Exhibit 99.1
Execution Copy
XXXXX XXXX LASALLE INCORPORATED
CEO PERFORMANCE INCENTIVE COMPENSATION
AGREEMENT
THIS CEO PERFORMANCE INCENTIVE COMPENSATION
AGREEMENT (this “Agreement”) is made by and between XXXXX LANG LASALLE INCORPORATED, a Maryland Corporation
(the “Company”), and XXXXX XXXX (the “Executive”), and is dated as of April 19, 2012.
WHEREAS, the Board of Directors
of the Company (the “Board”) desires to retain the Executive so that he may continue to contribute to the growth,
development and future business success of the Company; and
WHEREAS, by this Agreement the
Board intends to provide the Executive with additional income security that will (1) reward the Executive for the organizational
value created during his years of service with the Company and (2) create an additional retention incentive so that the Company
will continue to benefit from the leadership of the Executive; and
WHEREAS, the Board has therefore
authorized the execution, delivery and performance by the Company of this Agreement.
NOW, THEREFORE, for and in consideration
of the mutual promises, covenants and obligations contained in this Agreement, the Company and the Executive agree as follows.
Capitalized terms used but not otherwise defined in this Agreement shall have the respective meanings given to them in Article
3 of this Agreement. This Agreement is meant to supplement and work in conjunction with (and not to replace) the Company’s
other incentive programs, such as its equity plans, severance arrangements and other benefit plans, in order to achieve the purposes
described above.
ARTICLE
1
ELIGIBILITY
| 1.1 | Eligibility. The Company will pay the Executive the Benefit upon the Executive’s: |
(a) Standard Termination
on or after the Eligibility Date;
(b) Death or Disability;
or
(c) Involuntary Termination.
ARTICLE
2
Amount and Form of Benefit
| 2.1 | Benefit. Upon the Executive’s Standard Termination, death or Disability on or after the Eligibility Date, the
annual value of the Benefit shall be equal to: |
$250,000 + 8.5% of the Executive’s
Final Average Annual Incentive (FAAI)
| 2.2 | Death, Disability or Involuntary Termination. In the event of the Executive’s death, Disability or Involuntary
Termination before the Eligibility Date, the annual value of the Benefit shall be equal to: |
| | ($250,000 + 8.5% of the Executive’s FAAI) x (number of months of Service ÷ 120); |
| | provided that the number of months of Service shall not exceed 120 for this purpose. |
| 2.3 | Other Terminations. Notwithstanding any provision of this Agreement to the contrary, the Executive and his Spouse shall
forfeit all rights to receive any Benefit under this Agreement upon the Executive’s Separation from Service due to a reason
(including voluntary resignation prior to the Eligibility Date and termination for Cause at any time, including after the
Eligibility Date) other than the reasons provided for in Sections 2.1 and 2.2 above. |
| 2.4 | Timing and Form of Payment. Upon the Executive’s (1) Standard Termination on or after the Eligibility Date, (2)
Disability, or (3) Involuntary Termination before the Eligibility Date, the Executive may elect to receive the resulting Benefit
in any one of the following forms of payment: |
| (a) | Single Life Annuity. Immediate Single Life Annuity paid to him in equal monthly installments beginning on the first
day of the month following his Separation from Service or Disability and ending with the month in which he dies, in an amount which
is the Equivalent Actuarial Value of the single life annuity for the life of the Executive; |
| (b) | Joint and 100% Survivor Annuity. A Joint and 100% Survivor Annuity which is an annuity for the Executive’s life,
with a survivor annuity for the life of his Spouse, if his Spouse survives him, in an amount which is the Equivalent Actuarial
Value of the single life annuity for the life of the Executive. Under such an annuity, the Executive shall receive monthly payments
beginning on the first day of the month following his Separation from Service or Disability and ending with the month in which
he dies, and his surviving Spouse shall receive monthly payments beginning on the first day of the month following his death and
ending with the month in which such Spouse dies; or |
| (c) | Joint and 50% Survivor Annuity. A Joint and 50% Survivor Annuity, which is an annuity for the Executive’s life,
with a survivor annuity for the life of his Spouse, if his Spouse survives him, which is 50 percent of the amount of the annuity
payable during the joint lives of the Executive and the Spouse, in an amount which is the Equivalent Actuarial Value of a single
annuity for the life of the Executive. Under such an annuity, the Executive shall receive monthly payments beginning on the first
day of the month following his Separation from Service or Disability and ending with the month in which he dies, and his surviving
Spouse shall receive monthly payments beginning on the first day of the month following his death and ending with the month in
which such Spouse dies. |
The Company will provide the
Executive with an estimate of the amount of Benefit payable under each of the forgoing Benefit payment forms and a copy of the
calculation of each such amount at the time of his eligibility for a Benefit under Section 2.1 or 2.2 above. Appendix A to this
Agreement includes examples of the calculation of the foregoing Benefit payment forms, for purposes of illustration only. The amount
of Benefit payments will be determined according to the terms of the Agreement, without reference to Appendix A.
| (a) | If the Executive dies before the Executive has elected an annuity form under Section 2.4 above and before annuity payments
have begun, and his Spouse survives him, the Executive’s surviving Spouse shall receive the Benefit in monthly payments beginning
on the first day of the month following the Executive’s death and ending with the month in which such Spouse dies, as if
the Executive had elected the Joint and 100% Survivor Annuity form of annuity payment in Section 2.4(b) above. |
| (b) | If the Executive dies (i) with no surviving Spouse, or (iii) having elected the immediate Single Life Annuity form payment
in Section 2.4(a) above, no Benefit shall be payable under this Agreement after Executive’s death. |
ARTICLE
3
Definitions
The following capitalized
terms shall have the respective definitions given to them for all purposes of this Agreement:
| 3.1 | “Agreement” shall have the meaning given to that term in the introduction to this CEO Performance Incentive
Compensation Agreement. |
| 3.2 | “Benefit” means an annual benefit or survivor benefit as determined under Article 2 as of any date of reference. |
| 3.3 | “Board” shall have the meaning given to it in the introduction of this Agreement. |
| 3.4 | "Cause" means the Executive’s (i) commission of a deliberate and premeditated act in bad faith against
the interests of the Company, which shall include a deliberate violation of the Company’s Code of Business Ethics as in effect
from time to time; (ii) conviction of, or entry of a plea of nolo contendere to, any crime having as its predicate element
fraud, dishonesty or misappropriation; (iii) willful refusal or willful failure to perform duties; or (iv) breach of any material
term of any written agreement between the Executive and the Company. If the Company asserts that “Cause” exists, the
Executive will be (I) notified in writing of the termination for Cause at least 30 days before the effective date of such termination;
(II) provided a reasonable opportunity to be heard, with counsel, before the Board regarding any disputed facts before the proposed
effective date of termination for Cause; and (III) provided 30 days in which to correct the circumstances alleged to constitute
such Cause. The Board will make a final determination of whether Cause exists. following any hearing and opportunity to correct,
provided that a determination that Cause exists shall require an affirmative vote of at least 2/3 of the non-employee and non-officer
members of the Board. |
| 3.5 | “Code” means the Internal Revenue Code of 1986, as amended. |
| 3.6 | “Committee” means the Compensation Committee of the Board. |
| 3.7 | “Company” shall have the meaning given to it in the introduction of this Agreement. |
| 3.8 | “Disability” means a disability by reason of a medically determinable physical or mental impairment that
(1) is expected to result in death or last for a continuous period of at least 12 months, (2) satisfies the definition of disability
under any long term disability plan maintained by the Company and (3) to the extent so required, otherwise satisfies the requirements
of Section 409A(a)(2)(C) of the Code and the applicable regulations. |
| 3.9 | “Eligibility Date” means the date on which the Executive has reached age sixty-two (62) and has attained
ten (10) Years of Service with the Company. |
| 3.10 | “Equivalent Actuarial Value” means the equivalent value when computed on the basis of the interest rate
determined as of such date under the regulations of the Pension Benefit Guaranty Corporation for determining the present value
of a lump sum distribution on plan termination that were in effect on September 1, 1993 and the 1994 Group Annuity Reserving mortality
table and in accordance Code Section 409A and the applicable regulations. |
| 3.11 | “ERISA” means the Employee Retirement Income Security Act of 1974, as amended. |
| 3.12 | “Final Average Annual Incentive” or “FAAI” means the average of the two highest consecutive
years’ Non-Equity Incentive Plan Compensation, which includes only cash payments attributable to the Company’s Stock
Award and Incentive Plan (or such similar or successor annual incentive bonus plan) in the five years preceding the year in which
Separation from Service takes place, as reported in the corresponding column of the Summary Compensation Table of Company’s
annual proxy statements, but excluding (i) any cash payments to the Executive under the Company’s GEC Long-Term Incentive
Compensation Program, and (ii) any other special bonuses that the Company may pay or provide to the Executive, which shall not
be included in the calculation of FAAI for purposes of this Agreement. For purposes of this Agreement, if for any fiscal year of
the Company, the Company offered to pay an annual incentive bonus to the Executive, but the Executive voluntarily declined to accept
all or part of such annual incentive bonus (as the Executive did in 2008), then for purposes of calculating FAAI, the full amount
of the annual incentive bonus offered by the Company to the Executive shall be counted. |
| 3.13 | “Involuntary Termination” means termination of the Executive’s employment with the Company, initiated
by the Company for reasons other than Cause, death or Disability, provided that such termination is also a Separation from Service. |
| 3.14 | “Separation from Service” means “separation from service” as defined under Section 409A(a)(2)(A)(i)
of the Code and the applicable regulations. |
| 3.15 | “Service” means any period during which the Executive is or has been an employee of the Company since the
Executive’s date of hire. |
| 3.16 | “Spouse” means the Executive’s wife who is lawfully married to the Executive as of the date of the
particular event (e.g., Separation from Service) then under consideration for purposes of this Agreement. |
| 3.17 | “Standard Termination” means a termination of the Executive’s employment with the Company for any
reason, whether initiated by the Executive or the Company, except for a termination from employment for Cause, provided that such
termination is also a Separation from Service. |
| 3.18 | “Years of Service” means the total number of the Executive’s full years of active service with the
Company. A full year of active service is any consecutive twelve (12)-month period of employment with the Company occurring after
the Executive’s date of hire, which for avoidance of doubt was August 30, 2004. |
ARTICLE
4
Miscellaneous
| 4.1 | Funding. The Executive and his beneficiaries, and their heirs, successors, and assigns shall have no secured interest
or claim in any property or assets of the Company. The Company’s obligation under this Agreement shall be merely that of
an unfunded and unsecured promise of the Company to pay money in the future. |
| 4.2 | Expenses. All expenses of administering this Agreement shall be borne by the Company. The Executive shall be responsible
for the expenses of his own counsel if he chooses to engage counsel with respect to this Agreement. |
| 4.3 | Non-assignability. No right or interest under this Agreement of the Executive or his Spouse (or any person claiming
through or under any of them) shall be assignable or transferable in any manner or be subject to alienation, anticipation, sale,
pledge, encumbrance, or other legal process or in any manner be liable for or subject to the debts or liabilities of the Executive
or his surviving Spouse. |
| 4.4 | Limitation of Rights of Executive. Nothing in this Agreement shall be construed as conferring upon the Executive any
right to continue in the employment of the Company, nor shall it interfere with the rights of the Company to terminate the employment
of the Executive and/or to take any personnel action affecting the Executive without regard to the effect which such action may
have upon the Executive as a recipient or prospective recipient of the Benefit under this Agreement. Any amounts payable hereunder
shall not be deemed salary or other compensation to the Executive for the purposes of computing benefits to which the Executive
may be entitled under any other arrangement established by the Company for the benefit of its employees. |
| 4.5 | No Limitation on Actions of Company. Nothing contained in this Agreement shall be construed to prevent the Company from
taking any action that is deemed by it to be appropriate or in its best interest. |
| 4.6 | Obligations to Company. If the Executive becomes entitled to a distribution of a Benefit under this Agreement, and if
at such time the Executive has outstanding any debt, obligation, or other liability representing an amount owing to the Company,
the Company may offset such amount owed to it against the amount of benefits otherwise distributable, but only to the extent permitted
by Section 409A of the Code. Such determination shall be made by the Committee. |
| 4.7 | Captions. The captions contained herein are for convenience only and shall not control or affect the meaning or construction
hereof. |
| 4.8 | Governing Law. This Agreement is intended to constitute an unfunded arrangement providing deferred compensation benefits
for officers and highly compensated employees exempt from the requirements of parts 2, 3, and 4 of Subtitle B of Title I of ERISA.
Except to the extent otherwise provided in ERISA and the Code, this Agreement shall be construed, regulated, and administered under
the laws of the State of Illinois. The jurisdiction and venue for any disputes arising under, or any action brought to enforce
(or otherwise relating to), this Agreement will be exclusively in the courts in the State of Illinois, County of Xxxx, including
the Federal Courts located therein (should Federal jurisdiction exist). |
| 4.9 | Successors. The provisions of this Agreement shall bind and inure to the benefit of the Company, and their respective
successors and assigns. The term successors as used herein shall include any corporate or other business entity that, whether by
merger, consolidation, purchase, or otherwise, acquires all or substantially all of the business and assets the Company and successors
of any such Company or other business entity. |
| 4.10 | Illegal or Invalid Provision. In case any provision of this Agreement shall be held illegal or invalid for any reason,
such illegal or invalid provision shall not affect the remaining parts of this Agreement, and this Agreement shall be construed
and enforced without regard to such illegal or invalid provision. |
| 4.11 | Protective Provisions. The Executive shall cooperate with the Company by furnishing any and all information reasonably
requested by the Company to facilitate the payment of benefits hereunder. |
| 4.12 | Withholding Taxes. The Company may make such provisions and take such action as it may deem necessary or appropriate
for the withholding of any taxes which the Company is required by any law or regulation of any governmental authority, whether
Federal, state, or local, to withhold in connection with any benefits under this Agreement, including, but not limited to, the
withholding of appropriate sums from any amount otherwise payable to, or on behalf of, the Executive. The Executive and his Spouse
(as the case may be), however, shall be responsible for the payment of all individual tax liabilities relating to any such benefits.
If said payments and benefits to Executive are not exempt from or in compliance with the provisions of Code Section 409A, the parties
will attempt to bring such payments and benefits into compliance with Section 409A without diminishing the benefits to which the
Executive is entitled to the greatest extent possible. |
| 4.13 | Compliance with Section 409A of the Code. This Agreement shall at all times be administered and the provisions herein
shall be interpreted consistent with the requirements of Code Section 409A and any and all regulations thereunder. If any provision
of this Agreement needs to be revised to satisfy the requirements of Code Section 409A, then such provision shall be modified or
restricted to the extent and in the manner necessary to be in compliance with such requirements of the Code and any such modification
will attempt to maintain the same economic results as were intended under this Agreement. Notwithstanding any provision to the
contrary in this Agreement, if the Executive is deemed by the Company at the time of his Separation from Service to be a “specified
employee” for purposes of Code Section 409A(a)(2)(B)(i), and if any of the payments upon Separation from Service set forth
in this Agreement are deemed to be “deferred compensation,” then to the extent delayed commencement of any portion
of such payments is required in order to avoid a prohibited distribution under Code Section 409A(a)(2)(B)(i) and the related adverse
taxation under Section 409A, such payments shall not be provided to the Executive prior to the earliest of (i) the expiration of
the six-month period measured from the date of his Separation from Service with the Company, (ii) the date of his death or (iii)
such earlier date as permitted under Section 409A without the imposition of adverse taxation. Upon the first business day following
the expiration of such applicable Code Section 409A(a)(2)(B)(i) period, all payments deferred pursuant to this paragraph shall
be paid in a lump sum to the Executive, and any remaining payments due shall be paid as otherwise provided herein. No interest
shall be due on any amounts so deferred. |
| 4.14 | Notice. For purposes of this Agreement, notices and all other communications provided for herein shall be in writing
and shall be deemed to have been duly given when personally delivered or when mailed by United States registered or certified mail,
return receipt requested, postage prepaid, addressed as follows: |
| If to Company to: |
|
Xxxxx Xxxx LaSalle
Incorporated
000 Xxxx Xxxxxxxx
Xxxxx
Xxxxxxx, XX 00000
Attn: Global General
Counsel |
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| If to Executive to: |
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At the most receipt address
on file with Company |
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| 4.15 | Benefit Claims. If the Executive believes he is being denied any rights or benefits under the Agreement, he (or his
duly authorized representative) may file a claim in writing with the Committee. The Committee shall have the authority to construe
and interpret the terms of the Agreement in its sole discretion. If any such claim is wholly or partially denied, the Committee
will notify the claimant of its decision in writing. The notification will set forth, in a manner calculated to be understood by
the claimant, the following: (i) the specific reason or reasons for the adverse determination, (ii) reference to the specific provisions
of the Agreement on which the determination is based, (iii) a description of any additional material or information necessary for
the claimant to perfect the claim and an explanation of why such material or information is necessary, and (iv) a description of
the review procedures of the Agreement and the time limits applicable to such procedures, including a statement of the claimant's
right to bring a civil action under ERISA Section 502(a) following an adverse benefit determination on review. Such notification
will be given within 90 days after the claim is received by the Committee, or within 180 days, if the Committee determines that
special circumstances require an extension of time for processing the claim. |
| (a) | Review of a Denied Claim. Within 60 days after the receipt of notification of an adverse benefit determination, the
Executive (or his duly authorized representative) may (i) file a written request with the Committee for a review of the adverse
benefit determination and (ii) submit written comments, documents, records, and other information relating to the claim for benefits.
A request for review shall be deemed filed as of the date of receipt of such written request by the Committee. The Executive shall
be provided, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information
relevant to the Executive's claim for benefits. The Committee will take into account all comments, documents, records, and other
information submitted by the claimant relating to the claim, without regard to whether such information was submitted or considered
in the initial benefit determination. The Committee will notify the claimant of its decision on review in writing. The decision
on review will be made within 60 days after the request for review is received by the Committee, or within 120 days if the Committee
determines that special circumstances require an extension of time for processing the claim. The Committee's decision on review
shall be final and binding. |
| (b) | Filing a Claim. The Executive (or beneficiary) must utilize the claims and review procedures described in this Section
4.15 and exhaust his remedies under the Agreement's claims procedures before the Executive (or beneficiary) can bring a legal action
alleging the denial of eligibility, miscalculation or denial of benefits under the Agreement, or any other right under the terms
of the Agreement. The Committee may develop additional written claims procedures consistent with the requirements of applicable
law and regulations. To the extent those procedures conflict with this Section 4.15, the procedures will govern. |
| (c) | Limitations Period. The Executive (or beneficiary) must make any claim or request for benefits under the Agreement within
one year of the date the claim for eligibility, benefits or other rights under the Agreement arose or, if later, within one year
of the date the Executive (or beneficiary) first knew or should have known that the Executive's eligibility, benefits or any other
rights under the Agreement were in question, so that the Committee can address it on a timely basis. |
| 4.16 | Compensation Recoupment Policy. Benefit paid under this Agreement shall be subject to any compensation recoupment policy
adopted by the Company from time to time that applies to the Company’s senior executives generally. |
| 4.17 | Counterparts. This Agreement may be signed in counterparts, both of which together shall constitute one Agreement. |
[signature page
follows]
IN WITNESS WHEREOF, the parties
hereto have executed this Agreement as of the date first written above.
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XXXXX XXXX LASALLE INCORPORATED |
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By: |
/s/ Xxxxxxxx Xxxxxx |
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Name: |
Xxxxxxxx Xxxxxx |
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Title: |
Executive Vice President and
Chief Human Resources Officer |
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EXECUTIVE |
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/s/ Xxxxx Xxxx |
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Xxxxx Xxxx |
Appendix
A
Example
of Joint and Survivor Annuity Calculations With Actuarial Reduction1
The
examples in this Appendix A are for illustration only. The chart below summarizes the reduction in the underlying Benefit payment
amount if the Executive were to elect to receive Benefit payments in the form of a Joint and 100% Survivor Annuity or a Joint
and 50% Survivor Annuity.1
For
example, if a $500,000 annual Benefit were payable to the Executive beginning at age 62 in the form of a Single Life Annuity,
and the Executive were to elect a Joint and 50% Survivor Annuity, the Company would pay the Executive approximately $443,500 per
year for his life and, at the Executive’s death, if his spouse survives him, the Company would pay her approximately $221,800
per year for the remainder of her life.2
| |
Estimated Annual Annuity Executive - Spouse1, 2 |
| Annuity “Purchase” Age3 |
Annuity Form |
Earned Benefit
$500,000 per Year
Executive -
Spouse |
Earned Benefit
$1,000,000 per Year
Executive -
Spouse |
| 65 |
Single Life |
$500,000 - $0 |
$1,000,000 - $0 |
| Joint and 50% Survivor |
$438,000 - $219,000 |
$876,000 - $438,000 |
| Joint and 100% Survivor |
$390,000 - $390,000 |
$780,000 - $780,000 |
| 62 |
Single Life |
$500,000 - $0 |
$1,000,000 - $ 0 |
| Joint and 50% Survivor |
$443,500 - $221,800 |
$887,000 - $443,500 |
| Joint and 100% Survivor |
$398,500 - $398,500 |
$797,000 - $797,000 |
(1)
Estimates are as of December 2011, based on 3.5% interest rate and GAM-94 mortality (separate male and female tables) used by
a prominent provider of such annuities. Assumes that the Executive’s Spouse is 6 months older than the Executive. Equivalent
Actuarial Value will be determined according to Section 3.10 of the Agreement, and rates are subject to change.
(2)
In all cases, reduced by applicable tax withholding.
(3)
The Company will not actually purchase an annuity to provide the Benefit.
