{"url_path":"/sec/cik-0000931182/8-k/2026-06-08/item-5-02","section_key":"item-5-02","section_title":"Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.","topic":"sec","document":{"doc_type":"8-K","doc_date":"2026-06-08","source_url":"https://www.sec.gov/Archives/edgar/data/906107/0001193125-26-261709-index.html","accession_number":"0001193125-26-261709","cik":"0000931182","ticker":null,"issuer_name":"ERP OPERATING LTD PARTNERSHIP","edgar_url":"https://www.sec.gov/Archives/edgar/data/931182/0001193125-26-261709-index.html","primary_entity_key":"0000906107","primary_entity_name":"EQUITY RESIDENTIAL"},"word_count":1103,"has_tables":true,"body_markdown":"Item 5.02\n\nDeparture of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.\n\nAs previously disclosed, on May 20, 2026, Equity Residential, a Maryland real estate investment trust (“Equity Residential”) entered into an Agreement and Plan of Merger (the “Merger Agreement”) with AvalonBay Communities, Inc., a Maryland corporation (“AvalonBay”), ERP Operating Partnership, an Illinois limited partnership, and Canopy Merger Sub LLC, a Maryland limited liability company and a direct wholly owned subsidiary of Equity Residential. The Merger Agreement provides for the combination of Equity Residential and AvalonBay in an\nall-stock\n\nmerger-of-equals\n\ntransaction upon the terms and subject to the conditions set forth in the Merger Agreement (the “Merger”). The combined company will operate under a new name to be announced prior to the closing of the Merger and the other transactions contemplated by the Merger Agreement (the “Closing”).\n\nAmended Schall Offer Letter\n\nOn June 7, 2026, Benjamin Schall, current President and Chief Executive Officer of AvalonBay and the incoming President and Chief Executive Officer of the combined company effective as of the Closing pursuant to the terms of an offer letter between Mr. Schall and Equity Residential dated May 20, 2026, entered into an amended offer letter, confirming his compensation for fiscal year 2027 (the “Amended Schall Offer Letter”).\n\nThe Amended Schall Offer Letter provides that, commencing on January 1, 2027, Mr. Schall will continue to receive an annual base salary of $1,000,000 and will be eligible to receive annual cash and equity incentive awards with target opportunities of 200% ($2,000,000) and 285% ($2,850,000) of his base salary, respectively, and annual long-term performance-vesting equity incentive awards with a target grant date fair value of 665% ($6,650,000) of his base salary.\n\nExecutive Offer Letters\n\nIn addition, on June 8, 2026, Equity Residential and AvalonBay announced that Michael Manelis, Equity Residential’s Executive Vice President and Chief Operating Officer, Kevin O’Shea, AvalonBay’s Chief Financial Officer, and Scott Fenster, Equity Residential’s Executive Vice President, General Counsel and Corporate Secretary, each entered into offer letters confirming their roles, compensation and terms of employment with the combined company following the Closing (the “Manelis Offer Letter,” the “O’Shea Offer Letter” and the “Fenster Offer Letter,” as applicable, and, collectively, “Executive Offer Letters”). Each Executive Offer Letter will become effective as of, and is contingent upon the occurrence of, the Closing.\n\nManelis Offer Letter\n\nThe Manelis Offer Letter provides that, following the Closing, Mr. Manelis will continue to serve as Executive Vice President and Chief Operating Officer of the combined company and will report directly to its Chief Executive Officer. Commencing on January 1, 2027, Mr. Manelis will receive an annual base salary of $800,000 and will be eligible to receive annual cash and equity incentive awards with target opportunities of 150% ($1,200,000) and 200% ($1,600,000) of his base salary, respectively, and annual long-term performance-vesting equity incentive awards with a target grant date fair value of 300% ($2,400,000) of his base salary.\n\nO’Shea Offer Letter\n\nThe O’Shea Offer Letter provides that, following the Closing, Mr. O’Shea will assume the role of Executive Vice President and Chief Financial Officer of the combined company and will report directly to its Chief Executive Officer. Commencing on January 1, 2027, Mr. O’Shea will receive an annual base salary of $675,000 and will be eligible to receive annual cash and equity incentive awards with target opportunities of 150% ($1,012,500) and approximately 193% ($1,300,000) of his base salary, respectively, and annual long-term performance-vesting equity incentive awards with a target grant date fair value of approximately 261% ($1,762,500) of his base salary.\n\nFenster Offer Letter\n\nThe Fenster Offer Letter provides that, following the Closing, Mr. Fenster will continue to serve as Executive Vice President, General Counsel and Corporate Secretary of the combined company and will report directly to its Chief Executive Officer. Commencing on January 1, 2027, Mr. Fenster will receive an annual base salary of $580,000 and will be eligible to receive annual cash and equity incentive awards with target opportunities of 120% ($696,000) and 125% ($725,000) of his base salary, respectively, and annual long-term performance-vesting equity incentive awards with a target grant date fair value of approximately 172% ($999,000) of his base salary.\n\nTransaction Awards\n\nThe offer letters with Messrs. Schall, Manelis, O’Shea and Fenster provide that each will be eligible to receive a\none-time\nequity incentive award as soon as practicable after the Closing (each, a “Transaction Award”). Fifty percent (50%) of each Transaction Award will be subject to service-based vesting and fifty percent (50%) will be subject to achievement of performance metrics over a three-year performance period, which metrics will be determined by the Chief Executive Officer and the Compensation Committee of the Board of Trustees of the combined company (or, for Mr. Schall, by the Board of Trustees or the Compensation Committee, in consultation with Mr. Schall). The Transaction Awards may be issued in the form of restricted shares or restricted units, at the executive’s election, and will be subject to the terms and conditions of an equity incentive plan and applicable form of award agreement. The Transaction Awards will vest on the third anniversary of the Closing, subject to continued employment through such date, provided that, in the event of an executive’s termination of employment without cause or resignation for good reason (but not upon retirement), the service-vesting component of the Transaction Award will accelerate and vest in full and the performance-vesting component will remain outstanding and eligible to vest at the end of the performance period based on the combined company’s achievement of applicable performance goals. The final form of award may contain additional and clarifying terms. Pursuant to the Executive Offer Letters, the grant date target values of the Transaction Awards to be issued to Messrs. Schall, Manelis, O’Shea and Fenster are $6,250,000, $4,500,000, $3,562,500 and $3,000,000, respectively.\n\nAs a condition to receipt of the Transaction Award, Messrs. Manelis and Fenster agree to waive any right to assert “good reason” (including under the existing change in control severance agreements between each executive and Equity Residential) with respect to the terms set forth in the applicable Executive Offer Letter, including the\ngo-forward\nrole with the combined company, cash and equity compensation and any other terms of employment.\n\nThe foregoing descriptions of the Amended Schall Offer Letter, the Executive Offer Letters and the Transaction Awards do not purport to be complete and are subject to modification and qualified in their entirety by reference to the Amended Schall Offer Letter and each applicable Executive Offer Letter, copies of which will be filed as exhibits to Equity Residential’s Quarterly Report on Form\n10-Q\nfor the second quarter."}