DEF 14A of Rithm Property Trust Inc.
Filed Apr 21, 2025 · FY20240001104659-25-036505
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON JUNE 2, 2025
| PROPOSAL 1 — ELECTION OF DIRECTORS | 6 | | COMPENSATION OF DIRECTORS | 9 | | CORPORATE GOVERNANCE AND BOARD MATTERS | 10 | | Corporate Governance Profile | 10 | | Board Committees | 10 | | Board and Committee Meetings | 13 | | Risk Management and Oversight Process | 13 | | Director Selection Process | 13 | | Code of Business Conduct and Ethics | 14 | | Insider Trading Policy | 14 | | Hedging and Pledging Policy | 14 | | Clawback Policy | 14 | | Availability of Corporate Governance Materials | 15 | | Independence of Directors | 15 | | Board Leadership Structure | 15 | | Communications with the Board | 15 | | PROPOSAL 2 — APPROVAL OF THE ISSUANCE OF UP TO 7,700,000 SHARES OF COMMON STOCK TO THE MANAGER AS PAYMENT OF FEES UNDER THE MANAGEMENT AGREEMENT | 16 | | PROPOSAL 3 — RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM | 18 | | Fee Disclosure | 18 | | Pre-Approval Policies and Procedures | 19 | | PROPOSAL 4 — NON-BINDING ADVISORY RESOLUTION TO APPROVE EXECUTIVE COMPENSATION | 20 | | PROPOSAL 5 — NON-BINDING ADVISORY RESOLUTION TO DETERMINE FREQUENCY OF VOTE ON AN ADVISORY RESOLUTION TO APPROVE EXECUTIVE COMPENSATION | 21 | | EXECUTIVE OFFICERS | 22 | | COMPENSATION OF EXECUTIVE OFFICERS | 23 | | SUMMARY COMPENSATION TABLE | 24 | | OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END | | | Pay Versus Performance | 25 | | Potential Payments Upon Termination or Change in Control | 27 | | Equity Compensation Plan Information | 28 | | Timing of Grants of Certain Equity Awards | 29 | | REPORT OF THE AUDIT COMMITTEE | 30 | | PRINCIPAL STOCKHOLDERS OF RPT | 31 | | CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS | 33 | | Management Agreement | 33 | | Servicing Agreement | 35 | | Trademark License Agreement | 36 | | OTHER MATTERS | 37 | | Other Matters to Come Before the Annual Meeting | 37 | | Advance Notice for 2026 Annual Meeting of Stockholders | 37 | | ADDITIONAL INFORMATION | 38 |
Proposal 1 — Election of Directors
Proposal 1 — Election of Directors The Board is currently comprised of four directors. The nominees, all of whom are currently serving as our directors, have been recommended by the Board for election to serve as directors until the 2026 annual meeting of stockholders and until their successors are duly elected and qualified. Based on its review of the relationships between the director nominees and us, the Board has affirmatively determined that the following directors are “independent” directors under the rules of the NYSE and under applicable rules of the Securities and Exchange Commission: Ms. Haggerty and Messrs. Friedman and Hoffman. The Board knows of no reason why any nominee would be unable to serve as a director. If any nominee is unavailable for re-election or service, the Board may designate a substitute nominee and the persons designated as proxy holders on the proxy card will vote for the substitute nominee recommended by the Board. Under these circumstances, the Board may also, as permitted by our Bylaws, decrease the size of the Board.
Nominees for Election as Directors
Nominees for Election as Directors The following table sets forth the name and age of each director nominee, indicating all positions and offices with RPT currently held by the nominee.
Nominees for Election as Directors
| Name | Age | Title | Director Since | Committee Assignment | | Paul Friedman | 69 | Director, Chairman of the Board | 2016 | Audit, Compensation | | Mary Haggerty | 65 | Director | 2021 | Audit, Nominating and Corporate Governance | | Daniel Hoffman | 65 | Director | 2024 | Audit, Compensation, Nominating and Corporate Governance | | Michael Nierenberg | 62 | Director, Chief Executive Officer | 2024 | N/A |
Nominees for Election as Directors
Set forth below are descriptions of the backgrounds and principal occupations of each of the nominees. Paul Friedman has been a member of the Board since July 2016 and has been the Chair of our Board and the Chair of our Compensation Committee since June 2024. Mr. Friedman has served on the board of directors of Oppenheimer Holdings Inc. since July 2015 and is currently the lead independent director, chair of its compliance committee and a member of its compensation committee. Mr. Friedman has also served on the board of directors of Tiptree Inc. since August 2016 and is currently chair of its audit committee. From November 2009 to March 2015, Mr. Friedman served as the Senior Managing Director and Chief Operating Officer of Guggenheim Securities LLC. From June 2008 to October 2009, Mr. Friedman served as the Managing Director of Mariner Investment Group. Mr. Friedman spent 27 years at Bear Stearns & Co. Inc. from 1981 to 2008, most recently holding the position of Chief Operating Officer of its Fixed Income Division. Mr. Friedman is a Certified Public Accountant and has a M.S. in Finance and Accounting from New York University, Stern School of Business, and a B.A. in Economics from Colgate University. Mr. Friedman brings an extensive amount of operational and risk management experience to the Board as well as a deep knowledge of the financial services industry. Mary Haggerty has been a member of the Board since March 2021 and the Chair of the Audit Committee since June 2024. Ms. Haggerty has served on the board of directors of Claros Mortgage Trust, Inc. since November 2021 and is currently chair of its audit committee. Ms. Haggerty served for 28 years in various roles at Bear Stearns, and, following its 2008 merger with JPMorgan, at JPMorgan. She retired in March 2020 from JPMorgan Chase as a Managing Director in Capital Markets. Most recently, Ms. Haggerty led the Portfolio Management Group in Capital Markets and spearheaded the restructuring of Chase Home Lending’s mortgage servicing portfolio. Prior to that, she led several businesses in the Securitized Products Group of JPMorgan Securities, including Plymouth Park Tax Services (a business that invested in delinquent real estate taxes), the Securitized Products Transaction Management Group, and EMC Mortgage Corporation (a residential mortgage special servicer). At Bear Stearns, as Senior Managing Director and Co-Head of Mortgage Finance, she built and managed its residential mortgage origination, acquisition, warehouse lending and mortgage finance businesses. Ms. Haggerty served as a board member of J.P. Morgan Residential Mortgage Acceptance Corp. between July 2009 and March 2020, a board member of Reoco, Inc. between December 2008 and March 2020 and a board member of Bear Stearns Residential Mortgage Corporation between April 2011 and December 2018. Ms. Haggerty began her career as a Certified Public Accountant at Arthur Young & Company. She has a B.S. degree in accounting from the State University of New York at Albany, is a board member of The University at Albany Foundation, and serves as a member of the Dean’s Advisory Council for the School of Business. Ms. Haggerty also serves as board member and Treasurer of Virtual Enterprises International, Inc., a national educational non-profit that develops entrepreneurial skills in middle and high school students utilizing a work-based learning environment and academic standards-based education. Ms. Haggerty’s background in investment banking paired with her experience in various director roles provide her with the expertise to serve as a director. Daniel Hoffman has served as a member of our Board of Directors and the Chair of the Nominating and Corporate Governance Committee since June 2024. He is the founder and CEO of The Monday Group, a multi-family office, since its founding in 2023. Mr. Hoffman was a Managing Director at Cerberus Capital Management, a residential real estate fund, from May 2016 to May 2023. He was a Managing Director and Co-Head of U.S. Securitized Products and Head of Sales at Royal Bank of Canada Capital Markets, from September 2015 to May 2016. He had been an independent director of the Board, and served as the head of the Board’s Audit Committee from its inception to June 2016. Mr. Hoffman was a Managing Director at Amherst, Pierpont Securities, a broker-dealer specializing in mortgage and mortgage related securities, from May 2010 to August 2015. He was Head of Fixed Income Sales at Amherst until August 2013 when he accepted a position as an Adjunct Professor of Real Estate Finance at Baruch College, one of the schools of the City University of New York. Mr. Hoffman remained an adjunct professor until June 2015. From July 2008 until May 2010, he was a Managing Director at the Royal Bank of Scotland. Prior thereto, Mr. Hoffman was with Bear, Stearns & Co. Inc. as a Senior Managing Director in the Fixed Income Division. He was Head of Mortgage Sales, Interest Rate Sales and headed the Middle Markets sales team. Mr. Hoffman was at Bear, Stearns for 22 years, primarily focused on mortgages (all types), asset-backed securities, commercial mortgages, CDOs (collateralized debt obligations) and CLOs (collateralized loan obligations). Mr. Hoffman received his B.S. in Economics from the State University of New York at Binghamton and his M.B.A. in Finance from the University of Chicago Booth School of Business. Mr. Hoffman’s over 25 years of experience in the mortgage securities market and his broad-based investment banking experience qualify him to serve as a director. Michael Nierenberg has served as a member of our Board since June 2024 and currently serves as RPT’s Chief Executive Officer, a position he has held since his appointment in June 2024. He is also the chief executive officer, president and member of the board of directors of Rithm Capital Corp., positions he has held since November 2013. He has served as chairman of the board of directors of Rithm Capital Corp. since May 2016. Additionally, beginning in January 2025, Mr. Nierenberg has served as the Chairman of the board and a director and, since November 2024, the Chief Executive Officer of Rithm Acquisition Corp., a special purpose acquisition company. From November 2013 until June 2022, Mr. Nierenberg served as a Managing Director at Fortress. From December 2020 until June 2022, Mr. Nierenberg also served as Chief Executive Officer and Chairman of the board of Fortress Capital Acquisition Corp., and, from January 2021 until June 2022, as a member of its audit and compensation committees. Prior to becoming Chief Executive Officer of Rithm Capital Corp., Mr. Nierenberg served as a Managing Director and head of Global Mortgages and Securitized Products at Bank of America Merrill Lynch. Mr. Nierenberg joined Bank of America Merrill Lynch in November 2008 from JP Morgan, where he was head of Global Securitized Products and a member of the management committee of the investment bank. Prior to his tenure at JP Morgan, Mr. Nierenberg held a range of senior leadership positions during fourteen years with Bear, Stearns & Co. Inc., including Head of Interest Rate and Foreign Exchange Trading Operations, Co-Head of Structured Products and Co-Head of Mortgage-Backed Securities Trading. From 2006 to 2008, he was a member of Bear Stearns’s Board of Directors. Mr. Nierenberg spent seven years at Lehman Brothers prior to joining Bear Stearns and was instrumental in building the company’s adjustable-rate mortgage business. Mr. Nierenberg’s knowledge, skill, expertise and experience as described above qualify him as a director. The affirmative vote of a plurality of all the votes cast at the Annual Meeting is necessary for the election of a director. Therefore, assuming a quorum is present, the four individuals with the highest
Nominees for Election as Directors
number of affirmative votes will be elected to the four directorships. A vote “withheld” from a director, abstentions and other shares not voted (whether by broker non-vote or otherwise) will not be counted as votes cast and will have no effect on the result of the vote. There is no cumulative voting with respect to the election of directors. THE BOARD UNANIMOUSLY RECOMMENDS A VOTE “FOR” EACH OF THE NOMINEES SET FORTH ABOVE.
COMPENSATION OF DIRECTORS
COMPENSATION OF DIRECTORS The independent directors receive an annual fee of $140,000, payable quarterly in shares of RPT’s Common Stock and/or in cash, at the election of each independent director. The number of the shares is determined in the same manner as the value of the shares to be paid to the Manager as part of its base management fee (see the section entitled “Certain Relationships and Related Party Transactions — Management Agreement”) and the value of the shares is based on of the closing price of the shares on the issuance date. The non-independent directors are not entitled to any compensation for their service. RPT reimburses all RPT’s directors for their reasonable expenses incurred in connection with their attendance at board and committee meetings. Beginning the first quarter of 2022, the chair of each committee of the Board other than the Audit Committee and the since-disbanded Investment Supervisory Committee receives an additional cash payment of $15,000 per year. The chairperson of the Audit Committee receives an additional cash payment of $20,000 per year, and the Chair of the Board (formerly the lead director) receives an additional $10,000 payment. Also, during the second quarter of 2023, in response to conflict of interest concerns arising in connection with the Strategic Transaction (as defined below), the Board established a Special Committee of disinterested directors. The directors on the Special Committee received a one-time cash payment of $20,000. This committee has also since been disbanded. In March 2023, each member of the Board was granted a restricted stock award of 5,000 shares of Common Stock, which were subject to a two-year vesting period. The following table sets forth information regarding the compensation paid during 2024 to each of RPT’s independent directors:
COMPENSATION OF DIRECTORS
| Name | Fees Earned or Paid in Cash ($) | Stock Awards ($)(1) | Total ($) | | Paul Friedman | 167,500 | 24,900 | 192,400 | | Mary Haggerty | 150,000 | 9,900 | 159,900 | | Daniel Hoffman(2) | 49,808 | — | 49,808 | | John C. Condas(3) | 96,924 | 9,900 | 106,824 | | Jonathan Bradford Handley, Jr.(3) | 110,770 | 9,900 | 120,670 | | J. Kirk Ogren, Jr.(3) | 117,692 | 9,900 | 127,592 |
COMPENSATION OF DIRECTORS
(1) Includes payment of the portion of quarterly directors’ fees payable in shares of Common Stock. (2) Includes 2,000 shares of restricted stock granted in connection with Mr. Hoffman’s joining the Board. Served as director until the closing of the Strategic Transaction on June 11, 2024.
Summary Compensation Table
Summary Compensation Table
Summary Compensation Table
| Name and principal position | Year | Salary ($) | Bonus ($) | Stock awards ($) | Option Awards ($) | Non-equity incentive plan compensation ($) | Nonqualified deferred compensation earnings ($) | All other compensation ($) | Total ($) | | Michael Nierenberg(1) | 2024 | — | — | — | — | — | — | — | — | | Lawrence Mendelsohn(2) | 2024 | — | — | — | — | — | — | — | — | | | 2023 | — | — | — | — | — | — | — | — | | Mary Doyle | 2024 | 481,696(3) | 164,358(3) | — | — | — | — | — | 716,272 | | | 2023 | 419,792(4) | 234,576(4) | — | — | — | — | — | 654,368 | | Russell Schaub(5) | 2024 | — | — | — | — | — | — | — | — | | | 2023 | — | — | — | — | — | — | — | — |
Summary Compensation Table
(1) Mr. Nierenberg was appointed as Chief Executive Officer of RPT on June 11, 2024. He is an employee of Rithm and did not receive any compensation from RPT in 2024. The Manager is not able to segregate and identify any portion of the compensation that Mr. Nierenberg received from Rithm as relating solely to services performed for RPT. (2) Mr. Mendelsohn resigned as Chief Executive Officer of RPT on June 11, 2024. He did not receive any compensation from RPT in 2024 or 2023, and, as discussed above, the Former Manager was not able to segregate and identify any portion of the compensation that Mr. Mendelsohn received as relating solely to services performed for RPT. (3) Includes (i) $365,400 in connection with Ms. Doyle’s service as RPT’s Chief Financial Officer during 2024 pursuant to her employment agreement with the Former Manager, dated March 4, 2022, until her resignation on June 11, 2024, after which time she ceased to receive any cash compensation from the Former Manager and (ii) $280,654 in connection with Ms. Doyle’s service under her consulting agreement with the Manager entered into as of June 11, 2024 pursuant to which Ms. Doyle was designated as the Company’s “principal financial officer” and “principal accounting officer.” (4) Amounts represent compensation in 2023 for Ms. Doyle’s service as RPT’s Chief Financial Officer pursuant to her employment agreement with the Former Manager, dated March 4, 2022. (5) Mr. Schaub resigned as President of RPT on June 11, 2024. He did not receive any compensation from RPT in 2024 or 2023, and, as discussed above, the Former Manager was not able to segregate and identify any portion of the compensation that Mr. Schaub received as relating solely to services performed for RPT.
Pay Versus Performance
Pay Versus Performance Compensation paid to RPT’s Chief Executive Officer and other named executives were calculated based on shares granted each year using the grant date stock price and adjusted for any previously issued shares that were unvested and fully vested each year and considered any dividends that have been paid. The following table summarizes the compensation paid to RPT’s Chief Executive Officer and other named executives and company performance measures.
Pay Versus Performance
| Year | Summary compensation table total for PEO(1) ($) | Summary compensation table total for PEO ($)(2) | Compensation actually paid to PEO(1)(4) ($) | Compensation actually paid to PEO(2)(5) ($) | Average summary compensation table total for non-PEO named executive officers(3) ($) | Average compensation actually paid to non-PEO named executive officers(1)(6) ($) | Value of initial fixed $100 investment based on: | GAAP Net (loss) income ($ thousands) | | | | | | | | | Total stockholder return ($) | | | 2024 | — | — | (29,296) | — | 358,136 | 346,550 | 61 | (92,175) | | 2023 | — | n/a | (25,460) | n/a | 327,184 | 316,505 | 100 | (49,261) | | 2022 | 167,360 | n/a | 51,850 | n/a | 358,800 | 291,380 | 109 | (28,679) |
Pay Versus Performance
(1) Lawrence Mendelsohn, RPT’s former CEO, was RPT’s principal executive officer until June 11, 2024. (2) Michael Nierenberg, RPT’s current CEO, was appointed to such position on June 11, 2024. (3) Includes compensation for Ms. Doyle and Mr. Schaub. (4) In accordance with the requirements of Item 402(v)(2)(iii) of Regulation S-K, the following adjustments were made to the amounts reported for Mr. Mendelsohn, in the Summary Compensation Table. Importantly, the dollar amounts do not reflect the actual amount of compensation earned by or paid to Mr. Mendelsohn during the applicable year.
Pay Versus Performance
| Description(a) | 2022 ($) | 2023 ($) | 2024 ($) | | Reported Summary Compensation Table | 167,360 | — | — | | Reported Stock Awards Deduction(b) | 167,360 | — | — | | Equity Award Adjustments(c) | 51,850 | (25,460) | (29,296) | | Compensation Actually Paid | 51,850 | (25,460) | (29,296) |
Relationship Between “Compensation Actually Paid” and Performance Measures
Relationship Between “Compensation Actually Paid” and Performance Measures The descriptions below describe the relationship of “compensation actually paid” to RPT’s CEO and executive officers to the total stockholder return and net income across the years ended December 31, 2024, 2023 and 2022. For the year ended December 31, 2024, Mr. Mendelsohn and Mr. Nierenberg, who both served as principal executive officer of RPT during the year, did not receive any compensation from RPT.
Potential Payments Upon Termination or Change in Control
Potential Payments Upon Termination or Change in Control RPT’s named executive officers are employees of or consultants to the Manager (or the Former Manager, as the case may be) or its affiliates and therefore RPT generally has no obligation to pay them any form of compensation upon their termination of employment. However, the 2016 Plan provides that, in the event of a “change in control” (as such term is defined in the 2016 Plan), the following would apply: