation, (i) any such expense reimbursement shall be made by the
Company no later than the last day of the taxable year following the taxable
year in which such expense was incurred by the Participant, (ii) the right to
reimbursement or in-kind benefits shall not be subject to liquidation or
exchange for another benefit, and (iii) the amount of expenses eligible for
reimbursement or in-kind benefits provided during any taxable year shall not
affect the expenses eligible for reimbursement or in-kind benefits to be
provided in any other taxable year.