UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): February 10, 2016

 

 

HYATT HOTELS CORPORATION

(Exact name of registrant as specified in its charter)

 

 

 

Delaware   001-34521   20-1480589

(State or other jurisdiction

of incorporation)

 

(Commission

File Number)

 

(IRS Employer

Identification No.)

71 South Wacker Drive, 12th Floor  
Chicago, IL   60606
(Address of principal executive offices)   (Zip Code)

Registrant’s telephone number, including area code: (312) 750-1234

Former name or former address, if changed since last report: Not Applicable

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 

Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On February 11, 2016, Hyatt Hotels Corporation (the “ Company ”) announced that Patrick J. Grismer has been appointed Executive Vice President, Chief Financial Officer of the Company, effective as of March 14, 2016. In this capacity, Mr. Grismer will also serve as the Company’s principal financial officer, effective as of March 14, 2016.

Mr. Grismer, age 53, has served as the Chief Financial Officer of YUM! Brands, Inc. since May 2012. Prior to that position, Mr. Grismer served as Chief Planning and Control Officer of YUM! Brands, Inc., a position he held beginning January 2011. Mr. Grismer served as Chief Financial Officer of Yum! Restaurants International, Inc. from June 2008 to January 2011.

On February 10, 2016, Hyatt Corporation, a wholly-owned subsidiary of the Company, entered into an employment letter with Mr. Grismer pursuant to which Mr. Grismer is entitled to the following compensation and benefits:

 

  •   annual base salary of $775,000;

 

  •   annual incentive award with a target incentive of 100% of base salary (with a guaranteed minimum incentive award for 2016 equal to 75% of base salary);

 

  •   annual grants under the Third Amended and Restated Hyatt Hotels Corporation Long-Term Incentive Plan similar to other senior executives of Hyatt (which, for grants made during 2016, are expected to have an aggregate value equal to $1,900,000);

 

  •   a grant of stock appreciation rights (“SARs”) with a value equal to $650,000 which will vest in equal amounts over three years with the first vesting date to occur on the first anniversary of the award grant date, provided that Mr. Grismer remains employed with Hyatt on each vesting date, subject to approval by the Compensation Committee of the Board of Directors of the Company (the “Compensation Committee”);

 

  •   a grant of restricted stock units (“RSUs”) with a value equal to $500,000 which will vest in full on the fourth anniversary of the award grant date, provided that Mr. Grismer remains employed with Hyatt through such date, subject to approval by the Compensation Committee;

 

  •   employee benefits and perquisites available to the Company’s senior executive officers from time to time;

 

  •   relocation to Chicago in accordance with the Company’s relocation policy; and

 

  •   severance in accordance with the Company’s executive severance plans.

The foregoing description of the employment letter is qualified in its entirety by reference to its terms, which is filed herewith as Exhibit 10.1 and is incorporated herein by reference.

A copy of the press release announcing Mr. Grismer’s appointment is filed as Exhibit 99.1 to this report.

Mr. Atish Shah, who served as the Company’s Senior Vice President, Interim Chief Financial Officer and as the Company’s principal financial officer since April 20, 2015, will no longer serve in these roles effective as of March 14, 2016.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

 

10.1    Employment Letter, dated as of February 10, 2016, between Hyatt Corporation and Patrick J. Grismer
99.1    Hyatt Hotels Corporation Press Release dated February 11, 2016

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

    Hyatt Hotels Corporation
Date: February 11, 2016     By:  

/s/ Rena Hozore Reiss

      Rena Hozore Reiss
     

Executive Vice President, General Counsel

and Secretary

INDEX TO EXHIBITS

 

Exhibit Number

  

Exhibit Description

10.1    Employment Letter, dated as of February 10, 2016, between Hyatt Corporation and Patrick J. Grismer
99.1    Hyatt Hotels Corporation Press Release dated February 11, 2016

Exhibit 10.1

 

LOGO      

Mark Hoplamazian

President & Chief Executive Officer

 

Hyatt Hotels Corporation

71 South Wacker Drive

Chicago, IL 60606 USA

 

T: +1 312.780.5400

mark.hoplamazian@hyatt.com

February 10, 2016

PRIVATE & CONFIDENTIAL

Mr. Pat Grismer

6732 Elmcroft Circle

Louisville, KY 40241

Dear Pat:

On behalf of Hyatt Corporation ( the “ Employer ”), I am pleased to offer you the position of Executive Vice President, Chief Financial Officer, based in Chicago. As we have discussed, your employment start date will be March 14, 2016.

The following outlines the terms of employment and compensation and other benefits for the position.

Job Assignment

In this position, you will be responsible for executing your job consistent with the strategies and practices of Hyatt Hotels Corporation (“ Hyatt ” or the “ Company ”). You will report to me in my capacity as President and Chief Executive Officer.

Compensation

You will be paid a gross annual base salary of $775,000. Your base salary will be reviewed on March 1, 2017 and annually thereafter in line with the Employer’s compensation market benchmarking practice.

Incentive Plan (IP)

You will be eligible to participate in the Employer Incentive Plan that is based on criteria established, from time to time, by Hyatt for its senior management and for the senior management of its various subsidiaries, as adopted by the Employer. The current target for this role is 100% of your eligible annual base salary.

For the 2016 performance period, the Company will guarantee a minimum incentive payment equal to 75% of your target. Actual performance may result in achievement above the guarantee.

In the event your employment with the Company results in the forfeiture of your earned 2015 Incentive with your current employer, we will provide you with a cash payment equal to the amount forfeited (less appropriate withholdings). This payment will be returned to the Company in the event you elect to terminate your employment prior to December 31, 2016.

 

1

Hyatt Long Term Incentive Plan

You will be eligible for equity-based compensation as a participant under the Hyatt Hotels Corporation Long Term Incentive Plan (“ LTIP ”). The type and actual amount of award may vary, but will generally be based upon your performance, performance of Hyatt and performance of your function. It is expected that the grant value in 2016 for this role will be approximately $1,900,000 and delivered (according to a formula approved by the Compensation Committee) in Stock Appreciation Rights (SARs), Restricted Stock Units (RSUs), and Performance Shares (PSs). As with all LTIP participants, no future awards are guaranteed. All awards under the LTIP are subject to the approval of the Compensation Committee of the Company’s Board of Directors and will be subject to the terms of the LTIP, the standard form of award agreement then in effect and such other terms and conditions as the Compensation Committee may determine. Hyatt also reserves the right to amend, modify or terminate the LTIP at any time.

Subject to approval by the Compensation Committee of the Board of Directors at its next regularly scheduled meeting following your employment start date, you will receive a special grant with an award value of $650,000 in recognition of unvested forfeited equity at your current employer. If approved by the Compensation Committee and otherwise subject to the terms and conditions of the SARs award agreement, this initial grant would be delivered in SARs and vest in equal amounts over three years with the initial tranche vesting on the first anniversary of the award. The vesting schedule is subject to change pending approval of the Compensation Committee. This special grant will be subject to the terms of the LTIP, the standard form of award agreement then in effect and such other terms and conditions as the Compensation Committee may determine.

In addition to any other award under the Company LTIP, subject to approval by the Compensation Committee of the Board of Directors, you will receive a special new hire grant with an award value of $500,000. If approved by the Compensation Committee, this would be delivered in RSUs, and vest in its entirety, subject to the term of the standard form of award agreement on the fourth anniversary of the award.

Benefits

In this role, you will receive the following benefits, subject to eligibility:

 

  •   Medical and Dental insurance

 

  •   Life Insurance

 

  •   401(k) Retirement Savings Plan

 

  •   Deferred Compensation Plan (DCP)

 

  •   Disability Coverage

 

  •   Paid Time Off (PTO) Accrual

 

  •   Use of the Company Dining Room

 

  •   Corporate Office Severance Plan

 

  •   Executive Change in Control Plan

During the period of time that you transition health care benefits from your current employer to the Company, we will reimburse you for COBRA coverage less standard premium payments.

Board Eligibility

As an executive officer of the Company, you will devote such time as is necessary to perform the job duties to which you have been assigned. You shall be eligible to serve on the board of either a private or publicly-traded company after your first anniversary of employment with the Company, subject to the approval of the President and CEO. Service as a director must not interfere with your responsibilities, and the company must not compete with the Company in any manner.

 

2

Relocation

You have been provided with details concerning our relocation policy under separate cover. The Company will provide you with a furnished apartment in Chicago and travel to Louisville during the transitional period.

Non-solicitation and Non-competition

You agree that while employed by the Company and or by any Company Affiliate (‘Company, Hyatt Hotels Corporation, and Hyatt Hotels Corporation’s subsidiaries and affiliates’), and for a period of two years beginning on the date that your employment with the Company or with any Company Affiliate terminates, regardless of the reason for such termination, you will not, directly or indirectly, whether on your behalf or on behalf of any other party, induce, solicit, or attempt to persuade any employee of any Company Affiliate to terminate his or her employment with such Company Affiliate. In the event that you are found by a court of competent jurisdiction to have violated this section, the time period in this section that restricts your activity shall be extended for one day for each day that you are found to have been violating this section, up to a maximum of two additional years.

You agree that for a period of one year beginning on the date that your employment with the Company or with any Company Affiliate terminates, regardless of the reason for such termination, you will not engage in Competition with the Company or any Company Affiliate. “Competition” shall mean the provision of services as an employee, contractor, director, advisor, or in any other capacity, or ownership, directly or indirectly, for or with a competitor that is competitive with those aspects of the Company’s business that you were involved in, had supervisory responsibility over or was provided confidential information or trade secret about during your employment with the Company. You stipulate that this covenant is fair, reasonable and necessary for the protection of the Company’s trade secrets, confidential business information and other legitimate business interests and that you have received adequate consideration for this covenant as set forth in this document.

Acceptance

Please review this document and the attached agreements in detail and consult with an attorney if necessary, to understand the content of these provisions and to evaluate whether they conflict with any other agreements you may have already signed.

Your employment at Hyatt is at-will, and the terms and conditions of this offer are intended to be for your information only. You will need to comply with all Hyatt policies, including, but not limited to the Hyatt Employee Handbook, Hyatt’s Code of Business Conduct and Ethics and such other policies Hyatt adopts.

I look forward to working with you.

 

Yours Sincerely,

/s/ Mark Hoplamazian

Mark Hoplamazian

 

3

Cc: Robb Webb, Chief Human Resources Officer

Lauren Brown, Vice President Compensation

I have read and fully understand the terms and conditions of my employment as Executive Vice President, Chief Financial Officer.

 

Acceptance:  

/s/ Patrick Grismer

  Patrick Grismer
Date:   February 10, 2016

 

4

Exhibit 99.1

CONTACT:

Candace Mueller

Hyatt

+1-312-780-5479

candace.mueller@hyatt.com

For Immediate Release

HYATT HOTELS CORPORATION ANNOUNCES PATRICK J. GRISMER AS NEW

CHIEF FINANCIAL OFFICER

CHICAGO (February 11, 2016) – Hyatt Hotels Corporation (NYSE: H) today announced the selection of Patrick J. Grismer as chief financial officer, reporting to Mark Hoplamazian, president and chief executive officer, effective March 14, 2016.

In this role, Grismer will be responsible for all aspects of the finance function, while serving as a key business partner in achieving the company’s strategic growth initiatives.

“Pat is a highly respected leader with strong financial acumen. His considerable experience building global brands will serve us well at Hyatt,” said Hoplamazian. “His focus on driving superior business performance as we build differentiated brands will help us grow with intent and, in return, we believe will provide great value for our guests, colleagues, owners and shareholders.”

Grismer joins Hyatt from his post as chief financial officer at YUM! Brands, where he previously held a number of roles including chief planning and control officer and chief financial officer for YUM! Restaurants International. Prior to YUM!, he worked at The Walt Disney Company where he served in roles that included vice president, business planning and development for The Disneyland Resort and chief financial officer for the Disney Vacation Club.

Grismer began his career with Price Waterhouse after earning an MBA from Northwestern University’s Kellogg School of Management, and a bachelor’s degree in accounting from the University of Southern California.

“Hyatt’s portfolio of premier hotel brands and its commitment to quality and outstanding service truly differentiate it from the competition,” said Grismer. “I’m excited to be part of a global company poised for growth, and to join a team passionate about transforming the hospitality industry.”

Grismer and his family will relocate to Chicago.

About Hyatt Hotels Corporation

Hyatt Hotels Corporation, headquartered in Chicago, is a leading global hospitality company with a proud heritage of making guests feel more than welcome. Thousands of members of the Hyatt family strive to make a difference in the lives of the guests they encounter every day by providing authentic hospitality. The Company’s subsidiaries develop, own, operate, manage, franchise, license or provide services to hotels, resorts, branded residences and vacation ownership properties, including under the Hyatt ® , Park Hyatt ® , Andaz ® , Grand Hyatt ® , Hyatt Centric™, Hyatt Regency ® , Hyatt Place ® , Hyatt House ® , Hyatt Zilara™, Hyatt Ziva™, Hyatt Residences ®  and Hyatt Residence Club ®  brand names and have locations on six continents. As of September 30, 2015, the Company’s worldwide portfolio consisted of 627 properties in 52 countries. For more information, please visit www.hyatt.com.