DEF 14A of Postal Realty Trust, Inc.
Filed Mar 29, 2024 · FY20230001140361-24-016589
PROPOSAL NO. 1. ELECTION OF DIRECTORS
PROPOSAL NO. 1. ELECTION OF DIRECTORS Our Bylaws provide that the number of directors shall be fixed by resolution of the Board of Directors, provided that there shall never be less than the minimum number required by Maryland law, nor more than 15. The Board of Directors has fixed the number of directors at five. All directors are elected until the next annual meeting of stockholders and until their successors are duly elected and qualify. Each nominee served on the Board of Directors as of the date hereof and no other director served on the Board of Directors in 2023. The Board of Directors, upon the recommendation of its Corporate Governance and Compensation Committee, has nominated Patrick R. Donahoe, Barry Lefkowitz, Jane Gural-Senders, Anton Feingold and Andrew Spodek for election at the Annual Meeting for a term to expire at the annual meeting of stockholders in 2025 and until their successors are duly elected and qualify.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR”
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” EACH OF THE NOMINEES NAMED IN PROPOSAL NO. 1. It is the intention of the persons named in the enclosed proxy, in the absence of a contrary direction, to vote for the election of all of the nominees named in Proposal No. 1. Should any of the nominees become unable or refuse to accept nomination or election as a director, the persons named as proxies intend to vote for the election of such other person as the Corporate Governance and Compensation Committee may recommend or our Board of Directors may reduce the number of directors to be elected at the Annual meeting. The Board of Directors knows of no reason why any of the nominees might be unable or refuse to accept nomination or election.
Nominees for Election
Nominees for Election Information is set forth below regarding each of our Board of Directors’ five nominees.
Nominees for Election
| Name | Age | Position(s) | Director Since | | Patrick R. Donahoe | 68 | Independent Chair of the Board of Directors | 2019 | | Barry Lefkowitz | 62 | Independent Director | 2019 | | Jane Gural-Senders | 75 | Independent Director | 2019 | | Anton Feingold | 43 | Independent Director | 2019 | | Andrew Spodek | 48 | Chief Executive Officer and Director | 2019 |
Nominees for Election
Patrick R. Donahoe Patrick R. Donahoe has been a director of the Company since May 2019. He was named the 73rd Postmaster General of the United States in October 2010, serving until his retirement in 2015. Mr. Donahoe was a 39-year veteran of the USPS, starting as a postal clerk in Pittsburgh, Pennsylvania in 1975. Prior to his appointment as Postmaster General, Mr. Donahoe served as the 19th Deputy Postmaster General. Mr. Donahoe has a degree in economics from the University of Pittsburgh and an MBA from the Massachusetts Institute of Technology. Mr. Donahoe is also a director of SG360, an industry-leading print and direct marketing solutions provider. Mr. Donahoe brings to our Board of Directors valuable prior experience as the Postmaster General of the United States and his 39-year career with the USPS and also experience overseeing technology and cybersecurity from his principal occupation or other professional experience. Barry Lefkowitz Barry Lefkowitz has been a director of the Company since May 2019. He has served as the President and Chief Executive Officer of Huntington Road Advisors LLC, a real estate investment and advisory firm, since 2014, and is the Co-Founder of HMC Real Estate Services LLC, an investment and management firm focused on value-add industrial and flex/office properties. He was a member of the board of ShopOne Centers REIT Inc. a leading owner, operator and manager of high-quality grocery-anchored shopping centers from 2018 to 2022. In 2016, Mr. Lefkowitz served as Interim Chief Financial Officer of Brixmor Property Group Inc. (NYSE: BRX), owner of the nation’s largest wholly-owned portfolio of grocery-anchored community and neighborhood shopping centers. He previously served as Executive Vice President and Chief Financial Officer of Mack-Cali Realty Corporation (NYSE: CLI) from 1996 to 2014 where he was responsible for overseeing the company’s investor relations activities as well as strategic financial planning and forecasting, financial accounting and reporting, and capital markets activities. Additionally, Mr. Lefkowitz led the company’s property management and asset management operations beginning in 2004. He served as a Vice President at Mack-Cali Realty Corporation from 1994 to 1997. Prior to joining Mack-Cali Realty Corporation, Mr. Lefkowitz served as a Senior Manager at Deloitte LLP, specializing in real estate. He is a graduate of Brooklyn College and a member of the American Institute of Certified Public Accountants. Mr. Lefkowitz brings to our Board of Directors his prior experience in a variety of management, financial and accounting roles at other public companies. Jane Gural-Senders Jane Gural-Senders has been a director of the Company since May 2019. She is an executive director and principal of GFP Real Estate LLC, a family real estate company, which owns and manages a portfolio of approximately 50 properties comprising over 11 million square feet primarily in the New York City metropolitan area. The firm also handles third-party services for over 20 properties comprising over 3 million square feet. She is a past president of the Gural JCC (Greater Five Towns, Long Island, NY) and presently is a member of the board of that organization. She also is a board member of the American Associates Ben-Gurion University of the Negev (AABGU); The Flatiron of 23rd Street Partnership Business Improvement District; and the Real Estate Committee for the Yeshiva University. Ms. Senders graduated from New York University with a Master of Social Work degree. Ms. Gural-Senders brings to our Board of Directors valuable experience in commercial real estate and leasing. Anton Feingold Anton Feingold has been a director of the Company since May 2019. He is a Partner and Associate General Counsel in the Legal Group of Ares Management Corporation. He also serves as General Counsel, Vice President and Secretary of Ares Commercial Real Estate Corporation (NYSE: ACRE), Assistant Secretary of Ares Management Corporation (NYSE: ARES) and Vice President and Assistant Secretary of CION Ares Diversified Credit Fund. Prior to joining Ares Management in 2014, Mr. Feingold was an attorney with Clifford Chance LLP, where he was a member of the firm’s capital markets and real estate departments, specializing in corporate finance and real estate transactions, as well as general securities law, corporate and regulatory matters. Mr. Feingold graduated from University of Birmingham with a Bachelor of Laws (LL.B Honors) and received a Postgraduate Diploma in Legal Practice at BPP University in London, England. Mr. Feingold brings to our Board of Directors valuable legal experience in the real estate and real estate capital markets areas. Andrew Spodek Andrew Spodek is our Chief Executive Officer and is a member of our Board of Directors. Mr. Spodek was the founder and Chief Executive Officer of our predecessor management entity, Nationwide Postal Management, Inc. (“NPM”), one of our predecessor entities. Mr. Spodek has over 20 years of experience exclusively focused on investing in and managing post office properties. Prior to founding NPM, Mr. Spodek led acquisitions and property management for his family’s private real estate investment activities. Mr. Spodek sits on the Board of Directors of the Association of United States Postal Lessors. Mr. Spodek earned an M.S. in Real Estate from New York University and a B.B.A. in Finance & International Management from Boston University. Mr. Spodek brings to our Board of Directors extensive experience acquiring and managing post office properties and his extensive experience and relationships with postal property owners.
EXECUTIVE OFFICER AND DIRECTOR COMPENSATION
EXECUTIVE OFFICER AND DIRECTOR COMPENSATION
Compensation of Named Executive Officers
| • | in 2020, introduced performance-based equity awards to our executive compensation program, in addition to grants of time-based equity awards; |
Compensation of Named Executive Officers
| • | in 2021, changed the allocation of performance-based equity awards within our long-term incentive compensation program to 50%, with the remaining 50% being time-based; |
Compensation of Named Executive Officers
| • | in 2022, implemented objective annual bonus compensation framework for NEOs with pre-established goals and weightings and adopted stock ownership policy and incentive compensation recoupment policy; |
Compensation of Named Executive Officers
| • | in 2023, introduced performance-based equity awards based on total stockholder return relative to that of the companies in the MSCI US REIT Index, in addition to performance-based equity awards based on achievement of absolute total stockholder return goals. We target to outperform the median of the MSCI US REIT Index, with performance at the 55th percentile of the index needed to achieve target payout; and |
Compensation of Named Executive Officers
| • | in 2024, further increased the allocation of performance-based equity awards within our long-term incentive compensation program from 50% to 55%, with the remaining 45% being time-based. |
Compensation of Named Executive Officers
We have employment agreements with each of Messrs. Spodek, Garber and Klein. See “— Employment Agreements of Our Named Executive Officers.” We are an “emerging growth company” and also a “smaller reporting company” under the federal securities laws and, as such, we have elected to comply with certain reduced disclosure requirements, including in the area of executive compensation. Executive Compensation Philosophy and Objectives We believe that the compensation of our executive officers and directors should align their interests with those of the stockholders in a way that encourages prudent decision-making, links compensation to our overall performance, provides a competitive level of total compensation necessary to attract and retain talented and experienced officers and motivates the officers and directors to contribute to our success. All of our officers are eligible to receive performance-based compensation under our equity incentive plan. We use grants of LTIP units or restricted shares of Class A common stock as the primary means of delivering long-term compensation to our executive officers. We believe that grants of LTIP units or restricted shares of Class A common stock with long vesting periods align the interests of officers and our stockholders and provide strong incentives to our officers to achieve long-term growth in our business, grow the value of our Class A common stock and maintain or increase our dividends. The officers personally benefit from these efforts through their LTIP units or restricted shares of Class A common stock, which receive dividends at the same rate as our Class A common stock. Because a substantial portion of our officers’ compensation is expected to be tied to the value of our Class A common stock, if we have superior long-term operating performance and the market price of our Class A common stock and dividends paid on such stock increase, our officers, through their equity compensation, may receive above market compensation from dividends and price appreciation in our Class A common stock. Conversely, if our operating performance decreases and the value of our Class A common stock and our dividends decline, our officers’ compensation may ultimately prove to be below market. Our Corporate Governance and Compensation Committee will determine the restrictions for each award granted pursuant to our equity incentive plan and the purchase price in the case of LTIP units (if any) or restricted shares of Class A common stock. Restrictions on the LTIP units or restricted shares of Class A common stock may include time-based restrictions, the achievement of specific performance goals or the occurrence of a specific event. Vesting of LTIP units or restricted shares of Class A common stock generally will be subject to cliff or ratable vesting periods ranging up to eight years and will be conditioned upon the officer’s continued employment among other restrictions that may apply. If any performance goals are not achieved or any time-based restrictions do not lapse, the officer will forfeit his or her LTIP units or restricted shares of Class A common stock. Compensation Risks The Corporate Governance and Compensation Committee has reviewed the elements of the executive compensation program to determine whether they encourage excessive risk taking, and concluded that any risks arising from our compensation policies and practices for our employees are not reasonably likely to have a material adverse effect on the Company. We believe that the mix and design of the elements of the executive compensation program do not encourage employees to assume excessive risks. Our executive compensation program is largely tied to objectively determinable financial and operating results. As a part of its oversight of our compensation policies and practices, the committee monitors the actions of management to ensure that our executive compensation program is not creating an environment of excessive risk taking which could be detrimental to stockholders. Compensation Review Process The Corporate Governance and Compensation Committee has the primary responsibility for determining our compensation philosophy and approving the compensation of our NEOs. In making these decisions, the committee considers recommendations from our Chief Executive Officer with respect to the performance and contributions of each of the other two NEOs but the committee ultimately acts in its sole and absolute discretion. The full Board of Directors also aids the committee by providing annual evaluations regarding the performance of our Chief Executive Officer. In addition, certain members of our senior management team provide support to the committee by preparing and disseminating relevant financial and non-financial information and relevant data concerning our peers as a supplement to the comparative market data prepared by Ferguson, the independent compensation consultant for the committee, as well as making recommendations with respect to performance metrics and related goals. Also, at the committee’s request, our General Counsel and Secretary attends meetings to act as secretary and record the minutes of the meetings, provide updates on legal developments and make presentations regarding certain organizational matters. The committee regularly meets separately in executive session, outside the presence of management, generally at regularly scheduled meetings and at other times as necessary or desirable. The committee may from time to time, in its sole discretion, retain or seek advice from compensation consultants, independent counsel and other advisors, and is directly responsible for determining the compensation of, and overseeing, such advisors. As noted above, the committee has engaged Ferguson to assist with the review of our compensation practices and plans. The committee determined that the engagement of Ferguson does not raise any conflicts of interest in accordance with the applicable SEC rules. The scope of Ferguson’s engagement for 2023 was to advise the committee on matters related to the compensation of our NEOs, including the enhancement of our compensation practices. In 2023, Ferguson supported the committee by (i) attending committee meetings, (ii) providing advice on the continuing enhancement of our compensation practices, (iii) preparing and presenting analyses on compensation levels, including competitive assessments of the Company’s practices and policies, and (iv) assisting the Company in preparing compensation-related materials and disclosure as requested by the Company. Peer Group Compensation Considerations The Corporate Governance and Compensation Committee utilizes benchmarking as a part of its executive compensation considerations. The benchmarking data assists the committee in comparing overall compensation practices against a broad mix of companies to ensure that our compensation practices are reasonable in light of both our size and industry trends and best practices. In particular, the committee views the compensation practices of our peer companies as a useful reference point when structuring each component of compensation and total compensation for our NEOs. While references are made to the median of our peer group, the committee does not target the median, average or any specific percentile of the peer group. With the assistance of Ferguson, for 2023, the committee established a peer group of the 13 companies listed below, all of which are publicly-traded equity REITs. The peer group had with a median market capitalization as of December 31, 2023 of approximately $445 million (excluding CatchMark Timber Trust, Inc., INDUS Realty Trust, Inc. and Urstadt Biddle Properties Inc., which were acquired in 2023 after being used as compensation peers):
Compensation of Named Executive Officers
Alignment of Interest Program Our Alignment of Interest Program is designed to provide our employees, directors and other individuals providing services to us or our affiliates, provided that they are eligible to participate in our equity incentive plan, with an incentive to remain with our company and to incentivize long-term growth and profitability. Pursuant to the Alignment of Interest Program, eligible participants may elect to receive LTIP units or restricted shares of Class A common stock, or a mix of both, in lieu of up to 100% of any compensation otherwise payable in cash. Participants must elect an applicable restriction period and will be entitled to receive an additional award of LTIP units or restricted shares of Class A common stock pursuant to the Alignment of Interest Program. The amount of such additional LTIP units or restricted shares of Class A common stock will be calculated based upon a multiple determined by the restricted period elected by the participant. The Corporate Governance and Compensation Committee or its authorized delegates will determine the specific terms of each award under the Alignment of Interest Program, which do not need to be uniform among all participants, including the restriction periods, the restriction multiples, the vesting terms and the periods for which participants may elect to participate. The Corporate Governance and Compensation Committee and its permitted delegates have the power of administration and interpretation of the Alignment of Interest Program. Generally, the LTIP units or restricted shares of Class A common stock acquired under the Alignment of Interest Program would vest at the conclusion of the restricted period elected by the participant. In the event of the participant’s termination of employment, the disposition of any LTIP units or restricted shares of Class A common stock acquired under the Alignment of Interest Program would be determined in accordance with the participant’s written employment agreement, if applicable, or the specific terms of the award under the Alignment of Interest Program as determined by the Corporate Governance and Compensation Committee or its authorized delegates. The vesting of all of a portion of the LTIP units or restricted shares of Class A common stock would generally be accelerated, however, upon certain events, such as an involuntary termination of the employee’s employment, the employee’s death or disability, or if we experience a change in control. Notwithstanding the foregoing, if a participant’s employment is terminated for cause, then any unvested LTIP units or restricted shares of Class A common acquired under the Alignment of Interest Program will be forfeited. For elections made by our NEOs with respect to compensation earned in 2022 and 2023, the number of LTIP units or restricted shares of Class A common stock was determined as of the determination date selected by our Corporate Governance and Compensation Committee by dividing the total of an NEO’s elected reduced salary or other cash compensation by the volume weighted average price of our Class A common stock for the 10 trading days immediately preceding the determination date. Additionally, to the extent an executive officer elected to receive LTIP units or restricted shares of Class A common stock in lieu of cash compensation, the NEO received an additional award of LTIP units or restricted shares of Class A common stock pursuant to the Alignment of Interest Program, subject to a three-, five- or eight-year cliff vesting schedule, at the NEO’s election. The number of additional LTIP units or restricted shares of Class A common stock, as applicable, granted was equal to (i) the number of LTIP units or restricted shares of Class A common stock, as applicable, awarded in lieu of compensation otherwise payable in cash, multiplied by (ii) a restriction multiple determined by the restriction period the NEO elected, according to the following table:
Compensation of Named Executive Officers
The restriction period subjects all LTIP units or restricted shares of Class A common stock obtained in lieu of cash compensation, as applicable, and additional LTIP units or restricted shares of Class A common stock, as applicable, awarded based on the restriction multiple to the risk of forfeiture in the event the NEO voluntarily terminates employment or terminates employment for cause, as those terms are described in the NEO’s employment agreement. Accordingly, if an NEO voluntarily leaves or is terminated for cause, that NEO would forfeit all LTIP units or restricted shares of Class A common stock that had not yet vested. By way of example, if an NEO elected to receive LTIP units or restricted shares of Class A common stock in lieu of cash compensation that is equivalent in value to 1,000 LTIP units or restricted shares of Class A common stock, as applicable, and the NEO elected an eight-year restriction period, the NEO would receive the 1,000 LTIP units or restricted shares of Class A common stock, as applicable, in lieu of the NEO’s cash compensation plus an additional award of 1,000 LTIP units or restricted shares of Class A common stock for electing an eight-year restriction period, resulting in a total receipt of 2,000 LTIP units or restricted shares of Class A common stock, as applicable, all of which would vest on the eighth anniversary of the date of grant, if the NEO is still employed by our company on the vesting date, but will not vest if he has been terminated for cause. In the event that an NEO’s employment is terminated by us without cause or by reason of the NEO’s death or disability prior to the vesting date, all or a portion of unvested LTIP units and/or restricted shares of Class A common stock may immediately vest at the time of such termination. The NEOs have the right to receive dividends or other distributions on unvested LTIP units and restricted shares of Class A common stock granted under the Alignment of Interest Program prior to vesting. As an example, the following charts illustrate the alignment between the compensation to our Chief Executive Officer and our shareholders’ interests. The chart on the left depicts the allocation of face value of compensation if our Chief Executive Officer had elected to receive his base salary and annual bonus in cash (in addition to his long-term incentive compensation in equity), and the chart on the right shows the actual allocation of face value of compensation based on his elections with respect to compensation in 2023. Summary Compensation Table The following table provides information regarding the compensation of our NEOs for the fiscal years indicated. Each of our NEOs has agreed to take 100% of his bonus and long-term incentive compensation in the form of restricted equity under our 2019 Equity Incentive Plan in 2022 and 2023. In addition, Mr. Spodek has agreed to take 100% of his base salary since the completion of our IPO, Mr. Garber has agreed to take $157,500 of his base salary in each of 2022 and 2023 and Mr. Klein has agreed to take $25,000 of his base salary in 2022 in the form of restricted common stock or LTIP units. In compliance with the terms of the Alignment of Interest Program described above, the election to acquire stock, otherwise payable in cash, caused the NEOs to be eligible to receive additional stock awards based upon a multiple described above. All shares of restricted stock and/or LTIP Units issued in lieu of cash compensation and any shares of restricted stock and/or LTIP Units issued under the Alignment of Interest Program are subject to a vesting schedule whereby no shares vest until the eighth anniversary of the date of grant (based our NEOs’ elections for the fiscal years indicated below), at which time 100% of the shares of restricted stock will vest, subject to continued employment.
Compensation of Named Executive Officers
| Name and Position | Principal Year | Salary | | Bonus | | Stock Awards | All Other Compensation(9) | Total(10) | | | | Compensation Paid in Cash(1) | Compensation Paid in Stock | Compensation Paid in Cash(4) | Compensation Paid in Stock | | | | | Andrew Spodek, Chief Executive Officer | 2023 | $— | $388,265(2) | $— | $561,810 (5) | $1,595,509(6) | $40,560 | $2,586,144 | | | 2022 | $— | $391,999 | $— | $564,052 | $1,485,030 | $65,032 | $2,506,113 | | Jeremy Garber, President and Treasurer | 2023 | $157,500 | $160,926(3) | $— | $364,807 (5) | $977,165(7) | $41,771 | $1,702,169 | | | 2022 | $157,500 | $159,077 | $— | $422,611 | $951,669 | $50,637 | $1,741,494 | | Robert Klein, Chief Financial Officer | 2023 | $275,000 | $— | $— | $304,930 (5) | $669,844(8) | $58,053 | $1,307,827 | | | 2022 | $250,000 | $25,789 | $— | $353,246 | $654,183 | $50,637 | $1,333,856 |
Compensation of Named Executive Officers
| (1) Mr. Spodek has elected to acquire LTIP Units in lieu of base salary since the completion of our IPO. Mr. Garber elected to acquire restricted shares of Class A common stock in lieu of $157,500 of base salary in each of 2022 and 2023. Mr. Klein elected to acquire restricted shares of Class A common stock in lieu of $25,000 of base salary for 2022. |
Compensation of Named Executive Officers
| (2) Mr. Spodek was issued 25,114 LTIP Units in lieu of $380,000 of base salary for 2023. Pursuant to our Alignment of Interest Program described above, by electing eight-year cliff vesting of LTIP units, Mr. Spodek is entitled to receive additional LTIP units equal to 100% of the number of LTIP units received in lieu of salary as further described in footnote 6 below. All of the LTIP units issued in lieu of base salary are subject to an eight-year cliff vesting schedule whereby no LTIP units vest until the eighth anniversary of the date of grant, at which time 100% of the LTIP units will vest, subject to continued employment. Mr. Spodek may receive distributions with respect to such LTIP units prior to vesting. The amount shown in the table represents the grant date fair value determined in accordance with FASB ASC Topic 718. |
Compensation of Named Executive Officers
| (3) Mr. Garber was issued 10,409 restricted shares of Class A common stock in lieu of $157,500 of base salary for 2023. Pursuant to our Alignment of Interest Program described above, by electing eight-year cliff vesting of restricted shares of Class A common stock, Mr. Garber is entitled to receive additional restricted shares of Class A common stock equal to 100% of the number of restricted shares of Class A common stock received in lieu of salary as further described in footnote 7 below. All of the restricted shares of Class A common stock issued in lieu of base salary are subject to an eight-year cliff vesting schedule whereby no restricted shares of Class A common stock vest until the eighth anniversary of the date of grant, at which time 100% of the restricted shares of Class A common stock, subject to continued employment. Mr. Garber may receive dividends with respect to such restricted shares of Class A common stock prior to vesting. The amount shown in the table represents the grant date fair value determined in accordance with FASB ASC Topic 718. |
Compensation of Named Executive Officers
| (4) Messrs. Spodek, Garber and Klein elected to acquire LTIP Units and/or restricted shares of Class A common stock in lieu of their bonus compensation awarded for 2022 and 2023. |
Compensation of Named Executive Officers
| (5) The amounts represent the bonuses earned by Messrs. Spodek, Garber and Klein for services performed in 2023, 100% of which was foregone in exchange for 39,648, 25,745 and 21,519 LTIP units to Messrs. Spodek, Mr. Garber and Mr. Klein, respectively. In addition, in connection with each officer’s election of an eight-year cliff vesting schedule under our Alignment of Interest Program, each officer received an additional number of LTIP units, as further described in footnotes 6, 7 and 8 below. |
Compensation of Named Executive Officers
| (6) Includes: (i) 25,114 LTIP units granted in connection with Mr. Spodek’s base salary election under our Alignment of Interest Program, with such LTIP units granted on January 31, 2023 and subject to an eight-year restricted period; (ii) 39,648 LTIP units granted in connection with Mr. Spodek’s bonus election under our Alignment of Interest Program, with such LTIP units granted on February 12, 2024 and subject to an eight-year restricted period; (iii) 20,091 target RSUs granted subject to the achievement of a service condition and market condition; and (iv) 20,091 LTIPs that are subject to a three-year vesting schedule whereby one-third of such LTIP units will vest on each of the three anniversaries beginning with February 1, 2024. The amount shown in the table represents the grant date fair value determined in accordance with FASB ASC Topic 718. The value of the target RSUs included in the table was $334,822, and the number of RSUs that can be earned if maximum performance is achieved is 200% of the target number of RSUs. For the RSUs subject to achievement of performance-based hurdles relating to the Company’s specified (i) absolute total stockholder return goals and (ii) relative total stockholder return goals, their grant date fair values were $15.77 and $19.35, respectively. |
Compensation of Named Executive Officers
| (7) Includes: (i) 10,409 LTIP units granted in connection with Mr. Garber’s base salary election under our Alignment of Interest Program, with such restricted shares of Class A common stock granted on January 31, 2023 and subject to an eight-year restricted period; (ii) 25,745 LTIP units granted in connection with Mr. Garber’s bonus election under our Alignment of Interest Program, with such LTIP units granted on February 12, 2024 and subject to an eight-year restricted period; (iii) 14,052 target RSUs granted subject to the achievement of a service condition and market condition; and (iv) 14,052 restricted shares of Class A common stock that are subject to a three-year vesting schedule whereby one-third of such shares will vest on each of the three anniversaries beginning with February 1, 2024. The amount shown in the table represents the grant date fair value determined in accordance with FASB ASC Topic 718. The value of the target RSUs included in the table was $234,183, and the number of RSUs that can be earned if maximum performance is achieved is 200% of the target number of RSUs. For the RSUs subject to achievement of performance-based hurdles relating to the Company’s specified (i) absolute total stockholder return goals and (ii) relative total stockholder return goals, their grant date fair values were $15.77 and $19.35, respectively. |
Compensation of Named Executive Officers
| (8) Includes: (i) 21,519 LTIP units granted in connection with Mr. Klein’s bonus election under our Alignment of Interest Program, with such LTIP units granted on February 12, 2024 and subject to an eight-year restricted period; (ii) 11,359 target RSUs granted subject to the achievement of a service condition and market condition; and (iii) 11,359 LTIP units that are subject to a three-year vesting schedule whereby one-third of such shares will vest on each of the three anniversaries beginning with February 1, 2024. The amount shown in the table represents the grant date fair value determined in accordance with FASB ASC Topic 718. The value of the target RSUs included in the table was $189,301, and the number of RSUs that can be earned if maximum performance is achieved is 200% of the target number of RSUs. For the RSUs subject to achievement of performance-based hurdles relating to the Company’s specified (i) absolute total stockholder return goals and (ii) relative total stockholder return goals, their grant date fair values were $15.77 and $19.35, respectively. |
Compensation of Named Executive Officers
| (10) The majority of NEOs’ 2023 compensation included long-term vesting performance-based/at-risk equity to ensure the alignment of long-term interests between the NEOs and our stockholders, as set forth in the following table. See footnotes 1 and 4 above regarding each NEO’s election of an eight-year cliff vesting schedule under our Alignment of Interest Program regarding all or a portion of their cash salary and bonus, as applicable. |
Compensation of Named Executive Officers
| Executive | 8-Year Cliff Vesting | | | 3-Year Ratable/Cliff Vesting | | Total Long- Term Vesting At-Risk / Performance- Based Equity | % of “Total” Compensation Shown in “Summary Compensation Table” Above | Actual Cash Salary Received | | | Cash Compensation Deferred In Exchange for At-Risk Alignment of Interest Equity | | At-Risk Alignment of Interest Equity Multiplier (100%) | Time- Based Vesting Equity | Absolute Total and Relative Stockholder Return Vesting Equity | | | | | | Cash Salary | Cash Bonus | | | | | | | | Andrew Spodek | $388,265 | $561,810 | $950,075 | $310,612 | $334,822 | $2,545,584 | 98.4% | — | | Jeremy Garber | $160,926 | $364,807 | $525,733 | $217,250 | $234,183 | $1,502,899 | 88.3% | $157,500 | | Robert Klein | — | $304,930 | $304,930 | $175,613 | $189,301 | $974,774 | 74.5% | $275,000 |
Outstanding Equity Awards at Fiscal Year-End
Outstanding Equity Awards at Fiscal Year-End The following table provides information regarding outstanding equity awards held by each of the NEOs as of December 31, 2023.
Outstanding Equity Awards at Fiscal Year-End
| | Stock Awards | | | | | Name | Number of Shares or Units that Have Not Vested (#) | Market Value of Shares or Units that Have Not Vested(1) ($) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) | | Andrew Spodek, Chief Executive Officer | 41,177 (2) | $599,537 | | | | | 53,230(3) | $775,029 | | | | | 27,365 (4) | $398,434 | | | | | 118,305(5) | $1,722,521 | | | | | 5,845(6) | $85,103 | | | | | 100,850(7) | $1,468,376 | 17,539(8) | $255,368 | | | 20,091(9) | $292,525 | | | | | 123,197(10) | $1,793,748 | 20,091(11) | $292,525 | | Jeremy Garber, President and Treasurer | 57,367(3) | $835,264 | | | | | 71,591(5) | $1,042,365 | | | | | 4,089(6) | $59,536 | | | | | 46,161(7) | $672,104 | 12,267(8) | $178,608 | | | 21,168(12) | $308,206 | | | | | 14,052(9) | $204,598 | | | | | 75,489(10) | $1,099,120 | 14,052(11) | $204,598 |
Outstanding Equity Awards at Fiscal Year-End
| | Stock Awards | | | | | Name | Number of Shares or Units that Have Not Vested (#) | Market Value of Shares or Units that Have Not Vested(1) ($) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) | | Robert Klein, Chief Financial Officer | 3,117(5) | $45,384 | | | | | 3,041(6) | $44,277 | | | | | 43,343(7) | $631,074 | 9,123(8) | $132,831 | | | 11,359(9) | $165,387 | | | | | 45,698(10) | $665,363 | 11,359(11) | $165,387 |
Outstanding Equity Awards at Fiscal Year-End
| (1) For purposes of this table, the market value per unvested LTIP unit and restricted share of Class A Common Stock, as applicable, is assumed to be $14.56, the closing price per share of Class A common stock on December 29, 2023, the last trading day of 2023. In addition, these amounts exclude the market-based RSU awards granted in February 2021 for the 2021 to 2023 performance period that vested in February 2024 based on the Company’s performance through December 31, 2023, which are reported in “— Long-Term Incentive Compensation — Grants and Payout of Performance-based RSUs to Named Executive Officers in 2021” above. |
Outstanding Equity Awards at Fiscal Year-End
| (2) Represents unvested LTIP units that will cliff vest on May 17, 2027. |
Outstanding Equity Awards at Fiscal Year-End
| (3) Represents unvested LTIP units or restricted shares of Class A common stock that will cliff vest on February 14, 2028. |
Outstanding Equity Awards at Fiscal Year-End
| (4) Represents unvested LTIP units that will cliff vest on May 18, 2028. |
Outstanding Equity Awards at Fiscal Year-End
| (5) Represents unvested LTIP units or restricted shares of Class A common stock that will cliff vest on February 1, 2029. |
Outstanding Equity Awards at Fiscal Year-End
| (6) Represents the unvested portion of LTIP units or restricted shares of Class A common stock that will vest on December 31, 2024. |
Outstanding Equity Awards at Fiscal Year-End
| (7) Represents unvested LTIP units or restricted shares of Class A common stock that will cliff vest on February 1, 2030. |
Outstanding Equity Awards at Fiscal Year-End
| (8) Represents RSUs subject to the achievement of a service condition and a market condition. Such RSUs are market-based equity awards and are subject to the achievement of hurdles relating to the Company’s absolute total stockholder return for the three-year period ending on December 31, 2024 and continued employment through such date. The number of market-based RSUs is based on the number of shares issuable upon achievement of the market-based metric at target. RSUs reflect the right to receive shares of Class A common stock, subject to the applicable vesting criteria. See “— Long-Term Incentive Compensation — Grants of Performance-based RSUs to Named Executive Officers in 2022” above for more details. |
Outstanding Equity Awards at Fiscal Year-End
| (9) Represents the unvested LTIP units or restricted shares of Class A common stock that will vest in equal installments on February 1, 2024, February 1, 2025 and February 1, 2026. |
Outstanding Equity Awards at Fiscal Year-End
| (10) Represents LTIP units that will cliff vest on February 1, 2031. |
Outstanding Equity Awards at Fiscal Year-End
| (11) Represents RSUs subject to the achievement of a service condition and a market condition. Such RSUs are market-based equity awards and are subject to the achievement of hurdles relating to the Company’s absolute and relative total stockholder return for the three-year period ending on December 31, 2025 and continued employment through such date. The number of market-based RSUs is based on the number of shares issuable upon achievement of the market-based metric at target. RSUs reflect the right to receive shares of Class A common stock, subject to the applicable vesting criteria. See “— Long-Term Incentive Compensation — Grants of Performance-based RSUs to Named Executive Officers in 2023” above for more details. |
Outstanding Equity Awards at Fiscal Year-End
| (12) Represents the unvested restricted shares of Class A common stock that will cliff vest on July 5, 2030. |
Director Compensation
Director Compensation In 2019, the Board of Directors adopted and implemented the following compensation program for non-employee directors for services as a director, as applicable:
Director Compensation
| • | an annual cash retainer of $25,000; |
Director Compensation
| • | an annual equity retainer of $50,000; |
Director Compensation
| • | an additional annual cash retainer of $100,000 to our Independent Chair of the Board; |
Director Compensation
| • | an additional annual cash retainer of $20,000 to our Audit Committee chair; |
Director Compensation
| • | an additional annual cash retainer of $10,000 to our Corporate Governance and Compensation Committee chair; and |
Director Compensation
| • | an additional annual cash retainer of $5,000 to each member of a committee. |
Director Compensation
Mr. Spodek, our chief Executive Officer, does not receive compensation for his service as a director. All members of our Board of Directors are reimbursed for their reasonable costs and expenses incurred in attending our board meetings. The following table sets forth information regarding 2023 compensation for each of our non-employee directors. The only fees earned or paid in cash to the directors in 2023 were related to their service as directors of the Company.
Director Compensation
| | Fees Earned in Cash | | Stock Awards | All Other Compensation | Total Compensation | | | Fees Paid in Cash(1) | Fees Paid in Stock in Lieu of Cash(2) | | | | | Mr. Donahoe | $— | $82,612 | $179,858(3) | — | $262,470 | | Mr. Lefkowitz | $— | $31,769 | $100,478(4) | — | $132,247 | | Ms. Gural-Senders | $— | $19,065 | $80,633(5) | — | $99,698 | | Mr. Feingold | $— | $25,417 | $90,548(6) | — | $115,965 |
Director Compensation
| (1) Each non-employee director elected to acquire restricted shares of Class A common stock or LTIP units in lieu of cash fees for each annual period following the completion of our IPO. |
Director Compensation
| (2) Mr. Donahoe, Mr. Lefkowitz, Ms. Gural-Senders and Mr. Feingold were issued 8,805, 3,386, 2,032 and 2,709 LTIP units, respectively, in the aggregate, in lieu of cash fees for the twelve-month period following May 17, 2023 (the third anniversary of our IPO). The amounts in the table above represent each non-employee directors’ prorated cash fees earned for the period from May 17, 2023 to December 31, 2023, which equal 5,500, 2,115, 1,269 and 1,692 LTIP units granted to Mr. Donahoe, Mr. Lefkowitz, Ms. Gural-Senders and Mr. Feingold, respectively. In addition, pursuant to our Alignment of Interest Program described below, a non-employee director electing to receive restricted shares of Class A common stock or LTIP units in lieu of cash fees is entitled to additional restricted shares of Class A common stock or LTIP units, as applicable, in an amount based upon the duration of a restriction period as further described in footnotes 3 to 6 below. |
Director Compensation
| (3) Includes: (i) 3,386 LTIP units, representing equity awards to Mr. Donahoe that are subject to a three-year vesting schedule whereby one-third of such LTIP units will vest on each anniversary of the date of grant, subject to continued service; (ii) 3,305 LTIP units representing the remaining cash fees that Mr. Donahoe elected to receive in the form of LTIP units (refer to footnote 2); and (iii) an additional 5,283 LTIP units in accordance with our Alignment of Interest Program, with such LTIP units subject to a three-year restricted period. The amount shown in the table represents the grant date fair value determined in accordance with FASB ASC Topic 718. The aggregate number of shares of Class A common stock and LTIP units outstanding at December 31, 2023, including those issued in lieu of cash fees, held by Mr. Donahoe was 43,666 and 46,359, respectively. |
Director Compensation
| (4) Includes: (i) 3,386 LTIP units, representing equity awards to Mr. Lefkowitz that are subject to a three-year vesting schedule whereby one-third of such LTIP units will vest on each anniversary of the date of grant, subject to continued service; (ii) 1,271 LTIP units representing the remaining cash fees that Mr. Lefkowitz elected to receive in the form of LTIP units (refer to footnote 2); and (iii) an additional 2,032 LTIP units in accordance with our Alignment of Interest Program, with such LTIP units subject to a three-year restricted period. The amount shown in the table represents the grant date fair value determined in accordance with FASB ASC Topic 718. The aggregate number of shares of Class A common stock and LTIP units outstanding at December 31, 2023, including those issued in lieu of cash fees, held by Mr. Lefkowitz was 27,124 and 20,684, respectively. |
Director Compensation
| (5) Includes: (i) 3,386 LTIP units, representing equity awards to Ms. Gural-Senders that are subject to a three-year vesting schedule whereby one-third of such LTIP units will vest on each anniversary of the date of grant, subject to continued service; (ii) 763 LTIP units representing the remaining cash fees that Ms. Gural-Senders elected to receive in the form of LTIP units (refer to footnote 2); and (iii) an additional 1,219 LTIP units in accordance with our Alignment of Interest Program, with such LTIP units subject to a three-year restricted period. The amount shown in the table represents the grant date fair value determined in accordance with FASB ASC Topic 718. The aggregate number of shares of Class A common stock and LTIP units outstanding at December 31, 2023, including those issued in lieu of cash fees, held by Ms. Gural-Senders was 14,419 and 17,608, respectively. |
Director Compensation
| (6) Includes: (i) 3,386 LTIP units, representing equity awards to Mr. Feingold that are subject to a three-year vesting schedule whereby one-third of such LTIP units will vest on each anniversary of the date of grant, subject to continued service; (ii) 1,017 LTIP units representing the remaining cash fees that Mr. Feingold elected to receive in the form of LTIP units (refer to footnote 2); and (iii) an |
Director Compensation
additional 1,625 LTIP units in accordance with our Alignment of Interest Program, with such LTIP units subject to a three-year restricted period. The amount shown in the table represents the grant date fair value determined in accordance with FASB ASC Topic 718. The aggregate number of shares of Class A common stock and LTIP units outstanding at December 31, 2023, including those issued in lieu of cash fees, held by Mr. Feingold was 15,259 and 20,482, respectively. Under our Alignment of Interest Program, each non-employee director had the opportunity to elect to take all or a portion of their cash retainers and other cash compensation in the form of LTIP units or restricted shares of our Class A common stock, or a mix of both. The number of LTIP units or restricted shares was determined on the same basis as for the NEOs, with the number of LTIP units or restricted shares of Class A common stock granted determined on the basis of a multiple of the compensation deferred and the length of the restriction period selected by the director. Each director who made this election was awarded additional LTIP units or restricted shares Class A common stock, at no additional cost to the director, equal to (i) the number of LTIP units or restricted shares awarded in lieu of the cash retainer(s), multiplied by (ii) a restriction multiple determined by the restriction period the director elected, according to the following table:
Director Compensation
| Duration of Restriction Period | Restriction Multiple | | 1 year | 0.2x | | 2 years | 0.4x | | 3 years | 0.6x |
Director Compensation
The restriction period subjects the LTIP units or restricted shares of Class A common stock obtained in lieu of cash compensation, as applicable, and the additional LTIP units or restricted shares awarded based on the restriction multiple to the risk of forfeiture in the event a director voluntarily resigns or is no longer a director for any reason on the vesting date. During the restricted period, the restricted shares may not be sold, assigned, pledged or otherwise transferred. Accordingly, for example, if a non-employee director elects to receive LTIP units or restricted shares of Class A common stock in lieu of cash compensation that is equivalent in value to 1,000 shares of Class A common stock and the director elects a three-year restriction period, the non-employee director would receive the 1,000 LTIP units or restricted shares of Class A common stock in lieu of the director’s cash compensation plus 600 additional LTIP units or restricted shares of Class A common stock for electing to a three-year restriction period, resulting in receipt of a total of 1,600 LTIP units or restricted shares of Class A common stock, as applicable, all of which would be vest on the third anniversary of the date of grant if the director remains a director as of the vesting date. All of the LTIP units or restricted shares of Class A common stock granted however, would be forfeited if such non-employee director voluntarily resigns on or prior to the vesting date. Subject to the risk of forfeiture and transfer restrictions, the non-employee directors will have the right to vote and receive dividends or other distributions on the unvested LTIP units and restricted shares of Class A common stock granted under the Alignment of Interest Program prior to vesting.