Equity Residential Approves Executive Severance Plan for Non-Change in Control Situations

Equity Residential, a real estate investment trust, recently disclosed the approval and adoption of the Equity Residential Executive Severance Plan for non-change in control situations. The Board of Trustees officially sanctioned this plan on December 12, 2024, following a recommendation from the Compensation Committee.

The Severance Plan applies to management employees, including the chief executive officer (CEO) and executive vice presidents reporting directly to the CEO, labeled as the Eligible Executives. It aims to offer a standardized framework for severance arrangements to enhance certainty for both the Company and the Participants in the event of a non-change in control severance.

Under this plan, in case of a Qualifying Termination, which includes termination without Cause by the Company or Good Reason termination by the Participant, several benefits kick in. These include a lump-sum cash payment based on performance, a cash payment equivalent to annual base salary and target performance bonus, coverage for medical benefits and COBRA continuation, prorated long-term incentive plan awards, and immediate vesting of unvested equity awards.

Yet, the plan doesn’t replace any existing change in control agreements with the Participants. To be eligible for benefits, Participants must fulfill specific requirements, including signing a participation notice and agreement, general release of claims, and compliance with post-employment restrictive covenants.

Additionally, Equity Residential’s operating partnership, ERP Operating Limited Partnership, enhanced the maximum aggregate amount for issuing unsecured notes under its commercial paper program from $1.0 billion to $1.5 billion, effective as of December 18, 2024. These notes are parallel in ranking with the Operating Partnership’s other unsecured senior indebtedness and are not registered under the Securities Act of 1933.

The Securities and Exchange Commission filing further informs that these Notes are being sold without registration under the Securities Act and that the report does not constitute an offer or solicitation for any securities purchase.

The disclosure indicates Equity Residential prioritizing executive retention and recruitment, as well as ensuring financial protections and costs reduction in certain employment termination scenarios.

The full details of the Severance Plan can be referenced in the Exhibit 10.1 of the 8-K filing submitted to the United States Securities and Exchange Commission.

This article was generated by an automated content engine and was reviewed by a human editor prior to publication. For additional information, read Equity Residential’s 8K filing here.

About Equity Residential

Equity Residential is committed to creating communities where people thrive. The Company, a member of the S&P 500, is focused on the acquisition, development and management of residential properties located in and around dynamic cities that attract affluent long-term renters. Equity Residential owns or has investments in 305 properties consisting of 80,683 apartment units, with an established presence in Boston, New York, Washington, DC, Seattle, San Francisco and Southern California, and an expanding presence in Denver, Atlanta, Dallas/Ft.