DEF 14A of Federal Realty Investment Trust
Filed Mar 28, 2025 · FY20240001193125-25-066328
Proposal 1: Election of Trustees
Proposal 1: Election of Trustees On recommendation of the Nominating Committee, our Board has nominated seven (7) candidates for election as trustees at the Annual Meeting. All of the nominees are incumbent trustees and were elected as trustees by our shareholders in May 2024. More detailed biographical information on each nominee can be found beginning on page 14. In accordance with our Corporate Governance Guidelines, Mr. McEachin submitted his resignation from the Board when he turned 72. After due consideration, the Board unanimously rejected Mr. McEachin’s resignation. Mr. McEachin did not participate in the consideration of or vote on his resignation. At the Annual Meeting, each trustee will be elected to hold office for a one-year term expiring at the 2026 annual meeting of shareholders and until his or her successor is elected and qualified.
Proposal 1: Election of Trustees
| Ø | VOTE REQUIRED AND MAJORITY VOTING STANDARD |
Proposal 1: Election of Trustees
You are entitled to cast one vote per share for each of the seven nominees. Proxies may not be voted for more than seven individuals. In an uncontested election such as this one, our Bylaws require that a nominee receive a majority of votes cast with respect to that nominee in order to be elected. Accordingly, any nominee who does not receive a majority of votes cast will be required to resign from the Board within ninety (90) days. Broker non-votes and abstentions, if any, will not be treated as votes cast and as a result, will have no effect on the outcome of the vote for this proposal. Over the past 5 years, our nominees who have stood for election have received, on average, nearly 98% votes “for” at each shareholder meeting.
Proposal 1: Election of Trustees
| | Our Board recommends a vote FOR each of the seven nominees |
Proposal 1: Election of Trustees
| ➣ | NOMINEE CHARACTERISTICS AND SELECTION |
Proposal 1: Election of Trustees
The Nominating Committee has primary responsibility for identifying and recommending individuals to be added to the Board and to stand for election by shareholders. Individuals identified must have the highest personal and professional integrity, demonstrated exceptional intelligence and judgment, have proven leadership skills, be committed to our success, have the requisite skills necessary to advance our long-term strategy, and have the ability to work effectively with our Chief Executive Officer and other members of the Board. In addition, the Nominating Committee assesses the contribution that a particular candidate’s skills and expertise will make with respect to guiding our strategy and management when considered as a whole with the skills and expertise of other trustees. The chart below highlights some of the key qualifications and experience that our Board believes are relevant to the effective oversight of the Company and the execution of our long-term strategy and were considered as relevant for each nominee. The absence of a mark for an attribute for any nominee does not necessarily mean that the nominee does not possess that attribute; it means only that when the Board considered that nominee in the overall context of the composition of our Board, that attribute was not a key factor in the determination to nominate that individual. Further information on each nominee’s qualifications and relevant experience is provided in the individual biographical descriptions below starting on page 14.
Proposal 1: Election of Trustees
| | NOMINEE QUALIFICATIONS AND EXPERIENCE | | | | | | | | | Qualification/Experience | | Faeder | Holland | Lamb-Hale | McEachin | Nader | Steinel | Wood | | | Strategic Planning and Leadership | ● | ● | ● | ● | ● | ● | ● | | | CEO/Executive Management | ● | ● | ● | ● | ● | ● | ● | | | REIT/Public Company Executive | ● | | ● | | | | ● | | | Public Company Board Service | ● | ● | ● | ● | ● | ● | ● | | | Financial Expertise/Literacy | ● | ● | | ● | ● | ● | ● | | | Real Estate Investing/Finance | ● | ● | | | ● | | ● | | | Retail Industry | | ● | | | ● | | | | | Risk Management | ● | ● | ● | ● | ● | ● | ● | | | Human Capital Management | ● | ● | ● | ● | ● | ● | ● | | | Corporate Governance | ● | ● | ● | ● | ● | ● | ● | | | Sustainability | ● | ● | | | | | ● | | | DEMOGRAPHICS | | | | | | | | | Race/Ethnicity | | Faeder | Holland | Lamb-Hale | McEachin | Nader | Steinel | Wood | | Black or African American | | | | ● | ● | | | | | White | | ● | ● | | | ● | ● | ● | | Gender | | | | | | | | | | Female | | | ● | ● | | | ● | | | Male | | ● | | | ● | ● | | ● |
Proposal 1: Election of Trustees
In 2024 the Company’s Corporate Governance Guidelines were modified to provide that no trustee who is the CEO of a publicly traded company can serve on more than two public company boards, including the Board of the Company, and no other trustee who is not the CEO or a named executive officer of a public company can serve on more than four public company boards, including the Board of the Company. These limitations were considered before nominating our existing trustees to stand for reelection in 2025. To identify, recruit and evaluate qualified candidates for the Board, the Board first looks to individuals known to current Board members through business and other relationships. If the Board is not able to identify qualified candidates in the foregoing way, the services of a professional search firm would be used. In addition, any shareholder, or a group of up to 20 shareholders, that has continuously owned for 3 years at least 3% of the Company’s outstanding Common Shares can nominate and include in the Company’s annual meeting proxy materials up to the greater of two trustees or 20% of the number of trustees serving on the Board, provided that the shareholder(s) and the nominee(s) satisfy the requirements set forth in our Bylaws. For further information regarding submission of a trustee nominee using the Company’s proxy access Bylaw provision or otherwise, see the “Shareholder Proposals for the 2026 Annual Meeting” section starting at page 47.
Proposal 1: Election of Trustees
| ➣ | NOMINEE DIVERSITY AND TENURE |
Proposal 1: Election of Trustees
The Board believes that a mix of skills, qualifications, ages, tenure and diversity are important considerations in identifying nominees so that the Board as a whole has the different viewpoints needed to provide appropriate oversight of the Company’s business. Among the many items the Board takes into account, the Board specifically considers the gender and race/ethnicity of prospective nominees in order to ensure diverse representation on the Board.
Proposal 1: Election of Trustees
| AGE | TENURE | GENDER & ETHNIC DIVERSITY | | | | | | Average age of independent trustees 64.3 years | Average tenure of independent trustees 10.3 years | Committees chaired by women 67% |
Proposal 1: Election of Trustees
| ➣ | OUR NOMINEES |
Proposal 1: Election of Trustees
The following biographical descriptions set forth certain information with respect to each nominee for election at the Annual Meeting as well as the specific experience, qualifications, attributes and skills that led to our Board’s conclusion that each nominee should serve as a trustee of our Company.
Proposal 1: Election of Trustees
| | DAVID W. FAEDER Age: 68 Trustee Since: 2003 Non-Executive Chairman Managing Partner of Fountain Square Properties and Managing Member of Kensington Senior Living | | ELIZABETH I. HOLLAND Age: 59 Trustee Since: 2017 Chief Executive Officer of Abbell Credit Corporation and Abbell Associates, LLC | | Mr. Faeder has been the managing partner of Fountain Square Properties since 2003 and managing member of Kensington Senior Living since 2011, both of which are focused on the ownership, operation and development of senior housing. Prior to that, he held various positions at Sunrise Senior Living from 1993 to 2003. Those positions included Vice Chairman, President and Executive Vice President-Chief Financial Officer. Mr. Faeder began his career in public accounting before moving into investment banking immediately prior to joining Sunrise. Mr. Faeder received a BS in Business Administration from Old Dominion University and an MBA from the Colgate Darden Graduate School of Business at the University of Virginia. Mr. Faeder has been designated by the Board as an audit committee financial expert in accordance with the SEC definition. Skills and Qualifications Mr. Faeder has deep levels of experience in leadership, real estate investment and development as well as finance and accounting acquired from his time as a private investor and as a public company real estate CFO coupled with his public company and accounting background. This experience provides valuable perspective on our investment decisions, alignment of our capital structure to support those investments and on our financial reporting. His experience in senior living also provides valuable insights for a growing area that could be a source of additional value creation at a number of our properties. Prior Public Company Directorships: Arlington Asset Investment Corp. (until 2023) Committees: Audit Committee Nominating Committee | | Ms. Holland is the Chief Executive Officer of Abbell Credit Corporation and Abbell Associates, LLC, a private retail real estate company. She has held that position since 1997. Ms. Holland is also Chief Executive Officer of Consortial Technologies, L.L.C., a software development company since 2017. Prior to that, she served as a senior staff attorney on the Congressional Bankruptcy Review Commission (1996-1997), as a business reorganization attorney at Skadden, Arps, Slate, Meagher & Flom (1993-1996) and as a fixed income portfolio manager at Brown Brothers Harriman & Company from (1989-1990). From 2016-2017, Ms. Holland served as the Chairman of the Board of Trustees for ICSC (f/k/a International Council of Shopping Centers) and has served as a trustee for that organization since 2004. Ms. Holland earned a BA from Hamilton College and a JD from Brooklyn Law School. In addition to her public board service, Ms. Holland serves on the boards of The Village Bank & Trust, a Chicago based owner, manager and developer of multi-family properties, and Primo Center for Women & Children, a non-profit organization whose mission is to provide family shelter and permanent supportive housing and other supportive services to homeless families in Chicago. Skills and Qualifications Ms. Holland brings valuable insights into retailers and the retail industry in general from her time in leadership positions with ICSC and her own investing experience in retail real estate as well as a wealth of business and leadership experience from running a private real estate company. Those perspectives are invaluable for a retail based real estate company. Current Public Company Directorships: VICI Properties, Inc. Committees: Audit Committee Compensation Committee (Chair) | |
Proposal 1: Election of Trustees
| | NICOLE Y. LAMB HALE Age: 58 Trustee Since: 2020 Vice President, Chief Legal Officer and Corporate Secretary of Cummins, Inc. | | THOMAS A. McEACHIN Age: 72 Trustee Since: 2022 Retired Vice President and Group Chief Financial Officer of Covidien Surgical Solutions | | Ms. Lamb-Hale currently serves as the Vice President, Chief Legal Officer and Corporate Secretary of Cummins Inc., a position she has held since 2023 overseeing all legal affairs and related risk management. While at Cummins Inc., Ms. Lamb-Hale has also held the titles Vice President and Chief Legal Officer (2023) and Vice President and General Counsel (2021-2022). Prior to that time, she was a Managing Director at Kroll, a global governance, risk and transparency consultant (2016-2021), a Senior Vice President at Albright Stonebridge Group (2013-2016), a global strategy consultancy, and served as the Assistant Secretary of Commerce for Manufacturing and Services in the International Trade Administration of the U.S. Department of Commerce (2010-2013) and as the Deputy General Counsel for the U.S. Department of Commerce (2009-2010). Ms. Lamb-Hale is a licensed attorney who began her career at law firms (1991-2009) where she practiced in the areas of business restructuring and public finance. Ms. Lamb-Hale earned an AB in Political Science from the University of Michigan and a JD from Harvard Law School. In addition to her service on Federal’s Board, Ms. Lamb-Hale serves on the board of Delta Parent Holdings, Inc. as well as the boards of various non-profit groups including the American Leadership Initiative, the Center for International Private Enterprise, the Cummins Foundation and the U.S. Chamber of Commerce Foundation. Skills and Qualifications Ms. Lamb-Hale’s 30 years of experience, spanning the private and public sectors, in law, executive level risk management and mitigation, and restructuring, coupled with her leadership skills gained from her varied executive roles, provides the company with diverse and valuable insights as it develops and implements its current and long-term business strategies. Committees: Compensation Committee Nominating Committee | | Mr. McEachin has served as Vice President and Group Chief Financial Officer (2008-2012) at Covidien Surgical Solutions, a division of Covidien plc, a global health care products company and manufacturer of medical devices and supplies. From 1997 to 2008, Mr. McEachin served in various finance capacities at United Technologies Corporation, a global leader in the aerospace and building industries, and its subsidiaries, including as chief Investor Relations officer, Vice President and Controller of Pratt & Whitney, and Vice President and Chief Financial Officer of UTC Power. Prior to that, he held several executive positions with Digital Equipment Corporation, a vendor of computer systems, including computers, software, and peripherals, from 1986 to 1997. Mr. McEachin was with Xerox Corporation, a global corporation that sells print and digital document products and services, from 1975 to 1986, serving as Controller of the procurement organization. Mr. McEachin formerly served as a trustee and officer of the Wadsworth Atheneum (Hartford, CT), the oldest public art institution in the United States, serving on their executive, finance and investment committees. He also is a past board member of the Connecticut Science Center and chair of the audit committee. Mr. McEachin holds a B.S. from New York University School of Engineering, an MBA from Stanford University and completed the Advance Management Program at University of Pennsylvania’s Wharton School. Skills and Qualifications Mr. McEachin’s history as a CFO plus his extensive finance and executive management experience and in-depth knowledge as a CFO of financial reporting, compliance, accounting and controls and corporate governance matters provides the company with important skills. Current Public Company Directorships: Pediatrix Medical Group, Inc. Prior Public Company Directorships: Surgalign Holdings, Inc. (until 2023) Committees: Compensation Committee Nominating Committee | |
Proposal 1: Election of Trustees
| | ANTHONY P. NADER, III Age: 61 Trustee Since: 2020 Managing Director of SWaN & Legend Venture Partners | | GAIL P. STEINEL Age: 68 Trustee Since: 2006 Owner of Executive Advisors | | Mr. Nader is a Managing Director of SWaN & Legend Venture Partners, an investment firm that Mr. Nader co-founded in 2006, making investments in growth-oriented companies. Mr. Nader also serves as Vice Chairman of Asurion, a privately held company with over 19,000 employees that provides technology protection to approximately 300 million customers worldwide. In 2008, Mr. Nader successfully merged his prior company, National Electronics Warranty (“NEW”) with Asurion. Mr. Nader joined NEW in 1990 as Chief Operating Officer, was named President in 1999 and Chief Executive Officer in 2006, a position he held until 2013. Under his leadership, NEW grew to be the largest global provider of extended service plans for the consumer electronics and appliance industry. Mr. Nader earned a BSBA in Finance from John Carroll University and an MBA from Weatherhead School of Management at Case Western Reserve University. Mr. Nader also served as the Chairman of the Inova Health System Board of Trustees until December 31 2023. Mr. Nader has been designated by the Board as an audit committee financial expert in accordance with the SEC definition. Skills and Qualifications Mr. Nader provides our Board with more than 30 years of business and leadership experience as well as a deep investment background in both real estate and growth-oriented companies including retailers. This background complements others on our Board and adds to our depth of financial and investing expertise that is so critical to the success of the Company. Prior Public Company Directorships: Arlington Asset Investment Corp. (until 2023) Committees: Audit Committee Nominating Committee (Chair) | | Ms. Steinel is the owner of Executive Advisors (2007-present), a business that provides consulting services to chief executives and senior officers and leadership seminars/speeches to various organizations. Prior to creating her own consulting firm, Ms. Steinel was the Executive Vice President of Global Commercial Services of Bearing Point (2002-2007) and a global managing partner for Arthur Andersen’s Business Consulting Practice (1984-2002) after beginning her career as an auditor at Arthur Andersen (1977-1984). Ms. Steinel received a BA in Accounting from Rutgers University. Ms. Steinel’s public company board service experience includes MTS Systems Corporation (2009-2020). In addition, Ms. Steinel serves as the lead independent director since 2024 of Invesque, Inc., a Toronto stock exchange company that invests in a highly diversified portfolio of properties across the health care spectrum throughout the US and Canada, and serves on the board of DAI, an international development company that tackles fundamental social and economic development problems caused by inefficient markets, ineffective governance, and instability, and the Center for Hope & Safety, a nonprofit that assists women and children suffering from domestic violence. Ms. Steinel has been designated by the Board as an audit committee financial expert in accordance with the SEC definition. Skills and Qualifications Ms. Steinel’s history as a CPA combined with her more than 35 years of experience in auditing, leadership, leadership development and financial systems provides us with valuable insights on leadership, leadership development, risk management and systems operations. Prior Public Company Directorships: MTS Systems Corporation (until 2020) Committees: Audit Committee (Chair) Compensation Committee | |
Proposal 1: Election of Trustees
| | DONALD C. WOOD Age: 64 Trustee Since: 2003 Chief Executive Officer of Federal Realty Investment Trust | | Mr. Wood currently serves as our Chief Executive Officer, a role he has held since 2003. Before assuming that role, he served as our President (2001-2003) and held the titles of Chief Operating Officer and Chief Financial Officer at various points from 1998-2003. Prior to joining Federal, Mr. Wood served as the Chief Financial Officer for Caesers World, Inc. (1996-1998), the Assistant/Deputy Controller of ITT Corporation (1990-1996), the VP of Finance for Trump Taj Mahal Associates (1989-1990) and as an audit manager with Arthur Andersen (1982-1989). Mr. Wood is a CPA and received a BS in Business Administration from Montclair State College. Mr. Wood previously served as a director of public companies Quality Care Properties (2016-2018) and Post Properties (2011-2016). In addition to his public company board service, Mr. Wood served as Chairman of the Board of Trustees of the National Association of Real Estate Investment Trusts (2011-2012) and previously served on the Board of Governors of ICSC (f/k/a International Council of Shopping Centers). Skills and Qualifications Mr. Wood’s 25 years of experience with Federal, including his responsibilities as chief executive officer and as a REIT CFO, provide the Board with familiarity and details on all aspects of the operations and financial condition of the Company. Current Public Company Directorships: Healthcare Realty Trust Incorporated Prior Public Company Directorships: Quality Care Properties (until 2018) Post Properties (until 2016) | |
Proposal 1: Election of Trustees
| Ø | TRUSTEE COMPENSATION |
Proposal 1: Election of Trustees
As of December 31, 2024, our standard arrangement for compensation for our non-management trustees included the following:
Proposal 1: Election of Trustees
| Trustee Compensation Element | Amount | Payment Form | | Board Service | | | | Annual Retainer | $200,000 | 40% cash; 60% equity | | Annual Retainer Non-Executive Chairman | $225,000 | 60% cash; 40% equity | | Committee Chairs | | | | Audit Committee | $25,000 | Cash | | Compensation Committee | $15,000 | Cash | | Nominating Committee | $15,000 | Cash |
Proposal 1: Election of Trustees
All amounts are prorated for any partial years of service and shares issued are fully vested on the grant date. Effective January 1, 2025, the annual retainer for the Non-Executive Chairman increased to $275,000 and the annual retainer for all other Trustees increased to $225,000. All other aspects of trustee compensation remain unchanged. Our non-management Trustees are required to maintain ownership of our shares having a value equal to at least 5 times the amount of their annual cash retainer. This requirement must be met within 5 years after joining the Board. As of December 31, 2024, all of our Trustees were in full compliance with this ownership requirement except for Mr. McEachin who joined the Board in 2022. We expect Mr. McEachin to be in compliance with this equity ownership requirement within the 5-year time frame. The actual compensation awarded to our Trustees for service in 2024 was as follows:
Proposal 1: Election of Trustees
| | Annual Retainer | | Committee | | | Name | Paid in Cash | Paid in Shares(1) | Chair Fees | Total | | David W. Faeder | $135,000 | $90,000 | $- | $225,000 | | Elizabeth I. Holland | $80,000 | $120,000 | $15,000 | $215,000 | | Nicole Y. Lamb-Hale | $80,000 | $120,000 | $- | $200,000 | | Thomas A. McEachin | $80,000 | $120,000 | $- | $200,000 | | Anthony P. Nader, III | $80,000 | $120,000 | $15,000 | $215,000 | | Gail P. Steinel | $80,000 | $120,000 | $25,000 | $225,000 | | Total | $535,000 | $690,000 | $55,000 | $1,280,000 |
Proposal 2: Approving our Executive Compensation
| CD&A TABLE OF CONTENTS | Page # | | Introduction | 20 | | 2024 Business Highlights Supporting Compensation Decisions | 20 | | Program Philosophy and Objectives | 20 | | Executive Compensation Practices | 21 | | Components of Compensation | 21 | | Compensation Setting Process | 21 | | Annual Compensation Decision Making | 21 | | Role of the Compensation Committee | 22 | | Role of Management | 22 | | Role of Independent Compensation Consultant | 22 | | 2024 Compensation Decisions | 22 | | Changes for 2024 | 22 | | Setting 2024 Target Compensation | 22 | | Individual Elements of 2024 Pay | 23 | | Base Pay | 23 | | Annual Bonus Program | 23 | | Long-Term Incentive Program | 24 | | 2024 NEO Performance Summary | 26 | | Other Compensation Practices and Policies | 27 | | Consideration of Say on Pay Vote | 27 | | No Hedging or Pledging of Our Shares | 27 | | Severance and Change-in-Control Arrangements | 27 | | Clawback Policy | 28 | | Share Ownership Guidelines | 28 | | Risk Assessment of Compensation Programs | 28 | | Equity Grant Practices | 29 | | Tax Deductibility of Executive Compensation | 29 | | Health and Welfare Benefits | 29 | | Compensation Committee Report | 29 |
Proposal 2: Approving our Executive Compensation
| Current NEOs | | | | DONALD C. WOOD Chief Executive Officer and President Age: 64 Joined Federal: 1998 In position since: 2003 | | | DANIEL GUGLIELMONE EVP-Chief Financial Officer and Treasurer Age: 58 Joined Federal: 2016 In position since: 2016 | | | DAWN M. BECKER EVP-Chief Legal Officer and Secretary Age: 61 Joined Federal: 1997 In position since: 2002 |
INTRODUCTION
| What We Do | | What We Don’t Do | | | | Maintain a pay mix that is heavily performance-based | | Have employment agreements with our NEOs with required fixed compensation increases | | | Align compensation with company and individual performance | | Grant options below fair market value or reprice options | | | Seek annual shareholder advisory approval of executive compensation | | Permit hedging or pledging of our shares | | | Maintain strong share ownership guidelines of 7x base salary for our CEO and 2.5x base salary plus annual bonus for our other NEOs | | Provide perquisites that are not made available to all of our employees | | | Maintain incentive compensation clawback policy | | | | | Conduct annual compensation risk assessment | | |
INTRODUCTION
| | Pay Component | Time | Metric | Purpose | Impact | | | Annual / Short-Term | Base Pay See p. 23 for more information | 1 year | Individual performance | To provide fair and competitive compensation for individual performance and level of responsibility of position held | Attract and retain talent | Fixed | | | Annual Performance Bonus See p. 23 for more information | 1 year | FFO per Share Individual performance | To provide performance based annual cash awards to motivate and reward employees for achieving our short-term business objectives | Drive near-term corporate and individual performance goals | Variable / At risk | | Long-Term | Equity Incentive See p. 24 for more information | 3 years | Relative total shareholder return (34%) FFO multiple premium (33%) Return on invested capital (33%) | To provide performance-based equity compensation in the form of restricted shares to drive medium and longer-term business objectives | Drive medium and long- term performance goals and retain talent | |
COMPENSATION SETTING PROCESS
| ➣ | ROLE OF INDEPENDENT COMPENSATION CONSULTANT |
2024 COMPENSATION DECISIONS
In addition to our current NEOs, Jeffrey S. Berkes, age 61, served as our President and Chief Operating Officer during 2024 and was an NEO during 2024. Effective December 31, 2024, the position of Chief Operating Officer of the Company was eliminated and as a result, Mr. Berkes was terminated without cause effective as of that date. A complete discussion of amounts paid to Mr. Berkes in connection with his termination is included in the “Potential Payments on Termination of Employment and Change-in-Control” section below. There were no changes made to the target compensation levels for any of our NEOs in 2024 other than Mr. Guglielmone. After reviewing market compensation levels for Chief Financial Officers in the REIT industry, the Compensation Committee increased Mr. Guglielmone’s long-term equity target to $1.5 million resulting in a total target compensation level for Mr. Guglielmone for 2024 of $2,650,000.
2024 COMPENSATION DECISIONS
| | | Target Annual Bonus | | Target Long- Term Incentive | Total 2024 Target | | | Base Pay | % of Base | Amount | | | | Mr. Wood | $1,000,000 | 150% | $1,500,000 | $6,000,000 | $8,500,000 | | Mr. Guglielmone | $575,000 | 100% | $575,000 | $1,500,000 | $2,650,000 | | Ms. Becker | $575,000 | 100% | $575,000 | $1,000,000 | $2,150,000 | | Mr. Berkes | $650,000 | 125% | $812,500 | $1,000,000 | $2,462,500 |
2024 COMPENSATION DECISIONS
| CEO Pay Mix | Base Pay | Annual Bonus | Long-Term | | | 12% | 18% | 70% | | | | 88% Performance-Based At Risk | |
2024 COMPENSATION DECISIONS
| Average Other NEOs Pay Mix | Base Pay | Annual Bonus | Long-Term | | | 25% | 27% | 48% | | | | 75% Performance-Based At Risk | |
2024 COMPENSATION DECISIONS
Base Pay The base pay level established for each of our NEOs represents a modest portion of each individual’s total compensation package and the Compensation Committee believes them to be competitive and appropriate based on market data. Annual Bonus Program Our bonus plan is an annual cash incentive program designed to reward achievement for the current year based on achieving a level of FFO per share that the Committee has determined is necessary for the Company to achieve its business objectives for the year. The Compensation Committee has determined that FFO per share is the appropriate measure to use for our annual bonus program because it is a key annual metric used by investors, the Board and management to evaluate the Company’s annual performance and it reflects the full range of decision making and execution for the Company for the year. The Compensation Committee sets the required performance level for FFO per share at the beginning of each year with levels reflecting performance that ranges from acceptable at the threshold level to exceptional at the stretch level based on budgets reviewed by the entire Board. Approximately 94% of our employees participate in this annual bonus plan.
2024 COMPENSATION DECISIONS
| | Performance Levels | | | | | Performance Goal | Threshold | Target | Stretch | Actual | | Payout as Percentage of Target | 75% | 100% | 125% | | | FFO per diluted Share | $6.61 | $6.71 | $6.81 | $6.77 | | | | | Final Payout | 112.5% |
2024 COMPENSATION DECISIONS
| | | | Potential Maximum Payout | Actual Earned | | | | | Target (% Base Pay) | Target ($) | | Company Performance | Individual Performance | Total Paid | | NEO | | | | | | | | Mr. Wood | 150% | $1,500,000 | $1,875,000 | $421,875 | $1,265,625 | $1,687,500 | | Mr. Guglielmone | 100% | $575,000 | $718,750 | $161,719 | $485,156 | $646,875 | | Ms. Becker | 100% | $575,000 | $718,750 | $161,719 | $485,156 | $646,875 | | Mr. Berkes | 125% | $812,500 | $1,015,625 | $914,063 | $0 | $914,063 |
2024 COMPENSATION DECISIONS
| | | Performance Targets | | | Payout Factor | | | Performance Goal | Weighting | Threshold | Target | Stretch | Unweighted | Weighted | | Payout as Percentage of Target | | 50% | 100% | 150% | | | | Relative Total TSR | 34% | 5% < Index | Index | 5% > Index | 58.7% | 19.96% | | FFO Multiple Premium | 33% | 5% Premium | 15% Premium | 20% Premium | 145.5% | 48.02% | | Return on Invested Capital | 33% | 6.75% | 7.00% | 7.25% | 150.0% | 49.50% | | | | | | | Final Payout | 117.47% |
2024 COMPENSATION DECISIONS
The Compensation Committee has the right to increase or decrease each NEO’s award under our long-term incentive program by up to 20% to reflect individual performance and chose not to exercise that discretion for any of our NEOs. See the discussions on pages 26-27 for the factors considered by the Compensation Committee in determining the final long-term incentive awards payable to our NEOs for the 2022 through 2024 performance period. The equity awards under our long-term incentive program are paid in the form of restricted shares that are issued after completion of the 3-year performance period and then vest equally over an additional period of 3 years from the date they are earned and issued. As a result, each NEO is required to hold all of their earned shares for 1 year after they have been earned, two-thirds of their earned shares for 2 years after they are earned and one-third of their earned shares for 3 years after they are earned.
2024 COMPENSATION DECISIONS
The actual number of shares awarded to each of our NEOs is determined by dividing the amount of the award by the closing price of our shares on the NYSE on the date the awards are made. There is no amount included in the Summary Compensation Table or Grants of Plan-Based Awards Table in this proxy statement for long-term incentive awards earned for the 2022-2024 performance period. Those amounts will be included in next year’s proxy statement. The long-term incentive awards included in the Summary Compensation Table and the Grants of Plan-Based Awards Table for our NEOs in this proxy statement relate to awards made in February 2024 for the 3-year performance period ending December 31, 2023.
OTHER COMPENSATION PRACTICES AND POLICIES
| ➣ | SEVERANCE AND CHANGE-IN-CONTROL ARRANGEMENTS |
OTHER COMPENSATION PRACTICES AND POLICIES
We do not have employment agreements in place with any of our NEOs or any other employee which provides the Compensation Committee with maximum flexibility to modify compensation as warranted based on market conditions and Company considerations. We do, however, have in place with each of our NEOs a severance agreement that provides for certain payments and benefits to be provided to the NEO if he/she is terminated from employment under the conditions set forth in those agreements. The circumstances in which payments may be made and the potential amounts of those payments are described in more detail in the “Potential Payments on Termination of Employment and Change-in-Control” section below. We believe that the payments provided for in these agreements are consistent with market and important as part of the total compensation packages available for our NEOs.
OTHER COMPENSATION PRACTICES AND POLICIES
The Compensation Committee completed its last annual review of our compensation programs and policies from a risk perspective in February 2025. The Compensation Committee does not believe that our programs encourage unnecessary or excessive risk or are likely to have a material adverse effect on the Company. Our compensation programs use both short- and long-term incentives with different metrics driven by corporate performance, and have differing performance requirements. Further, we have in place policies to mitigate risk including robust share ownership requirements and vesting periods on equity awards made as part of our compensation programs.
OTHER COMPENSATION PRACTICES AND POLICIES
| ➣ | EQUITY GRANT PRACTICES |
OTHER COMPENSATION PRACTICES AND POLICIES
We do not grant equity awards in anticipation of the release of material non-public information and we do not time the release of material non-public information based on equity award grant dates or for the purpose of affecting the value of executive compensation. In addition, we do not take material non-public information into account when determining the timing and terms of such awards. Although we do not have a formal policy with respect to the timing of our equity award grants, the Compensation Committee has historically granted such awards on a predetermined annual schedule. In 2024, we did not grant new awards of stock options, stock appreciation rights, or similar option-like instruments to our NEOs. All of our options have an exercise price equal to the closing price of our shares on the date of grant and our 2020 Performance Incentive Plan (“2020 Plan”) expressly prohibits any repricing of options. The Compensation Committee has delegated to our CEO, in his capacity as a Trustee, authority to make equity awards to non-executive officers, subject to various limitations set forth in the delegation.
➣ SUMMARY COMPENSATION TABLE
➣ SUMMARY COMPENSATION TABLE The table below summarizes the total compensation earned by or paid to the individuals who were NEOs for the fiscal years ended December 31, 2024, 2023 and 2022. All amounts are calculated in accordance with current SEC rules.
➣ SUMMARY COMPENSATION TABLE
| Name and Principal Position | Year | Salary(1) | Bonus(2) | Stock Awards(3) | Non-Equity Incentive Plan Compensation(4) | All Other Compensation(5) | Total | | Donald C. Wood (PEO) | 2024 | $1,000,000 | $- | $6,946,529 | $1,265,625 | $28,376 | $9,240,530 | | Chief Executive Officer and | 2023 | $1,000,000 | $- | $6,502,565 | $1,406,250 | $33,005 | $8,941,820 | | President | 2022 | $1,000,000 | $- | $6,474,391 | $1,406,250 | $35,391 | $8,916,031 | | Daniel Guglielmone (PFO) | 2024 | $575,000 | $- | $1,063,974 | $646,875 | $13,340 | $2,299,188 | | Executive Vice President- | 2023 | $575,000 | $150,000 | $989,990 | $718,750 | $12,389 | $2,446,128 | | Chief Financial Officer & Treasurer | 2022 | $575,000 | $- | $890,996 | $718,750 | $11,736 | $2,196,482 | | Dawn M. Becker | 2024 | $575,000 | $- | $1,279,594 | $485,156 | $18,868 | $2,358,619 | | Executive Vice President- | 2023 | $575,000 | $- | $1,205,597 | $539,063 | $17,644 | $2,337,304 | | Chief Legal & Administrative Officer | 2022 | $575,000 | $- | $727,570 | $539,063 | $14,521 | $1,856,154 | | Jeffrey S. Berkes(6) | 2024 | $650,000 | $- | $1,368,649 | $914,063 | $1,736,328 | $4,669,039 | | Former President and Chief | 2023 | $650,000 | $- | $1,233,773 | $761,719 | $18,904 | $2,664,395 | | Operating Officer | 2022 | $650,000 | $- | $1,205,703 | $609,375 | $15,613 | $2,480,691 |
➣ SUMMARY COMPENSATION TABLE
| (1) Amounts shown in the Salary column include all amounts deferred at the election of the NEOs into our non-qualified deferred compensation plan. |
➣ SUMMARY COMPENSATION TABLE
| (2) Amounts represent a one-time cash bonus. |
➣ SUMMARY COMPENSATION TABLE
| (3) Amounts shown in this column reflect the aggregate grant date fair value of the awards calculated in accordance with FASB ASC Topic 718 that were issued in the year shown. |
➣ SUMMARY COMPENSATION TABLE
| (4) Amounts shown in this column represent the cash amount paid under our annual bonus plan and include amounts deferred by our NEOs into our non-qualified deferred compensation plan. |
➣ SUMMARY COMPENSATION TABLE
| (5) The amounts shown in this column for the most recent fiscal year include: (a) contributions to our 401(k) plan of $8,625 for each of our NEOs; and (b) payments for various life, long-term disability and other medical related insurance of $19,751 for Mr. Wood, $4,715 for Mr. Guglielmone, $10,243 for Ms. Becker and $11,518 for Mr. Berkes. In addition, the amount shown in this column for Mr. Berkes includes severance costs of $1,716,185 paid to Mr. Berkes in connection with him leaving the Trust as described in the “Potential Payments on Termination of Employment and Change-in-Control” section below. |
➣ SUMMARY COMPENSATION TABLE
| (6) Mr. Berkes was a named executive officer until December 31, 2024. In addition to the amounts reflected above, at the conclusion of the term of his Consulting Agreement, Mr. Berkes will receive a distribution of the balance in his non-qualified deferred compensation account as reflected in the “Non-Qualified Deferred Compensation” section below. |
➣ SUMMARY COMPENSATION TABLE
| ➣ | GRANTS OF PLAN BASED AWARDS TABLE |
➣ SUMMARY COMPENSATION TABLE
The following equity awards were made in 2024 to our NEOs.
➣ SUMMARY COMPENSATION TABLE
| Name | Grant Date | All Other Stock Awards: Number of Shares of Stock or Units(3) | Grant Date Fair Value(4) | | Donald C. Wood | 2/6/2024(1) | 5,533 | $562,485 | | | 2/6/2024(2) | 62,798 | $6,384,045 | | Daniel Guglielmone | 2/6/2024(2) | 10,466 | $1,063,974 | | Dawn M. Becker | 2/6/2024(1) | 2,121 | $215,621 | | | 2/6/2024(2) | 10,466 | $1,063,974 | | Jeffrey S. Berkes | 2/6/2024(1) | 2,997 | $304,675 | | | 2/6/2024(2) | 10,466 | $1,063,974 |
➣ SUMMARY COMPENSATION TABLE
| (1) Issued under our annual bonus plan for the 1-year performance period ending December 31, 2023. These shares vest equally over 3 years. |
➣ SUMMARY COMPENSATION TABLE
| (2) Issued under our long-term incentive program for the 3-year performance period ending December 31, 2023. These shares vest equally over 3 years. |
➣ SUMMARY COMPENSATION TABLE
| (3) Dividends are paid on these shares issued at the same rate and time as paid to all other holders of our shares as declared by our Board from time to time. |
➣ SUMMARY COMPENSATION TABLE
| (4) Represents the grant date fair value of share awards as computed in accordance with FASB ASC Topic 718. |
➣ OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END TABLE
➣ OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END TABLE The following table sets forth information about outstanding equity awards held by our NEOs as of December 31, 2024:
➣ OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END TABLE
| Stock Awards | | | | | | Name | Number of Shares or Units of Stock That Have Not Vested | Market Value of Shares or Units of Stock That Have Not Vested(6) | 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(6) | | Donald C. Wood | 5,533 (1) | $619,419 | | | | | 62,798 (1) | $7,030,236 | | | | | 3,407 (2) | $381,414 | | | | | 35,981 (2) | $4,028,073 | | | | | 1,408 (3) | $157,626 | | | | | 15,653 (3) | $1,752,353 | | | | Daniel Guglielmone | 10,466 (1) | $1,171,669 | | | | | 5,997 (2) | $671,364 | | | | | 2,348 (3) | $262,859 | | | | | 3,428 (4) | $383,765 | | | | Dawn M. Becker | 2,121 (1) | $237,446 | | | | | 10,466 (1) | $1,171,669 | | | | | 1,306 (2) | $146,207 | | | | | 5,997 (2) | $671,364 | | | | | 352 (3) | $39,406 | | | | | 1,565 (3) | $175,202 | | | | Jeffrey S. Berkes | | | 5,221(5) | $584,491 |
➣ OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END TABLE
| (1) One-third of these shares vested on February 12, 2025 and the remaining shares will vest equally on February 12 of each of 2026 and 2027. |
➣ OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END TABLE
| (2) One-half of these shares vested on February 12, 2025 and the remaining shares will vest on February 12, 2026. |
➣ OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END TABLE
| (3) These shares vested on February 12, 2025. |
➣ OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END TABLE
| (4) One-half of these shares will vest equally on August 3 of each of 2025 and 2026. |
➣ OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END TABLE
| (5) The number of shares represent the threshold payout level under a performance award made in 2021 that included a performance period ending December 31, 2024. The final number of shares earned was calculated in January 2025 in accordance with the agreement which resulted in Mr. Berkes earning 7,204 shares and receiving a cash payment of $124,485 for accrued dividends also in 2025. All other shares held by Mr. Berkes vested in full on December 31, 2024 in accordance with his severance arrangements. See the “Potential Payments on Termination of Employment and Change-in-Control” section below for more information. |
➣ OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END TABLE
| (6) The value of shares is calculated based on $111.95, the closing price of our shares on the NYSE on December 31, 2024. |
➣ OPTIONS EXERCISED AND STOCK VESTED IN 2024
➣ OPTIONS EXERCISED AND STOCK VESTED IN 2024 The following table includes information with respect to shares held by our NEOs that vested in 2024. None of our NEOs holds any options or exercised any options during 2024.
➣ OPTIONS EXERCISED AND STOCK VESTED IN 2024
| | Stock Awards | | | Name | Number of Shares Acquired on Vesting | Value Realized on Vesting(1) | | Donald C. Wood | 54,904 | $5,529,382 | | Daniel Guglielmone | 10,192 | $1,046,598 | | Dawn M. Becker | 7,936 | $799,235 | | Jeffrey S. Berkes (2) | 44,910 | $4,840,877 |
➣ OPTIONS EXERCISED AND STOCK VESTED IN 2024
| (1) The amounts in this column were calculated using the closing price of a share on the date the shares vested. |
➣ OPTIONS EXERCISED AND STOCK VESTED IN 2024
| (2) Includes 28,291 Shares that vested on December 31, 2024 with a value realized on vesting of $3,167,177 in connection with Mr. Berkes’ leaving the Company as described in “Potential Payments on Termination of Employment and Change-in-Control” section below. |
➣ NON-QUALIFIED DEFERRED COMPENSATION
➣ NON-QUALIFIED DEFERRED COMPENSATION We maintain a non-qualified deferred compensation plan that is open to participation by 47 members of our management team, including our NEOs. Each participant can elect to defer up to 100% of his or her base salary and cash payment under our annual bonus plan with deferral elections made in December of each year for amounts to be earned in the following year. A number of widely available investment options are made available to each plan participant who then decides how to allocate amounts deferred among those investment options. The amount earned by plan participants on their deferrals is calculated by our third party plan administrator as if the amounts deferred had actually been invested in the investment options selected by each participant. We do not make any contributions to the deferred compensation plan for any individual nor do we guarantee any rate of return on amounts deferred. Amounts deferred into the plan, including amounts earned on the deferrals, are generally payable to the participant shortly after he or she retires or is otherwise no longer employed by us; however, there are a few other alternatives where amounts may be paid to a participant sooner. All of our NEOs other than Mr. Guglielmone participate in our deferred compensation plan. 2024 activity for the participants in our plan is described below.
➣ NON-QUALIFIED DEFERRED COMPENSATION
| Name | Executive Contributions in Last Fiscal Year(1) | Registrant Contributions in Last Fiscal Year | Aggregate Earnings in Last Fiscal Year | Aggregate Withdrawals/ Distributions | Aggregate Balance at Last Fiscal Year-End | | Donald C. Wood | $250,000 | $- | $1,629,420 | $- | $12,826,650 | | Dawn M. Becker | $57,500 | $- | $266,275 | $- | $2,773,531 | | Jeffrey S. Berkes | $190,430 | $- | $117,149 | $- | $926,563 |
➣ NON-QUALIFIED DEFERRED COMPENSATION
| (1) All amounts in this column are included in either the “Salary” or “Non-Equity Incentive Plan Compensation” column of the Summary Compensation Table for 2024. |
➣ POTENTIAL PAYMENTS ON TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL
➣ POTENTIAL PAYMENTS ON TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL Termination Payments to Jeffrey S. Berkes Mr. Berkes’ position with the Company as Chief Operating Officer was eliminated and as a result, Mr. Berkes’ employment with the Company was terminated without cause effective as of December 31, 2024. Payments to Mr. Berkes were made in accordance with his Severance Agreement and applicable law and included the following:
➣ POTENTIAL PAYMENTS ON TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL
| • | One year of current base pay equal to $650,000 |
➣ POTENTIAL PAYMENTS ON TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL
| • | Highest annual bonus paid over prior three years equal to $1,015,625 |
➣ POTENTIAL PAYMENTS ON TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL
| • | Accelerated vesting of 28,291 restricted Shares of the Company |
➣ POTENTIAL PAYMENTS ON TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL
| • | One year of COBRA continuation coverage costs equal to $50,560 |
➣ POTENTIAL PAYMENTS ON TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL
Mr. Berkes also had a performance share agreement where the performance period ended December 31, 2024. Final calculation of the shares earned under that agreement was calculated in January 2025 in accordance with terms of the agreement which resulted in Mr. Berkes being awarded in 7,204 shares and receiving a cash payment of $124,485 for accrued dividends in 2025 in accordance with his Performance Share Award agreement. Mr. Berkes will also receive a lump sum cash payment from his account under our non-qualified deferred compensation plan in accordance with the election made by Mr. Berkes pursuant to our non-qualified deferred compensation plan. In addition, effective as of January 1, 2025, the Company and Mr. Berkes entered into a Consulting Agreement whereby Mr. Berkes will provide post-employment services relating to the Company’s acquisition efforts for up to one year and will be paid a percentage of the purchase price for qualifying completed acquisitions as described in more detail in the agreement, a copy of which was filed as Exhibit 10.40 to the Company’s Form 10-K for the fiscal year ending December 31, 2024 filed with the SEC on February 13, 2025. Potential Termination Payments to NEOs We have entered into severance agreements with each of our current and former NEOs that require us to make certain payments and provide certain benefits to them in the event of a termination of employment, whether following a change in control of the Company or in connection with other circumstances. Regardless of the reason for an NEO’s termination of employment, he or she will be entitled to receive upon termination a distribution of any amounts in our non-qualified deferred compensation plan as described in the “Non-Qualified Deferred Compensation” section above. No NEO is entitled to receive a new award under the annual bonus plan or our long-term incentive plan for the year in which the termination occurs. The agreements with each of our NEOs contain provisions restricting the executive from engaging in competing behavior and soliciting and/or hiring our employees for a period of time after termination. The payments that will be made to an NEO on termination vary depending on the reason for termination and may be conditioned on the signing of a release in favor of the Company. The amount of compensation payable to each of our NEOs under various termination scenarios is reflected below assuming that the separation of service was effective on December 31, 2024, other than with respect to Mr. Berkes whose compensation reflects the actual amounts paid in connection with his termination.
➣ POTENTIAL PAYMENTS ON TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL
| Name | Type of Compensation | For Cause Termination(1) | Termination Without Cause(1) | Change-in- Control Termination(1)(5) | Termination on Death(1) | Termination on Disability(1) | | Donald C. Wood | Cash Benefits (multiple) | 6 months | 1.5x | 3.0x | N/A | N/A | | | Cash Benefits (amount) | $500,000 | $4,312,500 | $8,625,000 | $- | $1,400,544 | | | Medical Benefits(2) | $22,297 | $1,633,446 | $1,733,784 | $1,360,000 | $1,610,595 | | | Accelerated Equity(3) | $- | $13,969,121 | $13,969,121 | $13,969,121 | $13,969,121 | | | Other Benefits(4) | $- | $60,000 | $166,665 | $- | $- | | | Excise Tax Gross-Up | N/A | N/A | $- | N/A | N/A | | Total | | $522,297 | $19,975,067 | $24,494,570 | $15,329,121 | $16,980,259 | | Daniel Guglielmone | Cash Benefits (multiple) | 3 months | N/A | 2.0x | N/A | N/A | | | Cash Benefits (amount) | $143,750 | $- | $2,587,500 | $- | $664,504 | | | Medical Benefits(2) | $12,253 | $- | $98,026 | $- | $49,013 | | | Accelerated Equity(3) | $- | $2,489,656 | $2,489,656 | $2,489,656 | $2,489,656 | | | Other Benefits(4) | $- | $- | $90,000 | $- | $- | | | Excise Tax Gross-Up | N/A | N/A | N/A | N/A | N/A | | Total | | $156,003 | $2,489,656 | $5,265,182 | $2,489,656 | $3,203,173 | | Dawn M. Becker | Cash Benefits (multiple) | 6 months | 1.0x | 2.0x | N/A | N/A | | | Cash Benefits (amount) | $287,500 | $1,293,750 | $2,587,500 | $- | $628,519 | | | Medical Benefits(2) | $11,270 | $16,905 | $45,081 | $- | $22,541 | | | Accelerated Equity(3) | $- | $2,441,294 | $2,441,294 | $2,441,294 | $2,441,294 | | | Other Benefits(4) | $- | $60,000 | $90,000 | $- | $- | | | Excise Tax Gross-Up | N/A | N/A | $- | N/A | N/A | | Total | | $298,770 | $3,811,949 | $5,163,875 | $2,441,294 | $3,092,353 | | Jeffrey S. Berkes(6) | Cash Benefits (multiple) | N/A | 1.0x | N/A | N/A | N/A | | | Cash Benefits (amount) | N/A | $1,665,625 | N/A | N/A | N/A | | | Medical Benefits(2) | N/A | $50,560 | N/A | N/A | N/A | | | Accelerated Equity(3) | N/A | $3,167,177 | N/A | N/A | N/A | | | Other Benefits(4) | N/A | $- | N/A | N/A | N/A | | | Excise Tax Gross-Up | N/A | N/A | N/A | N/A | N/A | | Total | | N/A | $4,883,362 | N/A | N/A | N/A |
➣ POTENTIAL PAYMENTS ON TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL
| (1) For all NEOs, the cash payments for termination without cause and termination following a change-in-control include base salary plus the highest bonus earned during 2023, 2022 and 2021, the last three completed fiscal years. The cash payments on termination with cause for Mr. Wood, Mr. Guglielmone and Ms. Becker are 1 month of base pay for every year of service above 5 years, capped at 6 months of base pay. The cash payments on disability for Mr. Wood, Mr. Guglielmone and Ms. Becker represent 1 year of base salary less amounts received from disability insurance maintained by the Company, grossed up for taxes on non-tax exempt payments. |
➣ POTENTIAL PAYMENTS ON TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL
| (2) Amounts in this row represent our estimate of the COBRA equivalent rates for health care benefits for all NEOs and current life and long-term disability premiums for Mr. Wood, Mr. Guglielmone and Ms. Becker. The period of time for which these benefits are provided varies as follows: (a) termination without cause – 9 months for Mr. Wood and Ms. Becker; (b) termination following a change-in-control – 3 years for Mr. Wood and 2 years for Ms. Becker and Mr. Guglielmone; (c) termination for cause – 1 month for every year of service above 5 years, capped at 6 months for Mr. Wood, Mr. Guglielmone and Ms. Becker; and (d) disability – 1 year. All amounts shown in this row for Mr. Wood also include the estimated costs (calculated in accordance with GAAP) of satisfying the obligations under his Health Continuation Coverage Agreement. |
➣ POTENTIAL PAYMENTS ON TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL
| (3) All unvested restricted shares held by our NEOs will vest in the event of termination without cause, termination following a change-in-control, death or disability. Values were calculated by multiplying the number of unvested shares that vest under each termination event using the closing price of the Company’s shares on December 31, 2024. With respect to Mr. Berkes, all of his unvested shares vested on December 31, 2024. |
➣ POTENTIAL PAYMENTS ON TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL
| (4) Amounts in this row are estimated costs for an administrative assistant and outplacement assistance for a period of 6 months in the event of a termination without cause for Mr. Wood and Ms. Becker and for a period of 12 months for Mr. Wood and 9 months for Mr. Guglielmone and Ms. Becker in the event of a termination following a change-in-control. The amount also includes the cost of providing a company vehicle to Mr. Wood for three years in the event of a termination following a change-in-control should he choose to use that benefit. |
➣ POTENTIAL PAYMENTS ON TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL
| (5) Change-in-control is deemed to have occurred when a person acquires a 20% interest in us, or our current Trustees, or those subsequently approved by our current Trustees, constitute less than 50% of our Board. Upon a change-in-control, each NEO is entitled to receive payments and benefits in the following circumstance: (a) the NEO is terminated from employment by the Company (other than for cause) or leaves for good reason within 2 years after the change-in-control; or (b) Mr. Wood or Ms. Becker voluntarily leaves employment within the 30-day window following the 1-year anniversary of the change-in-control. |
➣ POTENTIAL PAYMENTS ON TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL
| (6) The amounts shown for Mr. Berkes are actual amounts paid to him in connection with his termination without cause as described above. In addition, in January 2025, Mr. Berkes earned 7,204 performance shares calculated based on a performance period that ended December 31, 2024 and also received a cash payment of $124,485 for accrued dividends on those shares. Mr. Berkes will also receive a distribution from his account under our non-qualified deferred compensation plan as described above. |
➣ CEO PAY RATIO
➣ CEO PAY RATIO Our compensation and benefit programs are substantially similar throughout the Company and are designed to reward all employees who contribute to our success with a total compensation package that is competitive in the marketplace for each employee’s position and performance. We are required to calculate and disclose the compensation of our median paid employee as well as the ratio of the total annual compensation paid to our CEO to the annual compensation of our median paid employee. The determination of our median paid employee was used taking our total employee population as of December 31, 2024, excluding our CEO, which included full-time and part-time employees ranging from executive vice presidents to maintenance technicians. For the determination, we used annual base pay plus annual bonus at target levels plus overtime actually paid, the combination of which we believe most closely approximates the total annual direct compensation of our employees. For purposes of the calculation, base pay was annualized for the 46 employees who started with us in 2024. No other adjustments were made. The actual total annual compensation of our Chief Executive Officer and median paid employee for 2024 was calculated in accordance with the requirements of the Summary Compensation Table included in this proxy statement. Based on this methodology, we have determined that the total annual compensation paid to our Chief Executive Officer in 2024 was $9,240,530 and the total annual compensation paid to our median paid employee in 2024 was $137,925 resulting in a ratio of 67:1. We calculated our pay ratio in accordance with SEC rules; however, those rules allow companies discretion in methodologies used to identify the median paid employee and the compensation used to determine the median paid employee. As a result, this ratio is unique to our Company. Other companies may make their determinations differently so that the ratio may not be comparable across companies. We believe our ratio is a reasonable estimate. Our ratio is very heavily influenced by what employees/services we choose to provide through employees as opposed to through third parties who are not taken into account in the calculation of the pay ratio. ➣
PAY VERSUS PERFORMANCE DISCLOSURE
PAY VERSUS PERFORMANCE DISCLOSURE
PAY VERSUS PERFORMANCE DISCLOSURE
| | | | | | Value of Initial Fixed $100 Investment Based On: | | | | | Year | Summary Compenstion Table Total for PEO (1) | Compensation Actually Paid to PEO (1) | Average Summary Compenstion Table Total for non-PEO NEOs (2) | Average Compensation Actually Paid to non-PEO NEOs (2) | Total Shareholder Return | Peer Group Total Shareholder Return (3) | Net Income (in 000s) | FFO per Diluted Share (4) | | 2024 | $9,240,530 | $11,336,876 | $3,108,949 | $3,549,950 | $106.52 | $125.61 | $304,334 | $6.77 | | 2023 | $8,941,820 | $9,972,582 | $2,499,276 | $2,742,212 | $95.04 | $113.74 | $247,217 | $6.55 | | 2022 | $8,916,031 | $6,570,796 | $2,177,775 | $1,669,484 | $89.10 | $104.09 | $395,661 | $6.32 | | 2021 | $7,520,917 | $15,446,709 | $2,955,860 | $3,999,185 | $115.21 | $119.96 | $269,081 | $5.57 | | 2020 | $7,481,796 | $1,832,214 | $1,753,182 | $859,320 | $69.44 | $73.36 | $135,888 | $4.38 |
PAY VERSUS PERFORMANCE DISCLOSURE
| (1) Mr. Wood was our principal executive officer for all years shown. Following are the adjustments made during each year shown to arrive at compensation actually paid to our principal executive officer during each year. |
PAY VERSUS PERFORMANCE DISCLOSURE
| | PEO | | | | | | Adjustments | 2024 | 2023 | 2022 | 2021 | 2020 | | Amounts reported under “Stock Aw ards” in SCT | $(6,946,529) | $(6,502,565) | $(6,474,391) | $(5,213,719) | $(5,830,493) | | Change Fair Value of Aw ards Granted in Year and Unvested as of Year-End | $7,649,655 | $6,203,610 | $5,171,732 | $7,421,261 | $3,899,517 | | Change in Fair Value from Prior Year-End to Current Year-End of Aw ards Granted Prior to Year that w ere Outstanding and Unvested as of Year-End | $991,042 | $406,886 | $(1,546,034) | $4,544,000 | $(3,866,637) | | Change in Fair Value from Prior Year-End to Vesting Date of Aw ards Granted Prior to Year that Vested During Year | $(128,475) | $449,965 | $66,969 | $765,243 | $(223,600) | | Increase based on Dividends or Other Earnings Paid During Year prior to Vesting Date of Award | $530,653 | $472,866 | $436,488 | $409,008 | $371,631 | | Total Adjustments | $2,096,346 | $1,030,762 | $(2,345,236) | $7,925,792 | $(5,649,582) |
PAY VERSUS PERFORMANCE DISCLOSURE
| (2) For 2020, our other NEOs were Mr. Guglielmone and Ms. Becker. For 2021, 2022, 2023 and 2024, our other NEOs were Mr. Berkes, Mr. Guglielmone and Ms. Becker. Following are the adjustments made during each year shown to arrive at the average compensation actually paid to our other NEOs during each year. |
PAY VERSUS PERFORMANCE DISCLOSURE
| | Average of Other NEOs | | | | | | Adjustments | 2024 | 2023 | 2022 | 2021 | 2020 | | Amounts reported under “Stock Aw ards” in SCT | $(1,237,406) | $(1,143,120) | $(941,423) | $(1,903,744) | $(863,272) | | Change Fair Value of Aw ards Granted in Year and Unvested as of Year-End | $1,362,655 | $1,090,565 | $752,007 | $1,669,647 | $577,369 | | Change in Fair Value from Prior Year-End to Current Year-End of Aw ards Granted Prior to Year that w ere Outstanding and Unvested as of Year-End | $230,157 | $99,558 | $(433,020) | $1,024,717 | $(616,362) | | Change in Fair Value from Prior Year-End to Vesting Date of Aw ards Granted Prior to Year that Vested During Year | $(20,379) | $91,527 | $5,263 | $149,658 | $(51,710) | | Increase based on Dividends or Other Earnings Paid During Year prior to Vesting Date of Award | $105,973 | $104,406 | $108,881 | $103,048 | $60,114 | | Total Adjustments | $441,001 | $242,936 | $(508,292) | $1,043,325 | $(893,862) |
PAY VERSUS PERFORMANCE DISCLOSURE
| (3) Peer group is the BBRESHOP Index. |
PAY VERSUS PERFORMANCE DISCLOSURE
| (4) The Company has identified FFO per diluted share as the most important additional financial metric used to link pay and performance. Our annual bonus program pays out based on our absolute level of FFO per diluted share achieved for the year and one-third of our long-term incentive plan pays out based on a metric tied to FFO per diluted share. FFO per diluted share is a non-GAAP financial measure of a real estate company’s operating performance and is defined by the National Association of Real Estate Investment Trusts. We consider FFO per diluted share a meaningful measure of operating performance primarily because it avoids the assumption that the value of real estate assets diminishes predictably over time and is a primary way of evaluating our operating performance as compared to other real estate investment trusts. A reconciliation of FFO per diluted share to net income is included as Appendix A. |
Relationship to Compensation Actually Paid
Relationship to Compensation Actually Paid The following charts show the relationship of the compensation actually paid to our CEO and the average compensation actually paid to our other NEOs as compared to the total shareholder return for the Company and for the BBRESHOP Index.
Relationship to Compensation Actually Paid
| * Compensation actually paid is shown in thousands. |
Relationship to Compensation Actually Paid
The following charts show the relationship of the compensation actually paid to our CEO and the average compensation actually paid to our other NEOs as compared to our GAAP reported net income and our FFO per diluted share.
Relationship to Compensation Actually Paid
| * Net income is shown in ten thousands. |
Relationship to Compensation Actually Paid
One of our primary compensation objectives is to align the financial interests of our NEOs with our shareholders. The high correlation shown above between the compensation actually paid to our CEO and other NEOs and the total shareholder return for us and the BBRESHOP Index reflect our success in achieving that objective. This is a direct result of the high percentage of our NEOs’ compensation that is paid in the form of Company shares and our equity retention policies which directly align the interests of our NEOs with the interests of our shareholders. There is a less direct correlation between the compensation of our NEOs and our net income because no portion of our compensation program is linked directly to net income. There is also little correlation between the compensation of our NEOs and FFO per diluted share because FFO per diluted share metric is directly used only for our annual bonus plan which is a relatively modest portion of our NEOs’ total compensation package and is only a component of the calculation that determines only a third of our NEOs’ awards under our long-term incentive plan.