The Compensation Committee believes that compensation should be at-risk and heavily dependent upon the achievement of rigorous and objective performance requirements. As illustrated below, approximately 90%92% of the Co-CEOs’ target total direct compensation is variable and/or at-risk subject to the Company’s performance results.and continued employment over applicable earnings/vesting periods. Although the Compensation Committee does not target any particular percentile of our Executive Compensation
Total direct compensation refers to the compensation required to be disclosed in our Summary Compensation Table for 2019, but disregards additional compensation2021, excluding amounts identified as “all other compensation” because such amounts are not typically considered in the Compensation Committee’s annual compensation decisions in light of the relative sizeimmateriality of such amounts as compared to overall CEO compensation.
The Company’s compensation program rewards superior corporate performance as well as individual NEO contributions to the Company’s annual and long-term goals. AnnualShort-term incentive bonuses focus on retention and driving value over a one-year period, while long-term equity-based awards are designed to promote retention, further align pay with performance and contribute towards long-term stockholder value accretion.
We believe that the Company’s executive compensation program design features assist in rewarding and promoting the following:
On an annual basis, our Compensation Committee and Co-CEOs consider market competitiveness, business results, experience and individual performance in evaluating executive compensation. Our Co-CEOs are engaged in setting target compensation for our other NEOs and for other executives, including discussing individual performance of the other executives and recommending Compensation Committee approval of the compensation for their executive team. All decisions affecting executive compensation are ultimately made by the Compensation Committee.
performance relative to the Executive Compensation Peer Group and the unique circumstances associated with any individual executive, the Compensation Committee in consultation with FTIFerguson Consulting determines an appropriate level of target total direct annual compensation, although no particular Executive Compensation Peer Group percentile is targeted for any of our NEOs. The Compensation Committee considered FTIFerguson Consulting recommendations and peer group analysis when determining base salaries, annual incentives and long-term incentives.
The Compensation Committee recognizes that it is essential to receive objective advice from an independent compensation consultant. Accordingly, FTIFerguson Consulting’s services to the Compensation Committee and the Company in 20192021 were limited to review and advice to the Compensation Committee and the Company with respect to matters related to structuring and implementing our executive compensation program, director compensation program and with respect to the 20192021 Proxy Statement. In addition, the Compensation Committee has the sole authority to retain and terminate FTIFerguson Consulting as its compensation consultant and approve fees and other engagement terms. Other than providing the advice as described above, FTIFerguson Consulting did not provide any services to the Company in 2019.2021. The Compensation Committee has considered the independence of FTIFerguson Consulting, consistent with the requirements of NYSE, and has determined that FTIFerguson Consulting is independent. Further, pursuant to SEC rules, the Company conducted a conflicts of interest assessment and determined that there is no conflict of interest resulting from retaining FTIFerguson Consulting.
The Company’s primary components of compensation for its executive officers continued in 20192021 to be base salary, annual short-term incentive bonuses and annual grants of long-term equity-based incentive compensation. We have no pre-established policy or target for the allocation between cash and non-cash incentive compensation or between short-term and
long-term compensation, although the Company attempts to keep total cash compensation within the Company’s fiscal year budget while reinforcing its pay-for-performance philosophy.
The Company seeks to maintain a competitive total compensation package that aligns the economic interest of the executives with that of stockholders while maintaining sensitivity to multiple factors including the Company’s fiscal year budget, annual accounting cost and the impact to share dilution.
Consistent with the Company’s philosophy of tying pay to performance, our NEOs receive a majoritymost of their overall targeted compensation in a form other than base pay. Although the Compensation Committee does not set base salary levels equal to any specific percentile of base salaries paid to comparable officers in the Executive Compensation Peer Group, the NEOs are paid an amount in the form of base pay within a competitive range of base salaries paid to such comparable officers in the Executive Compensation Peer Group and sufficient to attract skilled executive talent and maintain a stable management team.
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Named Executive Officer | | Threshold | | Target | | Maximum |
Howard Schwimmer, Co-CEO | | 50% | | 150% | | 200% |
Michael S. Frankel, Co-CEO | | 50% | | 150% | | 200% |
Adeel Khan, CFO | | 50% | | 125% | | 175% |
David Lanzer, General Counsel and Secretary | | 40% | | 90% | | 120% |
EXECUTIVE COMPENSATION MATTERS
Actual 2019 Annual2021 Short-Term Incentive Bonuses
In determining actual 2019 annual2021 short-term incentive bonuses under the 20192021 STI Program for Messrs. Schwimmer and Frankel, KhanMs. Clark and Mr. Lanzer, the Compensation Committee reviewed Company performance in 20192021 against the CompanyQuantitative Performance Criteria and the Qualitative Performance Criteria. The following chart shows each performance metric within the CompanyQuantitative Performance Criteria, identifies the range of performance between threshold and maximum payout with respect to each metric and the weighting of each metric as a component of overall annualshort-term incentive bonus, as well as actual 20192021 results determined by the Compensation Committee with respect to each metric:
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Performance Criteria(1) | Weighting | Threshold | Target | Maximum |
Core FFO per Diluted Share(2) | | |
Consolidated Portfolio NOI Growth(3) | | |
Qualitative | | Qualitative measurement considerations included favorable positioning of the Company for future growth, capital structure and balance sheet management and management through the pandemic. |
(1)See Appendix A for definitions of “NOI” and “Core FFO” and reconciliations of net income (computed under GAAP) to NOI and Core FFO.
(2)Core FFO per diluted share was included as a performance metric because it is the earnings metric most commonly used by investors and analysts to evaluate and compare the Company’s performance with that of other REITs.
(3)Consolidated Portfolio NOI Growth was included as a performance metric because it includes acquisitions and reflects aspects of our asset management efforts, such as leasing, releasing and dispositions, as well as changes in cash rent due to contractual rent escalation provisions contained in our leases.
For the Qualitative Performance Criteria (weighted at 30% of the short-term incentive bonus opportunity), the NEOs were evaluated based on a number of considerations including capital structure and balance sheet management, favorable positioning of the Company for future growth, and management through the ongoing COVID-19 pandemic, among other variables determined and assessed by the Compensation Committee.
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Qualitative Performance Criteria | | 2021 Achievements |
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Favorable positioning of the Company for future growth | | •Completed 50 acquisitions representing 53 properties and 5.7 million RSF for an aggregate purchase price of $1.9 billion, in which 86% of transactions were executed through off-market or lightly-marketed transactions. •Stabilized six of our repositioning and redevelopment properties with a combined 1.0 million rentable square feet at a weighted average unlevered stabilized yield of 6.6%. •Demonstrated strength in leasing activity with the execution of over 7.0 million square feet of new and renewal leases with aggregate GAAP re-leasing spreads of 42.7%. •As a result of strong leasing activity, achieved Same Property Portfolio occupancy of 99.1% as of December 31, 2021. |
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Capital structure and balance sheet management | | •Completed a public green bond offering of $400 million 2.15% senior notes due 2031, for which the proceeds are expected to be allocated to investments in recently completed or future green building, energy and resource efficiency and renewable energy projects, including the development and redevelopment of such projects. •Raised net proceeds of $1.6 billion through a range of equity transactions, allowing the Company to fund acquisitions throughout the year. •Ended the year with low leverage equating to 9.1% net debt to enterprise value ratio. |
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Management through COVID-19 pandemic | | •Operated the Company with no material litigation, environmental or regulatory claims. •Despite ongoing eviction moratoriums, managed properties to achieve rent collections at pre-pandemic levels. |
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Performance Criteria5 | | Weighting | | Threshold | | Target | | Maximum | | Actual 2019 Results |
Core FFO per diluted Share | | 50% | | $1.16 | | $1.185 | | $1.21 | | $1.23 |
Consolidated Portfolio GAAP NOI Growth | | 50% | | 14.0% | | 17.0% | | 19.0% | | 26.4% |
EXECUTIVE COMPENSATION MATTERS
Based on the Company’s achievement of $1.23$1.64 Core FFO per diluted Share and 26.4%37.8% Consolidated Portfolio GAAP NOI Growth during 2019,2021, as described above, 70% of the annualshort-term incentive bonus opportunity was paid out to each NEO at maximum. Annualthe maximum level. Furthermore, based on the accomplishments that were significant to the Company during 2021, as described in the table above, the remaining 30% of the annual bonus opportunity, based on the Qualitative Performance Criteria, was paid out to each NEO at the maximum level.
Short-term incentive bonus awards to Messrs. KhanMs. Clark and Mr. Lanzer were payablepaid in cash. The Compensation Committee chose to provide Messrs. Schwimmer and Frankel’s 2019 annualFrankel had elected to receive their 2021 short-term incentive bonuses partly50% in cash (with respect to 25% of their respective annual bonuses) and partly50% in LTIP Units (with respect to 75% of their respective annual bonuses)in Rexford Industrial Realty, L.P., our operating partnership (“LTIP Units”). Accordingly, in early 2020,2022, at the same time that annualshort-term incentive bonuses were paid to our NEOs generally, Messrs. Schwimmer and Frankel were each granted 18,14612,824 LTIP Units (the “Annual Bonus“STI LTIP Units”), with the number of Annual BonusSTI LTIP Units granted determined by dividing the cash value of relevant portion of each of Messrs. Schwimmer and Frankel’s respective annualshort-term incentive bonuses by the closing price of our common stock on the date of grant. The Annual BonusSTI LTIP Units were fully vested at grant. Since LTIP Units haveUnit value only totracks the extent that there is future appreciation invalue of our value,stock price, this further aligns our Co-CEOs’ pay with our performance and mitigates against excessive short-term risk-taking. The annualshort-term incentive bonuses paid to Messrs. Schwimmer and Frankel, KhanMs. Clark and Mr. Lanzer under the 20192021 STI Program for 20192021 performance were as follows:
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Named Executive Officer | | 2019 Aggregate Annual Bonuses | | Portion of Annual Bonus Delivered in Cash | | Portion of Annual Bonus Delivered in LTIP Units | | Total Annual Bonus LTIP Units Granted |
Howard Schwimmer, Co-CEO | | $1,188,000 | | $297,000 | | $891,000 | | 18,146 |
Michael S. Frankel, Co-CEO | | $1,188,000 | | $297,000 | | $891,000 | | 18,146 |
Adeel Khan, CFO | | $661,500 | | $661,500 | | $— | | — |
David Lanzer, General Counsel and Secretary | | $408,000 | | $408,000 | | $— | | — |
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5 See Appendix A for the definition of “NOI” and a reconciliation of net income computed in accordance with GAAP to NOI, as well as the definition of “FFO,” “Core FFO” and “Core FFO per diluted share” and a reconciliation of net income computed in accordance with GAAP to FFO and Core FFO.
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Named Executive Officer | | 2021 Annual Bonuses | | Portion of Short-Term Incentive Bonus Delivered in Cash | | Portion of Short-Term Incentive Bonus Delivered in LTIP Units | | Total STI LTIP Units Granted |
Howard Schwimmer | | $ | 1,875,000 | | | $ | 937,500 | | | $ | 937,500 | | | 12,824 | |
Michael S. Frankel | | $ | 1,875,000 | | | $ | 937,500 | | | $ | 937,500 | | | 12,824 | |
Laura Clark | | $ | 875,000 | | | $ | 875,000 | | | $ | — | | | — | |
David Lanzer | | $ | 743,750 | | | $ | 743,750 | | | $ | — | | | — | |
Long-Term IncentivesCompensation
The Company’s long-term incentive compensation program consists of equity-based awards under our Second Amended and Restated 2013 Incentive Award Plan (the “Incentive Award Plan”). Equity incentive awards incentivize our NEOs to work to deliver stock price performance while providing valuable retention incentives. Further, equity-based awards linked to TSR performance goals deliver value only when the value of our common stock increases above certain thresholds and equity-based awards linked to growth in Core FFO per diluted share performance goals deliver value only when our Core FFO per diluted share increases above certain thresholds. The Compensation Committee administers our Incentive Award Plan, which provides for the issuance of equity-based awards to our NEOs and other officers, directors and employees. The Compensation Committee authorizes the awards and establishes the terms and conditions of the awards under the Incentive Award Plan, as it deems appropriate.
In December 2019,2021, our Compensation Committee granted awards to our NEOs in the form of Service-Vesting LTIP Units and Performance-Vesting LTIP Units, which may ultimately be exchanged on a one-for-one basis into shares of our common stock (if earned). In addition to the Service-Vesting LTIP Units and Performance-Vesting LTIP Units, in early 2020, a portion of each of Messrs. Schwimmer and Frankel’s 2019 annual bonus was delivered in the form of Annual Bonus LTIP Units, as described under the heading “Annual Bonuses,” above.
20192021 Service-Vesting LTIP Units
Based on the foregoing considerations, including the TSR and operational performance highlighted on page 34,pages 6 through 7, in December 2019,2021, the Compensation Committee approved a grant of Service-Vesting LTIP Units to Messrs. Schwimmer and Frankel, KhanMs. Clark and Mr. Lanzer.
EXECUTIVE COMPENSATION MATTERS
The table below sets forth the grant date value and the total number of Service-Vesting LTIP Units awarded to Messrs. Schwimmer and Frankel, KhanMs. Clark and Mr. Lanzer in December 2019:2021.
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Named Executive Officer | | Total Service-Vesting LTIP Units | Grant Date Value ($)(1) |
Howard Schwimmer | | 37,741 | | 2,696,974 | |
Michael S. Frankel | | 37,741 | | 2,696,974 | |
Laura Clark | | 10,645 | | 760,690 | |
David Lanzer | | 6,903 | | 493,290 | |
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Named Executive Officer | | Total Service-Vesting LTIP Units |
Howard Schwimmer, Co-CEO | | 43,725 |
Michael S. Frankel, Co-CEO | | 43,725 |
Adeel Khan, CFO | | 21,862 |
David Lanzer, General Counsel and Secretary | | 10,931 |
(1)Represents the grant date fair value computed in accordance with FASB ASC 718.The Service-Vesting LTIP Units vest with respect to one-third of the Service-Vesting LTIP Units underlying each award on December 1623 of each year over a three-year period, beginning on December 16, 2020,23, 2022, subject to continued employment through the applicable vesting date. The Compensation Committee believes that Service-Vesting LTIP Units provide important retention benefits along with further incentive to increase the Company’s share price and, therefore, serve to drive value for our stockholders, over a three-year period. If the Company experiences poor performance that results in poor stockholder return, then the value of the Service-Vesting LTIP Units, and likewise the individual NEO’s total realized compensation, will decline as a result. If the Company has superior performance that results in superior stockholder returns, then the value of the Service-Vesting LTIP Units, and likewise the individual NEO’s total realized compensation, will correspondingly increase.
Distributions are paid on all Service-Vesting LTIP Units, whether vested or unvested, as and when dividends are declared on our common stock.
20192021 Performance-Vesting LTIP Units
On December 16, 2019,23, 2021, the Compensation Committee approved Performance-Vesting LTIP Unit awards to Messrs. Schwimmer and Frankel, KhanMs. Clark and Mr. Lanzer which vest, subject to continued employment and the achievement of the goals described below, based on (i) the Company’s absolute TSR, (ii) the Company’s TSR performance relative to a peer group (the Dow Jones All Equity REIT Index), and (iii) the Company’s growth in Core FFO per diluted share, in each case, over thea three-year performance period from January 1, 2020 through December 31, 2022.period. The maximum number of Performance-Vesting LTIP Units will be earned only if the Company (a) achieves 30%40% or higher absolute TSR, inclusive of all dividends paid, over the three-year performance period, (b) finishes in the 75th90th or greater percentile of the peer group for TSR over the three-year performance period and (c) achieves 21%24% or higher growth in Core FFO per diluted share over the three-year performance period.
Each award of Performance-Vesting LTIP Units is comprised of a number of units designated as “absolute TSR base units,” a number of units designated as “relative TSR base units,” a number of units designated as “Core FFO per-share base units” and a number of units designated as “distribution equivalent units.” “TheThe Performance-Vesting LTIP Units, exclusive of any distribution equivalent units thereon (described below), are allocated 42%one-third to absolute TSR performance metrics (the “Absolute TSR Base Units”), 27%one-third to relative TSR performance metrics (the “Relative TSR Base Units”) and 31%one-third to Core FFO per-shareper diluted share growth performance metrics (the “Core FFO Per-Share Base Units”). The table below sets forth the total number of Performance-Vesting LTIP Units awarded to Messrs. Schwimmer and Frankel, KhanMs. Clark and Mr. Lanzer (which equals the sum of the Absolute TSR Base Units, the Relative TSR Base Units, Core FFO Per-Share Base Units and distribution equivalents on the Performance-Vesting LTIP Units that will vest, if at all, following the end of the performance period based upon achievement of the number of Absolute TSR Base Units, Relative TSR Base Units and Core FFO Per-Share Base Units that become vested in accordance with their terms)relevant performance measures).
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Named Executive Officer | | Absolute TSR Base LTIP Units | Relative TSR Base LTIP Units | Core FFO Per-Share Base LTIP Units | Distribution Equivalent LTIP Units | Total Performance- Vesting LTIP Units |
Howard Schwimmer | | 46,129 | | 46,129 | | 46,129 | | 9,881 | | 148,268 | |
Michael S. Frankel | | 46,129 | | 46,129 | | 46,129 | | 9,881 | | 148,268 | |
Laura Clark | | 13,097 | | 13,097 | | 13,097 | | 2,805 | | 42,096 | |
David Lanzer | | 8,516 | | 8,516 | | 8,516 | | 1,824 | | 27,372 | |
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Named Executive Officer | | Total Performance-Vesting Units | | Absolute TSR Base Units | | Relative TSR Base Units | | Core FFO Per-Share Base Units | | Distribution Equivalent Units |
Howard Schwimmer, Co-CEO | | 117,410 | | 47,100 | | 29,466 | | 34,188 | | 6,656 |
Michael S. Frankel, Co-CEO | | 117,410 | | 47,100 | | 29,466 | | 34,188 | | 6,656 |
Adeel Khan, CFO | | 41,094 | | 16,485 | | 10,313 | | 11,966 | | 2,330 |
David Lanzer, General Counsel and Secretary | | 19,080 | | 7,654 | | 4,788 | | 5,556 | | 1,082 |
EXECUTIVE COMPENSATION MATTERS
Listed below are the grant date values and the number of Performance-Vesting LTIP Units each of Messrs. Schwimmer and Frankel, KhanMs. Clark and Mr. Lanzer will be eligible to receive under the Performance-Vesting LTIP Unit awards upon achieving threshold, target and maximum goals for the absolute TSR, relative TSR and Core FFO per-share performance metrics (but excluding any distribution equivalent units):
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Named Executive Officer | | Threshold Award (# Units) | | Target Award (# Units) | | Maximum Award (# Units)(1) | | Grant Date Value ($)(2) |
Howard Schwimmer | | 23,065 | | | 46,129 | | | 138,387 | | | $ | 4,822,018 | |
Michael S. Frankel | | 23,065 | | | 46,129 | | | 138,387 | | | $ | 4,822,018 | |
Laura Clark | | 6,549 | | | 13,097 | | | 39,291 | | | $ | 1,369,073 | |
David Lanzer | | 4,258 | | | 8,516 | | | 25,548 | | | $ | 890,206 | |
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Named Executive Officer | | Threshold Award (# Units) | | Target Award (# Units) | | Maximum Award (# Units)(1) | | Grant Date Value ($)(2) |
Howard Schwimmer, Co-CEO | | 27,689 | | 55,377 | | 110,754 | | 2,342,816 |
Michael S. Frankel, Co-CEO | | 27,689 | | 55,377 | | 110,754 | | 2,342,816 |
Adeel Khan, CFO | | 9,691 | | 19,382 | | 38,764 | | 819,988 |
David Lanzer, General Counsel and Secretary | | 4,500 | | 8,999 | | 17,998 | | 380,716 |
(1)Represents the maximum Performance-Vesting LTIP Units that may vest, excluding any distribution equivalent units.
(2)Represents the grant date fair value based on probable outcome of the performance conditions, computed in accordance with FASB ASC 718.
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(1) | Represents the maximum Performance-Vesting LTIP Units that may vest, excluding any distribution equivalent units. |
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(2) | Represents the grant date fair value based on probable outcome of the performance conditions, computed in accordance with FASB ASC 718. |
Any Performance-Vesting LTIP Units that are ultimately earned will vest in full onat the end of the three-year performance period in December 31, 2022,2024, contingent upon continued employment with the Company through the end of the performance period (with certain exceptions in the event of a change in control of the Company and/or certain qualifying terminations of employment, each as discussed below under the heading “—Potential Payments Upon Termination or Change in Control”).
With respect to the Absolute TSR Base Units, if the following hurdles are achieved over the three-year performance period, the Absolute TSR Base Units will become vested as follows (generally subject to continued service through the applicable performance period):
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| | Absolute TSR Performance | | % of Absolute TSR Base Units Vested |
“Threshold Level” | | 18% | | 25% |
“Target Level” | | 24% | | 50% |
“Maximum Level” | | 30% | | 100% |
With respect to the Relative TSR Base Units if the following hurdles are achieved over the three-year performance period, the Relative TSR Base Units will become vested as follows (generally subject to continued service through the applicable performance period):
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| | Relative TSR Performance
(based on the SNL U.S. REIT Equity Index) | | % of Relative TSR Base
Units Vested
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“Threshold Level” | | 35th percentile of the peer group | | 25% |
“Target Level” | | 55th percentile of the peer group | | 50% |
“Maximum Level” | | 75th percentile of the peer group | | 100% |
With respect to theand Core FFO Per-Share Base Units, if the following hurdles are achieved over the three-year performance period, the Absolute TSR Base Units, Relative TSR Base Units and Core FFO Per-Share Base Units will become vested as follows (generally subject to continued service through the applicable performance period):
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| | Core FFO Per-Share Growth | | Core FFO Vesting Percentage |
“Threshold Level” | | 12% | | 25% |
“Target Level” | | 16.5% | | 50% |
“Maximum Level” | | 21% | | 100% |
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| Threshold Level | Target Level | High Level | Maximum Level |
Vesting Percentage | 50% of Target | 100% | 200% of Target | 300% of Target |
Absolute TSR Performance | |
Relative TSR Performance (based on the Dow Jones All Equity REIT Index) | |
Core FFO Per-Share Growth | |
If performance falls between the levels specified in any or all of the three tables above, the applicable portion of the Performance-Vesting LTIP Unit awards to be earned will be determined by straight-line interpolation between the specified levels.
To the extent that common stock dividends are declared with an ex-dividend date that occurs during the applicable Performance-Vesting LTIP Unit performance period, unvested Performance-Vesting LTIP Units will entitle their
holders to a cash payment equal to 10% of such dividends. In addition, a number of distribution equivalent units having a value equal to total common stock dividends with ex-dividend dates that occur during the performance period with respect to Performance-Vesting LTIP Units that are earned and become vested (less the distributions made with respect to such Performance-Vesting LTIP Units during the performance period as described in the immediately preceding sentence) will vest following the completion of the applicable performance period, up to the maximum number of distribution equivalent units that are included in the Performance-Vesting LTIP Units. For purposes of calculating the number of distribution equivalent units, the dividend amount will be adjusted (i) (plus or minus) to reflect the gain or loss on such amount had the dividends been reinvested in common stock on the applicable ex-dividend date and (ii) to reflect the value of any notional dividends on the notional shares resulting from such hypothetical reinvestment of distributions with an ex-dividend date occurring on or after the hypothetical issuance of such notional shares and on or prior to the last day of the performance period.
EXECUTIVE COMPENSATION MATTERS
Performance To Date for Prior Grants
The table below summarizes the results of the 2018 performance grant, which was completed and certified in January 2022, and the performance to date results for the 2019 and 2020 performance grants, which are currently in the middle of a three-year performance period.
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| Grant Year (Performance Period) and Metrics | Metric Weighting | | 2019 | 2020 | 2021 | 2022 | 2023 | | Payout as % of Target(1) |
| 2018 Grant (Jan 2019 - Dec 2021) | | | | | | | |
Absolute TSR | 33.3% | | Maximum Achieved & 167% Earned | | | | 55.6 | % |
Relative TSR vs. Peer Group | 33.3% | | | | | 55.6 | % |
Core FFO Per-Share growth | 33.3% | | | | | 55.6 | % |
| Total | | | | | | | | | 166.7 | % |
| 2019 Grant (Jan 2020 - Dec 2022) | | | | | | | |
| Absolute TSR | 42.0% | | | Tracking at Maximum & 200% Earned(2) | | | 84.0 | % |
| Relative TSR vs. Peer Group | 27.0% | | | | | 54.0 | % |
| Core FFO Per-Share growth | 31.0% | | | | | 62.0 | % |
| Total | | | | | | | | | 200.0 | % |
| 2020 Grant (Dec 2020 - Dec 2023) | | | | | | | |
| Absolute TSR | 33.3% | | | | Absolute TSR & Core FFO Per-Share growth tracking at Maximum and Relative TSR tracking above High (273% Earned)(2) | | 100.0 | % |
| Relative TSR vs. Peer Group | 33.3% | | | | | 73.1 | % |
| Core FFO Per-Share growth | 33.3% | | | | | 100.0 | % |
| Total | | | | | | | | | 273.1 | % |
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(1)The 2018 performance award pays out between 0% and 166.7% of target. The 2019 performance award pays out between 0% and 200% of target. The 2020 performance award pays out between 0% and 300% of target.
(2)For the 2019 and 2020 performance grants, the percentage payouts shown for the Absolute TSR and Relative TSR metrics measures performance as of December 31, 2021. For the 2019 and 2020 performance grants, the percentage payouts shown for the Core FFO per-share growth metric assumes that Core FFO per diluted share growth continues at the same rate as we experienced for the two-year period ended December 31, 2021, and the year ended December 31, 2021, respectively. The performance periods for these awards remain open, and if our actual TSR, relative TSR and actual Core FFO per-share growth results vary, the payout percentages could be greater or less than the payout percentages reported above.
Other Benefits
Retirement Plans
The Internal Revenue Code of 1986, as amended, allows eligible employees to defer a portion of their compensation, within prescribed limits, on a pre-tax basis through contributions to a 401(k) plan. We established a 401(k) retirement savings plan for our employees, including our NEOs, who satisfy certain eligibility requirements. Our NEOs are eligible to participate in the 401(k) plan on the same terms as other full-time employees. Messrs. KhanSchwimmer and Lanzer each received an employer matching contribution to the 401(k) plan of $2,000 related to 20192021 contributions.
Employee Benefits and Perquisites
Our full-time employees, including our NEOs, are eligible to participate in health and welfare benefit plans, which provide medical, dental, prescription and other health and related benefits. We may also implement additional benefit and other perquisite programs as our Compensation Committee determines appropriate, though we do not expect any such additional benefits and perquisites to constitute a material component of our NEOs’ compensation package.
Severance and Change in Control Benefits
The Company’s business is competitive and the Compensation Committee believes that it is extremely important for the Company to maintain employment agreements with its most senior executives that offer reasonable protections to the executives in connection with transactions and involuntary termination. The employment agreements covering our NEOs
EXECUTIVE COMPENSATION MATTERS
generally provide for severance payments and benefits if the executive terminates his or her employment for “good reason” or is terminated by the Company without “cause”,“cause,” as those terms are defined in each agreement. In addition, our Co-CEOs are eligible to receive severance if our Company elects not to renew the term of their respective employment agreements, provided that they were willing to continue employment on similar terms. Our Compensation Committee believes that these severance arrangements promote stability and continuity of senior management. These employment agreements also provide for equity award acceleration (excluding performance unit awards) upon a change in control (as defined in our Incentive Award Plan) in order to ensure that our NEOs realize the value of their time-based equity incentive awards if they bring us through a successful sale transaction (accelerated vesting with respect to performance unit awards is governed by the terms of those awards, as described below under the heading “Potential Payments Upon Termination or Change in Control”). By including these severance and change in control provisions in the employment agreements, our Compensation Committee believes we can reinforce and encourage the continued attention and dedication of our NEOs to their assigned duties without distraction in the face of an actual or threatened transaction and ensure that our NEOs are motivated to negotiate the best acquisition consideration for our stockholders.
For a description of the material terms of these NEO employment agreements, as well as the treatment of outstanding equity awards in connection with a change in control or qualifying termination, see “—Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards in 20192021 Table” and “—Potential Payments Upon Termination or Change in Control” below.
GovernanceCompensation Policies Relating to Compensationand Procedures
Minimum Ownership Guidelines
The Board expects the NEOs to own a meaningful equity interest in the Company to more closely align the interests of these executive officers with those of stockholders. Accordingly, the Board has adopted the Executive Officer Stock Ownership Policy, dated February 16, 2016, which establishesestablished equity ownership guidelines for the Co-CEOs, the CFO and the General Counsel and Secretary. The executives are required to hold common equity with a value equivalent to a multiple of their salary as listed in the table below:
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TitleCo-CEOs | | MultipleCFO & General Counsel and Secretary |
Co-CEOs6x | | 6 x 3x |
Base Salary | | Base Salary |
CFO & General Counsel and Secretary | | 3 x Base Salary |
These NEOs have until December 2020 (or, with respectThe ownership guidelines are expected to Mr. Lanzer, December 2021)be achieved within five years of a person first becoming subject to meet the shareequity ownership guidelines. Vested and unvested restricted common stock and LTIP Units count toward the equity ownership guidelines (in addition to shares of common stock and units in our operating partnership), excluding unearned Performance-Vesting LTIP Units. As of April 13, 2020,May 2, 2022, all of our NEOs satisfied the stock ownership guidelines or were within the established period to acquire the applicable level of ownership.
Clawback Policy
The Board adopted a Compensation Recovery Policy, often referred to as a clawback policy, which provides that in the event that Company is required to prepare an accounting restatement due to its material noncompliance with any financial reporting requirement under U.S. securities laws as a direct result of an executive officer’s fraudulent or willful misconduct, the Board may, in its sole discretion, seek to recover from the executive officer the amount of incentive compensation received in excess of the amount that would have been paid had the financial results been properly reported, with such differential amount reduced by the amount of any taxes the executive officer actually paid with respect to such incentive compensation. Incentive compensation is generally comprised of any performance-based cash bonus or cash incentive payment or performance-based equity-based award granted, earned, vested and/or received by such executive officers from the Company on or after February 8, 2021, and during the 36 months immediately preceding the date on which the Company determines it is required to prepare a restatement.
EXECUTIVE COMPENSATION MATTERS
Anti-Hedging Policy
The Board has established an anti-hedging policy applicable to our officers, directors, other employees and their family members. The policy prohibits any director, officer or other employee of the Company and his or her family members from trading in puts, calls or other derivative securities based on the Company’s securities. In addition, certain forms of hedging or monetization transactions, such as zero-cost collars and forward sale contracts, allow a stockholder to lock in much of the value of his or her holdings, often in exchange for all or part of the potential upside appreciation in the share holdings. These transactions allow the stockholder to continue to own the covered securities, but without the full risks and rewards of ownership. When that occurs, the owner may no longer have the same objectives as the Company’s other stockholders. Therefore, directors, officers, other employees and their family members are prohibited from engaging in any such transactions with respect to the common stock owned.
Anti-Pledging Policy
The Board has established an anti-pledging policy applicable to our officers, directors, other employees and their family members. The policy prohibits any director, officer or other employee of the Company and his or her family members from pledging or using as collateral, the Company’s securities in order to secure personal loans, lines of credit or other obligations, including holding Company securities in a margin account. Exceptions to this policy are granted where (i) the securities pledged are not needed to satisfy the minimum ownership level required by the Company’s stock ownership guidelines, (ii) such individual has and maintains a sufficient amount of immediately available cash or securities at all times to prevent a sale of the Company’s securities during a time when such sale would be prohibited and (iii) the securities pledged are not utilized as part of any hedging transaction prohibited by the Company’s anti-hedging policy described above.
Tax and Accounting Considerations
Section 162(m) of the Internal Revenue Code
Section 162(m) of the Code disallows a tax deduction for any publicly held corporation for individual compensation exceeding $1.0 million in any taxable year for the chief executive officer, chief financial officer, and the three other most highly compensated officers of such corporation for such taxable year. Prior to the effectiveness of the Tax Act, the deduction limit included an exception for “qualified performance-based compensation.” However, the Tax Act amended certain aspects of Section 162(m) of the Code, including eliminating the exception permitting deduction of “qualified performance-based compensation,” and expanding the scope of employees to whom the deduction limit applies. The Tax Act includes a grandfathering provision, pursuant to which remuneration that was intended to be “qualified performance-based compensation,” and that was provided pursuant to a written binding contract in effect on November 2, 2017, which has not been modified in any material respect on or after that date, will continue to be eligible for the “qualified performance-based compensation” exception.
We believe that we qualify as a REIT under the Code and generally are not subject to federal income taxes, provided we distribute to our stockholders at least 90% of our taxable income each year. As a result of the Company’s tax status as a REIT, the loss of a deduction under Section 162(m) of the Code may not affect the amount of federal income tax payable by the Company. In approving the amount and form of compensation for our NEOs in the future, our Compensation Committee will consider all elements of the cost to the Company of providing such compensation, including the potential impact of Section 162(m) of the Code, if any. However, our Compensation Committee may, in its judgment, authorize compensation payments that are subject to deduction limitations under Section 162(m) of the Code when it believes that such payments are appropriate to attract and retain executive talent.
Section 280G of the Internal Revenue Code
Section 280G of the Code disallows a tax deduction with respect to excess parachute payments to certain executives of companies that undergo a change in control. In addition, Section 4999 of the Code imposes a 20% penalty on the individual receiving the excess payment.
Parachute payments are compensation that is linked to or triggered by a change in control and may include, but are not limited to, transaction bonus payments, severance payments, certain fringe benefits and payments and acceleration of vesting under long-term incentive plans. Excess parachute payments are parachute payments that exceed a threshold determined under Section 280G of the Code based on the executive’s prior compensation. In approving the compensation arrangements for our named executive officers in the future, our Compensation Committee will consider all elements of the cost to the Company of providing such compensation, including the potential impact of Section 280G of the Code. However, our Compensation Committee may, in its judgment, authorize compensation arrangements that could give rise to loss of deductibility under
EXECUTIVE COMPENSATION MATTERS
Section 280G of the Code and the imposition of excise taxes under Section 4999 of the Code when it believes that such arrangements are appropriate to attract and retain executive talent.
Note that none of our NEOs (or other executives or employees) are entitled to any tax gross-up or similar payments with respect to any excise taxes that may be imposed in accordance with the foregoing.
Accounting Standards
ASC Topic 718 requires us to calculate the grant date “fair value” of our stock-based awards using a variety of assumptions. ASC Topic 718 also requires us to recognize an expense for the fair value of equity-based compensation awards. Grants of restricted stock, Service-Vesting LTIP Units and Performance-Vesting LTIP Units under our equity incentive award plans will be accounted for under ASC Topic 718. Our Compensation Committee will regularly consider the accounting implications of significant compensation decisions, especially in connection with decisions that relate to our equity incentive award plans and programs. As accounting standards change, we may revise certain programs to appropriately align the accounting expense of our equity awards with our overall executive compensation philosophy and objectives.
Compensation Committee Interlocks and Insider Participation
COMPENSATION COMMITTEE REPORTEach of Messrs. Antin and Schwab and Ms. Morris served as a member of the Compensation Committee during fiscal year 2021. Since the date of our IPO, there have been no insider participations or Compensation Committee interlocks of the Compensation Committee, and no member of our compensation committee had a relationship that must be described under the SEC rules relating to disclosure of related person transactions except with respect to the transaction described under “Related Party and Other Transactions Involving our Officers and Directors–Lease Agreement”. At all times since the completion of our IPO, the Compensation Committee has been comprised solely of independent, non-employee directors.
Compensation Committee Report
The Compensation Committee of the Board of Directors of Rexford Industrial Realty, Inc., a Maryland corporation, has reviewed and discussed with management the Compensation Discussion and Analysis and, based on such review and discussions, recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this Proxy Statement.
This report of the Compensation Committee is not soliciting material, is not deemed filed with the Securities and Exchange Commission, and shall not be deemed incorporated by reference by any general statement incorporating by reference this Proxy Statement into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except to the extent that we specifically incorporate this information by reference, and shall not otherwise be deemed filed under such acts.
The foregoing report has been furnished by the Compensation Committee as of April 13, 2020.May 2, 2022.
Robert L. Antin, Chairman
Steven C. Good
Debra L. Morris
Peter E. Schwab
EXECUTIVE COMPENSATION TABLEMATTERS
Compensation Tables
Summary Compensation Table
The following table sets forth information concerning the compensation of our NEOs for 2021, 2020 and 2019.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Name and Principal Position | | Year | | Salary ($) | | | | Stock Awards ($) | | Non-Equity Incentive Plan Compensation ($)(1) | | All Other Compensation ($)(2) | | Total ($) |
Howard Schwimmer | | 2021 | | 750,000 | | | | | 8,456,492 | | (3)(4) | 937,500 | | | 16,910 | | | 10,160,902 | |
| 2020 | | 675,000 | | | | | 6,898,366 | | | 759,375 | | | 16,310 | | | 8,349,051 | |
| 2019 | | 594,000 | | | | | 5,105,682 | | | 297,000 | | | 15,469 | | | 6,012,151 | |
Michael S. Frankel | | 2021 | | 750,000 | | | | | 8,456,492 | | (3)(4) | 937,500 | | | 16,910 | | | 10,160,902 | |
| 2020 | | 675,000 | | | | | 6,898,366 | | | 759,375 | | | 16,310 | | | 8,349,051 | |
| 2019 | | 594,000 | | | | | 5,105,682 | | | 297,000 | | | 15,469 | | | 6,012,151 | |
Laura Clark | | 2021 | | 500,000 | | | | | 2,129,763 | | (3) | 875,000 | | | 16,910 | | | 3,521,673 | |
| 2020 | | 121,667 | | | | | 1,521,457 | | | 182,500 | | | 12,637 | | | 1,838,261 | |
David Lanzer | | 2021 | | 425,000 | | | | | 1,383,496 | | (3) | 743,750 | | | 16,910 | | | 2,569,156 | |
| 2020 | | 375,000 | | | | | 1,129,022 | | | 487,500 | | | 16,310 | | | 2,007,832 | |
| 2019 | | 340,000 | | | | | 848,670 | | | 408,000 | | | 15,469 | | | 1,612,139 | |
(1)Amounts shown in the “Non-Equity Incentive Plan Compensation” column reflect short-term incentive bonus awards earned for performance in 2021, 2020 and 2019 2018under the applicable short-term incentive bonus programs in place for those years. For Messrs. Schwimmer and 2017.Frankel, amounts shown for 2021 reflect the portion of each such NEO’s short-term incentive bonus (equal to 50% of each such NEO’s short-term incentive bonus, or $937,500 for 2021) that was paid in cash.
(2)Amounts shown in the “All Other Compensation” column for 2021 reflect medical insurance premiums paid by or reimbursed to each NEO by the Company for the direct or indirect benefit of the NEO that are not generally available to all other employees of the Company. |
| | | | | | | | | | | | | | | | | | | | |
Name and Principal Position | | Year | | Salary ($)(1) | | Bonus ($) | | Stock Awards ($) | | Non-Equity Incentive Plan Compensation ($)(2) | | All Other Compensation ($)(3) | | Total($) |
Howard Schwimmer Co-Chief Executive Officer | | 2019 | | 594,000 |
| | — |
| | 5,105,682 |
| (4)(5) | 297,000 |
| | 15,469 |
| | 6,012,151 |
|
| | 2018 | | 550,000 |
| | 17,738 |
| | 3,817,960 |
| | 257,262 |
| | 15,469 |
| | 4,658,429 |
|
| | 2017 | | 550,000 |
| | — |
| | 2,348,828 |
| | 825,000 |
| | 29,475 |
| | 3,753,303 |
|
Michael S. Frankel Co-Chief Executive Officer | | 2019 | | 594,000 |
| | — |
| | 5,105,682 |
| (4)(5) | 297,000 |
| | 15,469 |
| | 6,012,151 |
|
| | 2018 | | 550,000 |
| | 17,738 |
| | 3,817,960 |
| | 257,262 |
| | 15,469 |
| | 4,658,429 |
|
| | 2017 | | 550,000 |
| | — |
| | 2,348,828 |
| | 825,000 |
| | 13,149 |
| | 3,736,977 |
|
Adeel Khan Chief Financial Officer | | 2019 | | 378,000 |
| | — |
| | 1,755,897 |
| (4) | 661,500 |
| | 15,469 |
| | 2,810,866 |
|
| | 2018 | | 350,000 |
| | 5,644 |
| | 1,305,058 |
| | 519,356 |
| | 15,469 |
| | 2,195,527 |
|
| | 2017 | | 350,000 |
| | — |
| | 1,052,756 |
| | 525,000 |
| | 13,149 |
| | 1,940,905 |
|
David Lanzer General Counsel and Secretary | | 2019 | | 340,000 |
| | — |
| | 848,670 |
| (4) | 408,000 |
| | 15,469 |
| | 1,612,139 |
|
| | 2018 | | 325,000 |
| | 6,289 |
| | 646,185 |
| | 383,711 |
| | 15,469 |
| | 1,376,654 |
|
| | 2017 | | 300,000 |
| | — |
| | 726,402 |
| | 270,000 |
| | 13,149 |
| | 1,309,551 |
|
_____________
| |
(1) | Amounts shown in the “Salary” column reflect the base salary earned by each NEO during the applicable year. |
| |
(2) | Amounts shown in the “Non-Equity Incentive Plan Compensation” column reflect annual bonus awards earned for performance in 2019, 2018 and 2017 under the applicable annual bonus programs in place for those years. For Messrs. Schwimmer and Frankel, amounts shown for 2019 reflect the portion of each such NEO’s annual Bonus (equal to 25% of each such NEO’s annual bonus, or $297,000 for 2019) that was payable in cash. |
| |
(3) | Amounts shown in the “All Other Compensation” column reflect medical insurance premiums paid by or reimbursed to each NEO by the Company during 2019, 2018 and 2017, respectively, for the direct or indirect benefit of the NEO that are not generally available to all other employees of the Company. |
| |
(4) | Amounts shown in the “Stock Awards” column for 2019(3)Amounts shown in the “Stock Awards” column for 2021 include for all NEOs, the full grant-date fair value of Service-Vesting LTIP Units, and Performance-Vesting LTIP Units computed in accordance with ASC Topic 718, rather than the amounts paid to or realized by the named individual. We provide detailed information regarding the assumptions used to calculate the value of Service-Vesting LTIP Units and Performance-Vesting LTIP Units made to executive officers in Note 13 to our consolidated financial statements contained in our Annual Report on Form 10-K filed February 19, 2020. There can be no assurance that awards will vest (in which case no value will be realized by the individual). The |
Performance-Vesting LTIP UnitUnits and restricted stock awards computed in accordance with ASC Topic 718, rather than the amounts paid to or realized by the NEO. We provide detailed information regarding the assumptions used to calculate the value of Service-Vesting LTIP Units and Performance-Vesting LTIP Units made to executive officers in Note 13 to our consolidated financial statements contained in our Annual Report on Form 10-K filed February 17, 2022. There can be no assurance that awards will vest (and if awards do not vest, no value will be realized by the individual). The Performance-Vesting LTIP Units that are based on the Company’s absolute TSR and the Company’s TSR performance relative to a peer group are treated as market condition sharesawards as defined under ASC Topic 718, and as a result, they did not have a maximum value on the grant date values will not differthat differed from the grant date fair values.values presented in the table. Instead, the maximum value is factored into the calculation of the grant date fair value using a Monte-Carlo simulation pricing model. The Performance-Vesting LTIP Units based on the Company’s growth in Core FFO per diluted share are treated as performance condition awards as defined under ASC Topic 718, and the grant date fair value was measured based on the closing price of our common stock on the grant date ($77.50) and the achievement of FFO per-share performance at the target level (the most probable outcome as of the grant date), which was equal to $1,191,666 for Mr. Schwimmer, $1,191,666 for Mr. Frankel, $338,339 for Ms. Clark and $219,997 for Mr. Lanzer. The maximum value for the Performance-Vesting LTIP Units based on the Company’s growth in Core FFO per diluted share is equal to $3,574,998 for Mr. Schwimmer, $3,574,998 for Mr. Frankel, $1,015,018 for Ms. Clark and $659,990 for Mr. Lanzer, which is calculated by multiplying the closing price of our common stock on the grant date ($77.50) by the number of Core FFO Per-Share Base Units that would be earned upon the achievement of FFO per-share performance at the maximum level.
(4)Amounts shown in the “Stock Awards” column for 2021 include, for Messrs. Schwimmer and Frankel, the grant date fair value of the portion of each such NEO’s short-term incentive bonus (equal to 50% of each such NEO’s short-term incentive bonus) that was settled in fully-vested LTIP Units, which was $937,500 for each of Messrs. Schwimmer and Frankel. The grant date fair value of Messrs. Schwimmer and Frankel’s fully-vested LTIP Units was computed in accordance with ASC Topic 718. In early 2022, at the same time that annual bonuses were paid to our NEOs generally, Messrs. Schwimmer and Frankel were each granted 12,824 fully-vested LTIP Units.
| | | | | | | | | | | | | | |
(5) | Amounts shown in the “Stock Awards” column for 2019 include, for Messrs. Schwimmer and Frankel, the grant date fair value of the portion of each such NEO’s annual bonus (equal to 75% of each such NEO’s annual bonus) that was settled in fully-vested LTIP Units, which was $891,000 for each of Messrs. Schwimmer and Frankel. The grant date fair value of Messrs. Schwimmer and Frankel’s fully-vested LTIP Units was computed in accordance with ASC Topic 718. In early 2020, at the same time that annual bonuses were paid to our NEOs generally, Messrs. Schwimmer and Frankel were each granted 18,146 fully-vested LTIP Units. The number of LTIP Units granted was determined by dividing $891,000 by the closing price of our common stock on the date of grant. | | 2022 PROXY STATEMENT | 53 |
EXECUTIVE COMPENSATION MATTERS
GRANTS OF PLAN-BASED AWARDS FOR 2019Grants Of Plan-Based Awards For 2021
The following table sets forth information regarding grants of plan-based awards made to our NEOs during 2019.2021.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | Estimated Future Payouts Under Non-Equity Incentive Plan Awards(1) | | Estimated Future Payouts Under Equity Incentive Plan Awards(2) | | All Other Stock Awards; Number of Units (#) | | | Grant Date Fair Value of Stock Awards ($)(4) |
Name | | Grant Date | | Threshold ($) | | Target ($) | | Maximum ($) | | Threshold (#) | | Target (#) | | Maximum (#) | | | |
Howard Schwimmer | | 12/23/2021 | | — | | | — | | | — | | | — | | | — | | | — | | | 37,741 | | (3) | | 2,696,974 | |
| 12/23/2021 | | — | | | — | | | — | | | 23,065 | | | 46,129 | | | 138,387 | | | — | | | | 4,822,018 | |
| — | | | 562,500 | | | 1,312,500 | | | 1,875,000 | | | — | | | — | | | — | | | — | | | | — | |
Michael S. Frankel | | 12/23/2021 | | — | | | — | | | — | | | — | | | — | | | — | | | 37,741 | | (3) | | 2,696,974 | |
| 12/23/2021 | | — | | | — | | | — | | | 23,065 | | | 46,129 | | | 138,387 | | | — | | | | 4,822,018 | |
| — | | | 562,500 | | | 1,312,500 | | | 1,875,000 | | | — | | | — | | | — | | | — | | | | — | |
Laura Clark | | 12/23/2021 | | — | | | — | | | — | | | — | | | — | | | — | | | 10,645 | | | | 760,690 | |
| 12/23/2021 | | — | | | — | | | — | | | 6,549 | | | 13,097 | | | 39,291 | | | — | | | | 1,369,073 | |
| — | | | 375,000 | | | 625,000 | | | 875,000 | | | — | | | — | | | — | | | — | | | | — | |
David Lanzer | | 12/23/2021 | | — | | | — | | | — | | | — | | | — | | | — | | | 6,903 | | (3) | | 493,290 | |
| 12/23/2021 | | — | | | — | | | — | | | 4,258 | | | 8,516 | | | 25,548 | | | — | | | | 890,206 | |
| — | | | 212,500 | | | 425,000 | | | 743,750 | | | — | | | — | | | — | | | — | | | | — | |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | Estimated Future Payouts Under Non-Equity Incentive Plan Awards(1) | | Estimated Future Payouts Under Equity Incentive Plan Awards(2) | | | | |
Name | | Grant Date | | Threshold ($) | | Target ($) | | Maximum ($) | | Threshold (#) | | Target (#) | | Maximum (#) | | All Other Stock Awards; Number of Units (#) | | Grant Date Fair Value of Stock Awards ($)(5) |
Howard Schwimmer | | 12/16/2019 | | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | 43,725 |
| (3) | 1,871,866 |
|
| | 12/16/2019 | | — |
| | — |
| | — |
| | 27,689 |
| | 55,377 |
| | 110,754 |
| | — |
| | 2,342,816 |
|
| | — | | 74,250 |
| | 222,750 |
| | 297,000 |
| | — |
| | — |
| | — |
| | — |
| | — |
|
| | 4/24/2019 | | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | 18,146 |
| (4) | 891,000 |
|
Michael S. Frankel | | 12/16/2019 | | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | 43,725 |
| (3) | 1,871,866 |
|
| | 12/16/2019 | | — |
| | — |
| | — |
| | 27,689 |
| | 55,377 |
| | 110,754 |
| | — |
| | 2,342,816 |
|
| | — | | 74,250 |
| | 222,750 |
| | 297,000 |
| | — |
| | — |
| | — |
| | — |
| | — |
|
| | 4/24/2019 | | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | 18,146 |
| (4) | 891,000 |
|
Adeel Khan | | 12/16/2019 | | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | 21,862 |
| (3) | 935,909 |
|
| | 12/16/2019 | | — |
| | — |
| | — |
| | 9,691 |
| | 19,382 |
| | 38,764 |
| | — |
| | 819,988 |
|
| | — | | 189,000 |
| | 472,500 |
| | 661,500 |
| | — |
| | — |
| | — |
| | — |
| | — |
|
David Lanzer | | 12/16/2019 | | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | 10,931 |
| (3) | 467,954 |
|
| | 12/16/2019 | | — |
| | — |
| | — |
| | 4,500 |
| | 8,999 |
| | 17,998 |
| | — |
| | 380,716 |
|
| | — | | 136,000 |
| | 306,000 |
| | 408,000 |
| | — |
| | — |
| | — |
| | — |
| | — |
|
(1)Represents threshold, target and maximum short-term incentive bonus opportunities for performance in 2021. Messrs. Schwimmer and Frankel’s 2021 annual bonuses were delivered in a combination of cash and LTIP units, with 50% of each such NEO’s annual bonus delivered in cash and 50% of each such NEO’s annual bonus delivered in LTIP Units. For more information on the annual bonuses paid see “Compensation Discussion and Analysis—Elements of Our Compensation—Long-Term Compensation”. | |
(1) | Represents threshold, target and maximum annual cash bonus opportunities for performance in 2019. |
| |
(2) | (2)Represents awards of Performance-Vesting LTIP Units in our operating partnership. The amounts in the threshold, target, high and maximum columns correspond to the number of base Performance-Vesting LTIP Units that would be earned in the event that specified threshold, target, high and maximum goals, respectively, are achieved. These amounts exclude distribution equivalent units which are eligible to vest upon the conclusion of the applicable performance period based on the number of Performance-Vesting LTIP Units in our operating partnership. The amounts in the threshold, target and maximum columns correspond to the number of base Performance-Vesting LTIP Units that would be earned in the event that specified threshold, target and maximum goals, respectively, are achieved. These amounts exclude distribution equivalent units which are eligible to vest upon the conclusion of the applicable performance period based on the number of Performance-Vesting LTIP Units |
actually earned. For more information on these performance unit awards, see “Compensation Discussion and Analysis—Elements of Compensation-Long-Term Incentives”Our Compensation—Long-Term Compensation”.
(3)Represents awards of Service-Vesting LTIP Units in our operating partnership. For more information on these Service-Vesting LTIP Unit awards, see “Compensation Discussion and Analysis—Elements of Our Compensation—Long-Term Compensation”.
(4)Amounts for 2021 reflect the full grant-date fair value of Service-Vesting LTIP Units and Performance-Vesting LTIP Units granted in 2021, in each case, computed in accordance with ASC Topic 718, rather than the amounts paid to or realized by the named individual. We provide detailed information regarding the assumptions used to calculate the value of Service-Vesting LTIP Units and Performance-Vesting LTIP Units granted to executive officers in Note 13 to our consolidated financial statements contained in our Annual Report on Form 10-K filed February 17, 2022. With respect to any such awards that are subject to vesting, there can be no assurance that awards will vest (and if awards do not vest, no value will be realized by the individual).
| | | | | | | | | | | | | | |
(3)54 | Represents awards of Service-Vesting LTIP Units in our operating partnership. For more information on these Service-Vesting LTIP Unit awards, see “Compensation Discussion and Analysis—Elements of Compensation—Long-Term Incentives”.REXFORD INDUSTRIAL |
| | |
(4) | Represents the portion of Messrs. Schwimmer and Frankel’s annual bonus (equal to 75% of each such NEO’s annual bonus) that was paid in LTIP Units. |
| |
(5) | Amounts for 2019 reflect the full grant-date fair value of fully-vested LTIP Units (granted to Messrs. Schwimmer and Frankel only), Service-Vesting LTIP Units and Performance-Vesting LTIP Units granted in 2019 computed in accordance with ASC Topic 718, rather than the amounts paid to or realized by the named individual. We provide detailed information regarding the assumptions used to calculate the value of Service-Vesting LTIP Units and Performance-Vesting LTIP Units granted to executive officers in Note 13 to our consolidated financial statements contained in our Annual Report on Form 10-K filed February 19, 2020. With respect to any such awards that are subject to vesting, there can be no assurance that awards will vest (in which case no value will be realized by the individual). |
EXECUTIVE COMPENSATION MATTERS
Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table
Executive Compensation Arrangements
Below are summariesWe have entered into employment agreements with each of the key terms of the employmentour NEOs which provide for base salaries and letter agreements applicableshort-term cash incentive award targets, as reflected above, and with respect to Messrs. Schwimmer and Frankel, annual equity awards determined by our NEOs.Compensation Committee in its sole discretion. The employment agreements for Messrs. Schwimmer, Frankel and Khanour NEOs also provide for certain severance and change-in-control payments and benefits, as described below under “Potential Payments upon Termination or Change in Control.”
Howard Schwimmer and Michael Frankel
In July 2013, we entered into The employment agreements with Messrs. Schwimmer and Frankel which became effective uponautomatically renew annually, unless earlier terminated, and provide that the completion of our IPO. The following isCompany will nominate them for election as a summarydirector each year of the materialemployment term. The terms of the agreements.
Under the employment agreements, Messrs. Schwimmer and Frankel each serve as a Co-Chief Executive Officer of our Company and report directly to our Board. The initial term of the employment agreements endedwith Ms. Clark and Mr. Lanzer expire on the fourth anniversary of the completion of our IPO, or July 24, 2017. On that date the employment agreements automatically renewed,September 1, 2023 and on each subsequent one-year anniversary of such date, the term of the employment agreements will automatically be extended, in each case, for one year, unless earlier terminated. Pursuant to the employment agreements, during the terms of Messrs. Schwimmer’s and Frankel’s employment, we will nominate each for election as a director.June 26, 2023, respectively.
Under the employment agreements, Messrs. Schwimmer and Frankel each received initial annual base salaries of $495,000, which are subject to increase at the discretion of our Compensation Committee. In addition, each of Messrs. Schwimmer and Frankel is eligible to receive an annual discretionary cash performance bonus targeted at 100% of the executive’s then-current annual base salary. The actual amount of any such bonuses is determined by reference to the attainment of applicable company and/or individual performance objectives, as determined by our Compensation Committee.In connection with entering into the employment agreements and as described below, Messrs. Schwimmer and Frankel were each granted an award of 285,715 shares of our restricted common stock (of which 281,395 shares
EXECUTIVE COMPENSATION MATTERS
subject to each award were cancelled as ofOutstanding Equity Awards At December 31, 2013 in connection with the Accommodation, as defined and further described in our Annual Report on Form 10-K filed on February 25, 2016). These restricted stock awards vested in four equal, annual installments on each of the first four anniversaries of the date of grant, subject to each executive’s continued service through the applicable vesting date. In addition, beginning in calendar year 2014 and for each calendar year thereafter, Messrs. Schwimmer and Frankel are and have been eligible to receive annual equity awards, as determined by our Compensation Committee in its sole discretion. Messrs. Schwimmer and Frankel are also eligible to participate in customary health, welfare and fringe benefit plans, and, subject to certain restrictions, healthcare benefits will be provided to them and their eligible dependents at the Company’s sole expense. Each of Messrs. Schwimmer and Frankel accrues four weeks of paid vacation per year.
On June 26, 2017, the Company, the Operating Partnership and each of Messrs. Frankel and Schwimmer entered into an amendment to their respective employment agreements.
The amendments update Mr. Frankel’s and Mr. Schwimmer’s employment agreements to, among other things, (i) reflect updates to the executives’ base salaries (as have been adjusted since the executives’ respective employment agreements were originally executed) and (ii) to provide that, if Mr. Frankel’s or Mr. Schwimmer’s employment is terminated by reason of the executive’s death or disability, the applicable executive (or his estate) will be entitled to a pro rata portion of the executive’s annual bonus for the partial fiscal year in which the termination date occurs, determined based on actual performance (in addition to any accrued amounts and the executives’ current entitlement to accelerated vesting of outstanding equity awards that vest based solely on providing continued services to the Company). The termination provisions of the amended employment agreements for Mr. Frankel and Mr. Schwimmer are detailed below in “Potential Payments Upon Termination or Change in Control.”
Adeel Khan
In November 2014, we entered into an employment agreement with Mr. Khan. The following is a summary of the material terms of the agreement.
Under his employment agreement, Mr. Khan serves as Chief Financial Officer of our Company and reports directly to the Co-Chief Executive Officers of our Company or their designee, subject to the Resignation Letter described below. The initial term of the employment agreement ended on the third anniversary of the effective date (November 25, 2017).
Under his employment agreement, Mr. Khan initially received an annual base salary of $315,000, which is subject to annual review and increase at the discretion of our Compensation Committee. In addition, Mr. Khan is eligible under his employment agreement to receive an annual discretionary cash performance bonus targeted at 80% of Mr. Khan’s base salary actually paid for such year. The actual amount of any such bonus is determined by reference to the attainment of applicable Company and/or individual performance objectives, as determined by our Compensation Committee, and may be greater or less than the target amount, or zero.
Mr. Khan is eligible to participate in customary health, welfare and fringe benefit plans, and, subject to certain restrictions, healthcare benefits will be provided to him and his eligible dependents at our sole expense. Mr. Khan accrues four weeks of paid vacation per year.
On June 26, 2017, the Company, the Operating Partnership and Mr. Khan entered into an amendment to his employment agreement.
The amendment updates Mr. Khan’s employment agreement to, among other things, (i) extend the term of Mr. Khan’s employment agreement through November 25, 2020, (ii) update Mr. Khan’s base salary (as has been adjusted since the Mr. Khan’s employment agreement was originally executed), (iii) reflect Mr. Khan’s target annual bonus level, and (iv) to provide that, if Mr. Khan’s employment is terminated by reason of death or disability, he (or his estate) will be entitled to a pro rata portion of his annual bonus for the partial fiscal year in which the termination date occurs (in addition to any accrued amounts and Mr. Khan’s current entitlement to accelerated vesting of outstanding equity awards that vest based solely on continued services to the Company). The termination provisions of the amended employment agreements for Mr. Khan are detailed below in “Potential Payments Upon Termination or Change in Control.”
On January 15, 2020, Mr. Khan notified the Company of his intent to step down as our Chief Financial Officer (“CFO”). Subject to the terms of the Resignation Letter (defined below), Mr. Khan will continue to serve as CFO and assist in the transition of the CFO role to a successor during a transition period, as described below.
In connection with Mr. Khan’s resignation and the transition and onboarding of a replacement CFO, Mr. Khan and the Company entered into a Letter of Resignation, dated January 15, 2020 (the “Resignation Letter”), pursuant to which Mr. Khan will use good faith, best efforts to continue to serve as CFO and, if a replacement CFO is found within a set timeframe, assist with the transition of the CFO duties to such replacement CFO during a transition period ending upon the earliest to occur of (i) the 90th day following the start date of a new CFO, and (ii) January 15, 2021 (the “Transition Period”). During the Transition Period, provided that Mr. Khan does not resign and is not terminated for Cause (as defined in his employment agreement) prior to the expiration of the Transition Period, Mr. Khan shall receive: (a) regular payments of his base salary at the existing base salary of $425,000, which shall be paid for a period of not less than 6 months from January 15, 2020 irrespective of the date of hire and transition of a new CFO; (b) all of the health, welfare and retirement benefits currently in effect for Mr. Khan and his eligible dependents and following the expiration of the Transition Period, if Mr. Khan is no longer then employed by the Company, for a period extending for 12 months from the expiration of the Transition Period in the form of Company-paid COBRA; (c) subject to Mr. Khan’s timely execution and non-revocation of a release, a prorated 2020 cash bonus based on actual attainment of the performance goals set forth in the 2020 NEO bonus criteria and leverage percentages established by the Compensation Committee, which cash bonus (if earned) shall be paid in 2021 when the other 2020 bonuses are paid to NEOs, prorated for the period of January 1, 2020 through the employment start date of the replacement CFO; and (d) continued vesting of the outstanding and unvested LTIP Units granted to Mr. Khan pursuant to his existing time-based and performance based LTIP Unit agreements in accordance with the terms of such agreements.
David Lanzer
On June 26, 2017, the Company and the Operating Partnership entered into an employment agreement with Mr. Lanzer. The following is a summary of the material terms of the employment agreement.
Under his employment agreement, Mr. Lanzer initially received an annual base salary of $300,000, which is subject to annual review and increase at the discretion of our Compensation Committee. In addition, Mr. Lanzer is eligible to receive an annual cash performance bonus opportunity targeted at 60% of Mr. Lanzer’s annual base salary. The actual amount of any such bonus will be determined by reference to the attainment of applicable Company and/or individual performance objectives, as determined by the Compensation Committee, and may be greater or less than the target amount, or zero.
Mr. Lanzer is eligible to participate in customary health, welfare and fringe benefit plans, and, subject to certain restrictions, healthcare benefits will be provided to him and his eligible dependents at our sole expense. Mr. Lanzer will accrue four weeks of paid vacation per year. The termination provisions of the Mr. Lanzer’s employment agreement are detailed below in “Potential Payments Upon Termination or Change in Control.”
OUTSTANDING EQUITY AWARDS AT DECEMBER 31, 2019
The following table summarizes the number of shares of common stock underlying outstanding equity incentive plan awards for each NEO as of December 31, 2019.2021.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Name | | Grant Date(1) | | Number of Shares or Stock Units that Have Not Vested (#) | | Market Value of Shares of Stock or Units that Have Not Vested ($)(2) | | Equity Incentive Plan Awards; Number of Unearned Units That Have Not Vested (#) | | Equity Incentive Plan Awards; Market or Payout Value of Unearned Units That Have Not Vested ($)(3) |
Howard Schwimmer | | 12/16/2019 | | 14,575 | | (4) | | 1,182,178 | | | — | | | | — | |
| 12/16/2019 | | — | | | | — | | | 110,754 | | (5) | | 8,983,257 | |
| 12/22/2020 | | 33,578 | | (6) | | 2,723,512 | | | — | | | | — | |
| 12/22/2020 | | — | | | | — | | | 184,682 | | (7) | | 14,979,557 | |
| 12/23/2021 | | 37,741 | | (8) | | 3,061,173 | | | — | | | | — | |
| 12/23/2021 | | — | | | | — | | | 123,011 | | (9) | | 9,977,422 | |
Michael S. Frankel | | 12/16/2019 | | 14,575 | | (4) | | 1,182,178 | | | — | | | | — | |
| 12/16/2019 | | — | | | | — | | | 110,754 | | (5) | | 8,983,257 | |
| 12/22/2020 | | 33,578 | | (6) | | 2,723,512 | | | — | | | | — | |
| 12/22/2020 | | — | | | | — | | | 184,682 | | (7) | | 14,979,557 | |
| 12/23/2021 | | 37,741 | | (8) | | 3,061,173 | | | — | | | | — | |
| 12/23/2021 | | — | | | | — | | | 123,011 | | (9) | | 9,977,422 | |
Laura Clark | | 9/1/2020 | | 2,331 | | (10) | | 189,067 | | | — | | | | — | |
| 12/22/2020 | | 7,410 | | (8) | | 601,025 | | | — | | | | — | |
| 12/22/2020 | | — | | | | — | | | 40,758 | | (9) | | 3,305,881 | |
| 12/23/2021 | | 10,645 | | | | 863,416 | | | — | | | | — | |
| 12/23/2021 | | — | | | | — | | | 34,925 | | | | 2,832,767 | |
David Lanzer | | 12/16/2019 | | 3,643 | | (4) | | 295,484 | | | — | | | | — | |
| 12/16/2019 | | — | | | | — | | | 17,998 | | (5) | | 1,459,818 | |
| 12/22/2020 | | 6,175 | | (6) | | 500,854 | | | — | | | | — | |
| 12/22/2020 | | — | | | | — | | | 33,965 | | (7) | | 2,754,901 | |
| 12/23/2021 | | 6,903 | | (8) | | 559,902 | | | — | | | | — | |
| 12/23/2021 | | — | | | | — | | | 22,709 | | (9) | | 1,841,927 | |
(1)In addition to the vesting schedules described below, each equity award may be subject to accelerated vesting in certain circumstances, as described in “Potential Payments upon Termination or Change in Control” below.
(2)The market value of shares of restricted stock and Service-Vesting LTIP Units that have not vested is calculated by multiplying the fair market value of a share of our common stock on December 31, 2021 ($81.11) by the number of unvested shares of restricted stock or unvested Service-Vesting LTIP Units outstanding under the applicable award.
(3)The market value of unearned Performance-Vesting LTIP Units is calculated by multiplying the fair market value of a share of our common stock on December 31, 2021 ($81.11) by the number of unearned units disclosed in accordance with SEC rules in footnotes 5, 7 and 9.
(4)One-third of each Service-Vesting LTIP Unit award vests on each of the first, second and third anniversaries of the date of grant, subject to the executive’s continued employment with us through the applicable vesting date. The unvested portions of these awards are scheduled to vest in one remaining installment on December 16, 2022.
(5)Represents the number of Performance-Vesting LTIP Units, excluding distribution equivalent units, that would become earned and vested at the end of the performance period, assuming that the Company’s absolute TSR performance, relative TSR performance and Core FFO Per-Share is achieved at the maximum level for the three-year performance period from January 1, 2020 through December 31, 2022.
(6)One-third of each Service-Vesting LTIP Unit award vests on each of the first, second and third anniversaries of the date of grant, subject to the executive’s continued employment with us through the applicable vesting date. The unvested portions of these awards are scheduled to vest in two remaining installments on December 22, 2022, and December 22, 2023.
|
| | | | | | | | | | | | | | |
Name | | Grant Date(1) | | Number of Shares or Stock Units that Have Not Vested (#) | | Market Value of Shares of Stock or Units that Have Not Vested ($)(2) | | Equity Incentive Plan Awards; Number of Unearned Units That Have Not Vested (#) | | Equity Incentive Plan Awards; Market or Payout Value of Unearned Units That Have Not Vested ($)(3) |
Howard Schwimmer | | 12/29/2016 | | 11,009 |
| (4) | 502,781 |
| | — |
| | — |
|
| | 12/15/2017 | | 14,715 |
| (5) | 672,034 |
| | — |
| | — |
|
| | 12/15/2017 | | — |
| | — |
| | 68,750 |
| (6) | 3,139,813 |
|
| | 12/15/2018 | | 31,826 |
| (7) | 1,453,493 |
| | — |
| | — |
|
| | 12/15/2018 | | — |
| | — |
| | 56,250 |
| (8) | 2,568,938 |
|
| | 12/16/2019 | | 43,725 |
| (9) | 1,996,921 |
| | — |
| | — |
|
| | 12/16/2019 | | — |
| | — |
| | 27,689 |
| (10) | 1,264,557 |
|
Michael S. Frankel | | 12/29/2016 | | 11,009 |
| (4) | 502,781 |
| | — |
| | — |
|
| | 12/15/2017 | | 14,715 |
| (5) | 672,034 |
| | — |
| | — |
|
| | 12/15/2017 | | — |
| | — |
| | 68,750 |
| (6) | 3,139,813 |
|
| | 12/15/2018 | | 31,826 |
| (7) | 1,453,493 |
| | — |
| | — |
|
| | 12/15/2018 | | — |
| | — |
| | 56,250 |
| (8) | 2,568,938 |
|
| | 12/16/2019 | | 43,725 |
| (9) | 1,996,921 |
| | — |
| | — |
|
| | 12/16/2019 | | — |
| | — |
| | 27,689 |
| (10) | 1,264,557 |
|
Adeel Khan | | 12/29/2016 | | 7,156 |
| (4) | 326,815 |
| | — |
| | — |
|
| | 12/15/2017 | | 7,630 |
| (5) | 348,462 |
| | — |
| | — |
|
| | 12/15/2017 | | — |
| | — |
| | 25,000 |
| (6) | 1,141,750 |
|
| | 12/15/2018 | | 16,443 |
| (7) | 750,952 |
| | — |
| | — |
|
| | 12/15/2018 | | — |
| | — |
| | 20,626 |
| (8) | 941,989 |
|
| | 12/16/2019 | | 21,862 |
| (9) | 998,438 |
| | — |
| | — |
|
| | 12/16/2019 | | — |
| | — |
| | 9,691 |
| (10) | 442,588 |
|
David Lanzer | | 4/2/2016 | | 1,374 |
| (11) | 62,751 |
| | — |
| | — |
|
| | 3/1/2017 | | 4,340 |
| (12) | 198,208 |
| | — |
| | — |
|
| | 12/15/2017 | | 3,815 |
| (5) | 174,231 |
| | — |
| | — |
|
| | 12/15/2017 | | — |
| | — |
| | 12,500 |
| (6) | 570,875 |
|
| | 12/15/2018 | | 8,486 |
| (7) | 387,556 |
| | — |
| | — |
|
| | 12/15/2018 | | — |
| | — |
| | 9,688 |
| (8) | 442,451 |
|
| | 12/16/2019 | | 10,931 |
| (9) | 499,219 |
| | — |
| | — |
|
| | 12/16/2019 | | — |
| | — |
| | 4,500 |
| (10) | 205,515 |
|
____________
| | | | | | | | | | | | | | |
(1)56 | In addition to the vesting schedules described below, each equity award may be subject to accelerated vesting in certain circumstances, as described in “Potential Payments upon Termination or Change in Control” below.REXFORD INDUSTRIAL |
| | |
(2) | The market value of shares of restricted stock and Service-Vesting LTIP Units that have not vested is calculated by multiplying the fair market value of a share of our common stock on December 31, 2019 ($45.67) by the number of unvested shares of restricted stock or unvested Service- or Performance-Vesting LTIP Units outstanding under the applicable award. |
| |
(3) | The market value of unearned Performance-Vesting LTIP Units is calculated by multiplying the fair market value of a share of our common stock on December 31, 2019 ($45.67) by the number of unearned shares disclosed in accordance with SEC rules and footnotes 6, 8 and 10. |
| |
(4) | Each Service-Vesting LTIP Unit award vests as to 25% of the number of Service-Vesting LTIP Units subject to the award on each of the first, second, third and fourth anniversaries of the date of grant, subject to the executive’s continued employment with us through the applicable vesting date. The unvested portions of these awards are scheduled to vest in one remaining installment on December 29, 2020. |
| |
(5) | Each Service-Vesting LTIP Unit award vests as to one-third of the number of Service-Vesting LTIP Units subject to the award on each of the first, second and third anniversaries of the date of grant, subject to the executive’s continued employment with us through the applicable vesting date. The unvested portions of these awards are scheduled to vest in one remaining installment on December 15, 2020. |
| |
(6) | Represents the number of Performance-Vesting LTIP Units, excluding distribution equivalent units, that would become earned and vested at the end of the performance period, assuming that the Company’s absolute TSR performance and relative TSR performance is achieved at the maximum level for the three-year performance period from December 15, 2017 through December 14, 2020. |
| |
(7) | Each Service-Vesting LTIP Unit award vests as to one-third of the number of Service-Vesting LTIP Units subject to the award on each of the first, second and third anniversaries of the date of grant, subject to the executive’s continued employment with us through the applicable vesting date. The unvested portions of these awards are scheduled to vest in two remaining installments on December 15, 2020, and December 15, 2021. |
| |
(8) | Represents the number of Performance-Vesting LTIP Units, excluding distribution equivalent units, that would become earned and vested at the end of the performance period, assuming that the Company’s absolute TSR performance and relative TSR performance is achieved at the maximum level and Core FFO Per-Share is achieved at the threshold level for the three-year performance period from January 1, 2019 through December 31, 2021. |
| |
(9) | Each Service-Vesting LTIP Unit award vests as to one-third of the number of Service-Vesting LTIP Units subject to the award on each of the first, second and third anniversaries of the date of grant, subject to the executive’s continued employment with us through the applicable vesting date. The unvested portions of these awards are scheduled to vest in three remaining installments on December 16, 2020, December 16, 2021, and December 16, 2022. |
| |
(10) | Represents the number of Performance-Vesting LTIP Units, excluding distribution equivalent units, that would become earned and vested at the end of the performance period, assuming that the Company’s absolute TSR performance, relative TSR performance and Core FFO Per-Share is achieved at the threshold level for the three-year performance period from January 1, 2020 through December 31, 2022. |
EXECUTIVE COMPENSATION MATTERS
| |
(11) | This restricted stock award vests as to 25% of the number of shares subject to the award on each of the first, second, third and fourth anniversaries on the date of grant, subject to the executive’s continued service with us through the applicable vesting date. The unvested portion of this award subsequently vested on April 2, 2020. |
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(12) | This restricted stock award vests as to 25% of the number of shares subject to the award on each of the first, second, third and fourth anniversaries on the date of grant, subject to Mr. Lanzer’s continued service with us through the applicable vesting date. The unvested portion of this award is scheduled to vest in one remaining installment on March 1, 2021. |
OPTION EXERCISES AND STOCK VESTED DURING 2019(7)Represents the number of Performance-Vesting LTIP Units, excluding distribution equivalent units, that would become earned and vested at the end of the performance period, assuming that the Company’s absolute TSR performance and relative TSR performance is achieved at the maximum level for the three-year performance period from December 22, 2020 through December 21, 2023, and Core FFO Per-Share is achieved at the maximum level for the three-year performance period from January 1, 2021 through December 31, 2023.
(8)One-third of each Service-Vesting LTIP Unit award vests on each of the first, second and third anniversaries of the date of grant, subject to the executive’s continued employment with us through the applicable vesting date. The unvested portions of these awards are scheduled to vest in three remaining installments on December 23, 2022, December 23, 2023 and December 23, 2024.
(9)Represents the number of Performance-Vesting LTIP Units, excluding distribution equivalent units, that would become earned and vested at the end of the performance period, assuming that the Company’s absolute TSR performance is achieved at the maximum level and relative TSR performance is achieved at the high level for the three-year performance period from December 23, 2021 through December 22, 2024, and Core FFO Per-Share is achieved at the maximum level for the three-year performance period from January 1, 2022 through December 31, 2024.
(10)One-third of this restricted stock award vests on each of the first, second and third anniversaries on the date of grant, subject to Ms. Clark’s continued service with us through the applicable vesting date. The unvested portions of this award is scheduled to vest in two remaining installments on September 1, 2022, and September 1, 2023.
Option Exercises And Stock Vested During 2021
The following table summarizes vesting of restricted stock awards and LTIP Units applicable to our NEOs during the year ended December 31, 2019.2021. None of our NEOs held any options during 2019.2021.
| | | | | | | | | | | | | | |
| | Stock Awards |
Name | | Number of Shares Acquired on Vesting (#) | | Value Realized on Vesting ($)(1) |
Howard Schwimmer | | 141,016 | | | 10,772,303 | |
Michael S. Frankel | | 141,016 | | | 10,772,303 | |
Laura Clark | | 4,871 | | | 363,720 | |
David Lanzer | | 26,656 | | | 2,046,281 | |
(1)Amounts represent the market value as of the vesting date of the awards, based on the closing price for our common stock on the date of vesting of restricted stock, Service-Vesting LTIP Units or Performance-Vesting LTIP Units.
|
| | | | | | |
| | Stock Awards |
Name | | Number of Shares Acquired on Vesting (#) | | Value Realized on Vesting ($)(1) |
Howard Schwimmer | | 165,144 |
| | 7,253,048 |
|
Michael S. Frankel | | 165,144 |
| | 7,253,048 |
|
Adeel Khan | | 62,572 |
| | 2,845,305 |
|
David Lanzer | | 11,603 |
| | 490,019 |
|
| |
(1) | Amounts represent the market value as of the vesting date of the awards, based on the closing price for our common stock on the date of vesting of restricted stock, Service-Vesting LTIP Units or Performance-Vesting LTIP Units. |
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROLPotential Payments Upon Termination Or Change In Control
Employment Agreements
Pursuant to the terms of the amended employment agreements for Messrs. Schwimmer and Frankel, if Mr. Schwimmer’s or Mr. Frankel’s employment is terminated by our Company without “cause,” by the executive for “good reason” (each, as defined in the applicable employment agreement) or because our Company elects not to renew the term of the employment agreement then, in addition to any accrued amounts, the executive will be entitled to receive the following, subject to the execution and non-revocation of an effective general release of claims in favor of the Company:
A•a lump-sum payment in an amount equal to three times the sum of (i) the executive’s annual base salary then in effect, (ii) the average annualshort-term incentive bonus earned by the executive for the three prior fiscal years and (iii) the average value of any annual equity awards(s) made to the executive during the prior three fiscal years (excluding the initial grant of restricted stock granted pursuant to the employment agreements, any award(s) granted pursuant to a multi-year, outperformance or long-term performance program and any other non-recurring awards);
•a lump-sum payment in an amount equal to (i) any annualshort-term incentive bonus relating to the year immediately preceding the year in which the termination date occurs that remains unpaid on the termination date (if any), and (ii) a pro rata portion of the executive’s target bonus for the partial fiscal year in
which the termination date occurs, payable in a lump sum on the date on which annualshort-term incentive bonuses are paid to our Company’s senior executives generally for such year;
other than with respect to the Performance-Vesting LTIP Units (discussed below), •accelerated vesting of all outstanding equity awards that vest solely on the passage of time held by the executive as of the termination date;date (excluding, for clarity, Performance-Vesting LTIP Units); and
•company-paid continuation healthcare coverage for 18 months after the termination date.
EXECUTIVE COMPENSATION MATTERS
Upon a termination of employment by reason of death or disability, Messrs. Schwimmer and Frankel or their respective estates will be entitled to accelerated vesting of all outstanding equity awards held by the executive as of the termination date other than the Performance-Vesting LTIP Units (discussed below) and a pro rata portion of the executive’s annualshort-term incentive bonus for the partial fiscal year in which the termination date occurs, determined based on actual performance, payable in a lump sum on the date on which annualshort-term incentive bonuses are paid to our Company’s senior executives generally for such year, in addition to any accrued amounts. In addition, upon a change in control of our Company (as defined in the Incentive Award Plan), Messrs. Schwimmer and Frankel will be entitled to accelerated vesting of all outstanding equity awards held by such executive, other than the Performance-Vesting LTIP Units (discussed below), as of the date of the change in control.
Pursuant to the terms of the amended employment agreement for Mr. Khan and the employment agreementagreements for Mr. Lanzer and Ms. Clark, if Mr. Khan’s or Mr. Lanzer’sthe executive’s employment is terminated by our Company without “cause” or by Mr. Khan or Mr. Lanzerthe executive for “good reason” (each, as defined in the applicable employment agreement) then, in addition to any accrued amounts, Mr. Khan oreach of Mr. Lanzer and Ms. Clark, as applicable, will be entitled to receive the following, subject to the execution and non-revocation of an effective general release of claims in favor of the Company:
•a lump-sum payment in an amount equal to the executive’s annual base salary then in effect;
•a pro rata portion of the executive’s annualshort-term incentive bonus for the partial fiscal year in which the termination date occurs, determined based on actual performance, payable in a lump sum on the date on which annualshort-term incentive bonuses are paid to our Company’s senior executives generally for such year;
other than with respect to the Performance-Vesting LTIP Units (discussed below), •accelerated vesting of all outstanding equity awards that vest based solely on the passage of time held by the executive as of the termination date; and
•company-paid continuation healthcare coverage for up to 18 months after the termination date.
Upon a termination of employment by reason of death or disability, Mr. Khan oreach of Mr. Lanzer and Ms. Clark or their respective estates, as applicable, will be entitled to accelerated vesting of all outstanding equity awards that vest based solely on the passage of time held by Mr. Khan or Mr. Lanzersuch executive as of the termination date and a pro rata portion of the executive’s annualshort-term incentive bonus for the partial fiscal year in which the termination date occurs, determined based on actual performance, payable in a lump sum on the date on which annualshort-term incentive bonuses are paid to the Company’s senior executives generally for such year, in addition to any accrued amounts. In addition, upon a “change in control” of our Company (as defined in the Incentive Award Plan), Mr. Khan andeach of Mr. Lanzer and Ms. Clark will be entitled to accelerated vesting of all outstanding equity awards held by them, other than the Performance-Vesting LTIP Units (discussed below), as of the date of the change in control.
The employment agreements with Messrs. Schwimmer, Frankel, Khan and Lanzer alsothe named executive officers contain customary confidentiality provisions, which generally prohibit the NEOs from disclosing the Company’s confidential information except in limited circumstances to federal and judicial authorities.provisions. In addition, the employment
agreements with Messrs. Schwimmer and Frankel contain a non-solicitation provision that prohibits them from soliciting, directly or indirectly, any employee, consultant, or any member of the Company and its subsidiaries and affiliates while employed with the Company and for a period of 12 months following their termination. The employment agreements with Messrs. KhanMr. Lanzer and LanzerMs. Clark contain substantially the same non-solicitation provision but cover their employment with the Company and the 18 months following their termination.
In addition, each of Messrs. Schwimmer, Frankel, Khan and Lanzer’sthe employment agreements with our named executive officers provide that, to the extent that any change in control payment or benefit to the applicable executive would be subject to an excise tax imposed in connection with Section 4999 of the Code, such payments and/or benefits may be subject to a “best pay cap” reduction to the extent necessary so that the executive receives the greater of the (i) net amount of the change in control payments and benefits reduced such that such payments and benefits will not be subject to the excise tax and (ii) net amount of the change in control payments and benefits without such reduction. No NEO (or other employee) is entitled to any tax gross-up payment in connection with change in control payments (or otherwise).
Service-Vesting LTIP Units and Performance-Vesting LTIP Units
Termination of EmploymentEmployment.. If Messrs. Schwimmer, Frankel, Khan or Lanzer’sa named executive officer’s employment is terminated by the Company other than for “cause,” by the executive for “good reason,” or due to the executive’s death or “disability” (each as defined in the applicable award agreement) or, in the case of Messrs. Schwimmer or Frankel, upon the Company’s non-renewal of the executive’s employment agreement, in any case, then:
•his or her Service-Vesting LTIP Units will vest in full; and
•his or her Performance-Vesting LTIP Units will remain outstanding and eligible to vest based on the achievement of the performance goals during the performance period.
EXECUTIVE COMPENSATION MATTERS
Change in ControlControl.. In the event of a change in control, Messrs. Schwimmer, Frankel, Khan and Lanzer’sall Service-Vesting LTIP Units held by the named executive officers will vest in full. In addition, if a change in control occurs before the end of a performance period, then:
•If the change in control occurs on or prior to the first anniversary of the grant date of the Performance-Vesting LTIP Units, the number of Performance-Vesting LTIP Units that vest will depend on whether the Company’s absolute TSR is attained at or above the threshold level as of the change in control. If it is not attained at or above the threshold level, then the number of Performance-Vesting LTIP Units that vest will equal the sum of (i) (x) the number of Absolute TSR Base Units which vest based on the achievement of pro-rated absolute TSR performance goals (determined by reference to the shortened performance period through the date of the change in control), plus (y) the number of Relative TSR Base Units which vest based on achievement of the relative TSR performance goals, with such sum pro-rated to reflect the shortened performance period through the change in control date (such number, the “Year 1 CIC base units”), (ii) the target number of Core FFO Per-Share Based Units, plus (iii) the distribution equivalent units (calculated with respect to the Year 1 CIC base units). If the Company’s absolute TSR is attained at or above the threshold level as of the change in control, then the same calculation will apply, except that the number of Absolute TSR Base Units comprising the total vested amount will equal the greater of the number of Absolute TSR Base Units that vest based on the achievement of pro-rated absolute TSR performance goals (determined by reference to the shortened performance period through the date of the change in control) and the number of Absolute TSR Base Units that vest based on the achievement of Company’s absolute TSR (determined by reference to the
shortened performance period through the date of the change in control, without pro-ration). Any Performance-Vesting LTIP Units that vest as described in this paragraph will vest immediately prior to the change in control, subject to the NEO’s continued employment until immediately prior to the change in control (except in the case of an earlier qualifying termination, as discussed above).
•If the change in control occurs following the first anniversary of the grant date of the Performance-Vesting LTIP Units, a number of Performance-Vesting LTIP Units equal to the sum of (i) (x) the number of Absolute TSR Base Units that vest based on the achievement of pro-rated absolute TSR performance goals (determined by reference to the shortened performance period as of the date of the change in control) plus (y) the number of Relative TSR Base Units that vest based on achievement of the relative TSR performance goals (determined by reference to the shortened performance period through the date of the change in control, without pro-ration) (such number of base units, the “Year 2/3 CIC base units”), (ii) the target number of Core FFO Per-Share Base Units, plus (iii) the distribution equivalent units (calculated with respect to the Year 2/3 CIC base units), will vest immediately prior to the change in control, subject to the NEO’s continued employment until immediately prior to the change in control (or an earlier qualifying termination as discussed above).
Elimination of Single-Trigger Accelerated Vesting for Future Executives
In February 2021 the Board implemented a “double trigger” accelerated vesting policy providing that, going forward, no incentive equity awards issued to Company officers, executives or other employees hired after the implementation of the policy will be eligible to receive automatic “single trigger” accelerated vesting upon the occurrence of a change in control of the Company (absent buyer refusal to assume any such incentive equity awards). Instead, all incentive equity awards granted to subsequently-hired officers, executives or other employees will only be eligible to vest on an accelerated basis in connection with a qualifying termination of employment (whether or not in connection with a change in control) and solely to the extent determined by the Compensation Committee. This “double trigger” policy will not modify the terms and conditions applicable to any existing equity awards (including with the current NEOs) and will not apply to any future incentive equity awards issued to officers, executives or other employees who were employed by us prior to adoption of the “double trigger” policy (including the current NEOs).
EXECUTIVE COMPENSATION MATTERS
Summary of Potential Payments Upon Termination or Change in Control
The following table summarizes the payments that would be made to Messrs. Schwimmer and Frankel, KhanMs. Clark and Mr. Lanzer upon the occurrence of certain qualifying terminations of employment or a change in control, in any case, occurring on December 31, 2019.2021. Amounts shown do not include (i) accrued but unpaid base salary through the date of termination, or (ii) other benefits earned or accrued by the NEO during his employment that are available to all salaried employees, such as accrued vacation. For purposes of the table, a “qualifying termination” refers to a termination by the executive for “good reason” or by the Company without “cause” or, with respect to Messrs. Schwimmer and Frankel, a termination due to Company non-renewal of the executive’s employment agreement.
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Name | | Benefit | | Death/ Disability ($) | | Qualifying Termination (no Change in Control) ($) | | Change in Control (no Termination) ($)(1) | | Qualifying Termination in Connection with a Change in Control ($)(1) | |
Howard Schwimmer | | Cash Severance | | 1,875,000 | | | 13,128,625 | | | — | | | 13,128,625 | | |
| Continued Health Benefits | | — | | | 47,648 | | | — | | | 47,648 | | |
| Equity Acceleration | | 43,266,670 | | (2) | 43,266,670 | | (2) | 26,548,578 | | (3) | 26,548,578 | | (4) |
| Total | | 45,141,670 | | | 56,442,943 | | | 26,548,578 | | | 39,724,851 | | |
Michael S. Frankel | | Cash Severance | | 1,875,000 | | | 13,128,625 | | | — | | | 13,128,625 | | |
| Continued Health Benefits | | — | | | 47,648 | | | — | | | 47,648 | | |
| Equity Acceleration | | 43,266,670 | | (2) | 43,266,670 | | (2) | 26,548,578 | | (3) | 26,548,578 | | (4) |
| Total | | 45,141,670 | | | 56,442,943 | | | 26,548,578 | | | 39,724,851 | | |
Laura Clark | | Cash Severance | | 875,000 | | | 1,375,000 | | | — | | | 1,375,000 | | |
| Continued Health Benefits | | — | | | 47,648 | | | — | | | 47,648 | | |
| Equity Acceleration | | 8,238,748 | | (2) | 8,238,748 | | (2) | 4,331,349 | | (3) | 4,331,349 | | (4) |
| Total | | 9,113,748 | | | 9,661,396 | | | 4,331,349 | | | 5,753,997 | | |
David Lanzer | | Cash Severance | | 743,750 | | | 1,168,750 | | | — | | | 1,168,750 | | |
| Continued Health Benefits | | — | | | 47,648 | | | — | | | 47,648 | | |
| Equity Acceleration | | 7,835,794 | | (2) | 7,835,794 | | (2) | 4,791,084 | | (3) | 4,791,084 | | (4) |
| Total | | 8,579,544 | | | 9,052,192 | | | 4,791,084 | | | 6,007,482 | | |
(1)In accordance with the employment agreement terms, if any payments made in connection with a change in control would otherwise be subject to an excise tax under Section 4999 of the Code by reason of the “golden parachute” rules contained in Section 280G of the Code, such payments will be reduced if and to the extent that doing so will result in net after-tax payments and benefits for the NEO that are more favorable than the net after-tax payments and benefits payable to the NEO in the absence of such a reduction after the imposition of the excise tax. The figures reported in this column do not reflect any such reductions as a result of Code Section 280G limits. No NEO (or other employee) is entitled to any tax gross-up payment in connection with change in control payments (or otherwise).
(2)Represents, for each NEO, the sum of the values attributable to (i) the accelerated vesting of the unvested portion of all outstanding shares of restricted stock and all outstanding Service-Vesting LTIP Units held by the NEO as of December 31, 2021 and (ii) the number of Performance-Vesting LTIP Units that would become earned and vested at the end of the performance period, assuming absolute and relative TSR performance continue at the same rate as we experienced from the first day of the applicable performance period through December 31, 2021, Core FFO per diluted share growth continues at the same rate as we experienced for the year ended December 31, 2021, and including the assumed number of distribution equivalent units that will be allocated in connection with those units.
(3)Represents, for each NEO, the sum of the values attributable to (i) the accelerated vesting of the unvested portion of all outstanding shares of restricted stock and all outstanding Service-Vesting LTIP Units held by the NEO as of December 31, 2021 and (ii) the accelerated vesting of the NEO’s Performance-Vesting LTIP Unit awards as described in the narrative above. The Performance-Vesting LTIP Unit awards were valued for each NEO by multiplying (i) the number of Performance-Vesting LTIP Units that would have been earned as if the date of the change in control occurred on December 31, 2021, by (ii) the fair market value of a share of our common stock on December 31, 2021 ($81.11). The number of Performance-Vesting LTIP Units that would have been earned as of December 31, 2021 is based on the Company’s actual TSR performance from the first day of the applicable performance period through December 31, 2021 and the target number of Core FFO Per-Share Base Units.
(4)Represents, for each NEO, the sum of the values attributable to (i) the accelerated vesting of the unvested portion of all outstanding shares of restricted stock and all outstanding Service-Vesting LTIP Units held by the NEO as of December 31, 2021 and (ii) the accelerated vesting of the NEO’s Performance-Vesting LTIP Unit awards as described in the narrative above with respect to a change in control. The Performance-Vesting LTIP Unit awards were valued for each NEO by multiplying (i) the number of Performance-Vesting LTIP Units that would have been earned as if the date of the change in control occurred on December 31, 2021, by (ii) the fair market value of a share of our common stock on December 31, 2021 ($81.11). The number of Performance-Vesting LTIP Units that would have been earned as of December 31, 2021 is based on the Company’s actual TSR performance from the first day of the applicable performance period through December 31, 2021 and the target number of Core FFO Per-Share Base Units.
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| | | | | | | | | | | | | | | |
Name | | Benefit | | Death/ Disability ($) | | Qualifying Termination (no Change in Control) ($) | | Change in Control (no Termination) ($)(1) | | Qualifying Termination in Connection with a Change in Control ($)(1) | |
Howard Schwimmer | | Cash Severance | | 1,188,000 |
| | 8,893,500 |
| | — |
| | 8,893,500 |
| |
| | Continued Health Benefits | | — |
| | 40,906 |
| | — |
| | 40,906 |
| |
| | Equity Acceleration | | 14,260,914 |
| (2) | 14,260,914 |
| (2) | 11,688,061 |
| (3) | 11,688,061 |
| (4) |
| | Total | | 15,448,914 |
| | 23,195,320 |
| | 11,688,061 |
| | 20,622,467 |
| |
Michael S. Frankel | | Cash Severance | | 1,188,000 |
| | 8,893,500 |
| | — |
| | 8,893,500 |
| |
| | Continued Health Benefits | | — |
| | 40,906 |
| | — |
| | 40,906 |
| |
| | Equity Acceleration | | 14,260,914 |
| (2) | 14,260,914 |
| (2) | 11,688,061 |
| (3) | 11,688,061 |
| (4) |
| | Total | | 15,448,914 |
| | 23,195,320 |
| | 11,688,061 |
| | 20,622,467 |
| |
Adeel Khan | | Cash Severance | | 661,500 |
| | 1,039,500 |
| | — |
| | 1,039,500 |
| |
| | Continued Health Benefits | | — |
| | 40,906 |
| | — |
| | 40,906 |
| |
| | Equity Acceleration | | 5,908,693 |
| (2) | 5,908,693 |
| (2) | 4,991,458 |
| (3) | 4,991,458 |
| (4) |
| | Total | | 6,570,193 |
| | 6,989,099 |
| | 4,991,458 |
| | 6,071,864 |
| |
David Lanzer | | Cash Severance | | 408,000 |
| | 748,000 |
| | — |
| | 748,000 |
| |
| | Continued Health Benefits | | — |
| | 40,906 |
| | — |
| | 40,906 |
| |
| | Equity Acceleration | | 2,991,431 |
| (2) | 2,991,431 |
| (2) | 2,562,110 |
| (3) | 2,562,110 |
| (4) |
| | Total | | 3,399,431 |
| | 3,780,337 |
| | 2,562,110 |
| | 3,351,016 |
| |
| | | | | | | | | | | | | | |
(1)60 | In accordance with the employment agreement terms, if any payments made in connection with a change in control would otherwise be subject to an excise tax under Section 4999 of the Code by reason of the “golden parachute” rules contained in Section 280G of the Code, such payments will be reduced if and to the extent that doing so will result in net after-tax payments and benefits for the NEO that are more favorable than the net after-tax payments and benefits payable to the NEO in the absence of such a reduction after the imposition of the excise tax. The figures reported in this column do not reflect any such reductions as a result of Code Section 280G limits. No NEO (or other employee) is entitled to any tax gross-up payment in connection with change in control payments (or otherwise).REXFORD INDUSTRIAL |
| | |
(2) | Represents, for each NEO, the sum of the values attributable to (i) the accelerated vesting of the unvested portion of all outstanding shares of restricted stock and all outstanding Service-Vesting LTIP Units held by the NEO as of December 31, 2019 and (ii) the number of Performance-Vesting LTIP Units that would become earned and vested at the end of the performance period, assuming absolute and relative TSR performance continue at the same rate as we experienced from the first day of the applicable performance period through December 31, 2019, Core FFO per diluted share growth continues at the same rate as we experienced for the year ended December 31, 2019, and including the assumed number of distribution equivalent units that will be allocated in connection with those units. Note, however, that the value of the Performance-Vesting LTIP Unit awards would ultimately reflect actual performance and, accordingly, if our actual TSR and actual Core FFO per diluted share growth results vary, the amounts payable in respect of these awards under this scenario could be greater or less than the amounts reported. As required by applicable disclosure rules, these values reflect a hypothetical termination of the executive’s employment occurring on December 31, 2019. |
| |
(3) | Represents, for each NEO, the sum of the values attributable to (i) the accelerated vesting of the unvested portion of all outstanding shares of restricted stock and all outstanding Service-Vesting LTIP Units held by the NEO as of December 31, 2019 and (ii) the accelerated vesting of the NEO’s Performance-Vesting LTIP Unit awards as described in the narrative above. The Performance-Vesting LTIP Unit awards were valued for each NEO by multiplying (i) the number of Performance-Vesting LTIP Units that would have been earned as if the date of the change in control occurred on December 31, 2019, by (ii) the fair market value of a share of our common stock on December 31, 2019 ($45.67). The number of Performance-Vesting LTIP Units that would have been earned as of December 31, 2019 is based on the Company’s actual TSR performance from the first day of the applicable performance period through December 31, 2019 and the target number of Core FFO Per-Share Base Units. As required by applicable disclosure rules, these values reflect a hypothetical change in control occurring on December 31, 2019. |
| |
(4) | Represents, for each NEO, the sum of the values attributable to (i) the accelerated vesting of the unvested portion of all outstanding shares of restricted stock and all outstanding Service-Vesting LTIP Units held by the NEO as of December 31, 2019 and (ii) the accelerated vesting of the NEO’s Performance-Vesting LTIP Unit awards as described in the narrative above with respect to a change in control. The Performance-Vesting LTIP Unit awards were valued for each NEO by multiplying (i) the number of Performance-Vesting LTIP Units that would have been earned as if the date of the change in control occurred on December 31, 2019, by (ii) the fair market value of a share of our common stock on December 31, 2019 ($45.67). The number of Performance-Vesting LTIP Units that would have been earned as of December 31, 2019 is based on the Company’s actual TSR performance from the first day of the applicable performance period through December 31, 2019 and the target number of Core FFO Per-Share Base Units. As required by applicable disclosure rules, these values reflect a hypothetical change in control and qualifying termination occurring on December 31, 2019. |
EXECUTIVE COMPENSATION MATTERS
CEO PAY RATIOPay Ratio
As required by Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, and Item 402(u) of Regulation S-K, we are providing the following information regarding the ratio of the annual total compensation for Howard Schwimmer and Michael Frankel (our Co-CEOs) to the median of the annual total compensation of all of our employees, excluding Mr. Schwimmer and Mr. Frankel (in each case, with annual total compensation calculated in accordance with SEC rules applicable to the Summary Compensation Table). We consider the pay ratio specified below to be a reasonable estimate, calculated in a manner that is intended to be consistent with the requirements of Item 402(u) of Regulation S-K.
For 2019,2021, our last completed fiscal year:
•the annual total compensation of our Co-CEOs, Mr. Schwimmer and Mr. Frankel, as reported in the Summary Compensation Table above, was $6,012,151$10,160,902 for each Co-CEO.
•the annual total compensation of the employee who represents our median compensated employee (other than Mr. Schwimmer and Mr. Frankel) was $107,693.$110,950.
Based on this information, for 2019,2021, the annual total compensation of each of our Co-CEOs was approximately 5692 times the median of the annual total compensation of all of our employees (other than our Co-CEOs).
Determining the Median Employee
Employee Population
We used November 1, 2019December 31, 2021 as the reference date for identifying our median employee.employee, which aligns the calculation date with other Company reporting and disclosures. As of such date, our employee population consisted of approximately 120184 total employees (excluding our Co-CEOs), all of whom were located in the United States. For purposes of the pay ratio calculation, our employee population consists of all full- and part-time employees at all locations, including all temporary employees employed as of the measurement date.
Methodology for Determining Our Median Employee
To identify the median employee from our employee population, we used total annual compensation (including base salary and bonus and equity payments, as applicable), calculated in accordance with the requirements of Item 402(c)(2)(x) of Regulation S-K. In identifying the median employee, we annualized the compensation of all full-time employees, including the use of an employee’s target bonus and equity payments if an employee commenced employment with the Company after the applicable bonus and equity payment dates for 2021, as we have done in the prior pay ratio calculations. We did not make any cost-of-living adjustments.
Compensation Measure and Annual Total Compensation of Median Employee
With respect to the annual total compensation of the median employee, we calculated such employee’s compensation for 20192021 in accordance with the requirements of Item 402(c)(2)(x) of Regulation S-K, which is the same method used to determine each of our Co-CEO’s compensation shown in the Summary Compensation Table above.
Annual Total Compensation of CEO
With respect to However, as described above, we annualized the annual total compensation of our CEO,all full-time employees not employed for the full year or whose employment with the Company began after the applicable bonus and equity payment dates for 2021, as we used the amount reportedhave done in the “Total” column of our 2019 Summaryprior pay ratio calculations.
EXECUTIVE COMPENSATION MATTERS
Equity Compensation Table included in this Proxy Statement.
EQUITY COMPENSATION PLAN INFORMATIONPlan Information
The following table provides information as of December 31, 20192021 regarding compensation plans under which our equity securities are authorized for issuance.
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Plan Category | | Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights (a) | Weighted Average Exercise Price of Outstanding Options, Warrants and Rights (b) | | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a)) |
Equity compensation plans approved by security holders(1) | | 1,336,528 | | (2) | — | | | 2,650,950 | |
Equity compensation plans not approved by security holders | | — | | | — | | | — | |
Total | | 1,336,528 | | | — | | | 2,650,950 | |
(1)Consists of the Incentive Award Plan, which was initially adopted by our Board in connection with the closing of our IPO in July 2013 and most recently amended on June 17, 2021, and provides for awards of options, stock appreciation rights, restricted stock, dividend equivalents, restricted stock units, performance awards, performance share awards, Service-Vesting LTIP Units, Performance-Vesting LTIP Units, stock payments and other incentive awards to be available for employees and consultants of our Company, our operating partnership and Rexford Industrial Realty and Management, Inc. (and any of their qualifying subsidiaries) and for our directors.
(2)Includes the following unvested securities: (i) 239,709 Service-Vesting LTIP Units and (ii) 1,096,819 Performance-Vesting LTIP Units, which represents the maximum number of Performance-Vesting LTIP Units that would be earned in the event that specified maximum goals are achieved. For more information on these Performance-Vesting LTIP Unit awards, see “Compensation Discussion and Analysis—Elements of Our Compensation—Long-Term Compensation”.
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| | | | | | | | | |
Plan Category | | Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights (a) | | Weighted Average Exercise Price of Outstanding Options, Warrants and Rights (b) | | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a)) |
Equity compensation plans approved by security holders(1) | | 986,173 |
| (2) | — |
| | 1,267,576 |
|
Equity compensation plans not approved by security holders | | — |
| | — |
| | — |
|
Total | | 986,173 |
| | — |
| | 1,267,576 |
|
____________
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(1)62 | Consists of the Incentive Award Plan, which was initially adopted by our Board in connection with the closing of our IPO in July 2013 and recently amended on June 11, 2018, and provides for awards of options, stock appreciation rights, restricted stock, dividend equivalents, restricted stock units, performance awards, performance share awards, Service-Vesting LTIP Units, Performance-Vesting LTIP Units, stock payments and other incentive awards to be available for employees and consultants of our Company, our operating partnership and Rexford Industrial Realty and Management, Inc. (and any of their qualifying subsidiaries) and for our directors.REXFORD INDUSTRIAL | | | |
“Say-When-On-Pay” Proposal
| | | | | | | | | | | |
(2) | Includes | | |
| PROPOSAL NO. 4 Advisory Vote on the following unvested securities: (i) 298,412 Service-Vesting LTIP UnitsFrequency of the Say-on-Pay Vote The option of one year, two years or three years that receives a majority of all the votes cast at a meeting at which a quorum is present will be the frequency for the advisory vote on executive compensation recommended by shareholders. For purposes of this advisory vote, abstentions and (ii) 687,761 Performance-Vesting LTIP Units, which representsbroker non-votes will not be counted as votes cast and will have no effect on the maximum numberresult of Performance-Vesting LTIP Units that wouldthe vote, although they will be earned inconsidered present for the purpose of determining the presence of a quorum. In the event that specified maximum goals are achieved. Forno option receives a majority of the votes cast, we will consider the option that receives the most votes to be the option selected by shareholders. In either case, this vote is advisory and not binding on the Board or the Company in any way, and the Board or the Nominating and Corporate Governance Committee may determine that it is in the best interests of the Company to hold an advisory vote on executive compensation more information on these Performance-Vesting LTIP Unit awards, see “Compensation Discussion and Analysis—Elements of Compensation—Long-Term Incentives”.or less frequently than the option recommended by our shareholders. | |
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STOCK OWNERSHIP
PRINCIPAL STOCKHOLDERS
The following table sets forth certain information regarding the beneficial ownership of shares of our common stock and shares of common stock into which common units of limited partnership held in our operating partnership (“common units”) are exchangeable as of March 31, 2020 for (i) each person who is the beneficial owner of 5% or more of our outstanding common stock, (ii) each of our directors and NEOs, and (iii) all of our directors and executive officers as a group. Each person named in the table has sole voting and investment power with respect to all of the shares of our common stock shown as beneficially owned by such person, except as otherwise set forth in the notes to the table. The extent to which a person holds shares of common stock as opposed to units is set forth in the footnotes below.
The SEC has defined “beneficial ownership” of a security to mean the possession, directly or indirectly, of voting power and/or investment power over such security. A stockholder is also deemed to be, as of any date, the beneficial owner of all securities that such stockholder has the right to acquire within 60 days after that date through (a) the exercise of any option, warrant or right, (b) the conversion of a security, (c) the power to revoke a trust, discretionary account or similar arrangement, or (d) the automatic termination of a trust, discretionary account or similar arrangement. In computing the number of shares beneficially owned by a person and the percentage ownership of that person, shares of common stock subject to options or other rights (as set forth above) held by that person that are exercisable as of March 31, 2020, or will become exercisable within 60 days thereafter, are deemed outstanding, while such shares are not deemed outstanding for purposes of computing percentage ownership of any other person.
Unless otherwise indicated, the address of each named person is c/o Rexford Industrial Realty, Inc., 11620 Wilshire Boulevard, Suite 1000, Los Angeles, California 90025.
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Name of Beneficial Owner | | Number of Shares and Units Beneficially Owned | | Percentage of All Shares(1) | | Percentage of All Shares and Units(2) |
The Vanguard Group(3) 100 Vanguard Blvd. Malvern, PA 19355 | | 16,352,318 | | 14.1% | | 13.6% |
BlackRock, Inc.(4) 55 East 52nd Street New York, NY 10055 | | 12,064,178 | | 10.4% | | 10.0% |
Howard Schwimmer(5) | | 778,660 | | * | | * |
Michael Frankel(6) | | 619,548 | | * | | * |
Richard Ziman(7) | | 262,536 | | * | | * |
Robert L. Antin | | 34,143 | | * | | * |
Steven C. Good | | 20,875 | | * | | * |
Peter E. Schwab | | 17,248 | | * | | * |
Tyler H. Rose | | 13,699 | | * | | * |
David Lanzer(8) | | 8,842 | | * | | * |
Adeel Khan(9) | | 8,222 | | * | | * |
Diana J. Ingram | | 4,855 | | * | | * |
All directors and executive officers as a group (10 persons) | | 1,768,628 | | 1.5% | | 1.5% |
__________________
* Less than 1.00%.
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(1) | Assumes 116,331,347 shares of common stock are outstanding as of March 31, 2020. In computing the percentage ownership of a person or group, we have assumed that all of the common units held by that person or the persons in the group have been redeemed in exchange for shares of common stock and that those shares are outstanding but that no units held by other persons have been redeemed in exchange for shares of common stock. |
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(2) | Computation | | Our Board recommends that you vote for a frequency of the percentage ownership assumes 120,248,631 shares of common stock and units, including vested Service-Vesting LTIP Units, vested Performance-Vesting LTIP Units and common units not held by us, are outstanding as of March 31, 2020, comprised of 116,331,347 shares of common stock, 3,053,396 common units held by limited partners, 434,368 vested Service-Vesting LTIP Units and 429,520 vested Performance-Vesting LTIP Units.“ONE YEAR” for future advisory votes on executive compensation. | |
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(3) | Based solely on information disclosed in the Schedule 13G/A filed with the SEC on February 11, 2020 by The Vanguard Group, Inc. (“Vanguard”) and Vanguard Fiduciary Trust Company (“VFTC”) and Vanguard Investments Australia, Ltd. (“VIA”), both wholly owned subsidiaries of Vanguard. Such report provides that Vanguard: (i) is the beneficial owner of all such shares of common stock (92,540 and 250,737 of such shares of common stock are beneficially owned as a result of its ownership of VFTC and VIA, respectively); (ii) has sole voting power with respect to 222,374 of such shares of common stock; (iii) has shared voting power with respect to 120,903 of such shares of common stock; (iv) has sole dispositive power with respect to 16,138,875 of such shares of common stock; and (v) has shared dispositive power with respect to 213,443 of such shares of common stock. |
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(4)2022 PROXY STATEMENT | Based solely on information disclosed in the Schedule 13G/A filed with the SEC on February 4, 2020 by BlackRock, Inc. Such report provides that BlackRock, Inc.: (i) is the beneficial owner of, and has sole63 |
dispositive power with respect to, all such shares of common stock
Related Party and (ii) has sole voting power with respect to 11,380,039 of such shares of common stock.
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(5) | Includes 13,575 shares of common stock and 42,002 common units held by the Schwimmer Family Irrevocable Trust for which Mr. Schwimmer is a trustee and 7,275 common units held by the Schwimmer Living Trust dated December 14, 2001 for which Mr. Schwimmer is a trustee. Includes 206,569 vested Service-Vesting LTIP Units and 214,760 vested Performance-Vesting LTIP Units. Excludes 101,275 Service-Vesting LTIP Units and 271,860 Performance-Vesting LTIP Units, which do not vest, or will not be earned, within 60 days of March 31, 2020. |
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(6) | Includes 66,614 shares of common stock held by the Candice and Michael Frankel Family Trust for which Mr. Frankel is a trustee. Includes 206,569 vested Service-Vesting LTIP Units and 214,760 vested Performance-Vesting LTIP Units. Excludes 101,275 Service-Vesting LTIP Units and 271,860 Performance-Vesting LTIP Units, which do not vest, or will not be earned, within 60 days of March 31, 2020. |
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(7) | Includes 10,000 shares of common stock and 180,075 common units held by RSZ Trust for which Mr. Ziman is the trustee and 7,405 shares of common stock and 413 common units held by Mr. Ziman’s affiliates. |
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(8) | Includes 4,244 vested Service-Vesting LTIP Units. Excludes 23,232 Service-Vesting LTIP Units and 46,447 Performance-Vesting LTIP Units, which do not vest, or will not be earned, within 60 days of March 31, 2020. |
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(9) | Includes 8,222 vested Service-Vesting LTIP Units. Excludes 53,091 Service-Vesting LTIP Units and 97,594 Performance-Vesting LTIP Units, which do not vest, or will not be earned, within 60 days of March 31, 2020. Mr. Khan also beneficially owns 5,460 shares (less than 1.0%) of the Company’s 5.875% Series A Cumulative Redeemable Preferred Stock, of which there are currently 3,600,000 shares outstanding, and 2,250 shares (less than 1.0%) of the Company’s 5.875% Series B Cumulative Redeemable Preferred Stock, of which there are currently 3,000,000 shares outstanding. |
DELINQUENT SECTION 16(A) REPORTS
Section 16(a) of the Exchange Act requiresOther Transactions Involving our executive officers, directorsOfficers and persons who own more than 10% of our common stock to file reports of ownership and changes in ownership with the SEC. SEC regulations require us to identify anyone who failed to file a required report or filed a late report during the most recent fiscal year. Based solely on our review of the copies of such forms received by us, or written representations from certain reporting persons that no Forms 5 were required for such persons, we believe that, during the fiscal year ended December 31, 2019, our executive officers, directors and 10% stockholders complied with all Section 16(a) filing requirements applicable to them, with the following exceptions: the Form 5 filing for Michael Frankel covering four transactions relating to charitable gifts of shares of common stock in 2018, one delinquent Form 4 filing for Michael Frankel covering one transaction with respect to an LTIP Unit grant in February 2019 and one delinquent Form 4 filing for Howard Schwimmer covering one transaction with respect to an LTIP Unit grant in February 2019.
RELATED-PARTY AND OTHER TRANSACTIONS INVOLVING OUR OFFICERS AND DIRECTORSDirectors
We describe below transactions and series of similar transactions, during our last fiscal year, to which we were a party or will be a party, in which:
•the amounts involved exceeded or will exceed $120,000; and
•any of our directors, executive officers, holders of more than 5% of our outstanding common stock or any member of their immediate family had or will have a direct or indirect material interest.
Registration Rights
In connection with the completion of our IPO, we entered into a registration rights agreement with the various persons receiving shares of our common stock and/or common units in the formation transactions and concurrent private placement, including certain of our executive officers. Pursuant to the registration rights agreement, we filed a registration statement on Form S-3 covering the resale of the shares of our common stock issued in the formation transactions and the concurrent private placement and the resale of the shares of our common stock issued or issuable, at our option, in exchange for common units issued in the formation transactions. We may, at our option, register the issuance by us of shares of our common stock under the Securities Act of 1933, as amended, in lieu of our operating partnership’s obligation to pay cash for such units. We agreed to pay all of the expenses relating to the securities registrations described above.
Tax Matters Agreement
We entered into a tax matters agreement with certain limited partners of our operating partnership, including Messrs. Ziman, Schwimmer and Frankel, (in such capacity, the “Tax Matters Representatives”). Under this agreement, our operating partnership will indemnify such limited partners for their tax liabilities (plus an additional amount equal to the taxes incurred as a result of such indemnity payment) attributable to their share of the built-in gain, as of the completion of the formation transactions, with respect to their interest in certain properties in our portfolio as of the date of our IPO if the operating partnership, without the consent of at least two of the Tax Matters Representatives, disposes of any interest with respect to such properties in a taxable transaction during the shorter of the seven-year period after the completion of our formation transactions and the date on which more than 50% of the common units originally received by any such limited partner in our formation transactions have been sold, exchanged or otherwise disposed of by the limited partner, subject to certain exceptions and limitations. In addition, if during the period ending on the twelfth anniversary of the completion of the formation transactions we fail to offer certain limited partners an opportunity to guarantee, in the aggregate, up to approximately $19 million of our outstanding indebtedness, or if we fail to make commercially reasonable efforts to provide such partners who continue to own at least 50% of the common units originally received by such partners in the formation transactions with an opportunity to guarantee debt after this period, our operating partnership will be required to indemnify such limited partners against their resulting tax liabilities (plus an additional amount equal to the taxes they incur as a result of such indemnity payment). Messrs. Ziman, Schwimmer and Frankel will have the opportunity to guarantee up to approximately $1.2 million, $5.5 million and $3.1 million respectively, of our outstanding indebtedness pursuant to the tax matters agreement. Among other things, this opportunity to guarantee debt is intended to allow the participating limited partners to defer the recognition of gain in connection with our formation transactions. The sole and exclusive rights and remedies of any limited partner under the tax matters agreement shall be a claim against our operating partnership for such limited partner’s tax liabilities as calculated in the tax matters agreement, and no limited partner shall be entitled to pursue a claim for specific performance or bring a claim against any person that acquires a property from our operating partnership in violation of the tax matters agreement.
RELATED PARTY AND OTHER TRANSACTIONS INVOLVING OUR OFFICERS AND DIRECTORS
Employment Agreements
We entered into employment agreements with certain of our NEOs, which will provide for salary, bonus and other benefits, including severance upon a termination of employment under certain circumstances. The material terms of the employment agreements with our NEOs are described above under the heading “Executive Compensation.”
Property Management Agreements
As of December 31, 2019,2021, Mr. Schwimmer owned interests in 1819 properties representing approximately 1.0 million rentable square feet that were not part of the Company’s consolidated portfolio. These properties are managed by Rexford Industrial Realty and Management, Inc., a wholly owned subsidiary of our operating partnership (our “services company”) pursuant to property management agreements. In 2019,2021, these management services generated revenues of $398,000$458,000 for the services company. Conflicts of interest may exist or could arise in the future as a result of this relationship, including the decision of whether to extend, terminate or re-negotiate these property management agreements.
Lease Agreement
In August 2021, we entered into a lease agreement with Apria Healthcare LLC (“Apria”) for a 17,519 rentable square foot unit at our property located at 3380 N. San Fernando Road. Ms. Debra Morris is the Chief Financial Officer of Apria and member of our Board, Audit Committee and Compensation Committee. The lease agreement is for a term of five years and expires on September 30, 2026, and has monthly base rent of $22,000, subject to annual increases of 3% per year. Common area maintenance, property taxes and insurance shall be paid by Apria. Upon the expiration of the initial five-year term, Apria has the option to renew the lease agreement for one additional five-year term. As of December 31, 2021, total future minimum base rents to be received under this lease were $1.3 million. To comply with our related party transactions policy, the potential transaction was brought to the attention of our Audit Committee, and Ms. Morris did not participate in the transaction or the Audit Committee’s determination. Appropriate controls and notices were given and followed by both companies. It was determined that annual gross payments from Apria year 1 will be approximately $325,000. Since this was an actual transaction as opposed to a services agreement, it was determined that director independence was maintained as long as the annual payments do not exceed 5% of our annual gross revenues. With Ms. Morris recusing herself, the remaining members of the Audit Committee approved the transaction and determined that no conflict of interest exists.
Equity Incentive Award Plan
In connection with the formation transactions, we adopted a cash and equity-based incentive award plan for our directors, officers, employees and consultants. The material terms of equity awards granted pursuant to the plan are described above under the heading “Executive Compensation.“Compensation Discussion and Analysis.”
Indemnification ofOfficers and Directors
Upon completion of our IPO, our charter and Bylaws provided for certain indemnification rights for our directors and officers and we entered into indemnification agreements with each of our executive officers and directors, providing for procedures for indemnification and advancements by us of certain expenses and costs relating to claims, suits or proceedings arising from their service to us or, at our request, service to other entities, as officers, directors, partners, trustees, managers or members to the maximum extent permitted by Maryland law. We also entered into indemnification agreements with Messrs. Schwab and Rose and Mses. Ingram, Morris and Kleiman upon their appointment by the Board to serve as directors.
REVIEW
RELATED PARTY AND APPROVAL OFOTHER TRANSACTIONS WITH RELATED PERSONSINVOLVING OUR OFFICERS AND DIRECTORS
Review and Approval of Transactions with Related Persons
We have operated under our Code of Business Conduct and Ethics policy since our IPO in July 2013. As part of our Code of Business Conduct and Ethics, our officers, directors and employees are expected to engage in honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships.
We have adopted a written policy regarding the review, approval and ratification of any related party transaction. Under this policy, our Audit Committee will review the relevant facts and circumstances of each related party transaction, including if the transaction is on terms comparable to those that could be obtained in arm’s-length dealings with an unrelated third party before approving such transaction. Any related party transaction shall be consummated and shall continue only if the Audit Committee or our Board of Directors has approved or ratified the transaction in accordance with the guidelines set forth in the policy. For purposes of our policy, a “Related Party Transaction” is (i) a transaction, arrangement or relationship, including any indebtedness or guarantee of indebtedness, (or any series of similar transactions, arrangements or relationships) in which we (including any of our subsidiaries) was, is or will be a participant, and in which any Related Party (as defined below) had, has or will have a direct or indirect interest or (b) any amendment or modification to such a transaction, arrangement or relationship,
regardless of whether such transaction, arrangement or relationship has previously been approved in accordance with our policy. For purposes of this policy, a “Related Party” is:
•any person who is, or at any time since the beginning of our last fiscal year was, a director or executive officer of ours or a nominee to become a director of ours;
•any person who is (or was) the beneficial owner of more than 5% of any class of our voting securities when the Related Party Transaction in question is expected to occur or exist (or when it occurred or existed);
•any immediate family member of any of the foregoing persons, which means any child, stepchild, parent, stepparent, spouse, sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in- law of such director, executive officer, nominee or more than 5% beneficial owner, and any person (other than a tenant or employee) sharing the household of such director, executive officer, nominee or more than 5% beneficial owner; and
•any firm, corporation or other entity in which any of the foregoing persons is employed or is a director, officer, general partner or principal or serves in a similar position or in which such person has a 5% or greater beneficial ownership interest.
INCORPORATION BY REFERENCE
Stock Ownership
Principal Stockholders
The Audit Committee Report referencefollowing table sets forth certain information regarding the beneficial ownership of shares of our common stock and shares of common stock into which common units of limited partnership held in our operating partnership (“common units”) are exchangeable as of April 14, 2022 for (i) each person who is the beneficial owner of 5% or more of our outstanding common stock, (ii) each of our directors and NEOs, and (iii) all of our directors and executive officers as a group. Each person named in the table has sole voting and investment power with respect to all of the shares of our common stock shown as beneficially owned by such person, except as otherwise set forth in the notes to the independencetable. The extent to which a person holds shares of common stock as opposed to units is set forth in the footnotes below.
The SEC has defined “beneficial ownership” of a security to mean the possession, directly or indirectly, of voting power and/or investment power over such security. A stockholder is also deemed to be, as of any date, the beneficial owner of all securities that such stockholder has the right to acquire within 60 days after that date through (a) the exercise of any option, warrant or right, (b) the conversion of a security, (c) the power to revoke a trust, discretionary account or similar arrangement, or (d) the automatic termination of a trust, discretionary account or similar arrangement. In computing the number of shares beneficially owned by a person and the percentage ownership of that person, shares of common stock subject to options or other rights (as set forth above) held by that person that are exercisable as of April 14, 2022, or will become exercisable within 60 days thereafter, are deemed outstanding, while such shares are not deemed outstanding for purposes of computing percentage ownership of any other person.
Unless otherwise indicated, the address of each named person is c/o Rexford Industrial Realty, Inc., 11620 Wilshire Boulevard, Suite 1000, Los Angeles, California 90025.
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Name of Beneficial Owner | | Number of Shares and Units Beneficially Owned | | Percentage of All Shares(1) | | Percentage of All Shares and Units(2) |
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The Vanguard Group(3) 100 Vanguard Blvd. Malvern, PA 19355 | | 21,111,202 | | | 12.8 | % | | 12.3 | % |
BlackRock, Inc.(4) 55 East 52nd Street New York, NY 10055 | | 19,810,848 | | | 12.0 | % | | 11.6 | % |
Principal Real Estate Investors, LLC(5) 801 Grand Avenue Des Moines, IA 50392 | | 8,338,119 | | | 5.1 | % | | 4.9 | % |
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Howard Schwimmer(6) | | 980,550 | | | * | | * |
Michael Frankel(7) | | 642,799 | | | * | | * |
Richard Ziman(8) | | 266,916 | | | * | | * |
Robert L. Antin | | 38,523 | | | * | | * |
David Lanzer(9) | | 27,801 | | | * | | * |
Peter E. Schwab | | 21,628 | | | * | | * |
Tyler H. Rose | | 18,079 | | | * | | * |
Diana J. Ingram | | 9,235 | | | * | | * |
Laura Clark(10) | | 6,799 | | | * | | * |
Debra Morris | | 2,551 | | | * | | * |
Angela Kleiman | | 565 | | | * | | * |
All directors and executive officers as a group (11 persons) | | 2,015,446 | | | 1.2 | % | | 1.2 | % |
* Less than 1.00%.
(1)Assumes 165,017,587 shares of common stock are outstanding as of April 14, 2022. In computing the percentage ownership of a person or group, we have assumed that all of the Audit Committee members, portionscommon units held by that person or the persons in the group have been redeemed in exchange for shares of common stock and that those shares are outstanding but that no units held by other persons have been redeemed in exchange for shares of common stock.
(2)Computation of the percentage ownership assumes 171,434,694 shares of common stock and units, including vested Service-Vesting LTIP Units, vested Performance-Vesting LTIP Units and common units not held by us, are outstanding as of April 14, 2022, comprised of 165,017,587 shares of common stock, 5,012,622 common units held by limited partners, 659,586 vested Service-Vesting LTIP Units and 744,899 vested Performance-Vesting LTIP Units.
(3)Based solely on information disclosed in the Schedule 13G/A filed with the SEC on February 10, 2022 by The Vanguard Group, Inc. Such report provides that the Vanguard Group, Inc.: (i) is the beneficial owner of all such shares of common stock; (ii) has sole voting power with respect to none of such shares of common stock; (iii) has shared voting power with respect to 219,068 of such shares of common stock; (iv) has sole dispositive power with respect to 20,763,680 of such shares of common stock; and (v) has shared dispositive power with respect to 347,522 of such shares of common stock.
(4)Based solely on information disclosed in the Schedule 13G/A filed with the SEC on January 27, 2022 by BlackRock, Inc. Such report provides that BlackRock, Inc.: (i) is the beneficial owner of all such shares of common stock, (ii) has sole voting power with respect to 18,037,948 of such shares of common stock; (iii) has shared voting power with respect to none of such shares of common stock; (iv) has sole dispositive power with respect to all of such shares of common stock; and (v) has shared dispositive power with respect to none of such shares of common stock.
(5)Based solely on information disclosed in the Schedule 13G filed with the SEC on February 15, 2022 by Principal Real Estate Investors LLC. Such report provides that Principal Real Estate Investors LLC: (i) is the beneficial owner of all such shares of common stock, (ii) has sole voting power with respect to none of such shares of common stock; (iii) has shared voting power with respect to all of such shares of common stock; (iv) has sole dispositive power with respect to none of such shares of common stock; and (v) has shared dispositive power with respect to all of such shares of common stock.
(6)Includes 171,273 common units held by Mr. Schwimmer as an individual, 13,575 shares of common stock and 42,002 common units held by the Schwimmer Family Irrevocable Trust for which Mr. Schwimmer is a trustee, and 7,275 common units held by the Schwimmer Living Trust dated December 14, 2001 for which Mr. Schwimmer is a trustee. Includes 338,170 vested Service-Vesting LTIP Units and 365,694 vested Performance-Vesting LTIP Units. Excludes 85,894 Service-Vesting LTIP Units and 464,012 Performance-Vesting LTIP Units, which do not vest, or will not be earned, within 60 days of April 14, 2022.
(7)Includes 277,105 vested Service-Vesting LTIP Units and 365,694 vested Performance-Vesting LTIP Units. Excludes 85,894 Service-Vesting LTIP Units and 464,012 Performance-Vesting LTIP Units, which do not vest, or will not be earned, within 60 days of April 14, 2022.
(8)Includes 52,246 common units held by Mr. Ziman as an individual, 10,000 shares of common stock and 180,075 common units held by RSZ Trust for which Mr. Ziman is the trustee, and 7,405 shares of common stock and 413 common units held by Mr. Ziman’s affiliates.
(9)Includes 14,290 vested Service-Vesting LTIP Units. Excludes 16,721 Service-Vesting LTIP Units and 82,928 Performance-Vesting LTIP Units, which do not vest, or will not be earned, within 60 days of April 14, 2022.
(10)Excludes 18,055 Service-Vesting LTIP Units and 85,867 Performance-Vesting LTIP Units, which do not vest, or will not be earned, within 60 days of April 14, 2022.
Delinquent Section 16(A) Reports
Section 16(a) of the Exchange Act requires our executive officers, directors and persons who own more than 10% of our Annual Reportcommon stock to file reports of ownership and changes in ownership with the SEC. SEC regulations require us to identify anyone who failed to file a required report or filed a late report during the most recent fiscal year. Based solely on Form 10-Kour review of the copies of such forms received by us, or written representations from certain reporting persons that no Forms 5 were required for such persons, we believe that, during the fiscal year ended December 31, 20192021, our executive officers, directors and 10% stockholders complied with all Section 16(a) filing requirements applicable to them, with the exception of one delinquent Form 4 filing for Debra L. Morris covering one transaction with respect to a restricted stock grant in June 2021.
Additional Information
Stockholder Proposals
2022 Annual Meeting Proposals
Our Bylaws provide that nominations of individuals for election as directors and proposals of other business to be considered at an annual meeting of our stockholders may be made only pursuant to our notice of the meeting, by or at the direction of our Board or by a stockholder who was a stockholder of record both at the time the stockholder provides the notice required by our Bylaws and at the time of the annual meeting, who is entitled to vote at the meeting in the election of each individual so nominated or such other business and who has complied with certain disclosure requirements and other procedures provided for in our Bylaws. We did not receive notice of any nominations or proposals to be made at the Annual Meeting within the time period required by our Bylaws and our Board does not know of any matters that may properly be presented at the Annual Meeting other than the proposals discussed in this Proxy Statement and any information included on our website, included or describedprocedural matters relating to these proposals.
2023 Annual Meeting Proposals
Stockholders who wish to have proposals considered for inclusion in the preceding pages are not deemed filed with the SECProxy Statement and shall not be deemed incorporated by reference into any prior or future filings made by usform of proxy for our 2023 Annual Meeting pursuant to Rule 14a-8 under the Exchange Act exceptmust cause their proposals to be received in writing by our General Counsel and Secretary at the address set forth on page 27 of this Proxy Statement no later than January 2, 2023. Any proposal should be addressed to our General Counsel and Secretary and may be included in next year’s proxy materials only if such proposal complies with the rules and regulations promulgated by the SEC. Nothing in this section shall be deemed to require us to include in our Proxy Statement or our proxy relating to any annual meeting any stockholder proposal that does not meet all of the requirements for inclusion established by the SEC.
In addition, our Bylaws currently require that we be given advance written notice of nominations for election as directors and other matters that stockholders wish to present for action at an annual meeting of stockholders (other than matters included in our proxy materials in accordance with Rule 14a-8 under the Exchange Act). Our Secretary must receive such notice at the address set forth on page 27 of this Proxy Statement not later than the close of business on January 3, 2023 and no earlier than December 4, 2022 for nominations and other matters to be presented at the 2023 annual meeting of our stockholders. However, in the event that the 2023 annual meeting is held before May 14, 2023 or after July 13, 2023, for notice by a stockholder to be timely it must be received no earlier than 150 days prior to the extentdate of the 2023 annual meeting and not later than 5:00 p.m., Eastern Time, on the later of (a) 120 days prior to the date of the 2023 annual meeting and (b) the tenth day following the day on which we first made a public announcement of the date of such meeting.
In addition to satisfying the foregoing requirements under our Bylaws, to comply with the universal proxy rules (once they become effective), stockholders who intend to solicit proxies in support of director nominees other than the Company’s nominees must provide notice that we specifically incorporate suchsets forth the information required by reference.Rule 14a-19 under the Exchange Act no later than April 14, 2023.
The Company intends to file a proxy statement and a WHITE proxy card with the SEC in connection with its solicitation of proxies for our 2023 Annual Meeting of Stockholders. Stockholders may obtain our proxy statement (and any amendments and supplements thereto) and other documents as and when filed by the Company without charge from the SEC’s website at: www.sec.gov.
DELIVERY OF PROXY MATERIALS TO HOUSEHOLDS
Delivery of Proxy Materials to Households
Under the rules of the SEC, we are permitted to use a method of delivery often referred to as “householding.” Householding permits us to mail a single set of proxy materials to any household in which two or more different stockholders reside and are members of the same household or in which one stockholder has multiple accounts. If we household materials for future meetings, then only one copy of our Annual Report and Proxy Statement will be sent to multiple stockholders who share the same address and last name, unless we have received contrary instructions from one or more of those stockholders. In addition, we have been notified that certain intermediaries (i.e., brokers, banks or other nominees) will household proxy materials for the Annual Meeting. For voting purposes, a separate proxy card will be included for each account at the shared address. We will deliver promptly, upon oral or written request, a separate copy of the Annual Report and Proxy Statement to any stockholder at the same address. If you wish to receive a separate copy of the Annual Report and Proxy Statement, or future annual reports and Proxy Statements, then you may contact our Investor Relations Department by: (a) mail at Rexford Industrial Realty, Inc., Attention: Investor Relations, 11620 Wilshire Boulevard, Suite 1000, Los Angeles, California 90025, (b) telephone at (424) 256-2153 ext. 401, or (c) e-mail at investorrelations@rexfordindustrial.com. You can also contact your broker, bank or other nominee to make a similar request. Stockholders sharing an address who now receive multiple copies of our Annual Report and Proxy Statement may request delivery of a single copy by contacting us as indicated above, or by contacting their broker, bank or other nominee, provided the broker, bank or other nominee has elected to household proxy materials.
Incorporation by Reference STOCKHOLDER PROPOSALS
2020 Annual Meeting Proposals
Our Bylaws provide that nominationsThe Audit Committee Report reference to the independence of individuals for election as directors and proposals of other business to be considered at an annual meetingthe Audit Committee members, portions of our stockholders may be made only pursuant toAnnual Report on Form 10-K for the fiscal year ended December 31, 2021 and any information included on our notice of the meeting, bywebsite, included or at the direction of our Board or by a stockholder who was a stockholder of record both at the time the stockholder provides the notice required by our Bylaws and at the time of the annual meeting, who is entitled to vote at the meetingdescribed in the election of each individual so nominatedpreceding pages are not deemed filed with the SEC and shall not be deemed incorporated by reference into any prior or future filings made by us under the Exchange Act, except to the extent that we specifically incorporate such other business and who has complied with certain disclosure requirements and other procedures provided for in our Bylaws. information by reference.
Forward-Looking Statements
We did not receive notice of any nominations or proposals to be made at the Annual Meeting within the time period required by our Bylaws and our Board does not know of any matters that may properly be presented at the Annual Meeting other than the proposals discussedmake statements in this Proxy Statement that are forward-looking statements, which are usually identified by the use of words such as “anticipates,” “believes,” “could,” “estimates,” “expects,” “intends,” “may,” “might,” “plans,” “potential,” “possible,” “predicts,” “projects,” “result,” “seeks,” “should,” “will,” and any procedural matters relatingvariations of such words or similar expressions. Our forward-looking statements reflect our current views about our plans, intentions, expectations, strategies and prospects, which are based on the information currently available to us and on assumptions we have made. Although we believe that our plans, intentions, expectations, strategies and prospects as reflected in or suggested by our forward-looking statements are reasonable, we can give no assurance that our plans, intentions, expectations, strategies or prospects will be attained or achieved and you should not place undue reliance on these proposals.
2021 Annual Meeting Proposals
Stockholders who wish to have proposals considered for inclusionforward-looking statements. Furthermore, actual results may differ materially from those described in the Proxy Statement and form of proxy for our 2021 Annual Meeting pursuant to Rule 14a-8 under the Exchange Act must cause their proposals to be received in writing by our General Counsel and Secretary at the address set forth on the first page of this Proxy Statement no later than December 14, 2020. Any proposal should be addressed to our General Counsel and Secretaryforward-looking statements and may be includedaffected by a variety of risks and factors described in next year’s proxy materials only if such proposal compliesour Annual Report on Form 10-K. For a further discussion of these and other factors that could cause our future results to differ materially from any forward-looking statements, see our reports and other filings with the rulesU.S. Securities and regulations promulgatedExchange Commission. Except as otherwise required by the SEC. Nothing in this section shall be deemedU.S. federal securities laws, we disclaim any obligations or undertaking to require uspublicly release any updates or revisions to includeany forward-looking statement contained herein (or elsewhere) to reflect any change in our Proxy Statementexpectations with regard thereto or our proxy relating to any annual meeting any stockholder proposal that does not meet all of the requirements for inclusion established by the SEC.
In addition, our Bylaws currently require that we be given advance written notice of nominations for election as directors and other matters that stockholders wish to present for action at an annual meeting of stockholders (other than matters includedchange in our proxy materials in accordance with Rule 14a-8 under the Exchange Act). Our Secretary must receive such notice at the address set forth on the first page of this Proxy Statement not later than the close of business on December 14, 2020 and no earlier than November 14, 2020 for nominations and other matters to be presented at the 2021 annual meeting of our stockholders. However, in the event that the 2021 annual meeting is held before April 26, 2021events, conditions or after June 25, 2021, for notice by a stockholder to be timely it must be received no earlier than 150 days prior to the date of the 2021 annual meeting and not later than 5:00 p.m., Eastern Time, on the later of (a) 120 days prior to the date of the 2021 annual meeting and (b) the tenth day following the daycircumstances on which we first made a public announcement of the date ofany such meeting.
statement is based.
Other Matters
Our Board of Directors knows of no other matters that may properly be presented for consideration at the Annual Meeting. If any other matters are properly brought before the Annual Meeting or any continuation, postponement or adjournment of the Annual Meeting, it is the intention of the persons named in the accompanying proxy to vote on such matters in accordance with their discretion. It is important that the proxies be returned promptly and that you be represented. Stockholders are urged to authorize a proxy promptly by either electronically submitting a proxy or voting instruction card over the internet or by telephone or by delivering to us or your broker a signed and dated proxy card.
By Order of the Board of Directors,
David Lanzer | | | | | |
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David Lanzer | |
General Counsel and Secretary Los Angeles, California May 2, 2022 | |
April 13, 2020
Q&A about the Annual Meeting
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Q Why am I receiving these materials? | | Our Board of Directors is making these materials available to you over the internet or by delivering paper copies to you by mail in connection with the Annual Meeting. As a stockholder, you are invited to attend the Annual Meeting and are entitled and requested to vote on the items of business described in this Proxy Statement. This Proxy Statement includes information that we are required to provide under Securities and Exchange Commission (“SEC”) rules and is designed to assist you in voting your shares. |
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Q Why did I receive a notice in the mail regarding internet availability of proxy materials instead of a paper copy of the proxy materials? | | Pursuant to Rule 14a-16 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), we have elected to provide access to our proxy materials over the internet. Accordingly, on or about May 2, 2022, we are sending a Notice of Internet Availability of Proxy Materials (the “Notice”) to our stockholders of record as of April 14, 2022, while brokers, banks and other nominees who hold shares on behalf of beneficial owners will be sending their own similar notice to the beneficial owners. All stockholders will have the ability to access the proxy materials, including this Proxy Statement and our 2021 Annual Report, on the website referred to in the Notice or to request to receive a printed copy of the proxy materials. Instructions on how to request a printed copy by mail or electronically, including an option to request paper copies on an ongoing basis, may be found in the Notice and on the website referred to in the Notice. We intend to mail this Proxy Statement, together with a proxy card, to those stockholders entitled to vote at the Annual Meeting who have properly requested paper copies of such materials, within three business days of such request. |
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Q How do I vote? | | If you hold your shares of common stock as a record holder and you are viewing this Proxy Statement on the internet, you may vote your shares by submitting a proxy over the internet by following the instructions on the website referred to in the Notice previously mailed to you. You may also authorize a proxy by telephone or by mail as described below. If your common stock is held in your name, there are three ways for you to authorize a proxy: |
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| | | If you received a paper copy of the proxy materials by mail, sign, date and mail the proxy card in the enclosed return envelope; |
| | | Call 1-800-776-9437; or |
| | | Log on to the internet at www.voteproxy.com and follow the instructions at that site. The website address for authorizing a proxy by internet is also provided on your Notice, as well as your unique 11-digit control number needed to access the Company’s annual meeting information located at www.voteproxy.com. |
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| | You may also attend the virtual Annual Meeting and vote electronically at https://web.lumiagm.com/218892223 during the virtual Annual Meeting. You will need the 11-digit voter control number which appears on your proxy card (printed in the box and marked by the arrow) and the meeting password, rexford2022. If you do not have your 11-digit voter control number you may attend as a guest (non-shareholder) by going to https://web.lumiagm.com/218892223 and entering the requested information. Please note you will not have the ability to ask questions or vote during the meeting if you participate as a guest. If a bank, broker or other nominee is the record holder of your stock on the record date, you will be able to submit a proxy by following the instructions on the voting instruction form or notice that you receive from your bank, broker or other nominee. If a bank, broker or other nominee is the record holder of your stock on the record date, you must obtain and submit a legal proxy from your broker or other nominee as the record holder and a letter from your broker or other nominee showing that you were the beneficial owner of your shares on the record date to American Stock Transfer & Trust on or before 5:00 p.m., Eastern Time, on June 6, 2022, in order to vote electronically at the virtual Annual Meeting. Requests for registration should be directed to proxy@astfinancial.com or to facsimile number 718-765-8730. Written requests for registration can be mailed to: American Stock Transfer & Trust Company LLC Attn: Proxy Tabulation Department 6201 15th Avenue Brooklyn, NY 11219 |
Q&A ABOUT THE ANNUAL MEETING
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| | Telephone and internet proxy authorizations will close at 11:59 p.m. (Eastern Time) on June 12, 2022. If you authorize a proxy, unless you indicate otherwise, the persons named as your proxies will cast your votes FOR the election of all of the nominees named in this Proxy Statement; FOR the ratification of Ernst & Young LLP as our independent registered public accounting firm; FOR the advisory resolution on the Company’s named executive officer compensation and ONE YEAR with respect to the frequency of future advisory votes on the Company’s executive compensation. The persons named as proxies will vote in their discretion on any other business properly introduced at the Annual Meeting or any postponement or adjournment of the Annual Meeting. If your shares of common stock are held in the name of your broker, bank or other nominee, you should receive separate instructions from the holder of your common stock describing how to provide voting instructions. Even if you plan to attend the Annual Meeting, we recommend that you authorize a proxy in advance as described above so that your vote will be counted if you later decide not to attend the Annual Meeting. |
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Q Can I vote my shares by completing and returning the Notice? | | No. The Notice will, however, provide instructions on how to authorize a proxy to vote your shares by telephone, by internet, by requesting and returning a paper proxy card or voting instruction card, or by voting electronically at the Annual Meeting. |
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Q Where and when is the Annual Meeting? | | The Annual Meeting will be held at 8:00 a.m. (Pacific Time) on Monday, June 13, 2022, in a virtual-only meeting format via live audio webcast at https://web.lumiagm.com/218892223. You will need the 11-digit voter control number which appears on your proxy card (printed in the box and marked by the arrow) and the meeting password, rexford2022. If you do not have your 11-digit voter control number you may attend as a guest (non-shareholder) by going to https://web.lumiagm.com/218892223 and entering the requested information. Please note you will not have the ability to ask questions or vote during the meeting if you participate as a guest. |
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Q Why are you having a virtual annual meeting? | | Los Angeles, California, where our principal office is located and annual meetings have been held, continues to maintain its local emergency due to the COVID-19 pandemic. As infection rates have fluctuated over recent months, the Los Angeles County Department of Public Health has loosened and then reinstated face covering and many other COVID-19 prevention rules. Because of the ongoing pandemic and the ever-changing health rules, we believe it is in the best interests of our stockholders to hold a virtual annual meeting. |
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Q What is the purpose of the Annual Meeting of Stockholders? | | At the Annual Meeting, stockholders will consider and vote upon matters described in the Notice of Annual Meeting and this Proxy Statement, including without limitation the election of directors and the ratification of the selection of Ernst & Young LLP as our independent registered public accounting firm. In addition, once the business of the Annual Meeting is concluded, members of management will respond to questions raised by stockholders, as time permits. |
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Q Who can attend the Annual Meeting? | | All of our stockholders as of the close of business on April 14, 2022, the record date for the Annual Meeting, or individuals holding their duly appointed proxies, may attend the Annual Meeting. Authorizing a proxy in response to this solicitation will not affect a stockholder’s right to attend the Annual Meeting and to vote in person. Please note that if you hold your common stock in “street name” (that is, through a broker, bank or other nominee), and you wish to vote electronically at the Annual Meeting, you must obtain a “legal proxy” from your bank, broker or other nominee, and you must submit the legal proxy from your broker or other nominee as the record holder and a letter from your broker or other nominee showing that you were the beneficial owner of your shares on the record date to American Stock Transfer & Trust on or before 5:00 p.m., Eastern Time, on June 6, 2022, in order to vote electronically at the virtual Annual Meeting. Requests for registration should be directed to proxy@astfinancial.com or to facsimile number 718-765-8730. Written requests for registration can be mailed to: American Stock Transfer & Trust Company LLC Attn: Proxy Tabulation Department 6201 15th Avenue Brooklyn, NY 11219 |
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Q&A ABOUT THE ANNUAL MEETING
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Q What am I voting on? What are the Board’s recommendations? | | At the Annual Meeting, you may consider and vote on: |
| Voting Items | | Board Recommendation | | Voting Standard | Treatment of Abstentions & Broker Non-Votes |
| 1.Election of Directors | | FOR the election of each nominee named in this Proxy Statement | | Majority of votes cast for each nominee | Not counted as votes cast and therefore no effect
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| | 2. Ratification of Independent Registered Public Accounting Firm | | FOR | | Majority of votes cast | Discretionary voting by brokers permitted |
| | 3. Say-on-Pay | | FOR | | Majority of votes cast | Not counted as votes cast and therefore no effect |
| | 4. Frequency of the Say-on-Pay Vote | | frequency of ONE YEAR | | Majority of votes cast | Not counted as votes cast and therefore no effect |
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| | A majority of votes cast means the number of shares voted “FOR” a proposal must exceed the number of shares voted “AGAINST” such proposal). Abstentions and broker non-votes will not be counted as votes cast and will have no effect on the result of the vote, although they will be considered present for the purpose of determining the presence of a quorum. Because there are three alternatives for Proposal No. 4, one year, two years or three years, it is possible that none of the three alternatives will receive a majority of the votes cast on this proposal. If no frequency receives a majority of the votes cast on the Frequency Proposal, our Board of Directors and the Compensation Committee of our Board of Directors intend to take the results of the vote on the Frequency Proposal into account in its decision regarding the frequency with which the Company submits advisory resolutions on executive compensation in the future. Unless you give other instructions on your proxy card, the persons named as proxy holders on the proxy card will vote in accordance with the recommendations of the Board and in their discretion on any other business properly introduced at the Annual Meeting. If you are a stockholder of record as of the close of business on the record date for the Annual Meeting and you authorize a proxy (whether by internet, telephone or mail) without specifying a choice on any given matter to be considered at this Annual Meeting, the proxy holders will vote your shares according to the Board’s recommendation on that matter. If you are a stockholder of record as of the record date for the Annual Meeting and you fail to authorize a proxy or vote electronically, assuming that a quorum is present at the Annual Meeting, it will have no effect on the result of the vote on any of the matters to be considered at the Annual Meeting. If you hold your shares through a broker, bank or other nominee, under the rules of the NYSE, your broker or other nominee may not vote with respect to certain proposals unless you have provided voting instructions with respect to that proposal. A “broker non-vote” results when a broker, bank or other nominee properly executes and returns a proxy but indicates that the nominee is not voting with respect to a particular matter because the nominee has not received voting instructions from the beneficial owner. A broker non-vote is not considered a vote cast on a proposal; however, stockholders delivering a properly-executed broker non-vote will be counted as present for purposes of determining whether a quorum is present. If you hold your shares in a brokerage account, then, under NYSE rules and Maryland law: •With respect to Proposal No. 1 (Election of Directors), your broker, bank or other nominee is not entitled to vote your shares on this matter if no instructions are received from you. Broker non-votes will have no effect on the election of directors. •With respect to Proposal No. 2 (Ratification of Independent Registered Public Accounting Firm), your broker is entitled to vote your shares on this matter if no instructions are received from you. •With respect to Proposal No. 3 (Advisory Vote on the Compensation of the Named Executive Officers (“Say-on- Pay Vote”)), your broker, bank or other nominee is not entitled to vote your shares on this matter if no instructions are received from you. Broker nonvotes will have no effect on the result of the vote on this proposal. •With respect to Proposal No. 4 (Advisory vote on the frequency of the Say-on-Pay), your broker, bank or other nominee is not entitled to vote your shares on this matter if no instructions are received from you. Broker non-votes will have no effect on the result of the vote on this proposal. Because an abstention is not a vote cast under state law, if you instruct your proxy or broker to “abstain” or “withhold” on any matter, it will have no effect on the vote on those the matters to be considered at the Annual Meeting. However, if you instruct your proxy or broker to “abstain” on any or all matters, you will still be counted as present for purposes of determining whether a quorum is present. |
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Q&A ABOUT THE ANNUAL MEETING
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Q Who may vote? | | You may vote if you owned shares of our common stock at the close of business on April 14, 2022, which is the record date for the Annual Meeting. You are entitled to cast one vote in the election of directors for as many individuals as there are directors to be elected at the Annual Meeting and to cast one vote on each other matter properly presented at the Annual Meeting for each share of common stock you owned as of the record date. As of April 14, 2022, we had 165,017,587 shares of common stock outstanding. |
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Q Who counts the votes? | | A representative of American Stock Transfer & Trust Company, LLC will tabulate the votes and will act as the inspector of the election. |
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Q What is a quorum for the Annual Meeting? | | The presence in person or by proxy of stockholders entitled to cast a majority of all the votes entitled to be cast at the Annual Meeting on any matter will constitute a quorum at the Annual Meeting. No business may be conducted at the Annual Meeting if a quorum is not present. If a quorum is not present at the Annual Meeting, the Chairman of the meeting may adjourn the Annual Meeting to another date, time or place, not later than 120 days after the original record date of April 14, 2022, without notice other than announcement at the meeting. We may also postpone the Annual Meeting by making a public announcement of the postponement before the time scheduled for the Annual Meeting. |
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Q Can I revoke my proxy? | | Yes, if your shares of common stock are held on record in your name, you can revoke your proxy by: •Filing written notice of revocation with our Secretary before the Annual Meeting at the address shown on the front of this Proxy Statement or at the Annual Meeting; •signing a proxy bearing a later date; or •attending and voting electronically at the Annual Meeting. Attendance at the Annual Meeting will not, by itself, revoke a properly-executed proxy. If your shares of common stock are held in the name of your broker, bank or other nominee, please follow the voting instructions provided by the holder of your common stock regarding how to revoke your proxy. |
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Q What happens if additional matters are presented at the Annual Meeting? | | Other than the four proposals described in this Proxy Statement, we are not aware of any business that may properly be brought before the Annual Meeting. If any other matters are properly introduced for a vote at the Annual Meeting and if you properly authorize a proxy, the persons named as proxy holders will vote in their discretion on any such additional matters. As of the date of this Proxy Statement, our Board is not aware of any other individual who may properly be nominated for election as a director at the Annual Meeting or of any nominee who is unable or unwilling to serve as director. If any nominee named in this Proxy Statement is unwilling or unable to serve as a director, our Board may nominate another individual for election as a director at the Annual Meeting, and the persons named as proxy holders will vote for the election of any substitute nominee. |
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Q Who pays for this proxy solicitation? | | We will bear the expense of preparing, printing and mailing this Proxy Statement and the proxies we solicit. Proxies may be solicited by mail, telephone, personal contact and electronic means and may also be solicited by directors and officers in person, by the internet, by telephone or by facsimile transmission, without additional remuneration. We will also request brokerage firms, banks, nominees, custodians and fiduciaries to forward proxy materials to the beneficial owners of shares of our common stock as of the record date and will reimburse them for the cost of forwarding the proxy materials in accordance with customary practice. Your cooperation in promptly voting your shares and submitting your proxy by the internet or telephone, or by completing and returning the enclosed proxy card (if you received your proxy materials in the mail), will help to avoid additional expense. |
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Q Who is soliciting my vote? | | The Company is providing this Proxy Statement in connection with the solicitation by the Board of proxies to be voted at the Annual Meeting and at any reconvened or rescheduled meeting following any adjournment or postponement of the Meeting. |
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Q Where can I find corporate governance materials? | | Our Corporate Governance Guidelines and Code of Business Conduct and Ethics and the charters for the Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee are available on the Company Information—Governance Documents page of the Investor Relations section on our website at www.rexfordindustrial.com. |
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Q&A ABOUT THE ANNUAL MEETING
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| NO PERSON IS AUTHORIZED ON OUR BEHALF TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS WITH RESPECT TO THE PROPOSALS TO BE VOTED ON AT THE ANNUAL MEETING, OTHER THAN THE INFORMATION AND REPRESENTATIONS CONTAINED IN THIS PROXY STATEMENT, AND, IF GIVEN OR MADE, SUCH INFORMATION AND/OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED. THE DELIVERY OF THIS PROXY STATEMENT SHALL UNDER NO CIRCUMSTANCES CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN OUR AFFAIRS SINCE THE DATE OF THIS PROXY STATEMENT. The date of this Proxy Statement is May 2, 2022. | |
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Appendices
Appendix A - RECONCILIATION OF NON-GAAP FINANCIAL MEASURESDefinitions and Reconciliation of
Non-GAAP Financial Measures
FFO, Core FFO and Core FFO Per Share
FFO
We calculate FFO in accordance with the standards established by the National Association of Real Estate Investment Trusts (“NAREIT”). FFO represents net income (loss) (computed in accordance with GAAP), excluding gains (or losses) from sales of depreciable operating property, gains (or losses) from sales of assets incidental to our business, impairment losses of depreciable operating property or assets incidental to our business, real estate related depreciation and amortization (excluding amortization of deferred financing costs), impairment write-downs of depreciable real estate, and after adjustments for unconsolidated partnerships and joint ventures.
Management uses FFO as a supplemental performance measure because, in excluding real estate related depreciation and amortization, gains and losses from property dispositions, and asset impairments, it provides a performance measure that, when compared year over year, captures trends in occupancy rates, rental rates and operating costs. We also believe that, as a widely recognized measure of performance used by other REITs, FFO may be used by investors as a basis to compare our operating performance with that of other REITs.
However, because FFO excludes depreciation and amortization and captures neither the changes in the value of our properties that result from use or market conditions nor the level of capital expenditures and leasing commissions necessary to maintain the operating performance of our properties, all of which have real economic effects and could materially impact our results from operations, the utility of FFO as a measure of our performance is limited. Other equity REITs may not calculate or interpret FFO in accordance with the NAREIT definition as we do, and, accordingly, our FFO may not be comparable to such other REITs’ FFO. FFO should not be used as a measure of our liquidity and is not indicative of funds available for our cash needs, including our ability to pay dividends.
Core FFO
We also present Core FFO by adjusting FFO to exclude the impact of certain items that we do not consider indicative of our on-going operating performance. Core FFO adjustments consist of (i) acquisition expenses, (ii) loss on extinguishment of debt, (iii) the amortization of the loss on termination of interest rate swaps, (iv) impairments of right-of-use assets and (v) other amounts as they may occur. For the year ended December 31, 2019,2021, Core FFO adjustments consisted of approximately $0.2$3.8 million of acquisition expenses.expenses, as detailed in the reconciliation table below. We believe that Core FFO is a useful supplemental measure as it provides a more meaningful and consistent comparison of our operating performance and allows investors to more easily compare our operating results.
Core FFO per diluted share
Core FFO per diluted share is calculated as Core FFO available to common stockholders divided by the weighted average shares of common stock outstanding – diluted.
The following table sets forth a reconciliation of net income, the most directly comparable financial measure calculated and presented in accordance with GAAP, to FFO, Core FFO and Core FFO per diluted share for the year ended December 31, 2019 (unaudited and in thousands, except per share amounts):
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| | Year Ended Year Ended December 31, |
| | 2021 | 2020 | 2019 | 2018 | 2017 |
Net income | | $ | 136,246 | | $ | 80,895 | | $ | 64,001 | | $ | 47,075 | | $ | 41,700 | |
Add: | | | | | | |
Depreciation and amortization | | 151,269 | | 115,269 | | 98,891 | | 80,042 | | 64,852 | |
Deduct: | | | | | | |
Gain on sale of real estate | | (33,929) | | (13,617) | | (16,297) | | (17,222) | | (29,573) | |
Gain on acquisition of unconsolidated joint venture property | | — | | — | | — | | — | | (11) | |
FFO | | 253,586 | | 182,547 | | 146,595 | | 109,895 | | 76,968 | |
Add: | | | | | | |
Acquisition expenses | | 94 | | 124 | | 171 | | 318 | | 454 | |
Impairment of right-of-use asset | | 992 | | — | | — | | — | | — | |
Loss on extinguishment of debt | | 505 | | 104 | | — | | — | | — | |
Amortization of loss on termination of interest rate swaps | | 2,169 | | 218 | | — | | — | | — | |
Core FFO | | 257,346 | | 182,993 | | 146,766 | | 110,213 | | 77,422 | |
Less: preferred stock dividends | | (12,563) | | (14,545) | | (11,055) | | (9,694) | | (5,875) | |
Less: Core FFO attributable to noncontrolling interests(1) | | (13,504) | | (7,667) | | (3,899) | | (2,302) | | (1,927) | |
Less: Core FFO attributable to participating securities(2) | | (943) | | (774) | | (733) | | (645) | | (549) | |
Core FFO available to common stockholders | | $ | 230,336 | | $ | 160,007 | | $ | 131,079 | | $ | 97,572 | | $ | 69,071 | |
Core FFO per diluted share | | $ | 1.64 | | $ | 1.32 | | $ | 1.23 | | $ | 1.12 | | $ | 0.96 | |
Weighted-average shares of common stock outstanding - diluted | | 140,076 | | 121,178 | | 106,799 | | 87,336 | | 71,599 | |
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| | Year Ended December 31, 2019 |
Net income | | $ | 64,001 |
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Add: | | |
Depreciation and amortization | | 98,891 |
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Deduct: | | |
Gain on sale of real estate | | (16,297 | ) |
FFO | | 146,595 |
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Add: | | |
Acquisition expenses | | 171 |
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Core FFO | | 146,766 |
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Less: preferred stock dividends | | (11,055 | ) |
Less: Core FFO attributable to noncontrolling interests(1) | | (3,899 | ) |
Less: Core FFO attributable to participating securities(2) | | (733 | ) |
Core FFO available to common stockholders | | $ | 131,079 |
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Core FFO per diluted share | | $ | 1.23 |
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Weighted-average shares of common stock outstanding - diluted | | 106,799 |
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(1) | Noncontrolling interests represent holders of outstanding common units and preferred units of the Company’s operating partnership that are owned by unit holders other than us. |
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(2) | Participating securities include unvested shares of restricted stock, unvested Service-Vesting LTIP Units and unvested Performance-Vesting LTIP Units. |
(1)Noncontrolling interests represent holders of outstanding common units and preferred units of the Company’s operating partnership that are owned by unit holders other than us.
(2)Participating securities include unvested shares of restricted stock, unvested Service-Vesting LTIP Units and unvested Performance-Vesting LTIP Units.
Compound Annual Growth Rate (CAGR) - Core FFO per diluted Share
Compound annual growth rate represents the average annual growth rate for specified performance over a time period longer than one year. The CAGR is calculated by dividing the ending value by the beginning value and multiplying the result to the power of one divided by the number of years in the calculation and then subtracting one from the result. We determined the five-year compound annual growth rate of our Core FFO per diluted share at December 31, 2021, to be 14% by dividing the 2021 Core FFO per diluted share of $1.64 by 2017 Core FFO per diluted share of $0.96, then multiplying the result to the one-fourth power and then subtracting one from the result.
NOI and Cash NOI (Including our Same Property Portfolio)
NOI
NOI is a non-GAAP measure, which includes the revenue and expense directly attributable to our real estate properties. NOI is calculated as rental income less property expenses (before interest expense, depreciation and amortization). We use NOI as a supplemental performance measure because, in excluding real estate depreciation and amortization expense and gains (or losses) from property dispositions, it provides a performance measure that, when compared year over year, captures trends in occupancy rates, rental rates and operating costs. We also believe that NOI will be useful to investors as a basis to compare our operating performance with that of other REITs. However, because NOI excludes depreciation and amortization expense and captures neither the changes in the value of our properties that result from use or market conditions, nor the level of capital expenditures and leasing commissions necessary to maintain the operating performance of our properties (all of which have real economic effect and could materially impact our results from operations), the utility of NOI as a measure of our performance is limited. Other equity REITs may not calculate NOI in a similar manner and, accordingly, our NOI may not be comparable to such other REITs’ NOI. Accordingly, NOI should be considered only as a supplement to net income as a
measure of our performance. NOI should not be used as a measure of our liquidity, nor is it indicative of funds available to fund our cash needs. NOI should not be used as a substitute for cash flow from operating activities in accordance with GAAP.
The following table sets forth a reconciliation of net income, the most directly comparable financial measure calculated and presented in accordance with GAAP, to NOI (unaudited and in thousands):
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| | Year Ended December 31, |
| | 2021 | 2020 | 2019 | 2018 | 2017 |
Net income | | $ | 136,246 | | $ | 80,895 | | $ | 64,001 | | $ | 47,075 | | $ | 41,700 | |
Add: | | | | | | |
General and administrative | | 48,990 | | 36,795 | | 30,300 | | 25,194 | | 21,610 | |
Depreciation and amortization | | 151,269 | | 115,269 | | 98,891 | | 80,042 | | 64,852 | |
Other expenses | | 1,297 | | 124 | | 171 | | 318 | | 454 | |
Interest expense | | 40,139 | | 30,849 | | 26,875 | | 25,416 | | 20,209 | |
Loss on extinguishment of debt | | 505 | | 104 | | — | | — | | — | |
Deduct: | | | | | | |
Management, leasing and development services | | 468 | | 420 | | 406 | | 473 | | 493 | |
Interest income | | 37 | | 338 | | 2,555 | | 1,378 | | 445 | |
Equity in income from unconsolidated real estate entities | | — | | — | | — | | — | | 11 | |
Gain on extinguishment of debt | | — | | — | | — | | — | | 25 | |
Gain on sale of real estate | | 33,929 | | 13,617 | | 16,297 | | 17,222 | | 29,573 | |
NOI | | $ | 344,012 | | $ | 249,661 | | $ | 200,980 | | $ | 158,972 | | $ | 118,278 | |
Compound Annual Growth Rate (CAGR) - NOI
We determined the five-year compound annual growth rate of our Consolidated NOI at December 31, 2021, to be 31% by dividing 2021 Consolidated NOI of $344.0 million by 2017 Consolidated NOI of $118.3 million, then multiplying the result to the one-fourth power and then subtracting one from the result.
Cash NOI
NOI on a cash-basis (“Cash NOI”) is a non-GAAP measure, which we calculate by adding or subtracting from NOI (i) fair value lease revenue and (ii) straight-line rental revenue adjustments. We use Cash NOI, together with NOI, as a supplemental performance measure. Cash NOI should not be used as a measure of our liquidity, nor is it indicative of funds available to fund our cash needs. Cash NOI should not be used as a substitute for cash flow from operating activities computed in accordance with GAAP.
Same Property Portfolio NOI and Same Property Portfolio Cash NOI
Same Property Portfolio NOI and Same Property Portfolio Cash NOI represents the NOI and Cash NOI for a subset of our consolidated portfolio and includes the NOI and Cash NOI attributable to properties that were wholly-owned by us as of January 1, 20182020 and still owned by us as of December 31, 2019.
2021.
The following table sets forth the revenue and expense items comprising Same Property Portfolio NOI and the adjustments to calculate Same Property Portfolio Cash NOI for the years ended December 31, 20192021 and 20182020 (unaudited and in thousands): | | | | | | | | | | | | | | | | | | | | |
| | Year Ended December 31, |
| | 2021 | | 2020 |
| | | | | | |
| | | | | | |
| | | | | | |
| | | | | | |
Rental income | | | $ | 317,887 | | | | $ | 293,543 | |
Property expenses | | | (73,062) | | | | (69,224) | |
Same Property Portfolio NOI | | | $ | 244,825 | | | | $ | 224,319 | |
Straight line rental revenue adjustment | | | (7,231) | | | | (9,638) | |
Amortization of above/below market lease intangibles | | | (5,349) | | | | (7,872) | |
Same Property Portfolio Cash NOI | | | $ | 232,245 | | | | $ | 206,809 | |
|
| | | | | | | | |
| | Year Ended December 31, |
| | 2019 | | 2018 |
Rental income | | 203,470 |
| | 192,577 |
|
Property expenses | | (48,692 | ) | | (46,886 | ) |
Same Property Portfolio NOI | | $ | 154,778 |
| | $ | 145,691 |
|
Straight line rental revenue adjustment | | (3,434 | ) | | (5,364 | ) |
Amortization of above/below market lease intangibles | | (3,671 | ) | | (4,496 | ) |
Same Property Portfolio Cash NOI | | $ | 147,673 |
| | $ | 135,831 |
|
The following table sets forth a reconciliation of net income, the most directly comparable financial measure calculated and presented in accordance with GAAP, to NOI, Same Property Portfolio NOI and Same Property Portfolio Cash NOI for the years ended December 31, 20192021 and 20182020 (unaudited and in thousands):
| | | | | | | | | | | | | | | | | | | | |
| | Year Ended December 31, |
| | 2021 | | 2020 |
Net income | | | $ | 136,246 | | | | $ | 80,895 | |
Add: | | | | | | |
General and administrative | | | 48,990 | | | | 36,795 | |
Depreciation and amortization | | | 151,269 | | | | 115,269 | |
Other expenses | | | 1,297 | | | | 124 | |
Interest expense | | | 40,139 | | | | 30,849 | |
Loss on extinguishment of debt | | | 505 | | | | 104 | |
Deduct: | | | | | | |
Management, leasing and development services | | | 468 | | | | 420 | |
Interest income | | | 37 | | | | 338 | |
Gain on sale of real estate | | | 33,929 | | | | 13,617 | |
NOI | | | $ | 344,012 | | | | $ | 249,661 | |
Non-Same Property Portfolio rental income | | | (133,846) | | | | (35,834) | |
Non-Same Property Portfolio property expenses | | | 34,659 | | | | 10,492 | |
Same Property Portfolio NOI | | | $ | 244,825 | | | | $ | 224,319 | |
Straight line rental revenue adjustment | | | (7,231) | | | | (9,638) | |
Amortization of above/below market lease intangibles | | | (5,349) | | | | (7,872) | |
Same Property Portfolio Cash NOI | | | $ | 232,245 | | | | $ | 206,809 | |
Net Debt to Enterprise Value
At December 31, 2021, we had consolidated indebtedness of $1.4 billion, reflecting a Net Debt to Enterprise Value of approximately 9.1%. Enterprise Value is defined as the sum of the liquidation value of our preferred stock and preferred units plus the market value of our common stock excluding shares of nonvested restricted stock, plus the market value of common units of limited partnership held in our operating partnership not owned by us, plus the value of our Net Debt. Our Net Debt is defined as our consolidated indebtedness less cash and cash equivalents. The market value of our common stock and common units of limited partnership not owned by us is based on the Company’s closing share price of $81.11 as of December 31, 2021.
|
| | | | | | | | |
| | Year Ended December 31, |
| | 2019 | | 2018 |
Net income | | $ | 64,001 |
| | $ | 47,075 |
|
Add: | | | | |
General and administrative | | 30,300 |
| | 25,194 |
|
Depreciation and amortization | | 98,891 |
| | 80,042 |
|
Acquisition Expenses | | 171 |
| | 318 |
|
Interest expense | | 26,875 |
| | 25,416 |
|
Deduct: | | | | |
Management, leasing and development services | | 406 |
| | 473 |
|
Interest income | | 2,555 |
| | 1,378 |
|
Gain on sale of real estate | | 16,297 |
| | 17,222 |
|
NOI | | $ | 200,980 |
| | $ | 158,972 |
|
Non-Same Property Portfolio rental income | | (60,782 | ) | | (18,066 | ) |
Non-Same Property Portfolio property expenses | | 14,580 |
| | 4,785 |
|
Same Property Portfolio NOI | | $ | 154,778 |
| | $ | 145,691 |
|
Straight line rental revenue adjustment | | (3,434 | ) | | (5,364 | ) |
Amortization of above/below market lease intangibles | | (3,671 | ) | | (4,496 | ) |
Same Property Portfolio Cash NOI | | $ | 147,673 |
| | $ | 135,831 |
|
The following table sets forth the calculation of the Net Debt to Enterprise Value as of December 31, 2021 (unaudited and in thousands):
| | | | | | | | | | | |
| | 12/31/2021 | | |
Common Stock and Operating Partnership Units - Capitalization(1) | | $ | 13,518,091 | | | | |
Preferred Equity: | | | | | |
Series B and C Cumulative Redeemable Preferred Stock(2) | | 161,250 | | | | |
4.43937% Series 1 Cumulative Redeemable Convertible Preferred Units(3) | | 27,031 | | | | |
4.00% Series 2 Cumulative Redeemable Convertible Preferred Units(4) | | 40,787 | | | | |
Total Equity | | $ | 13,747,159 | | | | |
| | | | | |
Total Debt | | $ | 1,413,121 | | | | |
Less: Cash and cash equivalents | | (43,987) | | | | |
Net Debt | | $ | 1,369,134 | | | | |
| | | | | |
Enterprise Value (Net Debt plus Total Equity) | | $ | 15,116,293 | | | | |
| | | | | |
Net Debt to Enterprise Value | | 9.1 | % | | | |
(1)Calculated as the number of common shares outstanding (160,262,303) plus the number of common units of limited partnership held in our operating partnership not owned by us (6,401,377) as of December 31, 2021, then multiplied by the closing stock price of our common stock on December 31, 2021 ($81.11).
(2)Value based on 3,000,000 outstanding shares of 5.875% Series B Cumulative Redeemable Preferred Stock plus 3,450,000 outstanding shares of 5.625% Series C Cumulative Redeemable Preferred Stock, then multiplied by the liquidation preference of $25 per share.
(3)Value based on 593,960 outstanding units of 4.43937% Cumulative Redeemable Convertible Preferred Units multiplied by the liquidation preference of $45.50952 per unit.
(4)Value based on 906,374 outstanding units of 4.00% Cumulative Redeemable Convertible Preferred Units multiplied by the liquidation preference of $45.00 per unit.
ANNUAL MEETING OF STOCKHOLDERS OF
REXFORD INDUSTRIAL REALTY, INC.
Important Notice Regarding the Internet Availability of Proxy Materials for the Stockholder Meeting to Be Held on May 26, 2020June 13, 2022
The Notice of Annual Meeting, Proxy Statement, 20192021 Annual Report and other SEC filings are available at the investor relations page of our website at www.rexfordindustrial.com.
PLEASE DATE, SIGN AND MAIL YOUR PROXY CARD IN
THE ENVELOPE PROVIDED AS SOON AS POSSIBLE.
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Signature of Stockholder Date: Signature of Stockholder 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. 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" THE ELECTION OF DIRECTORS AND "FOR" PROPOSALS 2 AND 3. THE BOARD RECOMMENDS A VOTE FOR "1 YEAR" ON PROPOSAL 4. PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE x COMPANY NUMBER ACCOUNT NUMBER NOTICE OF INTERNET AVAILABILITY OF PROXY MATERIAL:MATERIAL: The Notice of Meeting, proxy statement and proxy card are available at http://www.astproxyportal.com/ast/18440/ 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.astfinancial.com to enjoy online access. ANNUAL MEETING OF STOCKHOLDERS OF REXFORD INDUSTRIAL REALTY, INC. May 26, 2020
1. Election of Directors:
Richard S. Ziman Howard Schwimmer Michael S. Frankel Robert L. Antin Steven C. Good Diana J. Ingram Tyler H. Rose Peter E. Schwab
2. The ratification of the appointment of Ernst & Young LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2020. 3. The advisory resolution to approve the Company's named executive officer compensation, as described in the Rexford Industrial Realty, Inc. Proxy Statement.June 13, 2022 NOTE: At their discretion, the proxies are authorized to vote upon such other business as may properly come before the meeting or any adjournments or postponements thereof. 1. Election of Directors: Robert L. Antin Michael S. Frankel Diana J. Ingram Angela L. Kleiman Debra L. Morris Tyler H. Rose Howard Schwimmer Richard S. Ziman 2. The ratification of the appointment of Ernst & Young LLP as the Company's independent registered public accounting firm for the fiscal year ending December 31, 2022. 3. The advisory resolution to approve the Company's named executive officer compensation for the fiscal year ended December 31, 2021, as described in the Rexford Industrial Realty, Inc. Proxy Statement. 4. The advisory determination of the frequency of future advisory votes on the Company's executive compensation. FOR AGAINST ABSTAIN MARK “X” HERE IF YOU PLAN TO ATTEND THE MEETING VIRTUALLY. 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 and follow the instructions. Have your proxy card available when you call. Vote online/phone until 11:59 PM EST on June 12, 2022. MAIL - Sign, date and mail your proxy card in the envelope provided as soon as possible. VIRTUALLY AT THE MEETING - The company will be hosting the meeting live via the Internet this year. To attend the meeting via the Internet, please visit https://web.lumiagm.com/218892223 (password: rexford2022) and be sure to have your control number available.
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REXFORD INDUSTRIAL REALTY, INC. Annual Meeting of Stockholders May 26, 2020June 13, 2022 at 8:00 A.M. Pacific Time
This proxy is solicited by the Board of Directors The undersigned hereby appoints Michael Frankel and Howard Schwimmer, and each of them, with full power of substitution and power to act alone, as proxies to vote all the shares of Common Stock which the undersigned would be entitled to vote if personally present and acting at the Annual Meeting of Stockholders of Rexford Industrial Realty, Inc., to be held on May 26, 2020June 13, 2022 at 8:00 a.m.A.M. virtually at the offices of Rexford Industrial Realty, Inc. at 11620 Wilshire Boulevard, Suite 1000, Los Angeles, CA 90025. Due to the emerging public health impact of coronavirus disease 2019 (COVID-19), we are planning for the possibility that the Annual Meeting of Stockholders may be held solely by means of remote communication. If we take this step, we will announce the decision to do so in advance, and details on how to participate in the webcast will be set forth in a press release issued by Rexford Industrial Realty, Inc. and available at www.rexfordindustrial.com. https://web.lumiagm.com/218892223 (password: rexford2022). This proxy, when properly executed, will be voted in the manner directed herein. If no such direction is made, this proxy will be voted in accordance with the Board of Directors’ recommendations. (Continued and to be signed on the reverse side.)