No fee required.
1. The election of each of Alexander C. Matina and Jeffrey B. Citrin as a Class II member of our Board of Directors by the holders of our Common Stock and the election of Joanne M. Minieri as a Class II member of our Board of Directors by the holder of our Special Stock; 2. The ratification of the appointment of BDO USA, LLP as |
We are first mailing this proxy statement, the accompanying proxy card and our Transition Report on Form 10-KT for the ten months endedcalendar year ending December 31, 20152018 by the holders of our Common Stock;
To obtain directions to attend the meeting and vote in person, please telephone the Company at (212) 235-2190.
Please vote as promptly as possible by using the Internet or telephone or by signing, dating and returning the proxy card mailed to those who receive paper copies of this proxy statement.
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i
This
If you are a
Ratification of the appointment of BDO USA, LLP. The second proposal to be considered at the meeting is the ratification of the appointment of BDO USA, LLP as the Company’s independent registered public accounting firm for the calendar year ending December 31, 2016. All persons that own shares of our Common Stock directly in their name as the stockholder of record are entitled to cast one vote for each share owned.
Otherother matters. The holders of Common Stock will have the right to vote on other matters properly brought before the meeting. With respect to these matters, each holder of record of Common Stock as of the record date will be entitled to one vote for each share held.
Instructions
We currently have six members on our Board of Directors.
Two
On or about March 8, 2016, a General Unsecured Claim Satisfaction (as defined in the Modified Second Amended Joint Chapter 11 Plan of Reorganization of Syms Corp. and its Subsidiaries, or the Plan) occurred. Upon the occurrence of the General Unsecured Claim Satisfaction, the share of Series A Preferred Stock was automatically redeemed and, pursuant to the terms of our Certificate of Incorporation, the terms of the Series A Director, Alan Cohen, and Independent Director, Keith Pattiz, automatically terminated; Messrs. Cohen and Pattiz ceased to be directors of the Company and the size of the Board was automatically reduced to three. Subsequently, the Board of Directors increased the size of the Board of Directors to six, and appointed each of Alan Cohen, Keith Pattiz and Matthew Messinger as Class I Directors to fill the three vacancies resulting from the increase of the size of the Board from three to six, for terms ending at the 2017 annual meeting of stockholders and to hold office until their successors are elected and qualified or until their earlier resignation or removal.
The Company’s Certificate of Incorporation provides that on the first date that Third Avenue Trust, on behalf of Third Avenue Real Estate Value Fund (“Third Avenue”), no longer meets the Special Stock Ownership Threshold of 2,345,000 shares of Common Stock, the term of the Special Stock Director will automatically terminate, the person formerly holding such directorship will cease to be a director of the Company and the size of the Board of Directors will be automatically reduced by one directorship. Immediately following such reduction, the size of the Board of Directors will automatically be increased by one directorship, which will be a director elected by the holders of Common Stock.
Name of Director | | | Age | | | Business Experience and Other Information | |
Alexander C. Matina | | 41 | | | Mr. Matina has served as a director of the Company since April 11, 2013 and is the Chairman of the Board. He was initially elected by the two directors of the Company then serving as the directors elected by the holders of Common Stock pursuant to the Company’s by-laws. He is the Vice President of Investments for MFP Investors, LLC, the family office of Michael F. Price, which has a value-investing focus across public and private markets. Mr. Matina also serves as a director of S&W Seed Company, a publicly traded agricultural | |
Name of Director | | | Age | | | Business Experience and Other Information | |
| | | | | | Qualifications and Skills: Mr. Matina brings a strong finance background to the Company, including experience with bankruptcies and private equity. Mr. Matina serves as an adjunct professor of | |
| 60 | | Mr. Citrin currently serves as Vice Chairman/Senior Advisor of Square Mile Capital Management LLC. Square Mile, which Mr. Citrin founded in 2006, is a private institutionally backed New York-based investment firm which focuses on real estate and real estate related opportunities. Mr. Citrin served as Square Mile’s Co-Managing Principal until July 2017. In addition to his ongoing role on Square Mile’s Board of Directors, Mr. Citrin serves on the Investment Committees for all of Square Mile’s funds and investment vehicles. Prior to founding Square Mile, Mr. Citrin served as President of Blackacre Capital Management LLC which he cofounded in 1994. Blackacre (now Cerberus Institutional Real Estate) is the dedicated real estate arm of global investment firm Cerberus Capital Management LP. Prior to cofounding Blackacre, Mr. Citrin was a Managing Director at Oppenheimer & Co. Inc. where he served as head of the firm’s Commercial Mortgage Investment Unit through which Oppenheimer conducted its commercial mortgage and real estate principal activities. From 1991 through 1993, Mr. Citrin served as a | | |||
| | | | | | Mr. Citrin graduated from Dartmouth College in 1980 and received a JD from the Columbia University School of Law in 1983. He currently serves as a Co-Chairman of the Board of | |
| | | | | | Qualifications and Skills: | |
Biographical information regarding each other director follows. The age of each director is as of the date of the Annual Meeting.
Name of Director | | | Age | | | Business Experience and Other Information | |
Joanne M. Minieri | | 58 | | | Ms. Minieri has served as a director of the Company since November 8, 2013 and serves as the Chair of the Board’s Audit Committee. She was appointed by Third Avenue, a major investor in the Company. Ms. Minieri serves as the “Special Stock Director”, who is elected by the holder of the Special Stock pursuant to | | |
| | | | | | Qualifications and Skills: Ms. Minieri has extensive experience in real estate development, as well as a deep knowledge of accounting, particularly in the field of real estate. Prior to her position with RXR, Ms. Minieri served as the Deputy County Executive | |
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Name of Director | | | Age | | | Business Experience and Other Information | |
Alan Cohen | | | 81 | | | Mr. Cohen has served as a director of the Company since September 14, 2012. Mr. Cohen was initially elected to the Board of Directors by the Official Committee of Unsecured Creditors of Syms Corp. Mr. Cohen is the Chairman of Abacus Advisors LLC, a business advisory firm. | |
| | | | | | Qualifications and Skills: Mr. Cohen has more than 30 years’ experience working with distressed businesses in all aspects of their management and operations, serving as a consultant and advisor to numerous Fortune 500 companies and many leading banks and financial institutions. Mr. Cohen is an expert in retail investments and intellectual property and has many years of experience in restructuring businesses. He has been an active participant in seminars on turnaround management and has lectured extensively on restructuring and asset-based lending. Mr. Cohen has served as a trustee, chief restructuring officer, and consultant in various Chapter 11 cases, state court proceedings, and out-of-court restructurings for companies including The Towers Financial Corporation, County Seat Stores, 47th Street Photo, Russ Togs and Aileen, Inc. | |
Name of Director | | | Age | | | Business Experience and Other Information | |
Matthew Messinger | | 46 | | | Mr. Messinger has been | ||
Qualifications and | |||||||
Mr. | |||||||
New Markets Tax Credit Coalition, and the New York Hospitality Council. |
Keith Pattiz | | 65 | | | Mr. Pattiz has served as a director of the Company since November 5, 2013. Mr. Pattiz is a partner in the law firm of McDermott Will & Emery LLP, where he serves as head of the real estate group. Mr. Pattiz has been recognized in the Best Lawyers in America, Super Lawyers and Chambers USA. | | |
| | | | | | Qualifications and Skills: Mr. Pattiz has extensive experience in a wide range of real estate matters, including commercial leasing, financing, sales and acquisitions, hotel transactions and real estate workout matters. He has now provided legal representation to a variety of clients, including major residential, office, hotel and shopping center developers, hotel operators, lending institutions and U.S. and foreign investors. | |
| | | Audit Committee | | | Compensation Committee | | | Nominating and Corporate Governance Committee | | | Transaction Committee | |
Alan Cohen | | | X | | | X | | | Chair | | | | |
Alexander C. Matina | | | X | | | Chair | | | X | | | X | |
Matthew Messinger | | | | | | | | | | | | X | |
Joanne M. Minieri | | | Chair | | | X | | | | | | X | |
Keith Pattiz | | | | | | | | | X | | | Chair | |
also reviews director compensation and benefits for service on the Board and Board committees and recommends any changes to the Board as necessary.
The Audit Committee has reviewed and discussed with BDO USA, LLP, the Company’s independent registered public accounting firm, those matters requiredChief Executive Officer to be discussed by the applicable requirements of the Public Company Accounting Oversight Board, or PCAOB, including the matters described in the statement on Auditing Standards No. 16, as amended, as adopted by the PCAOB.
The Audit Committee has received the written disclosures and the letter from BDO USA, LLP, as required by applicable requirements of the PCAOB, regarding BDO USA, LLP’s communications with the Audit Committee concerning independence, and the Audit Committee has discussed with BDO USA, LLP its independence.
Based on the Audit Committee’s review of and discussions regarding the Company’s audited consolidated financial statements and the Company’s internal control over financial reporting with management, the Company’s internal auditors and the independent registered public accounting firm and the other reviews and discussions with the independent registered public accounting firm referred to in the preceding paragraph,make grants, subject to the limitationsprovisions of each plan.
Respectfully submitted,
Joanne M. Minieri, ChairmanAlan CohenAlexander C. MatinaKeith PattizMarina Shevrytalova
The Company does not currently have a standing nominating committee or other committee performing similar functions, nor have we adopted a nominating committee charter. Under Section 804 of the NYSE MKT Company Guide, in the absence of a nominating committee, Board of Director nominations may be either selected, or recommended for the Board’s selection, by a majority of the independent directors of the Board. Given our size, available resources and that the NYSE MKT does not require us to have a nominating committee, the Board of Directors has determined that may occur between annual meetings of stockholders. The Nominating and Corporate Governance Committee is responsible for identifying, screening and recommending candidates to the Board of Directors for Board membership. When formulating its Board of Directors membership recommendations, the Nominating and Corporate Governance Committee may also consider advice and recommendations from others, including stockholders, as it is indeems appropriate.
The Board has adopted director nominating procedures. Under these procedures, in general, the independent directorsCorporate Governance Committee will develop criteria for evaluating prospective candidates to the Board and committees, including any specific minimum qualifications and any specific qualities or skills necessary for one or more directors to possess. Among such other criteria as the independent directorsNominating and Corporate Governance Committee may from time to time determine appropriate, when the independent directorsNominating and Corporate Governance Committee determine that expansion of the Board or replacement of a director, or the establishment or expansion of a committee, or replacement of a committee member, is necessary or appropriate, the independent directorsNominating and Corporate Governance Committee will conduct candidate interviews, which may be with members of management, consult with the candidate’s associates and through other means determine a candidate’s honesty, integrity, reputation in and commitment to the community, judgment, personality and thinking style, residence, willingness to devote the necessary time, potential conflicts of interest, independence, understanding of financial statements and issues and other matters of relevance to the Board or applicable committee, and the willingness and ability of the candidate to engage in meaningful and constructive discussion regarding Company issues. While diversity may contribute to this overall evaluation, it is not considered by the independent directorsNominating and Corporate Governance Committee as a separate or independent factor in identifying nominees for director.
The Company
The Board of Directors does not have a compensation committee; rather, decisions with regard to the compensation of directors and executive officers are made by the independent directors (Messrs. Matina, Cohen and Pattiz, and Ms. Minieri and Ms. Shevyrtalova) based upon such directors’ determination of what salaries and level of equity-based compensation is necessary to attract and retain key personnel. The Board believes this is appropriate given the Company’s size and the stage of its development.
As noted above,(ii) chair and committee membership fees:
| | | Chair | | | Member | |||||
Board of Directors | | | | $ | 15,000 | | | | | | — |
Audit Committee | | | | $ | 15,000 | | | | | $ | 7,500 |
Compensation Committee | | | | $ | 10,000 | | | | | $ | 5,000 |
Nominating & Corporate Governance Committee | | | | $ | 8,000 | | | | | $ | 4,000 |
Transaction Committee | | | | $ | 11,500 | | | | | $ | 7,500 |
The Company’s director compensation policy provides for an annual payment to each director who is notTransaction Committee and an employee of the Company, does not receive any of $60,000, plus reimbursementthe compensation described above.
| | | Fees Earned or Paid in Cash | | | Stock Awards(1) | | | Total | | |||||||||
Alan Cohen | | | | $ | 67,007 | | | | | $ | 33,493 | | | | | $ | 100,500 | | |
Alexander C. Matina | | | | $ | 78,422 | | | | | $ | 38,828 | | | | | $ | 117,250 | | |
Joanne M. Minieri | | | | $ | 71,676 | | | | | $ | 35,824 | | | | | $ | 107,500 | | |
Keith Pattiz | | | | $ | 61,403 | | | | | $ | 30,497 | | | | | $ | 91,900 | | |
Marina Shevyrtalova(2) | | | | $ | 45,753 | | | | | $ | 30,497 | | | | | $ | 76,250 | | |
| | | Stock Awards (In Shares)(1) | | |||
Alan Cohen | | | | | 4,868 | | |
Alexander C. Matina | | | | | 5,643 | | |
Joanne M. Minieri | | | | | 5,206 | | |
Keith Pattiz | | | | | 4,432 | | |
Marina Shevyrtalova(2) | | | | | 4,432 | | |
Plan Category | Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights (a) | Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights (b) | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a)) (c) | |||||||||
Equity compensation plans approved by security holders | 30,000 | — | 770,000 | |||||||||
Equity compensation plans not approved by security holders | 1,352,794 | (1) | — | 1,304,172 | (2) | |||||||
Total | 1,382,794 | — | 2,074,172 |
Plan Category | | | Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights (a) | | | Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights (b) | | | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a)) (c) | | |||||||||
Stock Incentive Plan | | | | | 65,550 | | | | | | — | | | | | | 541,319 | | |
Individually negotiated awards | | | | | 1,488,364(1) | | | | | | — | | | | | | 60,000(2) | | |
Total | | | | | 1,553,914 | | | | | | — | | | | | | 601,319 | | |
|
10173.
Name | | | Age | | | Business Experience and Other Information | |
Matthew Messinger President and Chief Executive Officer | | 46 | | | See Election of Directors | | |
Steven Kahn Chief Financial Officer | | 52 | | | Mr. Kahn has been | ||
Qualifications and | | ||||||
Richard G. Pyontek Chief Accounting Officer, Treasurer and Secretary | | 50 | | | Mr. Pyontek has been | ||
Qualifications and | |
Effective beginning
Key Program
| What we do | | | What we don’t do | |
| ✓ Directly align pay with performance | | | X No excise tax gross-up provisions | |
| ✓ Competitive assessment of executive compensation program to a comparable group of peer companies | | | X No guaranteed cash incentives, or salary increases for executive officers | |
| ✓ Balanced mix of cash and equity compensation | | | X No excessive perquisites or other benefits | |
| ✓ Independent compensation consultant | | | X No hedging or pledging of our equity securities | |
| ✓ Robust stock ownership requirements | | | X No repricing of stock options | |
| ✓ Clawback policy | | |
The Company’s executive compensation is administered by the independent directors(86.3% of the Board of Directors. During the 10-month transition period covered by the accompanying Transition Report on Form 10-KT, as well as the prior periods reflected in the transition report, all members of the Board were independent. The independent directors are responsible for determining the compensation of the executives of the Company, including the named executive officers, and for overseeing the Company’s executive compensation and benefits programs. The independent directors take into account a variety of factors including recommendations of the chief executive officer on compensation actions for officers (other than the chief executive officer), the ability and appropriate incentivesvotes cast) voting to create long term stockholder value, contractual commitments, market practices and trends and the regulatory environment.
As part of determining an appropriate compensation package, the independent directors review and consider the risk profile associated with each such package. The independent directors do not set specific targets for compensation levels but instead review each element of compensation independently and determine the appropriate amount for each element for each NEO, as discussed below. Within the framework of the programs approved by independent directors, management provides input to the independent directors on compensation actions for executive officers and key select employees based on their evaluation of individual and Company performance. In making decisions regarding the compensation for the named executive officers, the independent directors focus primarily on the executive officer’s individual performance and overall Company performance as well as incentives and retention needs and the overall business environment.
On September 9, 2015, the Board adopted the Trinity Place Holdings Inc. 2015 Stock Incentive Plan (the “2015 Stock Incentive Plan”). The 2015 Stock Incentive Plan authorizes the grants of stock options, stock appreciation rights, shares of restricted stock, restricted stock units and shares of unrestricted stock (collectively, the “Awards”). The 2015 Stock Incentive Plan and the awards thereunder serve as an important element of the total compensation package of certain employees of the Company, providing Awards that are subject to achievement of specified performance goals, in order to retain persons whose efforts are expected to facilitate the long-term growth and profitability of the Company. Prior to the adoption of the 2015 Stock Incentive Plan, the Company granted equity awards on an individually-negotiated basis. As such, most of the equity awards outstanding as of December 31, 2015, including all of Mr. Messinger’s equity awards, which were made pursuant to our employment agreement with him, as amended, were granted prior to the adoption of the 2015 Stock Incentive Plan.
We held our first advisory vote onapprove the compensation of our named executive officers (“say on pay vote”) atdescribed in our annual meeting of stockholders on August 18, 2015. At that meeting, our stockholders passed a resolution approving the compensation of our named executive officers, with approximately 86.3% of the stockholders entitled to vote and present in person or by2015 proxy atstatement.
Wewe also held our first advisory vote on the frequency of future say on pay votes. The stockholders voted in favor (84.94% of votes atcast) of our annual meeting of stockholders on August 18, 2015. In accordance withcompany’s proposal to hold the recommendation of“say-on-pay” vote every three years. Accordingly, the holders of the Company’s common stock, the Board of Directors of the Company has decided to include annext management advisory stockholder vote on theexecutive compensation of the Company’s named executive officers in its proxy materials every three years untilis being held at this Annual Meeting. We currently expect the next required advisory vote on the frequency of future advisorystockholder votes onto approve the compensation of the Company’sour named executive officers to occur at our 2021 annual stockholders meeting.
Pay Element | | | Key Decisions | |
Base Salary | | | 2017 NEO base salaries were unchanged, other than a modest 2% increase for Mr. Pyontek. 2018 CEO base salary was unchanged, while the other NEOs’ salaries were adjusted based on an assessment of company and individual performance and to better align them with the peer group. | |
Pay Element | | | Key Decisions | |
Annual Cash Bonus | | | The annual bonus opportunity is designed to drive achievement of annual financial and operational results and key strategic activities that are linked to short-term company goals in relation to long-term strategy. Individual awards are determined by the Compensation Committee based on both company and individual performance. For 2017, the Compensation Committee determined to award annual cash bonuses to the NEOs at similar levels as the prior year; however, the CFO received an additional amount based on a specific performance achievement (described below). The 2018 bonus program remains the same as 2017. | |
Time-Based Restricted Stock Unit Awards | | | The equity incentive program is designed to directly align key executives’ interests with building shareholder value and includes grants of time vested awards. Based on the performance and future growth path of the Company, the Committee determined appropriate levels of annual time-based restricted stock unit (“RSU”) grants for its NEOs, other than the CEO, for 2017. Our CEO’s awards were granted in accordance with the terms of his 2013 employment agreement, as amended in 2015. RSUs vest ratably over a three-year period for the CEO and two-year period for the other NEOs, subject to continued service. | |
Executive | | | 2017 Base Salary | | | 2018 Base Salary | | ||||||
Matthew Messinger | | | | $ | 750,000 | | | | | $ | 750,000 | | |
Steven Kahn | | | | $ | 290,000 | | | | | $ | 340,000 | | |
Richard Pyontek | | | | $ | 167,500 | | | | | $ | 172,500 | | |
Executive | | | 2017 Bonus | | |||
Matthew Messinger | | | | $ | 500,000 | | |
Steven Kahn | | | | $ | 245,000(1) | | |
Richard Pyontek | | | | $ | 55,000 | | |
Executive | | | 2017 RSU Award (#) | | | 2017 RSU Award ($) | | ||||||
Matthew Messinger(1) | | | | | 30,000(2) | | | | | | 208,500 | | |
Steven Kahn(3) | | | | | 60,000 | | | | | | 417,000 | | |
Richard Pyontek(3) | | | | | 10,000 | | | | | | 69,500 | | |
amended employment agreement, Mr. Messinger is contractually entitled to receive an RSU award of 30,000 shares per year until 2019.
Compensation of Matthew Messinger, President and Chief Executive Officer
The Company hired and entered into an employment agreement with Mr. Messinger to serve as our Chief Executive Officer and President on October 1, 2013, in conjunctionresponsibilities with the initial investment by Third AvenueCompany and will provide security with regard to some of the most uncertain events relating to continued employment, thereby limiting concern and uncertainty and promoting productivity.
since he joined the Company:
| Date of Grant | | | Years Vesting | | | Shares Granted | | | Grant Date Fair Value per share | | | Grant Date Fair Value | | | Performance contingencies for award | | ||||||||||||
| 11/6/2013 | | | | | 0 | | | | | | 250,000 | | | | | $ | 5.18 | | | | | $ | 1,295,000 | | | | Granted upon the effectiveness of the Company’s filing of an Amended and Restated Certificate of Incorporation | |
| 3/31/2014 | | | | | 3 | | | | | | 476,190 | | | | | $ | 6.25 | | | | | $ | 2,976,188 | | | | Contingent upon delivering (i) a favorable resolution on payment/deferral of payment to Syms and Filene’s and (ii) a credible plan for the development, lease or sale of Westbury, NY and Paramus, NJ properties | |
| 3/31/2014 | | | | | 3 | | | | | | 363,095 | | | | | $ | 6.25 | | | | | $ | 2,269,344 | | | | Contingent upon delivering a credible plan for the development, lease or sale of Trinity Place property | |
| 12/31/2014 | | | | | 3 | | | | | | 363,095 | | | | | $ | 7.00 | | | | | $ | 2,541,665 | | | | Contingent upon delivering (i) a favorable resolution on payment/deferral of certain claims of Filene’s and (ii) a credible plan for the development, lease or sale of West Palm Beach, FL and Secaucus, NJ properties | |
| 3/31/2015 | | | | | 3 | | | | | | 363,095 | | | | | $ | 7.05 | | | | | $ | 2,559,820 | | | | No contingency | |
| 1/28/2016 | | | | | 3 | | | | | | 363,095 | | | | | $ | 5.98 | | | | | $ | 2,171,308 | | | | Contingent upon payments of the Initial Majority Shareholder and Subsequent Majority Shareholder by December 31, 2015; while conditions were not met at that time, the award was granted as Company had sufficient cash on hand to make the payments which were ultimately made at a discounted amount in March 2016 | |
| 1/28/2016 | | | | | 5 | | | | | | 250,000 | | | | | $ | 5.98 | | | | | $ | 1,495,000 | | | | No contingency | |
| 1/28/2016 | | | | | 3 | | | | | | 541,074 | | | | | $ | 5.98 | | | | | $ | 3,235,623 | | | | Granted to maintain CEO’s proportionate ownership interest (per employment agreement), concurrent with the Common Stock Rights Offering in December 2015, which resulted in issuance of additional shares of Company’s common stock | |
The Company anticipates that it will amend its employment agreement with Mr. Messinger, has been instrumentalor enter into a new employment agreement with him, later in the Company’s execution of its principal strategic objectives, including the following during 2015:
extent reasonably practicable and consistent with its other compensation objectives. The following table lists and describes the purpose of the key elements of Mr. Messinger’s compensation, as provided under the terms of his employment agreement, as amended:
Under the terms of Mr. Messinger’s employment agreement, his base salary was initially $700,000 per year. Effective January 1, 2016, his base salary was increased to $750,000 pursuant to the terms of the amendment to the employment agreement.
Mr. Messinger’s employment agreement provides that the BoardCompensation Committee may, in its sole discretion, award Mr. Messinger an annual cash bonus, taking into accountapprove compensation that will not meet these requirements when it determines that such payments are in the performancebest interests of the Company and Mr. Messinger duringour stockholders, such year. The annual cash bonus is designedas to reward Mr. Messingerensure competitive levels of total compensation for the achievement of the Company’s short-term financial and strategic goals while taking into account the risk profile of the Company. Mr. Messinger was awarded a bonus of $500,000 with respect to the period ended December 31, 2015.
A key component of Mr. Messinger’s compensation is long-term equity based compensation in the form of restricted stock units, or RSUs. The long-term equity-based compensation was principally negotiated at the time that we hired Mr. Messinger, with a view toward ensuring the alignment of his interests with those of the
Company’s creditors following the emergence of the Company from bankruptcy, by tying the vesting and settlement of his long-term equity-based compensation to payments made to the Company’s creditors in accordance with the terms of the Plan. This structure also ensured the conservation of the Company’s cash by providing for most of Mr. Messinger’s compensation in the form of long-term equity, as well as aligning Mr. Messinger’s interests with those of the Company’s stockholders by providing him with significant equity ownership in the Company, the value of which is tied to the Company’s success following the repayment of the Company’s creditors in accordance with the terms of the Plan.
Under the terms of his original employment agreement, Mr. Messinger received the following RSU Awards in 2015 and early 2016:
The 2015 amendment to Mr. Messinger’s employment agreement also provides for additional grants of RSUs as follows:
For additional information regarding certain provisions of Mr. Messinger’s equity awards, see “— Potential Payments Upon Termination or Change in Control.”
On September 16, 2015, the Company entered into an employment agreement with Steven Kahn to serve as Chief Financial Officer of the Company, effective as of September 21, 2015. On June 24, 2011, Syms Corp. entered into an offer letter with Richard Pyontek, who has served with the Company and its predecessor since the period prior to the bankruptcy proceedings.
The following table lists and describes the purpose of the key elements of the compensation of Messrs. Kahn and Pyontek’s compensation.
For additional information regarding certain provisions of each named executive officer’s employment arrangement, see “— Potential Payments Upon Termination or Change in Control.”
Base salaries for Messrs. Kahn and Pyontek are designed to compensate each executive for the experience, education, personal qualities and other qualifications of the executive that are essential to the specific role the executive serves within our Company, while remaining competitive in the labor market.
The independent directors, with the assistance of Mr. Messinger, generally review salaries in the early part of each year and, if appropriate adjusts them to reflect changes in considerations and to remain competitive in the labor market.
Under the terms of his employment agreement, Mr. Kahn receives an initial annual base salary of $290,000. Mr. Pyontek receives an annual base salary of $164,000.
Discretionary cash bonuses for executive officers are designed to attract and retain officer talent. Our named executive officers other than the CEO are eligible to receive annual discretionary cash bonuses as determined by the independent directors. The determination of the amounts of such discretionary bonuses is based on the past, present and expected future contributions of such individual to the overall success of the Company. Factors considered in evaluating those contributions include, among other things: overall individual performance, overall organizational performance, individual contribution to organizational performance, successful completion of projects or initiatives and level of individual responsibilities.
In accordance with his employment agreement, Mr. Kahn received a pro-rated cash bonus of $25,000 for 2015, based on his September 2015 employment commencement date, which was paid in 2016. Mr. Pyontek received a cash bonus for his performance and contributions to the Company in 2015 in the amount of $53,333, which was paid in 2016.
The Company believes that restricted stock awards reward the achievement of long-term goals, align the interest of executives with those of stockholders, foster employee stock ownership and promote stability among our executives. Restricted stock awards granted on or after September 9, 2015 are granted pursuant to the terms of the 2015 Stock Incentive Plan. These awards generally vest in two equal annual installments, starting on the first anniversary of the grant date, subject to the applicable executive’s continued employment through such dates.
On March 20, 2014, the Company entered into an RSU agreement with Mr. Pyontek, effective as of January 6, 2014, pursuant to which Mr. Pyontek was granted an award of 12,500 RSUs, with one-half of the RSUs vesting on each of January 6, 2015 and January 6, 2016, subject to Mr. Pyontek’s continued employment on the applicable vesting dates.
In accordance with his employment agreement, Mr. Kahn was granted an award of 30,000 RSUs, with one-third of the RSUs vesting on each of September 21, 2016, September 21, 2017 and September 21, 2018, subject to Mr. Kahn’s continued employment on the applicable vesting dates.
For additional information regarding certain provision the named executive officers’ equity awards, see “— Potential Payments Upon Termination or Change in Control.”
The Company provides limited perquisites. Our named executive officers as well as all of our full-time employees are eligible to participate in our 401(k) retirement plan under which we provide a matching feature.
The independent directors take into consideration the requirements for a public company in order to maintain tax deductibility of certain compensation under Section 162(m) of the Internal Revenue Code. It is possible, however, that awards intended to qualify for such tax deduction may not do so. Moreover, the independent directors may, in certain circumstances, approve compensation arrangements that include compensation which is not tax deductible.
Name and Principal Position | | | Fiscal Year | | | Salary | | | Bonus | | | Stock Award | | | All Other Compensation | | | Total | | ||||||||||||||||||
Matthew Messinger President and Chief Executive Officer | | | | | 2017 | | | | | $ | 750,000 | | | | | $ | 500,000 | | | | | $ | 208,500(1) | | | | | $ | 12,836(5) | | | | | $ | 1,471,336 | | |
| | | 2016 | | | | | $ | 750,000 | | | | | $ | 500,000 | | | | | $ | 7,359,431(2) | | | | | $ | 12,636(6) | | | | | $ | 8,622,067 | | | ||
| | | 2015 | | | | | $ | 592,308(18) | | | | | $ | 500,000(18) | | | | | $ | 2,559,820(3) | | | | | $ | 10,598(7) | | | | | $ | 3,662,726 | | | ||
| | | 2014 | | | | | $ | 700,000 | | | | | $ | 250,000 | | | | | $ | 7,787,196(4) | | | | | $ | 14,067(8) | | | | | $ | 8,751,263 | | | ||
Steven Kahn Chief Financial Officer | | | | | 2017 | | | | | $ | 290,000 | | | | | $ | 245,000 | | | | | $ | 63,910(1) | | | | | $ | 12,699(9) | | | | | $ | 611,609 | | |
| | | 2016 | | | | | $ | 290,000 | | | | | $ | 120,000 | | | | | $ | —(2) | | | | | $ | 12,499(10) | | | | | $ | 422,499 | | | ||
| | | 2015(12) | | | | | $ | 78,077(13) | | | | | $ | 25,000(13) | | | | | $ | 201,000(3) | | | | | $ | 5,159(11) | | | | | $ | 309,236 | | | ||
Richard G. Pyontek Chief Accounting Officer, Treasurer and Secretary(14) | | | | | 2017 | | | | | $ | 167,500 | | | | | $ | 55,000 | | | | | $ | —(1) | | | | | $ | 9,191(15) | | | | | $ | 231,691 | | |
| | | 2016 | | | | | $ | 164,000 | | | | | $ | 55,000 | | | | | $ | 66,125(2) | | | | | $ | 9,051(16) | | | | | $ | 294,176 | | | ||
| | | 2015 | | | | | $ | 138,769(19) | | | | | $ | 53,333(19) | | | | | $ | —(3) | | | | | $ | 7,790(17) | | | | | $ | 199,892 | | | ||
| | | 2014 | | | | | $ | 160,615 | | | | | $ | 53,333 | | | | | $ | —(4) | | | | | $ | 9,808(18) | | | | | $ | 223,756 | | |
Name and Principal Position | Fiscal Year | Salary | Bonus | Stock Award | All Other Compensation | Total | ||||||||||||||||||
Matthew Messinger President and Chief Executive Officer | 2015 | $ | 592,308 | (15) | $ | 500,000 | (15) | $ | 2,559,820 | (1) | $ | 10,598 | (4) | $ | 3,662,726 | |||||||||
2014 | $ | 700,000 | $ | 250,000 | $ | 7,787,196 | (2) | $ | 14,067 | (5) | $ | 8,751,263 | ||||||||||||
2013 | (6) | $ | 296,154 | $ | — | $ | 1,250,000 | (3) | $ | 14,500 | (7) | $ | 1,560,654 | |||||||||||
Steven Kahn Chief Financial Officer | 2015 | (8) | $ | 78,077 | (9) | $ | 25,000 | (9) | $ | 201,000 | (1) | $ | 5,159 | (10) | $ | 309,236 | ||||||||
Richard Pyontek Chief Accounting Officer, Treasurer and Secretary(11) | 2015 | $ | 138,769 | (15) | $ | 53,333 | (15) | $ | — | $ | 7,790 | (12) | $ | 199,892 | ||||||||||
2014 | $ | 160,615 | $ | 53,333 | $ | — | $ | 9,808 | (13) | $ | 223,756 | |||||||||||||
2013 | $ | 160,000 | $ | 53,333 | $ | 84,375 | (3) | $ | — | $ | 297,708 | |||||||||||||
2012 | $ | 160,000 | $ | 67,500 | (14) | $ | — | $ | — | $ | 227,500 |
Name | Grant Date | All Other Stock Awards: Number of Shares of Stock or Units (#) | Grant Date Fair Value of Stock Award | |||||||||
Matthew Messinger | 3/31/2015 | 363,095 | $ | 2,559,820 | (1) | |||||||
Steven Kahn | 9/21/2015 | 30,000 | $ | 201,000 | (2) | |||||||
Richard Pyontek | — | $ | — |
Name | Grant Date | | | All Other Stock Awards: Number of Shares of Stock or Units (#) | | | Grant Date Fair Value of Stock Award(1) ($) | | |||||||||||
Matthew Messinger | | | | | 12/31/2017 | | | | | | 30,000 | | | | | | 208,500(2) | | |
Steven Kahn | | | | | 1/15/2017 | | | | | | 7,000 | | | | | | 63,910(3) | | |
Richard Pyontek | | | — | | | | | — | | | | | | — | | |
Year End
Named Executive Officer | Number of Units of Stock that have not Vested | Market Value of Units of Stock that have not Vested ($)(4) | ||||||
Matthew Messinger | 1,164,681 | (1) | $ | 7,139,495 | ||||
Steven Kahn | 30,000 | (2) | $ | 183,900 | ||||
Richard Pyontek | 6,250 | (3) | $ | 38,313 |
Named Executive Officer | Number of Units of Stock that have not Vested (#) | | | Market Value of Units of Stock that have not Vested ($)(4) | | ||||||||
Matthew Messinger | | | | | 612,185(1) | | | | | | 4,254,788 | | |
Steven Kahn | | | | | 17,000(2) | | | | | | 118,150 | | |
Richard Pyontek | | | | | 6,250(3) | | | | | | 43,438 | | |
Vesting Date | | | Number of | | | Settlement Date | |
March 31, | | 151,092 | | 99,077 RSUs within 30 days of vesting | |||
52,015 RSUs within two years | |||||||
December 31, | | 264,425 | | 93,333 RSUs within 30 days of vesting 10,000 RSUs within one year and 30 days of vesting 109,077 RSUs within two years and 30 days of vesting 52,015 RSUs within four years and 30 days of vesting | | ||
December 31, 2019 | | | 103,333 | ||||
| |||||||
10,000 RSUs within one year and 30 days of vesting | |||||||
December 31, | | 93,334 | | 93,334 RSUs within two years and 30 days of vesting | |||
2017
Named Executive Officer | | | Stock Awards Number of Shares Acquired on Vesting (#) | | | Value Realized on Vesting ($) | | ||||||
Matthew Messinger | | | | | 822,519 | | | | | | 5,896,631 | | |
Steven Kahn | | | | | 10,000 | | | | | | 69,700 | | |
Richard Pyontek | | | | | 6,250 | | | | | | 50,313 | | |
Named Executive Officer | Stock Awards | Value Realized on Vesting ($) | ||||||
Number of Shares Acquired on Vesting (#) | ||||||||
Matthew Messinger | 400,794 | $ | 2,714,248 | |||||
Steven Kahn | — | $ | — | |||||
Richard Pyontek | — | $ | — |
The following describes the estimated amounts Mr. Messinger would have received if the termination event specified had occurred at December 31, 2015.
| | | Voluntary Resignation or Termination for Cause or Without Good Reason | | | Termination Without Cause or for Good Reason | | | Termination Without Cause or for Good Reason (w/ Change in Control) | | | Termination Due to Death or Disability | | ||||||||||||
Cash Payments | | | | | | ||||||||||||||||||||
Severance Bonus Amount | | | | $ | — | | | | | $ | 1,687,500 | | | | | $ | 1,687,500 | | | | | $ | — | | |
Benefits & Perquisites | | | | | | ||||||||||||||||||||
Health and Welfare Benefits | | | | $ | — | | | | | $ | 57,983 | | | | | $ | 57,983 | | | | | $ | 57,983 | | |
Long-Term Incentive Compensation | | | | | | ||||||||||||||||||||
Value of Accelerated RSUs(A) | | | | $ | — | | | | | $ | 4,254,686 | | | | | $ | 4,671,686 | | | | | $ | 3,606,012 | | |
Total Value of Payments and Benefits | | | | $ | — | | | | | $ | 6,000,169 | | | | | $ | 6,417,169 | | | | | $ | 3,663,995 | | |
|
Voluntary Resignation or Termination for Cause or Without Good Reason | Termination Without Cause or for Good Reason | Termination Without Cause or for Good Reason (w/Change in Control) | Termination Due to Death or Disability | |||||||||||||
Cash Payments | ||||||||||||||||
Severance Bonus Amount | $ | — | $ | 1,450,000 | $ | 1,450,000 | $ | — | ||||||||
Bonus for Year of Termination | — | 500,000 | 500,000 | 500,000 | ||||||||||||
Total Cash Payments | $ | — | $ | 1,950,000 | $ | 1,950,000 | $ | 500,000 | ||||||||
Benefits & Perquisites | ||||||||||||||||
Health and Welfare Benefits | $ | — | $ | 52,728 | $ | 52,728 | $ | 52,728 | ||||||||
Total Benefits & Perquisites | $ | — | $ | 52,728 | $ | 52,728 | $ | 52,728 | ||||||||
Long-Term Incentive Compensation | ||||||||||||||||
Value of Accelerated RSUs(A) | $ | 13,407,652 | $ | 14,143,252 | $ | 9,961,465 | ||||||||||
Total Value of Accelerated Equity Awards | $ | — | $ | 13,407,652 | $ | 14,143,252 | $ | 9,961,465 | ||||||||
Total Value of Payments and Benefits | $ | — | $ | 15,410,380 | $ | 16,145,980 | $ | 10,514,193 |
| | | Voluntary Resignation or Termination for Cause or Without Good Reason | | | Termination Without Cause or for Good Reason | | | Termination Without Cause or for Good Reason (w/ Change in Control) | | | Termination Due to Death or Disability | | ||||||||||||
Cash Payments | | | | | | ||||||||||||||||||||
Severance Bonus Amount | | | | $ | — | | | | | $ | 66,923 | | | | | $ | 66,923 | | | | | $ | — | | |
Benefits & Perquisites | | | | | | ||||||||||||||||||||
Health and Welfare Benefits | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | |
Long-Term Incentive Compensation | | | | | | ||||||||||||||||||||
Value of Accelerated RSUs(A) | | | | $ | — | | | | | $ | 93,825 | | | | | $ | 118,150 | | | | | $ | — | | |
Total Value of Payments and Benefits | | | | $ | — | | | | | $ | 160,748 | | | | | $ | 185,073 | | | | | $ | — | | |
|
Voluntary Resignation of Termination for Cause or Without Good Reason | Termination Without Cause or for Good Reason | Termination Without Cause or for Good Reason (w/Change in Control) | Termination Due to Death or Disability | |||||||||||||
Cash Payments | ||||||||||||||||
Severance Bonus Amount | $ | — | $ | 66,923 | $ | 66,923 | $ | — | ||||||||
Pro Rata Bonus for Year of Termination | — | — | — | — | ||||||||||||
Total Cash Payments | $ | — | $ | 66,923 | $ | 66,923 | $ | — | ||||||||
Benefits & Perquisites | ||||||||||||||||
Health and Welfare Benefits | $ | — | $ | — | $ | — | $ | — | ||||||||
Total Benefits & Perquisites | $ | — | $ | — | $ | — | $ | — | ||||||||
Long-Term Incentive Compensation | ||||||||||||||||
Value of Accelerated RSUs(A) | $ | — | $ | 61,300 | $ | 183,900 | $ | — | ||||||||
Total Value of Accelerated Equity Awards | $ | — | $ | 61,300 | $ | 183,900 | $ | — | ||||||||
Total Value of Payments and Benefits | $ | — | $ | 128,223 | $ | 250,823 | $ | — |
| | | Voluntary Resignation or Termination for Cause or Without Good Reason | | | Termination Without Cause or for Good Reason | | | Termination Without Cause (w/Sale of the Company) | | | Termination Due to Death or Disability | | ||||||||||||
Cash Payments | | | | | | ||||||||||||||||||||
Severance Bonus Amount | | | | $ | — | | | | | $ | — | | | | | $ | 41,825 | | | | | $ | — | | |
Benefits & Perquisites | | | | | | ||||||||||||||||||||
Health and Welfare Benefits | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | |
Long-Term Incentive Compensation | | | | | | ||||||||||||||||||||
Value of Accelerated RSUs(A) | | | | $ | — | | | | | $ | 43,438 | | | | | $ | 43,438 | | | | | $ | — | | |
Total Value of Payments and Benefits | | | | $ | — | | | | | $ | 43,438 | | | | | $ | 85,263 | | | | | $ | — | | |
|
Termination for Cause or Without Good Reason | Termination Without Cause or for Good Reason | Termination Without Cause (w/Sale of the Company) | Termination Due to Death or Disability | |||||||||||||
Cash Payments | ||||||||||||||||
Severance Bonus Amount | $ | — | $ | — | $ | 41,000 | — | |||||||||
Bonus for Year of Termination | — | 53,333 | 53,333 | — | ||||||||||||
Total Cash Payments | $ | — | $ | 53,333 | $ | 94,333 | $ | — | ||||||||
Benefits & Perquisites | ||||||||||||||||
Health and Welfare Benefits | $ | — | $ | — | $ | — | $ | — | ||||||||
Total Benefits & Perquisites | $ | — | $ | — | $ | — | $ | — | ||||||||
Long-Term Incentive Compensation | ||||||||||||||||
Value of Accelerated RSUs(A) | $ | — | $ | 38,313 | $ | 38,313 | $ | — | ||||||||
Total Value of Accelerated Equity Awards | $ | — | $ | 38,313 | $ | 38,313 | $ | — | ||||||||
Total Value of Payments and Benefits | $ | — | $ | 91,646 | $ | 132,646 | $ | — |
Name and Address of Beneficial Owner(1) | | | Number of Shares of Common Stock Beneficially Owned | | | Percent of Class(2) | | ||||||
Executive Officers and Directors | | | | ||||||||||
Matthew Messinger | | | | | 873,250(3) | | | | | | 2.8% | | |
Steven Kahn | | | | | 15,313 | | | | | | * | | |
Richard G. Pyontek | | | | | 16,132 | | | | | | * | | |
Jeffrey B. Citrin | | | | | 31,223 | | | | | | * | | |
Alan Cohen | | | | | 14,868 | | | | | | * | | |
Alexander C. Matina | | | | | 15,643 | | | | | | * | | |
Joanne M. Minieri | | | | | 101,923 | | | | | | * | | |
Keith Pattiz | | | | | 10,395 | | | | | | * | | |
All Executive Officers and Directors as a Group (8 Persons) | | | | | 1,078,747(3) | | | | | | 3.4% | | |
Greater than 5% Stockholders | | | | ||||||||||
Third Avenue Management LLC | | | | | 4,928,780(4) | | | | | | 15.6% | | |
MFP Partners, L.P. | | | | | 4,464,896(5) | | | | | | 14.2% | | |
Marcato Capital Management LP | | | | | 3,815,332(6) | | | | | | 12.1% | | |
DS Fund I LLC | | | | | 2,581,504(7) | | | | | | 8.2% | | |
Horse Island Partners, LLC | | | | | 1,689,138(8) | | | | | | 5.4% | | |
Name and Address of Beneficial Owner(1) | Number of Shares of Common Stock Beneficially Owned | Percent of Class(2) | ||||||
Executive Officers and Directors | ||||||||
Matthew Messinger | 450,211 | 1.8 | % | |||||
Steven Kahn | 0 | * | ||||||
Richard Pyontek | 8,914 | * | ||||||
Joanne M. Minieri | 75,000 | * | ||||||
Keith Pattiz | 3,200 | * | ||||||
All Executive Officers and Directors as a Group (8 Persons) | 537,325 | 2.1 | % | |||||
Greater than 5% Stockholders | ||||||||
Marcato Capital Management, LLC One Montgomery Street, Suite 3250 San Francisco, CA 94104 | 4,723,471 | (3) | 18.5 | % | ||||
Third Avenue Trust, on behalf of Third Avenue Real Estate Value Fund 622 Third Avenue New York, NY 10017 | 4,206,285 | (4) | 16.5 | % | ||||
MFP Partners, L.P. 667 Madison Avenue, 25th Floor New York, New York 10065 | 2,920,577 | (5) | 11.5 | % | ||||
DS Fund I LLC 1001 Brickell Bay Dr., Suite 3102A Miami, FL 33131 | 2,881,504 | (6) | 11.3 | % | ||||
Franklin Resources, Inc. One Parker Plaza, Ninth Floor Fort Lee, NJ 07024 | 1,498,034 | (7) | 5.9 | % |
Title of Class | | | Beneficial Owner | | | Number of Shares of Special Stock Beneficially Owned | | | Percent of Class | | ||||||
Special Stock | | | Third Avenue Trust, on behalf of Third Avenue Real Estate Value Fund 622 Third Avenue New York, NY 10017 | | | | | 1 | | | | | | 100% | | |
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Title of Class | Beneficial Owner | Number of Shares of Special Stock Beneficially Owned | Percent of Class | |||
Special Stock | Third Avenue Trust, on behalf of Third Avenue Real Estate Value Fund 622 Third Avenue New York, NY 10017 | 1 | 100% |
2016
Fees Category | | | Year Ended December 31, 2017 | | | Year Ended December 31, 2016 | | ||||||
Audit Fee | | | | $ | 199,500 | | | | | $ | 190,000 | | |
Audit Related Fees | | | | $ | 40,914 | | | | | $ | 27,506 | | |
Tax | | | | $ | 23,000 | | | | | $ | 23,000 | | |
Total Fees | | | | $ | 263,414 | | | | | $ | 240,506 | | |
|
Fiscal Year Ended | ||||||||
Fees Category | December 31, 2015 | February 28, 2015 | ||||||
Audit Fee | $ | 180,000 | $ | 252,500 | ||||
Audit Related Fees | $ | 32,990 | $ | 13,014 | ||||
Tax | $ | 23,000 | $ | 23,000 | ||||
Total Fees | $ | 235,990 | $ | 288,514 |
In addition to the