| 3. | The Audit Committee considers all of the relevant facts and circumstances available to it and may approve only those related person transactions that are in, or are not inconsistent with, the best interests of the Company and its stockholders, as the Committee determines in good faith. |
At the Board’s first meeting of each fiscal year, including this Annual Meeting, the Board must review any previously approved or ratified related person transactions that remain ongoing and have a remaining term of more than six months. Based on all relevant facts and circumstances, the Board must determine if it is in the best interests of the Company and its stockholders to renew, modify or terminate the related person transaction.
Current Related Person Transactions We have entered into a registration rights agreement and a tax receivables agreement with our principals, who are the limited partners of Silvercrest, L.P., the managing member of SAMG LLC, our operating subsidiary. Our principals include Messrs. Richard R. Hough III, Scott A. Gerard, David J. Campbell and Albert S. Messina. Registration Rights Agreement. Pursuant to a resale and registration rights agreement that we entered into with our principals, we have agreed to use our best efforts to filefiled a registration statement on Form S-3, in 2014, for the sale of the shares of our Class A common stock that are issuable upon exchange of Class B units as soon as practicable after we become eligible to file aThe registration statement on Form S-3, which we expect to be one year after the consummation of our initial public offering. We expect to cause that registration statement to bewas also declared effective by the SEC as soon as practicable thereafter.in 2014. Pursuant to this agreement, when Silvercrest L.P. issues any Class B units to its employees, partners or other consultants pursuant to the 2012 Equity Incentive Plan, the recipient will be entitled to the same resale and registration rights, and will be subject to the same restrictions, as the principals holding Class B units outstanding after our initial public offering. Tax Receivable Agreement. We have entered into a tax receivable agreement with our principals, and will enter into a tax receivable agreement with any future holders of Class B units, that requires us to pay them 85% of the amount of cash savings, if any, in U.S. federal, state and local income tax that we actually realize (or are deemed to realize in the case of an early termination payment by us, or a change in control) as a result of the increases in tax basis and certain other tax benefits related to entering into the tax receivable agreement, including tax benefits attributable to payments under the tax receivable agreement. We expect to benefit from the remaining 15% of cash savings, if any, realized. The tax receivable agreement will continue until all such tax benefits have been utilized or expired, unless we exercise our right to terminate the tax receivable agreement for an amount based on an agreed upon value of payments remaining to be made under the agreement. The tax receivable agreement will automatically terminate with respect to our obligations to a principal if a principal (i) is terminated for cause, (ii) breaches his or her non-solicitation covenants with our Company or (iii) voluntarily resigns or retires and competes with our Company in the 12-month period following resignation of employment or retirement, and no further payments will be made to such principal under the tax receivable agreement. Management of Employees’ Personal Funds.Funds. The Company manages the personal funds of many of its employees and members of the families of those employees, including Messrs. Hough, Gerard, Campbell and Messina, and the estate of our former Chairman and Chief Executive Officer, G. Moffett Cochran, pursuant to investment management agreements in which it has agreed to reduce the advisory fees it charges to such employees and members of their families. The value of the discount to the investment advisory services provided by the Company to Mr. Cochran and his estate in 2013Messina was approximately $295,000.$15,000. The value of services provided by the Company to other executives was not significant. Other. During 2013, the Company incurred approximately $780,000 for payments to be made through November 2014 to a relative of the Company’s former Chief Executive Officer, Mr. Cochran, who passed away in November 2013.
MEETINGS AND COMMITTEESCOMMITTEES OF THE BOARD The Board Each director is expected to make every reasonable effort to attend each meeting of the Board and any Committee of which the director is a member and to be reasonably available to management and the other directors between meetings. Our entire Board met five times during 2013.2016. Messrs. Conrad, Kidd and Pechter attended threeall five meetings in person. Mr. Conrad attended four of the five meetings in person and the other twoone by conference telephone call. All three independent directorsMessrs. Hough and Messina attended bothall five meetings in person. Messrs. Kidd and Pechter attended all four of the Committees on which they serve. The PricingAudit Committee meeting was heldmeetings in person. Mr. Conrad attended three of the four Audit Committee meetings in person and the other one by conference telephone call. The AuditMessrs. Kidd and Pechter attended all three Compensation Committee meetings in person. Mr. Conrad attended two Compensation Committee meetings in person and the other one by telephone conference call. Messrs. Kidd and Pechter attended both Nominating and Corporate Governance Committee meeting was held,in person. Mr. Conrad attended one Nominating and all three independent directors attended thatCorporate Governance Committee meeting in person.person and the other one by telephone conference call. Committees of the Board We currently have an Audit Committee, a Compensation Committee and a Nominating and Corporate Governance Committee, each of which is comprised of independent directors in accordance with the listing standards of NASDAQ. In 2013,2016, the Audit Committee met once.four times, the Compensation Committee met three times and the Nominating and Corporate Governance Committee met twice. The following table sets forth the names of each current Committee member and the primary responsibilities of each Committee. | | | Name of Committee and Members for 2017 | | Primary Responsibilities | Audit Winthrop B. Conrad, Jr. Brian D. Dunn Wilmot H. Kidd III (Chairman)(Chairman and Richard S. PechterAudit Committee Financial Expert)
| ● | • Reviews the audit plans and findings of our independent registered public accounting firm and our internal audit and risk review staff, as well as the results of regulatory examinations, and tracks management’s corrective action plans where necessary;
| ● | • Reviews our financial statements, including any significant financial items and/or changes in accounting policies, with our senior management and independent registered public accounting firm;
| ● | • Reviews our financial risk and control procedures, compliance programs regarding risk assessment and management and significant tax, legal and regulatory matters; and
| ● | • Appoints our independent registered public accounting firm annually, evaluates its independence and performance, determines its compensation and sets clear hiring policies for employees or former employees of the independent registered public accounting firm.
| | | Compensation Winthrop B. Conrad, Jr. Brian D. Dunn (Chairman) Wilmot H. Kidd III | Richard S. Pechter (Chairman)●
| | • Reviews,Determines the compensation of the Chief Executive Officer and reviews, approves, and makes recommendations to the Board with respect to the compensation of our other executive officers;
| ● | • Oversees, administers, and makes recommendations to the Board with respect to our cash and equity incentive plans; and
| ● | • Reviews and makes recommendations to the Board with respect to director compensation.
| | | Nominating and Corporate Governance Winthrop B. Conrad, Jr.Jr (Chairman) Brian D. Dunn Wilmot H. Kidd III | Richard S. Pechter●
| | • Makes recommendations to the Board regarding the selection of candidates, qualification and competency requirements for service on the Board and the suitability of proposed nominees as directors;
| ● | • Advises the Board with respect to the corporate governance principles applicable to us;
| ● | • Oversees the evaluation of the Board and management;
| | •
| ● | Reviews and approves in advance any related person transaction,transactions, other than those that are pre-approved pursuant to pre-approval guidelines or rules established by the Committee; | ● | • Reviews the form and amounts of director compensation and makes recommendations to the Board with respect thereto; and
| ● | • Establishes guidelines or rules to cover specific categories of transactions.
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The Board has adopted written charters for each Committee setting forth the roles and responsibilities of each Committee. Each of the charters is available on our website at http://ir.silvercrestgroup.com. Board’s Role in Risk Oversight The Board is responsible for overseeing management in the execution of its responsibilities and for assessing our general approach to risk management. In addition, an overall review of risk is inherent in the Board’s consideration of our long-term strategies and other matters presented to the Board. The board exercises its responsibilities periodically as part of its meetings and also through the Board’s three Committees, each of which examines various components of enterprise risk as part of their responsibilities. For example, the Audit Committee has primary responsibility for addressing risks relating to financial matters, particularly financial reporting, accounting practices and policies, disclosure controls and procedures and internal control over financial reporting. The Audit Committee also has primary responsibility for reviewing and discussing our practices regarding risk assessment and management, including any guidelines or policies that govern the process by which we identify, monitor and handle major risks. The Nominating and Corporate Governance Committee oversees risks associated with the independence of the Board and potential conflicts of interest. The Compensation Committee has primary responsibility for risks and exposures associated with our compensation policies, plans and practices, regarding both executive compensation and the compensation structure generally, including whether it provides appropriate incentives that do not encourage excessive risk-taking. Senior management is responsible for assessing and managing our various exposures to risk on a day-to-day basis, including the creation of appropriate risk management programs and policies. The Board’s role in risk oversight of our Company is consistent with our leadership structure, with the Chief Executive Officer and other members of senior management having responsibility for assessing and managing our risk exposure, with the Board and its Committees providing oversight in connection with those efforts. We believe this division of risk management responsibilities presents a consistent, systematic and effective approach for identifying, managing and mitigating risks throughout our Company. Compensation Committee Interlocks and Insider Participation None of the members who served on our Compensation Committee at any time during fiscal 20132016 was an officer or employee of the Company during fiscal 2016, was formerly an officer of the Company, or had any relationship with the Company requiring disclosure under the section of this Proxy Statement entitled “Related“Current Related Person Transactions.” Also, none of our executive officers serves as a member of the Boardboard of directors or compensation committee, or other committee serving an equivalent function, of another entity that has one or more of its executive officers serving as a member of the Board or Compensation Committee.
DIRECTOR COMPENSATIONCOMPENSATION Under our director compensation program, each non-management director receives annual compensation that is comprised of an annual retainer of $50,000 and an additional $5,000 annually per Committee on which the director serves. In 2016, each independent director was granted $13,190 of Class A restricted stock units in addition to their cash compensation. Management directors do not receive any additional compensation for services as a director. In addition, all directors are reimbursed for reasonable out-of-pocket expenses incurred by them in connection with attending Board, Committee and stockholder meetings, including those for travel, meals and lodging. We reserve the right to change the manner and amount of compensation to our directors at any time. 20132016 Director Summary Compensation Table
Information provided in the following table reflects the compensation delivered to our directors who are not named executive officers for our last completed fiscal year: | | | Fees Earned or | | Fees Earned or | | | | | | | | | | Paid in Cash | | Paid in Stock | | Total | | Name | | Fees Earned or Paid in Cash ($) | | | Total ($) | | | ($) | | ($)(1) | | ($) | | Winthrop B. Conrad, Jr. | | | 65,000 | | | | 65,000 | | Winthrop B. Conrad, Jr. | 65,000 | | 13,190 | | 78,190 | | Wilmot H. Kidd III | | | 65,000 | | | | 65,000 | | | Richard S. Pechter | | | 65,000 | | | | 65,000 | | | Wilmot H. Kidd III (2) | | Wilmot H. Kidd III (2) | 65,000 | | 13,190 | | 78,190 | | Richard S. Pechter (2) | | Richard S. Pechter (2) | 65,000 | | 13,190 | | 78,190 | |
| (1) | Reflects the grant date fair value computed in accordance with FASB ASC Topic 718, or ASC 718, associated with restricted stock units in Silvercrest Asset Management Group Inc. calculated pursuant to ASC 718. Pursuant to ASC 718, Silvercrest L.P. recognizes compensation expense associated with the granting of equity-based compensation based on the grant-date fair value of the award if it is classified as an equity instrument, and on the changes in settlement amount for awards that are classified as liabilities. Silvercrest L.P.’s restricted stock unit-based awards are all classified as equity instruments. For additional information regarding the assumptions made in calculating these amounts, see Note 16 to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016. |
| (2) | Mr. Pechter resigned from the Board effective April 21, 2017 and will not stand for reelection. Mr. Pechter turns 72 in April 2017. Unless the Nominating and Corporate Governance Committee affirmatively concludes that a person’s continued service as a director is in the Company’s best interest, no director will be nominated for reelection or reappointment to the Board after reaching 72 years of age. |
COMPENSATION COMMITTEECOMMITTEE REPORT Our Compensation Committee is comprised entirely of three independent directors who meet the independence, experience and other qualification requirements of the NASDAQ listing standards, and the rules and regulations of the SEC. Richard S. PechterBrian D. Dunn is the chair of our Compensation Committee. The Compensation Committee operates under a written charter adopted by the Board. Our charter can be viewed on our website at http://ir.silvercrestgroup.com/. We have relied on management’s representation that the compensation discussion and analysis presented in this Proxy Statement has been prepared with integrity, objectivity and in conformity with SEC regulations. Based upon our discussion with management, we recommended to the Board that the compensation discussion and analysis be included in this Proxy Statement. THE COMPENSATION COMMITTEE Richard S. Pechter,Brian D. Dunn, Chairman
Winthrop B. Conrad, Jr. Wilmot H. Kidd III
COMPENSATION DISCUSSIONDISCUSSION AND ANALYSIS This section summarizes the material elements and principles underlying our compensation policies, including those relating to our named executive officers. It generally describes the manner and context in which compensation is earned by, and awarded and paid to, our management and senior executives, who we refer to as our principals, and provides perspective on the tables and narratives that follow. For fiscal year 2013,2016, the named executive officers of the Company were G. Moffett Cochran, our former Chairman and Chief Executive Officer, Richard R. Hough III, currentChairman, Chief Executive Officer and President, Scott A. Gerard, Chief Financial Officer, David J. Campbell, General Counsel and Secretary, and Albert S. Messina, Managing Director and Portfolio Manager. Until our initial public offering in 2013, we were a private company. References to “we”, “our” or “Company” in this Compensation DiscussionExcept where the context requires otherwise and Analysis section that describe our historical compensation practices refer to Silvercrest L.P. and our predecessor Silvercrest GP LLC, andas otherwise set forth herein, references to “we”, “our” or “Company” in this Compensation Discussion and Analysis section that describe our compensation practices following the consummation of our initial public offering in 2013 refer to Silvercrest Asset Management Group Inc. and its subsidiaries.consolidated subsidiaries, including Silvercrest L.P. (“Silvercrest L.P.” or “SLP”), the managing member of SAMG LLC, our operating subsidiary.
Philosophy and Objectives of Compensation Program Our compensation program is designed to reward past performance onat an individual, team, and company level, and encourages future contributions to achieving our strategic goals and enhancing stockholder value. Our method of compensating our principals is intended to meet the following objectives: (i) support our overall business strategy; (ii) attract, retain and motivate top-tier professionals within the investment management industry; and (iii) align the interests of our principals with those of our stockholders. We believe that, in order to create long-term value for our stockholders, we need a skilled and experienced management team focused on achieving profitable and sustainable financial results, expanding our investment capabilities through disciplined growth, continuing to diversify sources of revenue and delivering superior client service. We depend on our management team to execute the strategic direction of our Company and maintain our standards for ethical, responsible and professional conduct. We also rely on our management team to manage our professionals and distribution channels and provide the operational infrastructure that allows our investment professionals to focus on achieving attractive investment returns and superior client service. In addition, we depend on our management team to encourage an entrepreneurial and collegial business culture. The elements of our compensation and equity participation programs have contributed to our ability to attract and retain a highly qualified team of professionals. For our principals, we use, and expect to continue to use, cash and equity compensation programs and equity participation in a combination that has been successful for us in the past and that we believe will continue to be successful for us.us in the future. In addition to cash compensation for our principals, we have recognized performance and value, which we believe enhance our overall compensation objectives, by offering interests in Silvercrest L.P. By doing so, we have enabled our principals to share in the future profits, growth and success of our business. Our compensation programs focusare focused on rewarding performance that increases long-term stockholder value, including growing revenues, retaining clients, developing new client relationships, developing new products, improving operational efficiency and managing risks. We periodically evaluate the success of our compensation and equity participation programs in achieving these objectives and adapt these programs as our Company grows in order to enable us to better achieve these, and future, objectives. Determination of Compensation and Role of Directors and Principals in Compensation Decisions Our executive compensation and equity participation programs were developed and implemented while we were a private company. We have not identified a specific peer group of companies for comparative purposes and have not engaged in formal competitive benchmarking of compensation against specific peer companies. In addition, we have not engaged a compensation consultant to assist in the annual review of our compensation practices or the development of compensation or equity participation programs for our principals. Compensation of our employees is not determined using rigid metrics or formulae and all compensation decisions are subject to the discretion of the Executive Committee (which is composed of Mr. Hough, Mr. Gerard, Mr. Campbell, and Mr. Messina) and, ultimately, our Chief Executive Officer, Mr. Hough. Historically, base salaries, annual bonuses and incentive compensation of our employees are reviewed by the Executive Committee and adjusted as deemed necessary after taking into account both individual and company performance.
We have a Compensation Committee comprised solely of independent directors to assist the Board in the discharge of its responsibilities relating to the compensation of our named executive officers. In making its decisions, the Compensation Committee is guided by the recommendations of the Chief Executive Officer and the Executive Committee. The Compensation Committee, in its sole discretion, determines the compensation of the Chief Executive Officer. We have not adopted policies with respect to cash versus non-cash compensation (or among different forms of non-cash compensation), although we have determined that it is important to encourage or provide a meaningful opportunity to acquire an amount of equity ownership by our principals to help align their interests with those of our Company.Company and its shareholders. The allocation between cash and non-cash compensation has historically been based on a number of factors, including individual performance, company performance and company liquidity. These determinations vary from year to year. We may decide in future years to pay some or all of short-term and long-termlong- term incentives in equity depending upon the facts and circumstances existing at that time. We have also not adopted specific policies with respect to current versus long-term compensation, but believe that both elements are necessary for achieving our compensation objectives for all employees. Our base salaries and performance bonuses are competitive for all employees. Equity awards for principals reward achievement of strategic long-term objectives, which we believe will contribute toward overall stockholder value. Our Chief Executive Officer has discretion to determine the compensation of the named executive officers (other than himself), which he is expected to do in consultation with our Compensation Committee. Our Compensation Committee has overall oversight responsibility for our compensation policies, plans and programs. The Committee reviews our Company’s achievements and the achievements of our employees and is expected to provide input and guidance to our Chief Executive Officer in the determination of the specific type and level of compensation of our other named executive officers. The Committee is also expected to set the compensation of our Chief Executive Officer. Principal Components of Compensation We have established compensation practices that directly link compensation with individual and company performance, as described below. These practices apply to all of our principals, including our named executive officers. Ultimately, ownership in our Company has been the primary tool we have used to attract and retain senior professionals. As of April 18, 2014,14, 2017, our principals indirectly held approximately 39%37% of the interests in Silvercrest L.P. In connection with our reorganization in July 2013, all units in Silvercrest GP LLC, our predecessor, held by our principals were converted into interests in Silvercrest L.P. The interests in Silvercrest L.P. currently held by our principals entitle them to receive distributions from Silvercrest L.P. In 2013,2016, we provided the following elements of compensation to our principals, the relative value of each of these components for individual principals varying based on job role and performance: (i) base salary; (ii) annual cash bonus; and (iii) stock awards; and (iv) other benefits and perquisites, each of which is described below. | • | | Base Salary. Base salaries are intended to provide the named executive officers with a degree of financial certainty and stability that does not depend entirely upon company or individual performance.
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| Base Salary. Base salaries are intended to provide the named executive officers with a degree of financial certainty and stability and are determined based on their role and responsibility. The intent behind all salaries is to provide a source of stable and predictable cash flow for each of our principals. The base salaries of our named executive officers for 2016 are set forth below in our “Summary Compensation Table.” Annual Cash Bonus. Annual cash bonus is determined after the end of each fiscal year and is based on a number of variables that are linked to individual and company-wide performance for that year and over the longer term. For Messrs. Hough, Gerard and Campbell, annual bonus awards are granted strictly on a discretionary basis. For Mr. Messina, who is a client-facing principal, annual cash bonuses are determined pursuant to a specific compensation plan whereby revenue is the predominant variable that is measured. Annual bonus awards for Messrs. Gerard and Campbell are recommended by the Chief Executive Officer and approved by the Compensation Committee. Our Compensation Committee has oversight of all of our executive compensation programs, including the approval of compensation of our Chief Executive Officer. The annual cash incentive compensation awarded to our named executive officers for fiscal year 2016 is set forth below in our “Summary Compensation Table”.
| • | Deferred Equity-Based Compensation. All of our principals, including our named executive officers, for 2013 are set forth below in our “Summary Compensation Table.” |
| • | | Annual Cash Bonus. Annual cash bonus is determined after the end of each fiscal year and is based on a number of variables that are linked to individual and company-wide performance for that year and over the longer term. Our principals’ annual bonus awards have been granted in the sole and absolute discretion of our Chief Executive Officer. Historically, our Chief Executive Officer determined his own bonus, if any, based upon the performance of our Company. Since our initial public offering, our Compensation Committee has assumed oversight of all of our compensation programs, including the approval of compensation of our Chief Executive Officer. The annual cash incentive compensation awarded to our named executive officers for fiscal year 2013 is set forth below in our “Summary Compensation Table”. |
| • | | Deferred Equity-Based Compensation. All of our named executive officers and all of our principals own equity interests in our Company. As part of our annual incentive compensation for some of our named executive officers and other principals, we awarded deferred equity units which vest over a four-year period and performance units in 2011 and 2012 for performance in the prior year. Each performance unit represents the unsecured right to receive additional interests in Silvercrest L.P., but only if: (i) the recipient continues to hold the underlying deferred equity units at the time the performance units vest, which is four years from the date of issuance; and (ii) interests in Silvercrest L.P. have increased in value from the date of issuance by at least 15% in year four. The valuefinal portion of the deferred equity and performance units when awarded is set forth belowthat were granted in our “Summary Compensation Table.”2012 vested in 2016. |
In 2015, the Company granted restricted stock units (“RSUs”) under the 2012 Equity Incentive Plan to some existing Class B unit holders, including our named executive officers. In 2016, the Company did not grant RSUs to our named executive officers. The RSUs granted in 2015 will vest and settle in the form of Class B units of SLP. Twenty-five percent of the RSUs granted vest and settle on each of the first, second, third and fourth anniversaries of the grant date. | • | | Other Benefits and Perquisites. Each of our employees participates in the employee health benefit programs we maintain, including medical, group life and long-term disability insurance, on the same basis as all other employees, subject to satisfying any eligibility requirements and applicable law. We also provide other perquisites such as an automobile program, by which our present and former Executive Committee members are provided $500 per month toward auto lease or financing payments. In addition, we offer each of our employees our investment management services, if they place their funds in a separately-managed account with us, at a discounted advisory fee typically associated with these services. Currently we do not have plans to change the levels of perquisites received, but continue to monitor them and may make adjustments from time to time. The perquisites provided to our named executive officers in the fiscal year ending December 31, 2013 are described below in our “Summary Compensation Table”. |
Other Benefits and Perquisites. Each of our employees participates in the employee health benefit programs we maintain, including medical, group life and long-term disability insurance, on the same basis as all other employees, subject to satisfying any eligibility requirements and applicable law. We also provide other perquisites such as an automobile program, by which our present and former Executive Committee members are provided $500 per month toward auto lease or financing payments. In addition, we offer each of our employees our investment management services, if they place their funds in a separately-managed account with us, at a discounted advisory fee typically associated with these services. Currently we do not have plans to change the levels of perquisites received, but continue to monitor them and may make adjustments from time to time. The perquisites provided to our named executive officers in the fiscal year ended December 31, 2016 are described below in our “Summary Compensation Table”. Stock Ownership Guidelines While the compensation of our principals has primarily included a set base salary and a discretionary bonus, virtually all of our principals own equity interests in Silvercrest L.P. As stated, we believe that equity ownership in our Company causes principals to have a long-term view of our success, and a healthy concern for the entire company, rather than merely improving their own compensation. Principals are incentivized to grow and increase the value of their equity interests by adding to our overall revenue and guarding our expenses in a way that a non-equitynon- equity owner would not. All of our principals have been offered multiple opportunities to acquire ownership interests in our Company, and in many cases, have received annual incentive compensation awards which include such interests. To date, only those employees who attained the title of Senior Vice President, Managing Director or higher have been invited to purchase equity interests in Silvercrest L.P. or receive them as annual incentive compensation awards. These transactions have taken a variety of forms. Some equity owners received equity interests in Silvercrest L.P. upon the acquisition by our Company of their prior firm. WeAs of December 31, 2016, we have successfully completed fiveseven of these acquisitions. Some equity owners were invited to purchase equity interests in Silvercrest L.P. upon commencement of employment at our Company or upon achieving a specified seniority level at our Company. On other occasions, we offered the opportunity to existing principals to purchase equity interests in Silvercrest L.P. that were redeemed by departing principals or issued new equity interests. In these cases, the principals purchased the equity interests by issuing promissory notes to us in the amount of the value of the equity interests purchased, some of which notes provided for annual amortization and others of which provided for a balloon payment. In addition, in 2012,2016, some principals received additional equity interests as annual incentive compensation awards.
Our principals have not historically been subject to mandated equity ownership or retention guidelines. It is our belief that the equity component of our compensation program ensures that our principals are also owners whose incentives are directly aligned with those of our Company and our clients. Since our initial public offering, we have continued to promote broad and substantial equity ownership by our principals through both equity-based compensation awards, and performance awards that will be granted in appropriate circumstances. We may expand our equity ownership by creating opportunities for all employees, and not only our principals, to acquire equity interests in our Company. In addition, while an employee of Silvercrest L.P., our principals are required to retain at least 25% of the Class B units in Silvercrest L.P. that were owned by the principal on the date of consummation of our initial public offering. Each holder’s profits percentage is fixed at the date of acquisition of the equity interests in Silvercrest L.P., subject to dilution when additional equity interests in these entities are issued or accretion if existing equity interests in their entities are redeemed and not resold. Under the terms of its second amended and restated limited partnership agreement, Silvercrest L.P. may retain profits for future needs of the partnership. An equity interest in Silvercrest L.P. also allows the holder to participate in the appreciation or depreciation in the value of Silvercrest L.P., from and after the date of the grant of the equity interest, by participating in defined capital or liquidity events (as defined in the second amended and restated limited partnership agreement) or by redemption following termination of employment. The redemption of these equity interests is described in detail below under “Vesting and Redemption of Silvercrest L.P.” In connection with our reorganization in 2013, the terms of the equity interests held by our named executive officers changed in several significant respects. As part of our reorganization, interests in Silvercrest L.P. were exchanged for Class B units of Silvercrest L.P. and shares of our Class B common stock. Class A units in Silvercrest L.P. are held by Silvercrest, the newCompany, which serves as the general partner of Silvercrest L.P. Each Class A unit and Class B unit gives its holder the right to receive a percentage of the current profits of Silvercrest L.P. (as defined in the second amended and restated limited partnership agreement). Since our initial public offering, a substantial portion of the economic return of our principals has continued to be obtained through their equity ownership in Silvercrest L.P. We believe that the continued link between the economic return they realize and our performance will encourage their continued exceptional performance. In addition, we believe that the restrictions on transfer and the ownership requirements to which they will be subject will align their interests with those of our stockholders. As an element of compensation, we intend to grant equity-based awards to those individuals considered to be important to our Company’s future success, primarily, (i) those professionals responsible for the investment performance of our strategies; (ii) those professionals principally responsible for servicing our existing clients and increasing our client base; and (iii) our executive officers. At December 31, 2013,2016, our named executive officers held deferred equityrestricted stock units with profits percentages and equity balances in Silvercrest L.P. as follows: | | | | | | | | | | | | | | | Profits Percentage (1) | | | 2013 Earned Profits (2) | | | Equity Balance as of December 31, 2013 (3) | | G. Moffett Cochran (4) | | | 0.27 | % | | $ | 63,786 | | | $ | 563,671 | | Richard R. Hough | | | 0.27 | % | | $ | 54,834 | | | $ | 575,058 | | Scott A. Gerard | | | 0.08 | % | | $ | 16,207 | | | $ | 168,130 | | David J. Campbell | | | 0.11 | % | | $ | 22,729 | | | $ | 242,147 | | Albert S. Messina | | | 0.29 | % | | $ | 46,829 | | | $ | 609,220 | |
| | | | | | | | Equity | | | | Profits | | | 2016 Earned | | | Balance as of | | | | Percentage (1) | | | Profits (2) | | | December 31, 2016 (3) | | Richard R. Hough | | | 0.40 | % | | $ | 55,488 | | | $ | 712,497 | | Scott A. Gerard | | | 0.27 | % | | $ | 37,381 | | | $ | 479,998 | | David J. Campbell | | | 0.23 | % | | $ | 32,125 | | | $ | 412,499 | | Albert S. Messina | | | 0.21 | % | | $ | 29,204 | | | $ | 375,002 | |
(1) | The amounts in this column represent the respective combined vested and unvested deferred equity unitfully-diluted percentages of our named executive officers, which reflect all Class B Units of Silvercrest L.P. and unvested restricted stock units held by our named executive officers. |
(2) | The amounts in this column represent allocations of 20132016 profits to our named executive officers pursuant to their respective equity interests related to both vested and unvested deferred equityrestricted stock units. Profits allocations related to the vested and unvested deferred equityrestricted stock units were determined based on the net income of Silvercrest L.P. in 2016. |
(3) | The amounts in this column represent the respective combined vested and unvested deferred equityrestricted stock unit account balances of our named executive officers that would be paid to the holder following termination of employment under certain circumstances. The amounts in this table assume that the holder’s employment was terminated by death or disability. |
(4) | G. Moffett Cochran died on November 18, 2013. |
Tax Considerations Our Compensation Committee is expected to consider the anticipated tax and accounting treatment of various payments and benefits to us and, when relevant, to our principals, although these considerations are not dispositive. Section 162(m) of the Internal Revenue Code generally disallows a tax deduction to a publicly-traded corporation that pays compensationfor amounts paid in excess of $1 million to any of its namedchief executive officer and its three most highly compensated executive officers (other than the chief executive officer and the chief financial officer) in any taxable year, unless the compensation plan and awards meet certain requirements. We have endeavoredWhile the compensation committee cannot predict how the deductibility limit may impact our executive compensation program in future years, the compensation committee intends to structuremaintain an approach to executive compensation that strongly links pay to qualify as performance-basedperformance. The compensation committee has not adopted a formal policy regarding tax deductibility of compensation paid to our executive officers but intends to consider tax deductibility under Section 162(m) where it is reasonableas a factor in compensation decisions to do so while meeting our compensation objectives.the extent applicable. Notwithstanding the foregoing, we reserve the right to pay amounts that are not deductible under Section 162(m) during any period when Section 162(m) is applicable to us.
Policy on Hedging and Short Sales The Company prohibits short sales and transactions in derivatives of Company securities for all directors and officers of the Company. Risk Considerations in our Compensation Program In evaluating our compensation program, we have identified two primary risks relating to compensation: (i) the risk that compensation will not be sufficient to retain talent and (ii) the risk that compensation may provide unintended incentives. To combat the risk that our compensation might not be sufficient, we strive to use a compensation structure and set compensation levels for all employees in a way that we believe contributes to low rates of employee attrition. We do not use compensation consultants with respect to non-equity-based compensation, but we receive regular and ongoing input from industry representatives and other market sources through our (1) participation on the Pershing Advisor Solutions, a service which provides a customized approach to understanding the RIA business and a range of solutions to help meet demand, with MFO/RIA peers; (2) participation in other custodian advisor forums and industry events; (3) review of compensation surveys by companies such as McLagan Partners and The Bower Group, which providesprovide international consulting services to a range of clients; (4) review of industry publications featuring stories on compensation practices and metrics; and (5) reviewingreview of the Moss Adams Adviser Compensation and Staffing Study, which is prepared by Pershing Advisor Solutions, Moss Adams LLP and IN Advisor Solutions and includes data on hundreds of advisory firms. We also make equity awards subject to multi-year vesting schedules to provide a long-term component to our compensation program and impose ongoing restrictions on the ability of our principals to dispose of their equity holdings acquired through equity awards. We believe that both the structure and levels of compensation have aided us in retaining key personnel as evidenced by the long-termlong- term tenure of our principals. To address the risk that our compensation programs might provide unintended incentives, we keep our compensation programs simple and the amount of equity-based compensation we tiegrant is based on company-wide results and the long-term component of our equity-based compensation is tied to our company-wide results.continued employment. We have not seen any employee behaviors motivated by our compensation policies and practices that create increased risks for our stockholders or our clients. Based on the foregoing, we do not believe that our compensation policies and practices motivate imprudent risk taking. Consequently, we are satisfied that any potential risks arising from our employee compensation policies and practices are not reasonably likely to have a material adverse effect on us. As mentioned, our Compensation Committee, which is comprised entirely of independent directors, reviews our compensation plans and policies periodically to ensure proper alignment with overall company goals and objectives. Our Compensation Committee also reviews the risks arising from our compensation policies and practices and assesses whether any such risks are reasonably likely to have a material adverse effect on us.
Summary CompensationCompensation Table The following table shows the annual compensation of our principal executive officer, principal financial officer and the threetwo most highly compensated executive officers other than our principal executive officer and principal financial officer, who were serving as executive officers on December 31, 2013.2016. These officers are referred to in this Proxy Statement as the “named executive officers.” Our named executive officers comprised all of our executive officers as of December 31, 2016. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Name and Principal Position | | Year | | | Salary ($) (4) | | | Bonus ($) (5) | | | Stock Awards ($) (6) | | | Cash Distributions (7) | | | All Other Compensation Earnings ($) (8) | | | Total ($) | | G. Moffett Cochran, former Chairman and Chief Executive Officer (1) | | | 2013 | | | $ | 662,414 | | | $ | — | | | $ | — | | | $ | 53,285 | | | $ | 301,777 | | | $ | 1,017,477 | | | | 2012 | | | $ | 708,333 | | | $ | — | | | $ | — | | | $ | 16,680 | | | $ | 248,352 | | | $ | 973,365 | | | | 2011 | | | $ | 500,000 | | | $ | — | | | $ | 396,750 | | | $ | 11,191 | | | $ | 230,523 | | | $ | 1,138,464 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Richard R. Hough, Chief Executive Officer and President (2) | | | 2013 | | | $ | 500,000 | | | $ | 599,400 | | | $ | — | | | $ | 54,486 | | | $ | — | | | $ | 1,153,886 | | | | 2012 | | | $ | 455,691 | | | $ | 425,000 | | | $ | 207,814 | | | $ | 16,453 | | | $ | — | | | $ | 1,104,958 | | | | 2011 | | | $ | 400,000 | | | $ | 225,000 | | | $ | 74,494 | | | $ | 8,607 | | | $ | — | | | $ | 708,101 | | | | | | | | | | Scott A. Gerard, Chief Financial Officer | | | 2013 | | | $ | 375,000 | | | $ | 490,000 | | | $ | — | | | $ | 16,177 | | | $ | — | | | $ | 881,177 | | | | 2012 | | | $ | 339,095 | | | $ | 350,000 | | | $ | 69,167 | | | $ | 4,759 | | | $ | — | | | $ | 763,021 | | | | 2011 | | | $ | 325,000 | | | $ | 200,000 | | | $ | 66,007 | | | $ | 1,974 | | | $ | — | | | $ | 592,981 | | | | | | | | | | David J. Campbell, General Counsel and Secretary | | | 2013 | | | $ | 375,000 | | | $ | 385,000 | | | $ | — | | | $ | 22,653 | | | $ | — | | | $ | 782,653 | | | | 2012 | | | $ | 339,095 | | | $ | 275,000 | | | $ | 34,584 | | | $ | 7,457 | | | $ | — | | | $ | 656,136 | | | | 2011 | | | $ | 325,000 | | | $ | 175,000 | | | $ | 57,756 | | | $ | 5,152 | | | $ | — | | | $ | 562,908 | | | | | | | | | | Albert S. Messina, Managing Director and Portfolio Manager (3) | | | 2013 | | | $ | 300,000 | | | $ | 306,000 | | | $ | — | | | $ | 45,669 | | | $ | 21,374 | | | $ | 673,043 | | | | 2012 | | | $ | 300,000 | | | $ | 381,489 | | | $ | — | | | $ | 19,562 | | | $ | — | | | $ | 701,051 | | | | 2011 | | | $ | 300,000 | | | $ | 391,000 | | | $ | 125,649 | | | $ | 15,791 | | | $ | — | | | $ | 832,440 | |
| | | | | | | | | | | | Stock | | | Cash | | | All Other | | | | | | | | | | Salary | | | Bonus | | | Awards | | | Distributions | | | Compensation | | | | | | Name and Principal Position | | Year | | ($) (1) | | | ($) (2) | | | ($) (3) | | | (4) | | | Earnings ($) (5) | | | Total ($) | | Richard R. Hough, | | 2016 | | $ | 700,000 | | | $ | 725,000 | | | $ | — | | | $ | 55,488 | | | $ | — | | | $ | 1,480,488 | | Chief Executive Officer and | | 2015 | | $ | 700,000 | | | $ | 725,000 | | | $ | 955,780 | | | $ | 18,660 | | | $ | — | | | $ | 2,399,440 | | President | | 2014 | | $ | 650,000 | | | $ | 725,000 | | | $ | — | | | $ | 9,565 | | | $ | — | | | $ | 1,384,565 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Scott A. Gerard, | | 2016 | | $ | 375,000 | | | $ | 564,000 | | | $ | — | | | $ | 37,381 | | | $ | — | | | $ | 976,381 | | Chief Financial Officer | | 2015 | | $ | 375,000 | | | $ | 564,000 | | | $ | 643,894 | | | $ | 10,703 | | | $ | — | | | $ | 1,593,597 | | | | 2014 | | $ | 375,000 | | | $ | 564,000 | | | $ | — | | | $ | 3,952 | | | $ | — | | | $ | 942,952 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | David J. Campbell, | | 2016 | | $ | 375,000 | | | $ | 443,000 | | | $ | — | | | $ | 32,125 | | | $ | — | | | $ | 850,125 | | General Counsel and Secretary | | 2015 | | $ | 375,000 | | | $ | 443,000 | | | $ | 553,346 | | | $ | 9,249 | | | $ | — | | | $ | 1,380,595 | | | | 2014 | | $ | 375,000 | | | $ | 443,000 | | | $ | — | | | $ | 2,927 | | | $ | — | | | $ | 820,927 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Albert S. Messina, | | 2016 | | $ | 300,000 | | | $ | 461,169 | | | $ | — | | | $ | 29,204 | | | $ | 22,276 | | | $ | 812,649 | | Managing Director and Portfolio | | 2015 | | $ | 300,000 | | | $ | 522,250 | | | $ | 503,042 | | | $ | 8,689 | | | $ | 18,101 | | | $ | 1,352,082 | | Manager | | 2014 | | $ | 300,000 | | | $ | 319,000 | | | $ | — | | | $ | 4,383 | | | $ | 18,005 | | | $ | 641,388 | |
(1) | As previously disclosed, Mr. Cochran passed away in November 2013. |
(2) | Mr. Hough was named President in February 2012 and Chief Executive Officer in November 2013. |
(3) | Mr. Messina was appointed to the Executive Committee and became a named executive officer in April 2013. |
(4) | Amounts represent guaranteed payments made to our named executive officers. |
(5)(2) | Amounts represent cash bonuses earned at December 31, 2013, 20122016, 2015 and 20112014 and paid in January 2017 and February 2014, 20132017, 2016 and 2012,2015, respectively. |
(6)(3) | Reflects the grant date fair value computed in accordance with FASB ASC Topic 718, or ASC 718, associated with deferred equityrestricted stock units in Silvercrest L.P., including distributions in respect of such units, calculated pursuant to ASC 718. Pursuant to ASC 718, Silvercrest L.P. recognizes compensation expense associated with the granting of equity-based compensation based on the grant-date fair value of the award if it is classified as an equity instrument, and on the changes in settlement amount for awards that are classified as liabilities. Silvercrest L.P.’s deferred equityrestricted stock unit-based awards have redemption features that necessitate their classificationare all classified as liabilities and, accordingly, changes to their redemption values subsequentequity instruments. For additional information regarding the assumptions made in calculating these amounts, see Note 16 to the grant date have beenconsolidated financial statements included as a component of compensation expense.in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016. |
(7)(4) | Amounts showing in this column represent the amount of cash distributed to each of the named executive officers on account of his vested and unvested deferred equity units and restricted stock units for the respective year. |
(8)(5) | For 2013,2016, 2015 and 2014, amounts in this column represent the aggregate dollar amount of all other compensation received by Mr. Cochran and Mr. Messina, consisting of employer-paid car allowances equal to $5,500 and $6,000, respectively, insurance premiums for life and disability insurance benefiting Mr. Cochran and Mr. Messina |
| equal to $1,228 and $1,340, respectively, and the savings of $295,049 and $14,034, to Mr. Cochran and Mr. Messina, respectively, for the discounted advisory fee for investment management services on their funds placed in separately managed accounts with the Company. For 2012 and 2011, amounts in this column represent the aggregate dollar amount of all other compensation received by Mr. Cochran, consisting of employer-paid car allowances equal to $6,000 and $6,000, respectively, insurance premiums for life and disability insurance benefiting Mr. CochranMessina equal to $6,370$1,207, $1,340 and $6,200,$1,340, respectively, and the savings of $235,652$15,069, $10,761 and $218,323,$10,665, respectively, to Mr. CochranMessina for the discounted advisory fee for investment management services on his funds placed in separately managed accounts with the Company. None of the perquisites received by our other named executive officers exceeded $10,000 in 2013, 20122016, 2015 and 2011.2014. |
Employment Agreements We do not have employment agreements with any of our named executive officers. As limited partners of Silvercrest L.P., pursuant to the terms of the second amended and restated limited partnership agreement with Silvercrest L.P., each of our named executive officers may not, while employed and during the one-year period following termination of employment by the employee, without good reason, (i) contact any of our clients or vendors or otherwise solicit any of our clients or vendors to terminate their relationship with us; (ii) accept any business from any of our clients with whom the employee dealt while at our Company; or (iii) hire any of our employees. Grants of Plan-Based Awards in Fiscal Year 2016 There were no grants of plan-based awards made to our named executive officers in 2016. Outstanding Equity Awards at Fiscal Year End 20132016 The following table sets forth information relating to equity interests in Silvercrest L.P. issued to our named executive officers subject to vesting provisions. | | | | | | | | | | | | | | | | | | | Stock Awards | | Name | | Number of Shares or Units of Stock That Have Not Vested (#) | | | Market Value of Shares or Units of Stock That Have Not Vested (as of 12/31/2013) ($) (1) | | | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | | | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) | | G. Moffett Cochran (2) | | | 11,246 | | | $ | 191,744 | | | | — | | | $ | — | | Richard R. Hough (3) | | | 33,399 | | | $ | 569,449 | | | | — | | | $ | — | | Scott A. Gerard (4) | | | 10,951 | | | $ | 186,718 | | | | — | | | $ | — | | David J. Campbell (5) | | | 12,945 | | | $ | 220,713 | | | | — | | | $ | — | | Albert S. Messina (6) | | | 25,606 | | | $ | 436,591 | | | | — | | | $ | — | |
| | | | Number of | | | Market | | | | | | Shares | | | Value of | | | | | | or | | | Shares or Units | | | | | | Units of Stock | | | of Stock | | | | | | That Have | | | That Have | | Name | | | | Not Vested (#) | | | Not Vested ($) (1) | | Richard R. Hough (2) | | | | | 54,182 | | | $ | 712,497 | | Scott A. Gerard (3) | | | | | 36,502 | | | $ | 479,998 | | David J. Campbell (4) | | | | | 31,369 | | | $ | 412,499 | | Albert S. Messina (5) | | | | | 28,517 | | | $ | 375,002 | |
(1) | Represents (i) $17.05$13.15 per unit, which is the effective per unit value as of December 31, 2013,2016, multiplied by (ii) the number of unvested units. |
(2) | Represents performance units which may vest on February 28, 2015 if performance targets are met. |
(3) | 3,605 units vest on February 24, 2014. 7,209 units, which represent performance units, vested on February 24, 2014 because the performance target was met, but were unvested as of December 31, 2013. 1,55218,061 restricted stock units vest on each of February 28, 2014August 6, 2017, 2018 and 2015. 3,104 units, which represent performance units, may vest on February 28, 2015 if performance targets are met. 3,2762019. |
(3) | 12,167 restricted stock units vest on each of February 28, 2014, 2015,August 6, 2017, 2018 and 2016. 6,551 units, which represent performance units, may vest on February 28, 2016 if performance targets are met.2019. |
(4) | 1,37510,456 restricted stock units vest on each of February 28, 2014August 6, 2017, 2018 and 2015. 2,750 units, which represent performance units, may vest on February 28, 2015 if performance targets are met. 1,0902019. |
(5) | 9,506 restricted stock units vest on each of February 28, 2014, 2015,August 6, 2017, 2018 and 2016. 2,180 units, which represent performance units, may vest on February 28, 2016 if performance targets are met.2019. |
(5) | 1,802 units vest on February 24, 2014. 3,605 units, which represent performance units, vested on February 24, 2014 because the performance target was met, but were unvested as of December 31, 2013. 1,203 units vest on each of February 28, 2014 and 2015. 2,406 units, which represent performance units, may vest on February 28, 2015 if performance targets are met. 545 units vest on each of February 2014, 2015 and 2016, 1,090 units, which represent performance units, may vest on February 28, 2016 if performance targets are met. |
(6) | 6,315 units vest on February 24, 2014. 9,476 units, which represent performance units, vested on February 24, 2014 because the performance target was met, but were unvested as of December 31, 2013. 2,617 units vest on each of February 28, 2014 and 2015. 4,581 units, which represent performance units, may vest on February 28, 2015 if performance targets are met. |
Option Exercises and Stock Vested During the Year Ended December 31, 20132016 The following table sets forth information concerning interests in Silvercrest L.P. acquired upon the vesting of deferred equity units and restricted stock units by the named executive officers during the year ended December 31, 2013.2016. | | | | | | Equity Awards | | | | Equity Awards | | | Number of L.P. Interests | | | Value Realized on | | Name | | Number of L.P. Interests Acquired on Vesting (#) | | | Value Realized on Vesting ($) (1) | | | Acquired on Vesting (#) | | | Vesting ($) (1) | | G. Moffett Cochran | | | 24,795 | | | $ | 359,526 | | | Richard R. Hough | | | 8,432 | | | $ | 125,388 | | | | 21,336 | | | $ | 256,653 | | Scott A. Gerard | | | 2,465 | | | $ | 36,660 | | | | 13,258 | | | $ | 160,711 | | David J. Campbell | | | 3,551 | | | $ | 52,799 | | | | 11,001 | | | $ | 133,833 | | Albert S. Messina | | | 8,933 | | | $ | 132,837 | | | | 9,506 | | | $ | 116,255 | |
(1) | Reflects the vesting date fair value, which also represents the vesting date market value, computed in accordance with ASC 718 associated with deferred equity units and restricted stock units in Silvercrest L.P. |
Pension Benefits We do not sponsor or maintain any benefit pension or retirement benefits for the benefit of our employees. Nonqualified Defined Contribution and Other Nonqualified Deferred Compensation Plans We do not sponsor or maintain any nonqualified defined contribution or other nonqualified deferred compensation plans for the benefit of our employees. Potential Payments Upon Termination or Change in Control The following summarizes the potential payments and benefits that we would provide to our named executive officers in connection with a termination of employment and/or a change in control. In determining amounts payable, we have assumed in all cases that the termination of employment occurred on December 31, 2013.2016. Severance Benefits We do not offer or have in place any formal retirement, severance, or similar compensation programs providing for additional benefits or payments in connection with a termination of employment, change in job responsibility or change in control. Our named executive officers, therefore, do not have employment, severance, change in control or other agreements with us that would require any payments to them in the event of a termination of employment and/or a change in control. Our named executive officers are all employed on an “at will” basis, which enables us to terminate their employment at any time. Under certain circumstances, a named executive officer may be offered severance benefits to be negotiated at the time of termination. Restricted Stock Units DeferredIn 2015, the Company granted restricted stock units under the 2012 Equity Units and Performance Units
As part of bonus compensation for performance during 2009, SAMG LLC awardedIncentive Plan to its principals 50% of the annual bonus earned by them in deferred equity units and performance units. For performance during 2010, the percentage was 25%, except in the case of Mr. Cochran, for whom the percentage in 2010 was 100%. For performance during 2011, discretionary awards were made in 2012 to all members of the Executive Committee, except for Mr. Cochran and Mr. Messina. As of December 31, 2013, there were 175,298 deferred equity units and 242,074 performance units outstanding. The deferred equity units and performance units were not issued pursuant to a plan.
Deferred Equity Units
Each deferred equity unit represents the right to receive onesome existing Class B unit of Silvercrest L.P. All deferred equityholders, including our named executive officers. In 2016, the Company did not grant restricted stock units receive distributions to our named executive officers. The restricted stock units granted in 2015 will vest and settle in the same extent as if underlying units exercisable therefore were deemed outstanding. As part of our reorganization in July 2013, all deferred equity units outstanding immediately prior to the consummation of our initial public offering represented the right to receive an equal numberform of Class B units of Silvercrest L.P. Each deferred equity unit vests in four annual incrementsSLP. Twenty-five percent of 25% beginningthe restricted stock units granted vest and settle on each of the first, anniversarysecond, third and fourth anniversaries of the date of grant. On each vesting date, each deferred equity unit will entitle the holder thereof to receive one Class B unit of Silvercrest L.P. On each vesting date, the holder of a deferred equity unit will have the right to require SAMG LLC to pay the holder cash for a specified percentage of the deferred equity units in lieu of issuing Class B units to the holder for that percentage. The Executive Committee sets the specified percentage that may be paid in cash at the option of the holder of the deferred equity units each year.grant date.
Performance Units
SAMG LLC also granted to each employee who received an award of deferred equity units, a number of performance units which represent the right to receive one unit of Silvercrest L.P. for every two units of Silvercrest L.P. issued upon vesting of the deferred equity units awarded to the employee. As part of our reorganization, each performance unit became exercisable for one Class B unit for every two Class B units issued upon vesting of the deferred equity units awarded to the employee. Each performance unit is subject to forfeiture if (i) the Class B units granted to the employee pursuant to the corresponding deferred equity unit are not held by such employee on the earlier of (A) February 29, 2016 for the fiscal 2011 performance units, February 28, 2015 for the fiscal 2010 performance units, and February 24, 2014 for the fiscal 2009 performance units and (B) the consummation of a change of control transaction or (ii) the value per Class B unit did not increase at least 15% per annum based on the Adjusted EBITDA (as defined in the unit award agreement) of Silvercrest L.P. calculated as of December 31, 2015, 2014, and 2013, respectively. Performance units are not entitled to any distributions from Silvercrest L.P. until the underlying Class B units are issued.
Dividend Equivalents Each deferred equityrestricted stock unit also entitles the holder to receive distributions from Silvercrest L.P. in the same amounts and at the same times as the holder would have received the distributions had the Class B units underlying the deferred equityrestricted stock units been issued on the date of grant. Treatment upon Termination of Employment Voluntary Resignation and Termination with Cause All deferred equity units and performancerestricted stock units are automatically forfeited upon a voluntary resignation or termination with cause. The right to receive dividend equivalents on the deferred equityrestricted stock units also terminates upon a termination of employment for the reasons stated above. Involuntary Termination without Cause, Death, Disability and Retirement Upon an employee’s involuntary termination by us, the disability of the employee, the retirement by the employee or an employee’s death, all deferred equityrestricted stock units become fully and immediately vested. The Executive Committee may determine as of the date of termination of employment the percentage of the deferred equity units held by the terminated employee that may be settled in cash. If an employee is terminated for any of the reasons set forth above, the terminated employee will receive a prorated number of Class B units based on the period of time employed between the date of grant and the settlement of the performance units when the performance target is achieved. The performance units will not be settled until the achievement of the performance target, if at all. In addition, the right to receive dividend equivalents on the deferred equityrestricted stock units will continue until the deferred equityrestricted stock units are settled. The value of the restricted stock units of our named executive officers that would have been accelerated assuming the events described in this paragraph occurred on December 30, 2016 would have been $712,497, $479,998, $412,499 and $375,002 for Messrs. Hough, Gerard, Campbell and Messina, respectively.
Change in Control All of the deferred equityrestricted stock units automatically vest in full upon the consummation of a change in control transaction (as defined in the unit award agreement). The Executive Committee will determine whether the performance target for the performance units was achieved asvalue of the closing daterestricted stock units of our named executive officers that would have been accelerated assuming the changeevents described in control transaction. If the performance target is achieved, the holder will receive settlement in full of the performance units upon the closing of the change in control transaction.this paragraph occurred on December 30, 2016 would have been $712,497, $479,998, $412,499 and $375,002 for Messrs. Hough, Gerard, Campbell and Messina, respectively. Vesting and Redemption of Silvercrest L.P. Interests Unless otherwise determined by the Board, in its sole discretion, or previously agreed to by the holder, his or her permitted transferees and us, if a holder of Silvercrest L.P. Class B units is terminated for cause, the holder (and, to the extent of any Class B units, transferred to his or her permitted transferees) would forfeit all of his, her or their unvested Class B units, if any, and, at our option, Silvercrest L.P. would have the right to redeem all of the vested Class B units collectively held by the holder and his or her permitted transferees for a purchase price equal to the lesser of (i) the aggregate capital account balance in Silvercrest L.P. of the holder and his or her permitted transferees and (ii) the purchase price paid by the terminated holder to first acquire the Class B units. In addition to the redemption described above, any holder terminated for cause will cease to receive any payments required to be made to the holder under the tax receivable agreement. In the event of termination of employment of a named executive officer due to death or disability on December 31, 2013,2016, no termination payments would be required to be made to any of our named executive officers. 2012 Equity Incentive Plan The Board has adopted, and our shareholders have approved, the 2012 Equity Incentive Plan. The purposes of the 2012 Equity Incentive Plan are to (i) align the long-term financial interests of our employees, directors, consultants and advisers with those of our stockholders; (ii) attract and retain those individuals by providing compensation opportunities that are consistent with our compensation philosophy; and (iii) provide incentives to those individuals who contribute significantly to our long-term performance and growth. To accomplish these purposes, the 2012 Equity Incentive Plan provides for the grant of units of Silvercrest L.P. (All references to units or interests of Silvercrest L.P. refer to Class B units of Silvercrest L.P. and accompanying shares of Class B common stock of our Company). The 2012 Equity Incentive Plan also provides for the grant of stock options (both stock options intended to be incentive stock options under Section 422 of the Internal Revenue Code and non-qualified stock options), stock appreciation rights, or SARs, restricted stock awards, restricted stock units, performance-based stock awards and other stock-based awards (collectively, stock awards) based on our Class A common stock. Incentive stock options may be granted only to employees; all other awards may be granted to employees, including officers, members, limited partners or partners who are engaged in the business of one or more of our subsidiaries, as well as non-employee directors and consultants.
EQUITY COMPENSATION PLANPLAN INFORMATION TABLE The following table sets forth our shares authorized for issuance under our equity compensation plans as of December 31, 2013.2016. | | | | | | | | | | | | | | | Number of shares to be
issued upon exercise of
outstanding options,
warrants, and rights | | | | | | | | | | | | | Number of shares | | | | Number of shares to be | | | Weighted-average | | | remaining available | | | | issued upon exercise of | | | exercise price of | | | for future issuance | | | | outstanding options, | | | outstanding options, | | | under equity | | | | warrants, and rights | | | warrants, and rights | | | compensation plans | | Equity compensation plans approved by stockholders | | | 980,883 | | | $ | 13.23 | | | | 690,077 | | Equity compensation plans not approved by stockholders | | | — | | | | — | | | | — | | Total | | | 980,883 | | | $ | 13.23 | | | | 690,077 | |
Weighted-average
exercise price of
outstanding options,
warrants, and rights
| | | Number of shares
remaining available
for future issuance
under equity
compensation plans | | Equity compensation plans approved by stockholders
| | | — | | | $ | — | | | | 1,670,960 | | Equity compensation plans not approved by stockholders
| | | — | | | $ | — | | | | — | | | | | | | | | | | | | | | Total
| | | — | | | | — | | | | 1,670,960 | | | | | | | | | | | | | | |
INFORMATION CONCERNING OUR NON-DIRECTORNON-DIRECTOR EXECUTIVE OFFICERS The following table provides information about our executive officers as of April 18, 2014.25, 2017. | | | | | | | Name | | Age | | | Position | | Scott A. Gerard | | 49 | 46 | | | Chief Financial Officer | | David J. Campbell | | 48 | 45 | | | General Counsel and Secretary | |
Our executive officers are elected by and serve at the discretion of the Board. There are no family relationships among any of our executive officers. Set forth below is a brief description of the business experience of all executive officers. Scott A. Gerard is our Chief Financial Officer. Mr. Gerard has served as Chief Financial Officer of SAMG LLC since 2010. Prior to joining Silvercrest, Mr. Gerard was Chief Financial Officer of Brand Connections, LLC, a private equity-backed marketing and media company from December 2008 through November 2009. Previously, he was Chief Financial Officer of Guideline, Inc., a publicly-held business research firm. Prior to Guideline, Mr. Gerard was a Division Controller with Citigroup Inc. and began his career with KPMG LLP. Mr. Gerard is a Certified Public Accountant and received a B.S. in accounting from the University of Buffalo. David J. Campbell is our General Counsel and Secretary. Mr. Campbell has served as the General Counsel of SAMG LLC since 2009. Prior to joining Silvercrest, Mr. Campbell served as a Managing Director and Associate General Counsel at Jefferies & Company, Inc. from 2006 to 2009. Mr. Campbell began his career at DLJ Securities Corporation, where as a Senior Vice President he provided advice and counsel to DLJ’s Pershing Division, Investment Services Group and DLJdirect. In 2001, he joined the law firm of Bressler, Amery & Ross, P.C., where he was a partner. He graduated with a B.A. from The George Washington University and a J.D. from Villanova University School of Law.
SECURITY OWNERSHIP OF CERTAIN BENEFICIALBENEFICIAL OWNERS AND MANAGEMENT Beneficial ownership is determined in accordance with the rules of the SEC. In computing the number of shares beneficially owned by a person and the percentage of ownership held by that person, shares of common stock subject to options and warrants held by that person that are currently exercisable or will become exercisable within 60 days after April 28, 201414, 2017 are deemed outstanding, while these shares are not deemed outstanding for computing percentage ownership of any other person. The address of each beneficial owner for which an address is not otherwise indicated is: 1330 Avenue of the Americas, 38th Floor, New York, New York 10019. Unless otherwise indicated in the footnotes to the table, the persons and entities named in the table have sole voting and investment power with respect to all shares beneficially owned, subject to community property laws where applicable. We know of no agreements among our stockholders which relate to voting or investment power over our common stock or any arrangement that may at a subsequent date result in a change in control of the Company. The following table sets forth information known to us regarding the ownership of our common stock as of April 18, 201414, 2017 by: each person or entity that beneficially owns more than five percent of our common stock; each member of the Board; each of our executive officers named in the “Summary Compensation Table” included in the Executive Compensation section of this Proxy Statement; and all directors and executive officers as a group.
The percentages of common stock beneficially owned are based on 7,522,974, 4,710,0458,100,205 and 12,233,0194,840,295 and 12,940,500 shares of our Class A, Class B and total common stock outstanding, respectively, on April 18, 2014.14, 2017. | | | Class | | | Class | | | | | | | | | | | | | | | | | | | | A | | | B | | | Total | | | | Class A Shares beneficially owned | | Class B Shares beneficially owned | | Total Shares beneficially owned | | | Shares beneficially owned** | | | Shares beneficially owned** | | | Voting Power | | Name of Beneficial Owner | | Number | | | Percentage | | Number | | | Percentage | | Number | | | Percentage | | | Number | | | Percentage | | | Number | | | Percentage | | | Percentage | | Lord, Abbett & Co. LLC (1) | | | 486,461 | | | | 6.5 | % | | | — | | | | — | | | 486,461 | | | | 4.0 | % | | 90 Hudson St., Jersey City, NJ 07302 | | | | | | | | | | | | | | RMB Capital Management, LLC (1) | | | | 875,033 | | | | 10.8 | % | | | — | | | | — | | | | 6.8 | % | 115 S. LaSalle Street, 34th Floor, Chicago, IL 60603 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Royce & Associates, LLC (2) 745 Fifth Avenue, New York, NY 10151 | | | 670,200 | | | | 8.9 | % | | | — | | | | — | | | | 670,200 | | | | 5.5 | % | | The Banc Funds Company, L.L.C. (2) | | | | 757,259 | | | | 9.3 | % | | | — | | | | — | | | | 5.9 | % | 20 North Wacker Drive, Suite 3300, Chicago, IL 60606 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Keeley Asset Management Corp.(3) 111 W. Jackson, Suite 810, Chicago, IL 60604 | | | 418,320 | | | | 5.6 | % | | | — | | | | — | | | | 418,320 | | | | 3.4 | % | | Royce & Associates, LP (3) | | | | 674,100 | | | | 8.3 | % | | | — | | | | — | | | | 5.2 | % | 745 Fifth Avenue, New York, NY 10151 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Boston Partners (4) | | | | 524,516 | | | | 6.5 | % | | | — | | | | — | | | | 4.1 | % | One Beacon Street, 30th Floor, Boston, MA 02108 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Punch & Associates Investment Management, Inc. (5) | | | | 502,816 | | | | 6.2 | % | | | — | | | | — | | | | 3.9 | % | 7701 France Ave. So., Suite 300, Edina, MN 55435 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Executive Officers, Directors and Others | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Richard R. Hough III | | | 200 | | | | * | | | 171,438 | | | | 3.6 | % | | 171,638 | | | | 1.4 | % | | | 200,905 | | | | 2.4 | % | | | 200,705 | | | | 4.1 | % | | | 1.6 | % | Scott A. Gerard | | | 100 | | | | * | | | 60,325 | | | | 1.3 | % | | 60,425 | | | | * | | | | 78,898 | | | * | | | | 78,798 | | | | 1.6 | % | | * | | David J. Campbell | | | 100 | | | | * | | | 95,069 | | | | 2.0 | % | | 95,169 | | | | * | | | | 110,325 | | | | 1.3 | % | | | 110,225 | | | | 2.3 | % | | * | | Albert S. Messina | | | — | | | | — | | | 197,097 | | | | 4.2 | % | | 197,097 | | | | 1.6 | % | | | 213,801 | | | | 2.6 | % | | | 213,801 | | | | 4.4 | % | | | 1.7 | % | Winthrop B. Conrad | | | 3,000 | | | | * | | | | — | | | | — | | | 3,000 | | | | * | | | | 4,000 | | | * | | | | — | | | | — | | | * | | Brian D. Dunn | | | | — | | | — | | | | — | | | | — | | | — | | Wilmot H. Kidd III | | | 25,000 | | | | * | | | | — | | | | — | | | 25,000 | | | | * | | | | 26,000 | | | * | | | | — | | | | — | | | * | | Richard S. Pechter | | | 10,000 | | | | * | | | | — | | | | — | | | 10,000 | | | | * | | | Estate of G. Moffett Cochran | | | 1,893,857 | | | | 25.2 | % | | | — | | | | — | | | 1,893,857 | | | | 15.5 | % | | Martin Jaffe | | | — | | | | — | | | 926,914 | | | | 19.7 | % | | 926,914 | | | | 7.6 | % | | Estate of G. Moffett Cochran (6) | | | | 1,005,103 | | | | 12.4 | % | | | — | | | | — | | | | 7.8 | % | Martin Jaffe (7) | | | | 667,379 | | | | 7.6 | % | | | 667,379 | | | | 13.8 | % | | | 5.2 | % | All executive officers and Directors as a group (7 persons) | | | 38,400 | | | | * | | | 523,930 | | | | 11.1 | % | | 562,330 | | | | 4.6 | % | | | 633,929 | | | | 7.3 | % | | | 603,529 | | | | 12.5 | % | | | 4.9 | % |
(1)** | Beneficial ownership is calculated in accordance with Rule 13d-3 under the Securities Exchange Act of 1934, whereby the reporting person is considered to beneficially own shares of our Class A common stock by virtue of the ability, generally, to exchange Class B units of Silvercrest L.P. for shares of our Class A common stock on a one-for-one basis. In accordance with Rule 13d-3, in determining the percentage ownership, only those shares issuable to the reporting person upon an exchange of partnership units are considered to be outstanding, in addition to the already outstanding shares of Class A common stock. As a result, the beneficial ownership percentage may not reflect the reporting person’s actual voting or economic interest in the Company. |
(1) | The number of shares owned is based on information included in the FormSchedule 13G/A filed by Lord, Abbett & Co.RMB Capital Management, LLC (“Lord”RMB”) with the SEC on April 10, 2014.February 13, 2017. According to the FormSchedule 13G/A, LordRMB has sole dispositive power over 486,461zero shares of our Class A common stock, shared dispositive power over 875,033 shares of our Class A common stock, sole voting power of over zero shares of our Class A common stock and shared voting power over 875,033 shares of our Class A common stock. |
(2) | The number of shares owned is based on information included in the Schedule 13G/A filed by The Banc Funds Company, L.L.C. (“Banc Funds”) with the SEC on February 14, 2017. According to the Schedule 13G/A, Banc Funds has sole dispositive power over 757,259 shares of our Class A common stock, shared dispositive power over zero shares of our Class A common stock, sole voting power of over 486,461757,259 shares of our Class A common stock and shared voting power over zero shares of our Class A common stock. |
(2)(3) | The number of shares owned is based on information included in the FormSchedule 13G/A filed by Royce & Associates, LLCLP (“Royce”) with the SEC on January 14, 2014.18, 2017. According to the FormSchedule 13G/A, RoyceMendon has sole dispositive power over 670,200674,100 shares of our Class A common stock, shared dispositive power over zero shares of our Class A common stock, sole voting power of over 670,200674,100 shares of our Class A common stock and shared voting power over zero shares of our Class A common stock. |
(3)(4) | The number of shares owned is based on information included in the FormSchedule 13G filed by Keeley Asset Management Corp.Boston Partners. (“Keeley”Boston”) with the SEC on February 7, 2014.8, 2017. According to the FormSchedule 13G, KeeleyBoston has sole dispositive power over 418,320524,516 shares of our Class A common stock, shared dispositive power over zero shares of our Class A common stock, sole voting power of over 418,320455,516 shares of our Class A common stock and shared voting power over zero shares of our Class A common stock. John L. Keeley, Jr., President |
(5) | The number of Keeley, may be deemedshares owned is based on information included in the Schedule 13G filed by Punch & Associates Investment Management, Inc. (“Punch”) with the SEC on February 3, 2017. According to have beneficial ownershipthe Schedule 13G/A, Mendon has sole dispositive power over 502,816 shares of these shares.our Class A common stock, shared dispositive power over zero shares of our Class A common stock, sole voting power of over 502,816 shares of our Class A common stock and shared voting power over zero shares of our Class A common stock. |
(6) | Mr. Cochran was the co-founder and former Chief Executive Officer of the Company. |
(7) | Mr. Jaffe is a senior advisor, co-founder and former Chief Operating Officer of the Company. |
SECTION 16(a) BENEFICIAL OWNERSHIPOWNERSHIP REPORTING COMPLIANCE Section 16(a) of the Securities Exchange Act of 1934 requires “insiders,” including our executive officers, directors and beneficial owners of more than 10 percent of our common stock, to file reports of ownership and changes in ownership of our common stock with the SEC and NASDAQ, and to furnish us with copies of all Section 16(a) forms they file. Based solely on our review of copies of such forms received by us, or written representations from reporting persons that no Forms 5 were required for those persons, we believe that our insiders complied with all applicable Section 16(a) filing requirements during fiscal year 2013.2016, except for one late Form 4 reporting one transaction made on behalf of Mr. Pechter on June 17, 2016.
PROPOSAL NO. 2 RATIFICATION OF APPOINTMENT BY THE AUDIT COMMITTEE OF DELOITTE & TOUCHE LLP AS OUR INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM FOR 20142017
Our Audit Committee has selected Deloitte & Touche LLP (“Deloitte”) as our independent registered public accounting firm for fiscal year 2014.2017. Deloitte also served as our independent registered public accounting firm for fiscal year 2013.2016. You are being asked to ratify the appointment by our Audit Committee of Deloitte as our independent registered public accounting firm for fiscal year 2014.2017. Members of Deloitte are expected to be present at the Annual Meeting, will have an opportunity to make a statement if they desire to do so and will be available to respond to appropriate questions. If Deloitte should decline to act or otherwise become incapable of acting, or if Deloitte’s engagement is discontinued for any reason, our Audit Committee will appoint another accounting firm to serve as our independent registered public accounting firm for fiscal year 2014.2017. 20132016 and 20122015 Audit and Tax Compliance Fees
Aggregate fees for professional services rendered for us by Deloitte, & Touche LLP as of and its affiliates, for the fiscal yearyears ended December 31, 20132016 and 20122015 are set forth below. | | | | | | | | | | | 2013 | | | 2012 | | Audit Fees (a) | | $ | 1,083,250 | | | $ | 1,517,569 | | | | | | | | | | |
| | 2016 | | | 2015 | | Audit Fees (a) | | $ | 530,500 | | | $ | 622,970 | | Audit-related Fees (b) | | | — | | | | — | | Tax Compliance Fees (c) | | | 20,800 | | | | 23,400 | | All Other Fees (d) | | | 2,178 | | | | 2,178 | | Total Fees | | $ | 553,478 | | | $ | 648,548 | |
(a) | Audit fees consist of fees for professional services provided in connection with the annual audit and interim reviews of our consolidated financial statements, and in connection with our initial public offering and the reorganization transactions.statements. Audit fees were $530,500 and fees in connection with our initial public offering and the related reorganization transactions were $526,930 and $556,320 and $427,703 and $1,089,866$622,970 for the fiscal years ended December 31, 20132016 and 2012,2015, respectively. |
(b) | Audit related fees consist of assurance and related services by the principal accountant that are reasonably related to the performance of the audit or review of the Company's financial statements and are not reported under Audit Fees. There were no audit related fees for the years ended December 31, 2016 and 2015. |
(c) | Tax compliance fees consist of fees for professional services in connection with a limited scope review of the Company’s U.S. federal, state, and local income tax returns. |
(d) | All other fees consist of the annual cost of a technical accounting database subscription provided by Deloitte or its affiliates. |
The Audit Committee is required by its charter to pre-approve audit services and permitted non-audit services to be performed by our independent registered public accounting firm. The Audit Committee approved all services provided by Deloitte during 2013 for the period after we became a public company.2016. THE BOARD OF DIRECTORS RECOMMENDS A VOTEFOR RATIFICATION OF DELOITTE & TOUCHE LLP AS OUR INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM FOR 2014.2017.
AUDIT COMMITTEECOMMITTEE REPORT We are responsible for providing independent, objective oversight of the Company’s accounting functions and internal controls and operate pursuant to a written charter approved by the Board. We are comprised entirely of three independent directors who meet independence, experience and other qualification requirements of the NASDAQ listing standards, Section 10A(m)(3) of the Securities Exchange Act of 1934 and the rules and regulations of the SEC. The Board has determined that the Audit Committee’s current chairman, Mr. Wilmot H. Kidd III, is the Audit Committee “financial expert”, as defined by SEC rules. Management is responsible for the Company’s financial reporting process, including the Company’s system of internal control, and for the preparation of consolidated financial statements in accordance with accounting principles generally accepted in the United States. The Company’s independent registered public accounting firm, or “independent accountants,” is responsible for auditing its consolidated financial statements and providing an opinion as to their conformity with accounting principles generally accepted in the United States. Our responsibility is to monitor and review this process. It is not our duty or responsibility to conduct auditing or accounting reviews or procedures. Consequently, in carrying out our oversight responsibilities, we shall not be charged with, and are not providing, any expert or special assurance as to the Company’s financial statements, or any professional certification as to the independent accountants’ work. In addition, we have relied on management’s representation that the financial statements have been prepared with integrity and objectively in conformity with accounting principles generally accepted in the United States and on the representations of the independent accountants included in their report on the Company’s financial statements. During 20132016 we met twice.four times. During 2013,2016, we: appointed Deloitte & Touche LLP as the independent registered public accounting firm for fiscal year 2013;2016; met with management and the independent accountants to review and discuss the Company’s critical accounting policies and significant estimates; met regularly with the independent accountants outside the presence of management; reviewed and discussed the quarterly reports prior to filing with the SEC; reviewed and discussed the quarterly earnings press releases; reviewed the processes by which risk is assessed and mitigated; and completed all other responsibilities under the Audit Committee charter. We have reviewed and discussed the Company’s audited financial statements for the year ended December 31, 2016 with management. We have discussed with the independent accountants the matters required by PCAOB AU 380, Public Company Accounting Oversight Board (“PCAOB”) Auditing Standard No. 1301, Communications with Audit Committees Auditing Standard No.16,, and SEC Rule 2-07 of Regulation S-X, which includes a review of significant accounting estimates and the Company’s accounting practices. In addition, we have received written disclosures and the letter from the independent accountants required by applicable requirements of the PCAOB Ethics and Independence Rule 3526, Communicationsregarding independent accountants’ communications with the Audit Committees Concerning Independence,Committee concerning independence, and discussed with the independent accountants their firm’s independence. Based upon our discussion with management and the independent accountants, and our review of the representations of management and the independent accountants, we recommended to the Board that the audited consolidated financial statements be included in the Company’s annual report on Form 10-K for the year ended December 31, 2013.2016. We considered whether the independent accountants’ provision of audit-related and tax compliance services to the Company is compatible with maintaining the independent accountants’ independence and have determined the provision of thesuch audit-related and tax compliance services are compatible with the independent accountants’ independence. Accordingly, we have approved retention of Deloitte as the Company’s independent registered public accounting firm for fiscal year 2014.2017. We reviewed and reassessed the adequacy of the Audit Committee Charter and recommended no changes. THE AUDIT COMMITTEE Wilmot H. Kidd III, Chairman Winthrop B. Conrad, Jr. Brian D. Dunn
Richard S. Pechter
OTHER MATTERSMATTERS A copy of our 20132016 annual report to stockholders is being sent to each stockholder of recordour stockholders together with this Proxy Statement. The annual report is not part of our proxy soliciting material. By order of the Board of Directors,
David J. Campbell General Counsel and Secretary New York, New York April 30, 2014 28, 2017
0 14475133014475 1330 Avenue of the Americas, 38th Floor New York, NY 10019THIS10019 THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS The undersigned hereby appoints David J. Campbell and Scott A. Gerard as proxies, each with full power of substitution, to represent and vote as designated on the reverse side, all the shares of Class A Common Stock of SILVERCREST ASSET MANAGEMENT GROUP INC. held of record by the under signedundersigned on April 28, 2014,25, 2017, at the Annual Meeting of Stockholders to be held at the Company’sCompany's headquarters located at 1330 Avenue of the Americas, 38th Floor, New York, NY 10019, on June 11, 2014,14, 2017, or any adjournment or postponement thereof. The shares of stock you hold as of the close of business on April 28, 201425, 2017 will be voted as you specify on the reverse side. If no choice is specified, the proxy will be voted “FOR” the election of all nominees for director (Proposal 1)and “FOR” Proposal 2, and otherwise in accordance with the best judgment of the proxy holder.(Continued (Continued and to be signed on the reverse side.) 1.1
ANNUAL MEETING OF STOCKHOLDERS OF SILVERCREST ASSET MANAGEMENT GROUP INC. June 11, 201414, 2017 Class A IMPORTANT NOTICE OF INTERNET AVAILABILITY OF PROXY MATERIAL FOR THE ANNUAL MEETING: The Notice of Meeting, proxy statement and proxy card are available at http://www.silvercrestgroup.com Please sign, date and mail your proxy card in the envelope provided as soon as possible. Signature of ShareholderStockholder Date: Signature of ShareholderStockholder Date: Note: Please sign exactly as your name or names appear on this Proxy. When shares are held jointly, each holder should sign. When signing as executor, administrator, attorney, trustee or guardian, please give full title as such. If the signer is a corporation, please sign full corporate name by duly authorized officer, giving full title as such. If signer is a partnership, please sign in partnership name by authorized person. To change the address on your account, please check the box at right and indicate your new address in the address space above. Please note that changes to the registered name(s) on the account may not be submitted via this method. 1. The election as director of the nominees listed below (except as marked to the contrary below). OBrian D. Dunn Wilmot H. Kidd III O Richard S. PechterR. Hough III 2. The ratification of Deloitte & Touche LLP as the independent registered public accounting firm for the fiscal year ending December 31, 2014.2017. The undersigned acknowledges receipt from the Company before the execution of this proxy of the Notice of 20142017 Annual Meeting of Stockholders, a Proxy Statement for the 20142017 Annual Meeting of Stockholders and the 20132016 Annual Report to Stockholders. FOR AGAINST ABSTAIN FOR ALL NOMINEES WITHHOLD AUTHORITY FOR ALL NOMINEES FOR ALL EXCEPT (See instructions below) INSTRUCTIONS: To withhold authority to vote for any individual nominee(s), mark “FOR ALL EXCEPT” and fill in the circle next to each nominee you wish to withhold, as shown here: NOMINEES: THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR”"FOR" EACH OF THE LISTED PROPOSALS. PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE x --------------- Please detach along perforated line and mail in the envelope provided. ---------------- 20230000000000000000 0 061114061417 GO GREEN e-Consent makes it easy to go paperless. With e-Consent, you can quickly access your proxy material, statements and other eligible documents online, while reducing costs, clutter and paper waste. Enroll today via www.amstock.comwww.astfinancial.com to enjoy online access.
Signature of ShareholderStockholder Date: Signature of ShareholderStockholder Date: Note: Please sign exactly as your name or names appear on this Proxy. When shares are held jointly, each holder should sign. When signing as executor, administrator, attorney, trustee or guardian, please give full title as such. If the signer is a corporation, please sign full corporate name by duly authorized officer, giving full title as such. If signer is a partnership, please sign in partnership name by authorized person. To change the address on your account, please check the box at right and indicate your new address in the address space above. Please note that changes to the registered name(s) on the account may not be submitted via this method. 1. The election as director of the nominees listed below (except as marked to the contrary below). OBrian D. Dunn Wilmot H. Kidd III O Richard S. PechterR. Hough III 2. The ratification of Deloitte & Touche LLP as the independent registered public accounting firm for the fiscal year ending December 31, 2014.2017. The undersigned acknowledges receipt from the Company before the execution of this proxy of the Notice of 20142017 Annual Meeting of Stockholders, a Proxy Statement for the 20142017 Annual Meeting of Stockholders and the 20132016 Annual Report to Stockholders. FOR AGAINST ABSTAIN FOR ALL NOMINEES WITHHOLD AUTHORITY FOR ALL NOMINEES FOR ALL EXCEPT (See instructions below) INSTRUCTIONS: To withhold authority to vote for any individual nominee(s), mark “FOR ALL EXCEPT” and fill in the circle next to each nominee you wish to withhold, as shown here: JOHN SMITH 1234 MAIN STREET APT. 203 NEW YORK, NY 10038 NOMINEES: ANNUAL MEETING OF STOCKHOLDERS OF SILVERCREST ASSET MANAGEMENT GROUP INC. June 11, 201414, 2017 Class A INTERNET - Access “www.voteproxy.com” and follow the on-screen instructions or scan the QR code with your smartphone. Have your proxy card available when you access the web page. TELEPHONE - Call toll-free 1-800-PROXIES (1-800-776-9437) in the United States or 1-718-921-8500 from foreign countries from any touch-tone telephone and follow the instructions. Have your proxy card available when you call. Vote online/phone until 11:59 PM EST the day before the meeting. MAIL - Sign, date and mail your proxy card in the envelope provided as soon as possible. IN PERSON - You may vote your shares in person by attending the Annual Meeting. GO GREEN - e-Consent makes it easy to go paperless. With e-Consent, you can quickly access your proxy material, statements and other eligible documents online, while reducing costs, clutter and paper waste. Enroll today via www.amstock.comwww.astfinancial.com to enjoy online access. PROXY VOTING INSTRUCTIONS Please detach along perforated line and mail in the envelope provided IF you are not voting via telephone or the Internet. THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR”"FOR" EACH OF THE LISTED PROPOSALS. PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE x --------------- ---------------- 20230000000000000000 0 061114061417 COMPANY NUMBER ACCOUNT NUMBER IMPORTANT NOTICE OF INTERNET AVAILABILITY OF PROXY MATERIAL FOR THE ANNUAL MEETING: The Notice of Meeting, proxy statement and proxy card are available at http://www.silvercrestgroup.com
0 --------------- . -------------- 14475 1330 Avenue of the Americas, 38th Floor New York, NY 10019 THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS The undersigned hereby appoints David J. Campbell and Scott A. Gerard as proxies, each with full power of substitution, to represent and vote as designated on the reverse side, all the shares of Class B Common Stock of SILVERCREST ASSET MANAGEMENT GROUP INC. held of record by the undersigned on April 28, 2014,25, 2017, at the Annual Meeting of Stockholders to be held at the Company’sCompany's headquarters located at 1330 Avenue of the Americas, 38th Floor, New York, NY 10019, on June 11, 2014,14, 2017, or any adjournment or postponement thereof. The shares of stock you hold as of the close of business on April 28, 201425, 2017 will be voted as you specify on the reverse side. If no choice is specified, the proxy will be voted “FOR” the election of all nominees for director (Proposal 1) and “FOR” Proposal 2, and otherwise in accordance with the best judgment of the proxy holder.older. (Continued and to be signed on the reverse side.) 1.1
ANNUAL MEETING OF STOCKHOLDERS OF SILVERCREST ASSET MANAGEMENT GROUP INC. June 11, 201414, 2017 Class B IMPORTANT NOTICE OF INTERNET AVAILABILITY OF PROXY MATERIAL FOR THE ANNUAL MEETING: The Notice of Meeting, proxy statement and proxy card are available at http://www.silvercrestgroup.com Please sign, date and mail your proxy card in the envelope provided as soon as possible. Signature of ShareholderStockholder Date: Signature of ShareholderStockholder Date: Note: Please sign exactly as your name or names appear on this Proxy. When shares are held jointly, each holder should sign. When signing as executor, administrator, attorney, trustee or guardian, please give full title as such. If the signer is a corporation, please sign full corporate name by duly authorized officer, giving full title as such. If signer is a partnership, please sign in partnership name by authorized person. To change the address on your account, please check the box at right and indicate your new address in the address space above. Please note that changes to the registered name(s) on the account may not be submitted via this method. 1. The election as director of the nominees listed below (except as marked to the contrary below). OBrian D. Dunn Wilmot H. Kidd III O Richard S. PechterR. Hough III 2. The ratification of Deloitte & Touche LLP as the independent registered public accounting firm for the fiscal year ending December 31, 2014.2017. The undersigned acknowledges receipt from the Company before the execution of this proxy of the Notice of 20142017 Annual Meeting of Stockholders, a Proxy Statement for the 20142017 Annual Meeting of Stockholders and the 20132016 Annual Report to Stockholders. FOR AGAINST ABSTAIN FOR ALL NOMINEES WITHHOLD AUTHORITY FOR ALL NOMINEES FOR ALL EXCEPT (See instructions below) INSTRUCTIONS: To withhold authority to vote for any individual nominee(s), mark “FOR ALL EXCEPT” and fill in the circle next to each nominee you wish to withhold, as shown here: NOMINEES: THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR”"FOR" EACH OF THE LISTED PROPOSALS. PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE x --------------- Please detach along perforated line and mail in the envelope provided. ---------------- 20230000000000000000 0 061114061417 GO GREEN e-Consent makes it easy to go paperless. With e-Consent, you can quickly access your proxy material, statements and other eligible documents online, while reducing costs, clutter and paper waste. Enroll today via www.amstock.comwww.astfinancial.com to enjoy online access.
Signature of ShareholderStockholder Date: Signature of ShareholderStockholder Date: Note: Please sign exactly as your name or names appear on this Proxy. When shares are held jointly, each holder should sign. When signing as executor, administrator, attorney, trustee or guardian, please give full title as such. If the signer is a corporation, please sign full corporate name by duly authorized officer, giving full title as such. If signer is a partnership, please sign in partnership name by authorized person. To change the address on your account, please check the box at right and indicate your new address in the address space above. Please note that changes to the registered name(s) on the account may not be submitted via this method. 1. The election as director of the nominees listed below (except as marked to the contrary below). OBrian D. Dunn Wilmot H. Kidd III O Richard S. PechterR. Hough III 2. The ratification of Deloitte & Touche LLP as the independent registered public accounting firm for the fiscal year ending December 31, 2014.2017. The undersigned acknowledges receipt from the Company before the execution of this proxy of the Notice of 20142017 Annual Meeting of Stockholders, a Proxy Statement for the 20142017 Annual Meeting of Stockholders and the 20132016 Annual Report to Stockholders. FOR AGAINST ABSTAIN FOR ALL NOMINEES WITHHOLD AUTHORITY FOR ALL NOMINEES FOR ALL EXCEPT (See instructions below) INSTRUCTIONS: To withhold authority to vote for any individual nominee(s), mark “FOR ALL EXCEPT” and fill in the circle next to each nominee you wish to withhold, as shown here: JOHN SMITH 1234 MAIN STREET APT. 203 NEW YORK, NY 10038 NOMINEES: ANNUAL MEETING OF STOCKHOLDERS OF SILVERCREST ASSET MANAGEMENT GROUP INC. June 11, 201414, 2017 Class B INTERNET - Access “www.voteproxy.com” and follow the on-screen instructions or scan the QR code with your smartphone. Have your proxy card available when you access the web page. TELEPHONE - Call toll-free 1-800-PROXIES (1-800-776-9437) in the United States or 1-718-921-8500 from foreign countries from any touch-tone telephone and follow the instructions. Have your proxy card available when you call. Vote online/phone until 11:59 PM EST the day before the meeting. MAIL - Sign, date and mail your proxy card in the envelope provided as soon as possible. IN PERSON - You may vote your shares in person by attending the Annual Meeting. GO GREEN - e-Consent makes it easy to go paperless. With e-Consent, you can quickly access your proxy material, statements and other eligible documents online, while reducing costs, clutter and paper waste. Enroll today via www.amstock.comwww.astfinancial.com to enjoy online access. PROXY VOTING INSTRUCTIONS Please detach along perforated line and mail in the envelope provided IF you are not voting via telephone or the Internet. THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR”"FOR" EACH OF THE LISTED PROPOSALS. PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE x --------------- ---------------- 20230000000000000000 0 061114061417 COMPANY NUMBER ACCOUNT NUMBER IMPORTANT NOTICE OF INTERNET AVAILABILITY OF PROXY MATERIAL FOR THE ANNUAL MEETING: The Notice of Meeting, proxy statement and proxy card are available at http://www.silvercrestgroup.com |
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