Dear Fellow Stockholders,
SECURITIES AND EXCHANGE COMMISSION
the Securities Exchange Act of 1934 (Amendment No. )
0-11.Filed by the Registrant xFiled by a Party other than the RegistrantoCheck the appropriate box:oPreliminary Proxy StatementoConfidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))xDefinitive Proxy StatementoDefinitive Additional MaterialsoSoliciting Material under §240.14a-12Granite Point Mortgage Trust Inc.(Name of Registrant as Specified In Its Charter)(Name of Person(s) Filing Proxy Statement, if other than the Registrant)Payment of Filing Fee (Check the appropriate box):xNo fee required.oFee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.(1)Title of each class of securities to which transaction applies:(2)Aggregate number of securities to which transaction applies:(3)Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):(4)Proposed maximum aggregate value of transaction:(5)Total fee paid:oFee paid previously with preliminary materials.oCheck box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.(1)Amount Previously Paid:(2)Form, Schedule or Registration Statement No.:(3)Filing Party:(4)Date Filed:NOTICE OF 2018 ANNUAL MEETING AND PROXY STATEMENTMarch 27, 2018 | NYSE: GPMTStockholders:20182024 Annual Meeting of Stockholders, which will be heldconducted virtually via live webcast, on Thursday, June 6, 2024, at the Loews Regency Hotel located at 540 Park Avenue, New York, NY 10065, on Tuesday, May 15, 2018, at 9:10:00 a.m. Eastern Daylight Time.2017 was a groundbreaking year We believe that hosting our annual meeting virtually will make the meeting more accessible for Granite Point Mortgage Trust Inc. We became a publicly traded company onall our stockholders.New York Stock Exchange under the symbol “GPMT” in June when we completed an initial public offering of $195 million of our common stock. We also grew in 2017, originating over $1.2 billion in high-quality floating rate senior loans, bringing our loan portfolio commitmentsbusiness to over $2.7 billionbe conducted at the end ofAnnual Meeting and details regarding access to the year and further expanding our presence in the commercial real estate lending markets. To support this growth, we were able to successfully access the capital markets again in December, issuing convertible senior notes in a private offering in which we ultimately raised approximately $144 million. We were also able to upsize two of our loan financing facilities in the fourth quarter by a combined $350 million, bringing our already substantial borrowing capacity to a total of $2.3 billion. In 2018, we remain focused on growing our company and our high credit quality portfolio in a disciplined manner that protects our stockholders’ capital while maximizing risk-adjusted returns.We hope you consider attending our first Annual Meeting.webcast. It is important that your shares of common stock be represented at our Annual Meeting, regardless of the number of shares you hold and whether or not you plan to attend the meeting in person.virtual meeting. Accordingly, we encourage you to authorize your vote as soon as possible by following the instructions contained in the Notice of Internet Availability of Proxy Materials that you receive for our Annual Meeting.The accompanying NoticeMeeting, or, if you have elected to receive a paper or email copy of the proxy materials, by completing, signing and returning the proxy card that is provided.Meeting of StockholdersMeeting. We appreciate your continued support and Proxy Statement describe the confidence demonstrated by your investment in Granite Point.
President, Chief Executive Officer and Director
| | | NOTICE OF ANNUAL MEETING | |
| | MEETING LOGISTICS | | | |||
| | When: | | | Thursday, June 6, 2024 10:00 a.m. Eastern Time | | |
| | Where: | | | You can attend the meeting by logging into virtualshareholdermeeting.com/GPMT2024 and following the instructions provided on your Notice of Availability. | | |
| | Who: | | | You may vote at the Annual Meeting if you were a holder of our common stock as of the close of business on April 8, 2024. | | |
| | Voting: | | | |||
| | You are encouraged to vote in one of the following ways prior to the meeting. | | |
| | Stockholders of Record | | | |||
| | By Internet | | | Please access the website www.proxyvote.com and follow the instructions provided on the Notice of Availability or proxy card. | | |
| | By Telephone | | | Please call the number and follow the instructions provided on the Notice of Availability or proxy card. | | |
| | By Mail | | | Please complete, sign and date your proxy card and return it in the reply envelope included with the paper proxy materials. | | |
| | Beneficial Owners | | | |||
| | If you hold your shares in street name, you must vote your shares in the manner prescribed by your broker, bank, trustee or other nominee, which is similar to the voting procedures for stockholders of record. | | |
| | IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON JUNE 6, 2024: Our 2024 Proxy Statement and Annual Report on Form 10-K for the fiscal year ended December 31, 2023, are available at www.proxyvote.com | | |
| Proposals | | | | | | Board’s Voting Recommendation | |
| | | To elect as directors the six nominees named in the accompanying proxy statement | | | FOR | | |
| | | To approve on an advisory basis the compensation of our named executive officers | | | FOR | | |
| | | To approve on an advisory basis the frequency of future advisory votes regarding the compensation of our named executive officers | | | EVERY YEAR | | |
| | | To ratify the appointment of Ernst & Young LLP as our independent auditor for our fiscal year ending December 31, 2024 | | | FOR | |
vote, to stockholders unless they have directed us to provide the materials in a different manner. Certain stockholders will continue to receive a printed set of proxy materials, including our Proxy Statement, Annual Report on Form 10-K and proxy card or voting instructions. Our Proxy Statement and Annual Report on Form 10-K are available at
www.proxyvote.com. | | | | | 53 | | | |
| | | | | 54 | | | |
| Summary Compensation Table | | | | | 54 | | |
| Grants of Plan-Based Awards in 2023 | | | | | 55 | | |
| | | | | 58 | | | |
| Stock Vested in 2023 | | | | | 60 | | |
| Nonqualified Deferred Compensation | | | | | 60 | | |
| | | | | 60 | | | |
| Pay Versus Performance | | | | | 65 | | |
| CEO Pay Ratio | | | | | 68 | | |
| | | | | 69 | | | |
| | | | | 70 | | | |
| | | | | 71 | | | |
| Audit and Non-Audit Fees | | | | | 71 | | |
| Audit Services Pre-Approval Policy | | | | | 72 | | |
| | | | | 73 | | | |
| | | | | 74 | | | |
| Meeting Matters | | | | | 74 | | |
| | | | | 74 | | | |
| Annual Report | | | | | 74 | | |
| | | | | 75 | | | |
| | | | | 81 | | | |
| RESERVATION REQUEST FORM | | | | | | | |
| 2024 PROXY STATEMENT / 1 | |
| | Benefits of Internal Management Structure for Our Stockholders | | | | | |
| | • Reduced operating expenses and created opportunities to realize increased economies of scale • Eliminated management fee based on stockholders’ equity • Executive compensation program emphasizes performance-based cash and equity awards that incorporate financial and non-financial goals • Compensation Committee approval – and transparent disclosure – of all components of executive compensation, not just equity awards • Alignment of capital markets activities with stockholder interests | | |
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| | Portfolio and Capitalization Snapshot(1) | | | | | |
| | • Broadly diversified 100% loan portfolio comprised of 73 discrete investments totaling $2.9 billion in commitments and $2.7 billion outstanding principal balance • 99% senior loans with an average commitment of $37 million, a weighted average stabilized LTV(2) of 63.6% and yield(2) of 8.3% • Capitalized with approximately $0.9 billion of equity and a well-balanced funding profile with approximately 56% non-mark-to-market borrowings, moderate leverage of 2.1x debt-to-equity(2) and no remaining corporate debt maturities | | | |||
| | (1) All information as of December 31, 2023 | | | |||
| | (2) See definition in the Appendix | | |
| 2024 PROXY STATEMENT / 3 | |
| | DATE & TIME: Thursday, June 6, 2024 10:00 a.m. Eastern Time VIRTUAL MEETING: This year’s meeting will be held virtually at virtualshareholdermeeting.com/GPMT2024 RECORD DATE: Holders of common stock at the close of business on April 8, 2024, are eligible to vote | | | MEETING AGENDA: 1. To elect as directors the six nominees named in this proxy statement 2. To approve on an advisory basis the compensation of our named executive officers 3. To approve on an advisory basis the frequency of future advisory votes regarding the compensation of our named executive officers 4. To ratify the appointment of Ernst & Young LLP to serve as our independent auditor for our fiscal year ending December 31, 2024 5. To transact such other business as may properly come before the Annual Meeting and any adjournment or postponement thereof | | |
| | | PROPOSAL 1: ELECTION OF DIRECTORS The Board of Directors recommends that you vote FOR each director nominee. These individuals bring relevant experiences and perspectives that are essential to good governance and leadership of our Company. | | | FOR (See Page 11) | |
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Nominee | | | Age | | | Director Since | | | Independent | | | Primary Occupation | | | Committees | | |||||||||
| Audit | | | Comp | | | N&CG | | |||||||||||||||||
| | Stephen G. Kasnet Chair of the Board | | | 78 | | | 2017 | | | | | Former President and Chief Executive Officer of Harbor Global Company, Ltd. | | | C | | | | | | | | ||
| | John (“Jack”) A. Taylor | | | 68 | | | 2017 | | | CEO | | | President and Chief Executive Officer of Granite Point Mortgage Trust Inc. | | | | | | | | | | | |
| | Tanuja M. Dehne | | | 52 | | | 2017 | | | | | Former President and Chief Executive Officer of the Geraldine R. Dodge Foundation | | | | | | M | | | C | | ||
| | Sheila K. McGrath | | | 59 | | | 2023 | | | | | Former Senior Managing Director, Evercore | | | M | | | | | | M | | ||
| | W. Reid Sanders | | | 74 | | | 2017 | | | | | President of Sanders Properties, Inc. | | | M | | | M | | | M | | ||
| | Hope B. Woodhouse | | | 67 | | | 2017 | | | | | Former Chief Operating Officer of Bridgewater Associates, LP | | | M | | | C | | | | | ||
Number of Meetings in 2023 | | | Full Board: 11 | | | | | | 8 | | | 8 | | | 5 | |
| 2024 PROXY STATEMENT / 5 | |
| | Independent Chair | | | | | | | Independent committees | | | | | | | Majority voting | |
| | Our Chief Executive Officer focuses on managing our Company while our independent Board Chair drives accountability at the Board level | | | | | | | All our Board committees are composed entirely of independent directors | | | | | | | We have a majority standard for uncontested elections of directors and a resignation policy for directors who do not receive a majority of the votes cast | |
| | Annually elected board | | | | | | | Board assessments | | | | | | | Executive sessions | |
| | We do not have a classified board – each of our directors is elected annually for a one-year term | | | | | | | A rigorous self-assessment process helps our Board evaluate its performance and identify and address any potential gaps | | | | | | | Our independent directors hold regular executive sessions, with the independent Board Chair presiding | |
| | Director education | | | | | | | Stock ownership guidelines | | | | | | | Director commitments | |
| | Our Director Education Policy empowers our directors to be well versed in principles of corporate governance and other critical subject matters | | | | | | | Each independent director is expected to accumulate equity interests in an amount equal to three times the director’s annual cash retainer | | | | | | | A director may not serve on more than three other boards of public companies in addition to our Board, and a director who is a CEO may not serve on more than one other board | |
| | Board diversity | | | | | | | ESG oversight | | | | | | | Investor outreach | |
| | We take reasonable steps to assemble a diverse pool of nominees when conducting searches for new directors, and any search firm we engage is instructed to seek to include diverse candidates | | | | | | | With the leadership of the Nominating and Corporate Governance Committee, our Board oversees our Company’s approach to environmental, social and governance matters | | | | | | | In addition to our standard investor engagement conducted at conferences and through non-deal roadshows and one-on-one meetings, we invite our largest investors to have an annual conversation on corporate governance topics | |
| | No hedging or pledging | | | | | | | Single class of common stock | | | | | | | No political contributions | |
| | We prohibit short sales, transactions in derivatives, hedging and pledging of our securities by directors, executive officers and employees | | | | | | | Each share of our common stock has one vote | | | | | | | In accordance with our Code of Business Conduct and Ethics, our Company will not contribute to political candidates, parties or campaigns | |
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| | Program Foundations | | |
| | At Granite Point, we are committed to identifying and responding to business risks and opportunities related to environmental, social and governance (ESG) issues. We are also committed to being a responsible, ethical corporate citizen, an employer of choice for talented professionals, and a positive member of the communities where we live and work. | | |
Sincerely,
John A. Taylor
Point Core Values
| 2024 PROXY STATEMENT / 7 | |
| | Environmental | | | | | | | Social | | | | | | | Governance | |
| | Climate change and other environmental factors pose risks to our investment portfolio that we must actively manage, and we also recognize our responsibility to operate our business in a manner that limits negative environmental impacts | | | | | | | Our social commitment is centered on human capital management – that is, providing resources and support to attract, develop and retain our team of talented professionals – as well as positively engaging with the communities where we operate in New York and Minnesota | | | | | | | A strong governance framework – including an effective ethics and compliance program, thoughtful attention to information security and privacy concerns, and quality corporate governance practices at the Board level – is critical to our long-term success as a real-estate finance company | |
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| | | PROPOSAL 2: ADVISORY APPROVAL OF EXECUTIVE COMPENSATION The Board of Directors recommends that you vote FOR this advisory “Say on Pay” proposal. Our executive compensation program is designed to reward performance and align with stockholders’ interests. | | | FOR (See Page 69) | |
| | OUR EXECUTIVE COMPENSATION PROGRAM IS DESIGNED TO: | | |
| | • Attract, retain and incentivize the best talent to support our business objectives; • Pay for performance by linking compensation to the achievement of short-term and long-term financial and strategic goals; • Align the interests of our named executive officers, or NEOs, and stockholders by tying elements of executive compensation to corporate performance and generated returns; and • Ensure fair, equitable and competitive pay practices. | | |
| | | |
| SAY ON PAY RESULTS IN 2023 Approximately 95% of the votes cast at our 2023 annual meeting of stockholders approved, on an advisory basis, our executive compensation program as described in our proxy statement for that meeting. Our Say on Pay voting results have been consistently high, with approval rates of approximately 97% at our 2022 annual meeting and approximately 96% at our 2021 annual meeting. | | | |
| 2024 PROXY STATEMENT / 9 | |
| | What We Do | | | | | |
| | • A significant portion of each NEO’s compensation is at risk • We have adopted meaningful stock ownership requirements applicable to our NEOs • Our independent Compensation Committee retains an independent compensation consultant who provides no other services to our Company • Performance-based cash and equity awards have a sliding scale earn-out structure that allows for 0% payouts and is capped at 200% of target amounts • Our performance-based equity awards use both absolute and relative performance metrics • Our Compensation Committee conducts an annual compensation risk assessment • We hold an annual Say on Pay vote | | |
| | What We Don’t Do | | | | | |
| | • Our NEOs do not receive perquisites or retirement plans not available to other employees • We do not allow our NEOs to hedge or pledge their Company stock • We do not have single-trigger accelerated vesting of equity awards upon a change of control of our Company, and our equity plan does not use a liberal definition of “change of control” • Our equity plan does not use liberal share recycling • We do not pay dividends on any performance-based equity units that are not earned through satisfaction of the awards’ performance metrics • We do not provide tax gross-ups • Our NEOs’ employment agreements do not provide for excessive severance payments | | |
| | | PROPOSAL 3: ADVISORY APPROVAL OF FREQUENCY OF SAY ON PAY VOTES The Board of Directors recommends that you vote on an advisory basis to hold future Say on Pay votes EVERY YEAR. | | | EVERY YEAR (See Page 70) | |
| | | PROPOSAL 4: RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITOR The Board of Directors recommends that you vote FOR the ratification of the appointment of Ernst & Young LLP as our independent registered public accounting firm for the year ending December 31, 2024. | | | FOR (See Page 71) | |
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Key Skill or Qualification | | | # | | | Connection to Granite Point’s Strategy | |
Real Estate or REIT | | | 6 | | | Directors with extensive knowledge of, and/or experience in, the real estate sector and/or REITs have the knowledge needed to set and oversee our strategy | |
Strategic Opportunities or Balance Sheet Management | | | 6 | | | Directors with experience overseeing corporate strategy (including M&A and capital markets transactions) and/or balance sheet management (including funding and capital allocation strategies) help evaluate value-creating opportunities for our Company and our stockholders | |
Finance or Accounting | | | 6 | | | Directors with strong financial literacy and experience reviewing financial reporting and internal controls enhance our Board’s ability to oversee our strategy and drive accurate and transparent reporting to our stockholders | |
Credit or Principal Investing | | | 5 | | | Directors with experience in credit investing and/or principal investing provide valuable perspectives that inform our strategy and long-term, fundamental, value-driven investment philosophy | |
Operations and Management | | | 5 | | | Directors with operations and management experience help guide our Company through various economic, credit and interest rate cycles and enhance our Board’s ability to develop and oversee our internal operations and business strategy | |
Prior Public Board or Governance Experience | | | 4 | | | Directors with experience serving on public company boards or on organizations with a governance focus help promote a culture of accountability and transparency on our Board, in addition to instituting corporate governance policies that protect stockholder interests | |
| | | | | | (continued) | |
| 2024 PROXY STATEMENT / 11 | |
Key Skill or Qualification | | | # | | | Connection to Granite Point’s Strategy | |
ESG | | | 2 | | | Directors with experience evaluating and overseeing ESG efforts, including but not limited to environmental sustainability and diversity, equity and inclusion efforts, allow our Company to build and maintain a long-term, responsible business model, and deepen relationships with our investors, business partners, other stakeholders and communities | |
Investor Communications and Outreach | | | 2 | | | Directors with experience understanding the investor perspective and/or maintaining deep institutional relationships enhance our investor communications and outreach practices as a publicly traded company | |
| | | Kasnet | | | Taylor | | | Dehne | | | McGrath | | | Sanders | | | Woodhouse | |
Real Estate or REIT | | | | | | | | | | | | | | ||||||
Strategic Opportunities or Balance Sheet Management | | | | | | | | | | | | | | ||||||
Finance or Accounting | | | | | | | | | | | | | | ||||||
Credit or Principal Investing | | | | | | | | | | | | | | | |||||
Operations and Management | | | | | | | | | | | | | | | |||||
Prior Public Board or Governance Experience | | | | | | | | | | | | | | | | ||||
ESG | | | | | | | | | | | | | | | | | | ||
Investor Communications and Outreach | | | | | | | | | | | | | | | | | | ||
Demographic Characteristics | | | | | | | | | | | | | | | | | | | |
Women | | | | | | | | | | | | | | | | | |||
Ethnic/Racial Minorities | | | | | | | | | | | | | | | | | | |
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| Chair of the Board and Independent Director Committee(s): Audit (Chair) | | | STEPHEN G. KASNET | | |||
| Age: 78 | | | Director Since: 2017 | | |||
| KEY SKILLS & QUALIFICATIONS Real Estate or REIT – Through various director and management positions, including at Two Harbors Investment Corp., Silver Bay Realty Trust, Bradley Real Estate Trust and Harbor Global, Mr. Kasnet has extensive REIT and real estate sector experience Strategic Opportunities or Balance Sheet Management – In various director and management positions, including at Two Harbors Investment Corp. and Silver Bay Realty Trust, Mr. Kasnet has experience navigating and evaluating M&A, capital markets and other strategic opportunities and in balance sheet management Finance or Accounting – As a qualified financial expert on the Audit Committee, Mr. Kasnet has the experience and financial literacy to oversee financial reporting and internal controls Credit or Principal Investing – As a director of Two Harbors Investment Corp., former CEO of Pioneer First Voucher Fund and former President of Pioneer Real Estate Investors, among other positions, Mr. Kasnet has experience investing in real estate and other real estate products Operations and Management – Through various executive roles in the real estate and mortgage REIT industry, Mr. Kasnet has the right expertise to help develop and oversee our business strategy and has a broad perspective on operational matters Prior Public Board or Governance Experience – Mr. Kasnet has served as a director for multiple public companies, including Two Harbors Investment Corp (NYSE: TWO), Silver Bay Realty Trust (NYSE: SBY), Columbia Laboratories (NASDAQ: CBRX) and Rubicon (NZX: RBC) | |
| PROFESSIONAL EXPERIENCE | | | | |
| • President and CEO, Harbor Global and CEO, PIOglobal Investment Fund (a subsidiary of Harbor Global) (2000-2006) • CEO, Pioneer First Voucher Fund (Russia) (2000-2006) • President, Pioneer Global Institutional Advisors (1995-2000) • President, Pioneer Real Estate Investors (1993-2000) | | | • Director and Member of the Executive Committee, The Bradley Real Estate Trust (1995-1999) • President, Cabot, Cabot and Forbes Asset Management (1990-1993) • Additional senior management positions with other financial organizations, including First Winthrop Corporation and Winthrop Financial Associates | |
| OTHER CORPORATE BOARDS • Chairman of the Board, Chairman of the Audit Committee and Member of the Risk Oversight Committee, Two Harbors Investment Corp. (NYSE: TWO) (2009-present) • Director, Silver Bay Realty Trust Corp. (NYSE: SBY) (2012-2017) • Chairman of the Board, Rubicon (NZX: RBC) (2008-2018) • Director, First Ipswich Bancorp (2008-2020) • Director, GoodBulk, an ocean cargo carrier (2017-2019) • Chairman of the Board, Tenon Ltd., a timberland owner and wood product producer (2016-2018) • Chairman of the Board, Columbia Laboratories, Inc. (NASDAQ: CBRX) (2004-2015) • Director, Republic Engineered Products, a specialty steel manufacturer (2002-2008) • Director, FTD, a florist collective (2001-2005) • Chairman of the Board, Warren Bank & Warren Bancorp. (1990-2003) | | |||
| ORGANIZATIONS • Trustee, The Governor’s Academy, a private coed boarding high school in Byfield, Massachusetts | | |||
| EDUCATION • BA, University of Pennsylvania | |
| 2024 PROXY STATEMENT / 13 | |
| President, Chief Executive Officer and Director | | | JOHN (“JACK”) A. TAYLOR | | |||
| Age: 68 | | | Director Since: 2017 | | |||
| KEY SKILLS & QUALIFICATIONS Real Estate or REIT – Through various management and real estate group leadership positions at asset management firms, including PGIM Real Estate Investors, UBS and PaineWebber, and membership in the Commercial Real Estate Finance Council and President’s Council of the Real Estate Roundtable, Mr. Taylor has extensive real estate sector experience Strategic Opportunities or Balance Sheet Management – As a leader in the real estate groups at Prudential Real Estate Investors, UBS, PaineWebber and Kidder, Peabody & Co., Mr. Taylor has extensive experience managing corporate strategy in the real estate sector – including by effecting transactions and raising capital – and the right experience to manage our balance sheet and funding profile Finance or Accounting – Through various management positions at real estate finance companies, Mr. Taylor brings strong financial literacy and a deep expertise in real estate finance fundamentals Credit or Principal Investing – As partner of Five Mile Capital and Head of Global Real Estate Finance at Prudential Real Estate Investors, Mr. Taylor has developed deep knowledge of debt products and asset-based lending in the real estate space Operations and Management – As President and CEO of Granite Point and through various management positions at asset management firms, Mr. Taylor has extensive knowledge of our Company and the right experience to oversee our Company’s operations and business strategy Investor Communications and Outreach – As President and CEO of Granite Point and through various management positions at asset management firms, Mr. Taylor has extensive experience with investor communications practices | |
| PROFESSIONAL EXPERIENCE | | | | |
| • President and CEO, Granite Point Mortgage Trust (2017-present) • Global Head of Commercial Real Estate, Pine River Capital Management (2014-2020) • Managing Director, Head of Global Real Estate Finance, Member of the Global Management Committee and Chair of the Global Investment Committee for debt and equity, Prudential Real Estate Investors (now known as PGIM Real Estate Company) (2009-2014) | | | • Partner, Five Mile Capital Partners (2003-2007) • Co-Head of Real Estate Investment Banking for the Americas and Europe, UBS • Head of Real Estate Group and Member of the Operating Committee, PaineWebber • Head Trader and Manager of CMBS and Principal Commercial Mortgage business, Kidder, Peabody & Co. | |
| ORGANIZATIONS • Founding Governor and Member, Commercial Real Estate Finance Council (formerly known as the Commercial Mortgage Securities Association) • Member, President’s Council of the Real Estate Roundtable • Chairman of the Board, Innocence Project, an organization that works to free the innocent, prevent wrongful convictions and create fair, compassionate and equitable systems of justice for everyone, guided by science and grounded in antiracism | | |||
| EDUCATION • JD, Yale Law School • MSc, International Relations, London School of Economics and Political Science • BA, University of Illinois | |
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| Independent Director Committee(s): Nominating & Corporate Governance (Chair), Compensation | | | TANUJA M. DEHNE | | |||
| Age: 52 | | | Director Since: 2017 | | |||
| KEY SKILLS & QUALIFICATIONS Real Estate or REIT – As a director at Silver Bay Realty Trust, Ms. Dehne developed knowledge of REITs and the real estate sector Strategic Opportunities or Balance Sheet Management – In various director and management positions, including at Silver Bay Realty Trust, Advanced Disposal Services and NRG Energy, as well as in private legal practice, Ms. Dehne has experience navigating and evaluating M&A, capital market and other strategic opportunities Finance or Accounting – Through her experience as a corporate and securities attorney, service on the Audit Committee of Silver Bay Realty Trust and her experience overseeing the investment management of an endowment, Ms. Dehne has the financial literacy to oversee financial reporting and internal controls Operations and Management – Through various roles and spans of control at NRG Energy and the Geraldine R. Dodge Foundation, Ms. Dehne has operational and management experience that enhances our Board’s ability to develop and oversee our operations and business strategy; through various roles at NRG Energy, including Chief Administrator and Senior Vice President of Human Resources, Ms. Dehne has operational experience in managing human capital ESG – As an executive and director at the Geraldine R. Dodge Foundation and Climate Real Impact Solutions II Acquisition Corp., respectively, Ms. Dehne has provided experience elevating and providing perspective regarding environmental, sustainability and social justice issues and best practices Prior Public Board or Governance Experience – With over two decades teaching, advising and serving on corporate boards, and as Chair of the Advisory Board of the Gupta Governance Institute at Drexel University, Ms. Dehne provides corporate governance expertise to our Board | |
| PROFESSIONAL EXPERIENCE | | | | |
| • President and CEO, Geraldine R. Dodge Foundation, a private foundation that supports, centers, and connects communities and changemakers who are addressing the root causes and repair of structural racism and inequity in New Jersey (2019-2024) | | | • NRG Energy (NYSE: NRG) (2004-2016) ◦ Executive Vice President, Chief Administrator and Chief of Staff ◦ Additional roles included: Senior Vice President, Human Resources; Secretary and Deputy/Assistant General Counsel • Practiced corporate law as a member of the business department, Saul Ewing (1999-2004) | |
| OTHER CORPORATE BOARDS • Director, Climate Real Impact Solutions II Acquisition Corp. (NYSE: CLIM.U) (2021-2022) • Director, Advanced Disposal Services (NYSE: ADSW) (2017-2020) • Director, Silver Bay Realty Trust (NYSE: SBY) (2012-2017) | | |||
| ORGANIZATIONS • Chair, Advisory Board of the Gupta Governance Institute, Drexel University, an institute that advocates for improved governance practices for public, private and nonprofit organizations through programming, knowledge sharing and research • Trustee, Lafayette College • Trustee, New York Public Radio • Trustee, AAPIP (Asian Americans/Pacific Islanders in Philanthropy) • Trustee, Philanthropy New York • Member, Nominating and Governance Peer Group Steering Committee, Women Corporate Directors • Faculty Member, NACD Board Advisory Services | | |||
| EDUCATION • JD, Syracuse University • MA, Political Science, University of Pennsylvania • AB, Lafayette College | |
| 2024 PROXY STATEMENT / 15 | |
| Independent Director Committee(s): Audit, Nominating & Corporate Governance | | | SHEILA K. McGRATH | | |||
| Age: 59 | | | Director Since: 2023 | | |||
| KEY SKILLS & QUALIFICATIONS Real Estate or REIT – Given her background as a senior REIT research analyst and involvement with several industry organizations such as the Real Estate Investment Advisory Council (REIAC) and National Association of Real Estate Investment Trusts (NAREIT), Ms. McGrath has a strong understanding of REITs and the real estate sector Strategic Opportunities or Balance Sheet Management – As a senior equity research analyst for over 25 years, with the past 10 years at Evercore, Ms. McGrath has broad expertise in analyzing and evaluating the financial and public market considerations of M&A, capital markets and other strategic opportunities and brings valuable insight into our balance sheet management policies Finance or Accounting – Through her 25+ years of experience as a REIT research analyst, Ms. McGrath has deep expertise in REIT fundamentals and valuation, and she is a qualified financial expert on the Audit Committee Credit or Principal Investing – As a commercial real estate appraiser with the Member of Appraisal Institute (MAI) designation while at CB Commercial, Ms. McGrath brings deep knowledge of commercial real estate valuation and feasibility analysis conducted for financial institutions and institutional investors for both equity investment and debt financing purposes Investor Communications and Outreach – Given her sell-side research expertise, Ms. McGrath has both an acute understanding of the investor perspective and deep institutional relationships, which enhance our investor communications and outreach ESG – Through her roles with NAREIT’s Dividends Through Diversity and Inclusion Initiative and the Gaining and Retaining Outstanding Women program at Rutgers Business School’s Center for Women in Business, Ms. McGrath has experience leading on diversity, equity and inclusion in our industry | |
| PROFESSIONAL EXPERIENCE | | | | |
| • Senior Managing Director, Equity REITs, Real Estate Operating Companies, Evercore (2012-2022) • Managing Director, Senior Vice President and Member of the Research Review and Leadership Committees, Keefe, Bruyette & Woods (2007-2012) | | | • Senior equity research analyst covering REITs for more than 20 years at other financial organizations, including Smith Barney, UBS and Dresdner Kleinwort • Valued commercial real estate properties in the real estate advisory and valuation group at CB Commercial | |
| OTHER CORPORATE BOARDS • Director and Member of the Life Science, Agtech & Advanced Technologies Committee, Alexandria Real Estate Equities, Inc. (NYSE: ARE) (2023-present) | | |||
| ORGANIZATIONS • Member of the Advisory Board of Governors, Real Estate Investment Advisory Council (REIAC), and former member of the Steering Committee of the Dividends Through Diversity and Inclusion Initiative and Best Financial Practices Committee, NAREIT • Founding Member of the Board of the Center for Women in Business and Mentor for GROW (Gaining and Retaining Outstanding Women), Rutgers Business School • Associate Member of a variety of industry organizations including International Council of Shopping Centers (ICSC), the Urban Land Institute (ULI) and the U.S. Green Building Council | | |||
| EDUCATION • MBA, Finance and Real Estate, Rutgers University • AB, Lafayette College | |
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| Independent Director Committee(s): Audit, Compensation, Nominating & Corporate Governance | | | W. REID SANDERS | | |||
| Age: 74 | | | Director Since: 2017 | | |||
| KEY SKILLS & QUALIFICATIONS Real Estate or REIT – In various director and management positions, including at Two Harbors Investment Corp., Silver Bay Realty Trust, Mid-America Apartment Communities and Sanders Properties, Mr. Sanders has extensive REIT and real estate sector experience Strategic Opportunities or Balance Sheet Management – In various director and management positions, including at Two Harbors Investment Corp., Mid-America Apartment Communities, Silver Bay Realty Trust and Sanders Properties, Mr. Sanders has experience navigating and evaluating M&A, capital markets and other strategic opportunities and in balance sheet management Finance or Accounting – Through Mr. Sanders’ extensive background in the financial services industry, he possesses strong financial literacy and experience to oversee financial reporting and internal controls Credit or Principal Investing – As a director of Two Harbors Investment Corp. and former executive at Southeastern Asset Management, Longleaf Partners Mutual Funds and First Tennessee Investment Management, among others, Mr. Sanders has extensive investing experience Operations and Management – In various director and management positions at Two Harbors Investment Corp., Mid-America Apartment Communities and Sanders Properties, among others, Mr. Sanders has experience managing operations in the real estate industry Prior Public Board or Governance Experience – Mr. Sanders has served as a director for multiple public companies, including Two Harbors Investment Corp (NYSE: TWO), Mid-America Apartment Communities (NYSE: MAA) and Silver Bay Realty Trust (NYSE: SBY) | |
| PROFESSIONAL EXPERIENCE | | | | |
| • President, Sanders Properties (2004-present) • Investment Committee Member, Cypress Realty (2002-present) | | | • Co-Founder and Executive Vice President, Southeastern Asset Management • President, Longleaf Partners Mutual Funds • Investment Officer, First Tennessee Investment Management | |
| OTHER CORPORATE BOARDS • Director and Member of the Audit, Compensation and Risk Oversight Committees, Two Harbors Investment Corp. (NYSE: TWO) (2009-present) • Director and Member of the Audit Committee, Mid-America Apartment Communities (NYSE: MAA) (2010-present) • Director and Member of the Executive, Nominating and Corporate Governance and Strategic Planning Committees, Independent Bank (2004-present) • Advisory Board Member, SSM Venture Partners III (2000-present) • Director, Silver Bay Realty Trust (NYSE: SBY) (2015-2017) • Chairman of the Board, Two Rivers Capital Management (2004-2007) • Director, Harbor Global (2001-2006) • Director, PIOglobal Asset Management (2001-2006) • Director, TBA Entertainment (2000-2004) • Director, The Pioneer Group (1999-2000) | | |||
| ORGANIZATIONS • Chairman of the Board, Hugo Dixon Foundation • Trustee, Dixon Gallery and Gardens Endowment Fund, and Dixon Gallery and Gardens | | |||
| EDUCATION • BA, University of Virginia | |
| 2024 PROXY STATEMENT / 17 | |
| Independent Director Committee(s): Compensation (Chair), Audit | | | HOPE B. WOODHOUSE | | |||
| Age: 67 | | | Director Since: 2017 | | |||
| KEY SKILLS & QUALIFICATIONS Real Estate or REIT – As a director of Two Harbors Investment Corp., Ms. Woodhouse has developed knowledge of REITs and the real estate sector Strategic Opportunities or Balance Sheet Management – Through various director and management positions, including at Two Harbors Investment Corp., Piper Jaffray and Seoul Securities, Ms. Woodhouse has experience navigating and evaluating M&A, capital markets and other strategic opportunities and in balance sheet management Finance or Accounting – As a qualified financial expert on the Audit Committee, Ms. Woodhouse has the experience and financial literacy to oversee financial reporting and internal controls Credit or Principal Investing – As a former executive at Bridgewater Associates, Soros Fund Management, Tiger Management and Salomon Brothers, Ms. Woodhouse brings extensive investing experience Operations and Management – As a former executive at Bridgewater Associates, Soros Fund Management, Tiger Management and Salomon Brothers, Ms. Woodhouse brings extensive management and operations experience, including the oversight of human resources Prior Public Board or Governance Experience – Ms. Woodhouse has served as a director for multiple public companies, including Two Harbors Investment Corp (NYSE: TWO), Piper Jaffray (NYSE: PJC), Acadia Realty Trust (NYSE: AKR) and Monro (NASDAQ: MNRO) | |
| PROFESSIONAL EXPERIENCE | | | | |
| • Chief Operating Officer, Bridgewater Associates (2005-2009) • President and Chief Operating Officer, Auspex Group (2003-2005) | | | • Chief Operating Officer, Soros Fund Management • Treasurer, Tiger Management • Managing Director, Salomon Brothers | |
| OTHER CORPORATE BOARDS • Trustee and Member of the Nominating and Governance Committee, Acadia Realty Trust (NYSE: AKR) (2023-present) • Director and Member of the Compensation and Audit Committees, Monro, Inc. (NASDAQ: MNRO) (2023-present) • Director, Chair of the Risk Oversight Committee and Member of the Audit Committee, Two Harbors Investment Corp. (NYSE: TWO) (2012-present) • Director, Atomyze (2020-2022) • Director, Piper Jaffray (NYSE: PJC) (2011-2014) • Director, Seoul Securities (2001-2003) | | |||
| ORGANIZATIONS • Member, Children’s Services Advisory Committee of Indian River Country • Trustee, Tiger Foundation | | |||
| EDUCATION • MBA, Harvard University • AB, Georgetown University | |
| | | PROPOSAL 1: ELECTION OF DIRECTORS The Board of Directors recommends that you vote FOR each director nominee. These individuals bring relevant experiences and perspectives that are essential to good governance and leadership of our Company. | | | FOR | |
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| 2024 PROXY STATEMENT / 19 | |
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| | AUDIT COMMITTEE Current Members: Stephen G. Kasnet (Chair) Sheila K. McGrath W. Reid Sanders Hope B. Woodhouse Meetings in 2023: 8 | | | Key Responsibilities: • Review interim financial information and audited financial statements included in reports filed with the SEC; • Review financial information included in earnings press releases issued by our Company; • Produce the Audit Committee Report; • Review the adequacy and effectiveness of our Company’s system of internal accounting controls; • Review our Company’s assessment and management of its risk exposures; • Review, approve and oversee any related person transactions as defined by SEC rules and regulations; • Oversee our Company’s compliance and ethics programs; • Oversee our Company’s internal audit activities; and • Be directly responsible for the appointment, compensation, retention and oversight of the work of the independent auditor. | | |
| | COMPENSATION COMMITTEE Current Members: Hope B. Woodhouse (Chair) Tanuja M. Dehne W. Reid Sanders Meetings in 2023: 8 | | | Key Responsibilities: • Establish our Company’s general compensation philosophy for the CEO and other executive officers; • Determine all matters relating to the compensation of the CEO and other executive officers, including corporate goals and objectives tied to compensation; • Administer, review and make recommendations to our Board with respect to our Company’s incentive compensation plans; • Review and recommend to our Board compensation programs applicable to directors; • Review our Company’s human capital management strategies and practices; • Review and assess the incentives and risks arising from our Company’s compensation programs and plans; and • Produce the Compensation Committee Report. | | |
| 2024 PROXY STATEMENT / 21 | |
| | NOMINATING AND CORPORATE GOVERNANCE COMMITTEE Current Members: Tanuja M. Dehne (Chair) Sheila K. McGrath W. Reid Sanders Meetings in 2023: 5 | | | Key Responsibilities: • Assist our Board in fulfilling its responsibilities to assure that our Company is governed in a manner consistent with the interest of its stockholders; • Recommend to our Board changes in the size, composition, organization and operational structure of the Board and its committees; • Recommend to our Board director nominees to stand for election or re-election, conducting a search to identify a nominee or nominees in the event of a vacancy or newly created Board seat; • Make recommendations to our Board regarding director qualifications, eligibility criteria and independence; • Review, and assist our Board in overseeing, our Company’s ESG priorities, strategies and related public disclosures; and • Oversee the evaluation of the effectiveness of our Board, its committees and directors (see “Board, Committee and Director Assessment” below for detailed information). | | |
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NOTICE
| | BOARD OF DIRECTORS Our Board exercises broad oversight of our Company’s risk management, including through the review of our business plans, capital structure and financial results. Our Board has also established investment guidelines, which set parameters for the type and size of investments management can make without further Board approval. | | |
| | AUDIT COMMITTEE This committee is primarily responsible for reviewing our Company’s assessment and management of its risk exposures: • Guidelines and policies to govern risk management and assessment; • The adequacy of our Company’s insurance coverage; • Any uninsured or commercially uninsurable risks; • Our Company’s interest rate risk management; • Our Company’s counterparty and credit risks; • Our Company’s information security and technology risks (including cybersecurity); and • Any environmental risks relating to our Company, including those related to climate change. | | |
| | NOMINATING AND CORPORATE GOVERNANCE COMMITTEE This committee recommends appropriate corporate governance practices. It also reviews our Company’s ESG priorities, strategies and public disclosures. | | |
| | COMPENSATION COMMITTEE This committee is responsible for assessing the risks arising from our compensation programs and plans. It also reviews our human capital management strategies and practices. | | |
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Date:Tuesday, May 15, 2018
Time:9:00 a.m. Eastern Daylight Time
Location:Loews Regency Hotel, 540 Park Avenue, New York, NY 10065
Agenda:(1)CONTENTS
| 2024 PROXY STATEMENT / 25 | |
(2)qualified or until the director’s earlier resignation or removal.
| | BY EMAIL | |
| | Please send correspondence via email to secretary@gpmtreit.com | |
| | BY MAIL | |
| | Please send correspondence via regular mail to the attention of the independent directors, the Chair of the Audit Committee, the Chair of the Compensation Committee or the Chair of the Nominating and Corporate Governance Committee, as the case may be, in each instance in care of the Secretary at the Company’s office at 3 Bryant Park, Suite 2400A, New York, New York 10036. | |
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| | Align the interests of our directors and our stockholders | | | | | | | Attract and retain outstanding director candidates to provide meaningful oversight of our business | | | | | | | Reflect the substantial time commitment our directors make to their Board and committee service | |
| 2024 PROXY STATEMENT / 27 | |
| | | Cash ($) | | | Restricted Stock Unit Awards ($) | | ||||||
Board | | | | | | | | | | | | | |
Chair | | | | | 160,000 | | | | | | 160,000 | | |
Other Directors | | | | | 100,000 | | | | | | 100,000 | | |
Audit Committee | | | | | | | | | | | | | |
Chair | | | | | 10,000 | | | | | | 10,000 | | |
Other Members | | | | | 5,000 | | | | | | 5,000 | | |
Compensation Committee | | | | | | | | | | | | | |
Chair | | | | | 6,250 | | | | | | 6,250 | | |
Other Members | | | | | 3,750 | | | | | | 3,750 | | |
Nominating and Corporate Governance Committee | | | | | | | | | | | | | |
Chair | | | | | 6,250 | | | | | | 6,250 | | |
Other Members | | | | | 3,750 | | | | | | 3,750 | | |
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Name | | | Fees Earned or Paid in Cash ($) | | | Stock Awards(1)(2) ($) | | | Total ($) | | |||||||||
Tanuja M. Dehne | | | | | 110,000 | | | | | | 110,000 | | | | | | 220,000 | | |
Stephen G. Kasnet | | | | | 170,000 | | | | | | 324,997 | | | | | | 494,997 | | |
Sheila K. McGrath | | | | | 104,331 | | | | | | 108,749 | | | | | | 213,080 | | |
W. Reid Sanders | | | | | 112,500 | | | | | | 112,496 | | | | | | 224,996 | | |
Hope B. Woodhouse | | | | | 112,826 | | | | | | 111,246 | | | | | | 224,072 | | |
Name | | | Restricted Stock Units | | |||
Ms. Dehne | | | | | 22,869 | | |
Mr. Kasnet | | | | | 67,567 | | |
Ms. McGrath | | | | | 22,609 | | |
Mr. Sanders | | | | | 23,388 | | |
Ms. Woodhouse | | | | | 23,128 | | |
| 2024 PROXY STATEMENT / 29 | |
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Name and Address of Beneficial Owner(1) | | | Number of Shares Beneficially Owned | | | Percent of Class(2) | | ||||||
Directors | | | | | | | | | | | | | |
Tanuja M. Dehne | | | | | 33,558 | | | | | | * | | |
Stephen G. Kasnet | | | | | 80,838(3) | | | | | | * | | |
Sheila K. McGrath | | | | | 7,138 | | | | | | * | | |
W. Reid Sanders | | | | | 122,679 (4) | | | | | | * | | |
John (“Jack”) A. Taylor(5) | | | | | 307,586 | | | | | | * | | |
Hope B. Woodhouse | | | | | 55,312 | | | | | | * | | |
Named Executive Officers | | | | | | | | | | | | | |
Stephen Alpart | | | | | 152,088 | | | | | | * | | |
Peter Morral | | | | | 80,073 | | | | | | * | | |
Steven Plust | | | | | 201,822 | | | | | | * | | |
Marcin Urbaszek | | | | | 93,756(6) | | | | | | * | | |
All directors and executive officers as a group (11 individuals) | | | | | 1,167,816 | | | | | | 2.3% | | |
| 2024 PROXY STATEMENT / 31 | |
Name and Address of Beneficial Owner | | | Number of Shares Beneficially Owned | | | Percent of Class(1) | | ||||||
BlackRock, Inc. 55 East 52nd Street New York, NY 100 | | | | | 5,394,244(2) | | | | | | 10.6% | | |
The Vanguard Group 100 Vanguard Blvd. Malvern, PA 19355 | | | | | 2,811,904(3) | | | | | | 5.5% | | |
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| Stephen Alpart Age: 60 Vice President and Chief Investment Officer | |
| • Mr. Alpart has been our Vice President and Chief Investment Officer since our Company’s inception in 2017. He is also our Co-Head of Originations and a member of our Investment Committee. • From 2014 to 2020, he was a Managing Director at Pine River Capital Management, L.P., our Former Manager. • Prior to joining our Former Manager, Mr. Alpart was a Managing Director in the Global Real Estate Finance Group at Prudential Real Estate Investment (now known as PGIM Real Estate Company) from 2009 to 2014, responsible for managing a series of close-end debt funds in the United States. • Previously, Mr. Alpart was a Managing Director in the Real Estate Group at GMAC Commercial Mortgage and Capmark Investments where he focused on originating, underwriting and closing large structured commercial real estate loans for private equity firms and private owner/operators. Prior to that, he was a Managing Director in the Real Estate Group at PaineWebber & Co., an investment bank and stock brokerage firm, and later an Executive Director in the Real Estate Group of UBS Group AG, a Swiss multinational investment bank and financial services company, where he focused on originating, underwriting and closing large structured commercial real estate loans for private equity firms and owner/operators. • He has worked in real estate finance and debt investing for over 25 years in a variety of functions, including third-party funds management, proprietary on-book lending, transaction advisory business, loan syndications, loan sales and workouts/ restructurings. • Mr. Alpart received an MBA, Finance and Real Estate. From New York University and a BS in Business Administration, Accounting and Economics from Washington University. | |
| 2024 PROXY STATEMENT / 33 | |
| Michael Karber Age: 44 Vice President, General Counsel and Secretary | |
| • Mr. Karber has served as our Vice President, General Counsel, Secretary and Chief Compliance Officer since 2020. He has been with our Company since its inception in 2017, previously serving as Deputy General Counsel from 2018 to 2019 and as Assistant Secretary from 2018 to 2020. • Prior to joining our Company, Mr. Karber was Lead Counsel – Business Operations at Two Harbors Investment Corp. (NYSE: TWO), a hybrid mortgage real estate investment trust, beginning in 2014. • Prior to joining Two Harbors, he was a Portfolio Manager at Presidium Asset Solutions, an asset management and loan servicing company, from 2010 to 2014. • From 2007 to 2009, Mr. Karber was an Associate at Pircher, Nicols & Meeks LLP, and he was previously an Associate at Schwartz Cooper Chartered (now known as Dykema Gossett PLLC). • Mr. Karber received a JD from Northwestern University, Pritzker School of Law, and a BA in Political Science and Psychology from the University of Michigan. | |
| Peter Morral Age: 56 Vice President and Chief Development Officer | |
| • Mr. Morral has been our Vice President and Chief Development Officer since 2020 and has been our Co-Head of Originations and a member of our Investment Committee since our Company’s inception in 2017. • From 2014 to 2020, he was a Managing Director at our Former Manager. • Prior to joining our Former Manager, he served as a Managing Director in Annaly Capital’s Commercial Real Estate Group. • Prior to joining Annaly Capital, Mr. Morral was a Managing Director and member of the Investment Committee at UBS Securities, LLC where he was responsible for institutional client and large loan originations, investment banking coverage, subordinate debt pricing and distribution and loan syndications. • He has worked in real estate finance and debt investing for over 20 years in a variety of functions, including on-balance sheet lending, syndications and investing, credit policy and underwriting, and CMBS loan originations, pricing, ratings and credit distribution. • Mr. Morral received an MBA from the Ohio State University and a BLA in History from the University of Connecticut. | |
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| Steven Plust Age: 65 Vice President and Chief Operating Officer | |
| • Mr. Plust has been our Vice President and Chief Operating Officer since our Company’s inception in 2017. He is also a member of our Investment Committee. • From 2014 to 2020, he was a Managing Director at our Former Manager. • Prior to joining our Former Manager, Mr. Plust was a Managing Director in the Global Real Estate Finance Group at Prudential Real Estate Investment (now known as PGIM Real Estate Company) from 2009 to 2014, responsible for managing a series of close-end debt funds in the United States. • He has over 25 years of experience in real estate finance and capital markets and was an advisor to the Resolution Trust Corporation in the development and implementation of its securitization programs. • Mr. Plust has worked for over 20 years in principal investing platforms on Wall Street and in investment management, where he has been primarily responsible for transaction pricing and structuring, credit risk assessment and analysis of complex transactions and multi-asset portfolios. • Mr. Plust received an MBA from Columbia University and a BS in Chemistry from Rensselaer Polytechnic Institute. | |
| Marcin Urbaszek Age: 48 Vice President, Chief Financial Officer and Treasurer | |
| • Mr. Urbaszek has been our Vice President, Chief Financial Officer, Treasurer and Head of Investor Relations since our Company’s inception in 2017. • He joined our Former Manager in May 2013 and, until the formation of our Company, served as a Managing Director of Two Harbors Investment Corp. (NYSE: TWO), a hybrid mortgage real estate investment trust, focusing on corporate development and capital markets activities. • Prior to joining our Former Manager, Mr. Urbaszek worked in the Investment Banking Division at Credit Suisse Group AG from 2006 to April 2013, most recently serving as a team lead and partner on coverage and strategic transaction execution for various financial institutions, including residential and commercial mortgage lenders. • He has over 20 years of finance experience, including capital markets and equity research, with the last 15+ years dedicated to financial institutions. • Over the course of his career, Mr. Urbaszek has been primarily responsible for strategic and capital raising transaction execution, as well as financial planning and analysis. • Mr. Urbaszek received a BBA in Finance, with a Minor focused on Financial Accounting and Economics, from Zicklin School of Business, Bernard M. Baruch College, CUNY. Mr. Urbaszek is a CFA® charterholder. | |
| 2024 PROXY STATEMENT / 35 | |
| | JOHN (“JACK”) A. TAYLOR | | | | | | | MARCIN URBASZEK | | | | | | | STEPHEN ALPART | | | | | | | PETER MORRAL | | | | | | | STEVEN PLUST | |
| | President, Chief Executive Officer and Director | | | | | | | Vice President, Chief Financial Officer and Treasurer | | | | | | | Vice President and Chief Investment Officer | | | | | | | Vice President and Chief Development Officer | | | | | | | Vice President and Chief Operating Officer | |
| EXECUTIVE COMPENSATION OVERVIEW | | | p. 37 | | | ||
| • Program Evolution • Executive Compensation Components Awarded in 2023 • 2023 Target Pay Levels • Summary of Results Under Performance-Based Awards • Quality Compensation Practices | | | | | | ||
| HOW EXECUTIVE COMPENSATION IS DETERMINED | | | p. 39 | | | ||
| • Compensation Philosophy and Objectives • Roles and Responsibilities in Executive Compensation Decisions • Employment Agreements • Peer Group • Say on Pay Vote | | | | | | ||
| EXECUTIVE COMPENSATION COMPONENTS | | | p. 41 | | | ||
| • 2023 Base Salary • 2023 Annual Incentive Plan (AIP) Awards • Long-Term Incentive Plan (LTIP) Awards Granted in 2023 • 2021 PSU Award Results (2021-2023 Performance Period) • Benefits | | | | | | | |
| EXECUTIVE COMPENSATION POLICIES AND PRACTICES | | | p. 51 | | | ||
| • Stock Ownership Guidelines • Prohibition Against Hedging and Pledging • Clawback Policy • Compensation Risk Assessment | | | | | |
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| EXECUTIVE COMPENSATION COMPONENTS AWARDED IN 2023 | | ||||||
| Cash | | | Base Salary | | | • Intended to provide market-competitive fixed income • Only element of total direct compensation not at performance risk | |
| Annual Incentive Plan (AIP) | | | • Target amount is 100% of base salary for CEO and 75% of base salary for each of the other NEOs • Performance period: 2023 • Pays out at 0% – 200% of target amount • Performance metrics: ◦ 50% financial measures – “Run-Rate” ROAE (return on average equity) and Change in Book Value per Share, weighted evenly ◦ 50% strategic objectives fundamental to the business | | |||
| Equity | | | Performance Stock Units (PSUs) | | | • 50% of equity award value delivered as PSUs • Performance period: 2023-2025 • Vests at 0% – 200% of target number of units • Performance metrics: ◦ 25% Absolute “Run-Rate” ROAE ◦ 25% Relative “Run-Rate” ROAE ◦ 25% Absolute Change in Book Value per Share ◦ 25% Relative Change in Book Value per Share | |
| Restricted Stock Units (RSUs) | | | • 50% of equity award value delivered as RSUs • Three-year ratable vesting | |
| 2024 PROXY STATEMENT / 37 | |
Named Executive Officer | | | 2023 Base Salary | | | Target AIP Award for 2023 Performance | | | RSU Award Granted in 2023 | | | Target PSU Award Granted in 2023 | | | Target Total Direct Compensation | | |||||||||||||||
John (“Jack”) A. Taylor | | | | $ | 1,000,000 | | | | | $ | 1,000,000 | | | | | $ | 1,125,000 | | | | | $ | 1,125,000 | | | | | $ | 4,250,000 | | |
Marcin Urbaszek | | | | $ | 600,000 | | | | | $ | 450,000 | | | | | $ | 485,000 | | | | | $ | 485,000 | | | | | $ | 2,020,000 | | |
Stephen Alpart | | | | $ | 600,000 | | | | | $ | 450,000 | | | | | $ | 600,000 | | | | | $ | 600,000 | | | | | $ | 2,250,000 | | |
Peter Morral | | | | $ | 600,000 | | | | | $ | 450,000 | | | | | $ | 600,000 | | | | | $ | 600,000 | | | | | $ | 2,250,000 | | |
Steven Plust | | | | $ | 600,000 | | | | | $ | 450,000 | | | | | $ | 600,000 | | | | | $ | 600,000 | | | | | $ | 2,250,000 | | |
| | What We Do | | | | | |
| | • A significant portion of each NEO’s compensation is at risk • We have adopted meaningful stock ownership requirements applicable to our NEOs • Our independent Compensation Committee retains an independent compensation consultant who provides no other services to our Company • Performance-based cash and equity awards have a sliding scale earn-out structure that allows for 0% payouts and is capped at 200% of target amounts • Our performance-based equity awards use both absolute and relative performance metrics • Our Compensation Committee conducts an annual compensation risk assessment • We hold an annual Say on Pay vote | | |
| | What We Don’t Do | | | | | |
| | • Our NEOs do not receive perquisites or retirement plans not available to other employees • We do not allow our NEOs to hedge or pledge their Company stock • We do not have single-trigger accelerated vesting of equity awards upon a change of control of our Company, and our equity plan does not use a liberal definition of “change of control” • Our equity plan does not use liberal share recycling • We do not pay dividends on any performance-based equity units that are not earned through satisfaction of the awards’ performance metrics • We do not provide tax gross-ups • Our NEOs’ employment agreements do not provide for excessive severance payments | | |
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| | Attract, retain and incentivize the best talent to support our business objectives | | | | | | | Pay for performance by linking compensation to the achievement of short-term and long-term financial and strategic goals | | | | | | | Align the interests of our executive officers and stockholders by tying elements of executive compensation to corporate performance and generated returns | | | | | | | Ensure fair, equitable and competitive pay practices | |
| 2024 PROXY STATEMENT / 39 | |
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Named Executive Officer | | | 2023 Base Salary | | | Target Award Percentage | | | Minimum AIP Payout for 2023 Performance | | | Target AIP Payout for 2023 Performance | | | Maximum AIP Payout for 2023 Performance | | |||||||||||||||
John (“Jack”) A. Taylor | | | | $ | 1,000,000 | | | | | | 100% | | | | | $ | 0 | | | | | $ | 1,000,000 | | | | | $ | 2,000,000 | | |
Marcin Urbaszek | | | | $ | 600,000 | | | | | | 75% | | | | | $ | 0 | | | | | $ | 450,000 | | | | | $ | 900,000 | | |
Stephen Alpart | | | | $ | 600,000 | | | | | | 75% | | | | | $ | 0 | | | | | $ | 450,000 | | | | | $ | 900,000 | | |
Peter Morral | | | | $ | 600,000 | | | | | | 75% | | | | | $ | 0 | | | | | $ | 450,000 | | | | | $ | 900,000 | | |
Steven Plust | | | | $ | 600,000 | | | | | | 75% | | | | | $ | 0 | | | | | $ | 450,000 | | | | | $ | 900,000 | | |
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Objective | | | Percentage of Strategic Component | | | Summary of Assessment Factors | |
Balance sheet management | | | 30% | | | • Create a diversified and stable funding profile • Maintain appropriate balance sheet leverage • Actively manage corporate liquidity and comply with financial covenants • Grow equity capital to achieve economies of scale, larger market presence and increasing liquidity for stockholders | |
Risk management | | | 30% | | | • Use a comprehensive risk management framework to mitigate various risks, including credit risk, financing and liquidity risk, internal control and operational risk, and IT infrastructure and cybersecurity risk • Assess business counterparties | |
Stockholder/investor focus | | | 20% | | | • Generate detailed, transparent and accurate public company disclosures • Engage equity and debt investors through a robust investor relations program • Attend various equity and fixed income industry conferences and execute marketing efforts | |
Enhancing franchise value | | | 20% | | | • Enhance the Company’s brand and presence in the CRE market to further growth opportunities • Maintain a first-class team with highly skilled and experienced professionals with broad CRE lending relationships • Expand the Company’s reputation in the market as a fair and reliable business counterparty | |
| 2024 PROXY STATEMENT / 43 | |
| 2023 PERFORMANCE ASSESSMENT OF STRATEGIC FACTORS | | |||
| Balance Sheet Management (30% of Strategic Component) | | | • Proactively managed the balance sheet, realizing over $700 million of loan repayments, paydowns and resolutions • Prioritized maximizing liquidity – particularly in light of the convertible notes maturing in October 2023, the second such maturity in a year, and the capital markets volatility • Strategically refinanced our second de-levered CRE CLO (commercial real estate collateralized loan obligation) funding vehicle, releasing over $80 million of capital, during extremely challenging market conditions caused by the regional banking crisis • Extended the maturities of several of our bank financing facilities and amended certain terms, including two financial covenants, as our lenders continue to support our platform and seek to do more business with us • Increased the borrowings on one of our bank facilities, realizing $100 million of additional proceeds to give us additional resources to actively manage our balance sheet | |
| Risk Management (30% of Strategic Component) | | | • Proactively managed liquidity and funding sources while maintaining an active dialogue with lending counterparties regarding portfolio performance • Successfully resolved three non-accrual loans and actively asset-managed the investment portfolio while collaboratively working with borrowers to help them navigate any disruptions at their properties due to market dislocations • Actively oversaw a fully dedicated team of professionals at our sub-servicer, who are focused exclusively on servicing and assisting in asset managing our loan portfolio • Further enhanced internal controls and operations processes to ensure accurate financial reporting that meets all regulatory requirements and maintained compliance with all reporting, listing, and REIT regulatory requirements • Maintained a sophisticated and secure IT infrastructure environment through our master service provider, and maintained cybersecurity insurance coverage | |
| | | | (continued) | |
| 44 / gpmtreit.com/investors | |
| 2023 PERFORMANCE ASSESSMENT OF STRATEGIC FACTORS, cont’d | | |||
| Stockholder/ Investor Focus (20% of Strategic Component) | | | • Engaged with many equity and fixed income investors through targeted outreach, holding one-on-one meetings, and attending six real estate lending industry and equity/fixed income investor conferences • Maintained a dialogue with our largest institutional investors focused on corporate governance topics and continued an active dialogue with our equity research analysts to help further expand their knowledge and understanding of our Company and business strategy • Continued to evolve our proxy disclosure, aimed at improving communication related to executive compensation and other governance topics • Further improved and expanded the financial disclosures in our quarterly SEC filings with the goal of providing a more informed view of the business • Continued to improve our corporate website with the goal of expanding the discussion of the business and highlighting ESG efforts and initiatives • Repurchased over 2 million shares of common stock at a meaningful discount to book value | |
| Enhancing Franchise Value (20% of Strategic Component) | | | • Maintained our presence and franchise in the CRE lending markets through an active dialogue with industry participants, attending largest industry conferences and by sustaining positive borrower relationships by collaboratively working with them during a challenging market environment • Maintained and enhanced corporate culture focused on inclusion, teamwork, compliance and risk management, as evidenced by employee survey results • Maintained an active dialogue with our capital providers in the equity and fixed income markets with the goal of developing new and preserving existing relationships and channels to access capital to support future growth of the business • Maintained our highly capable team with no turnover, while employee survey results reflect high levels of satisfaction | |
| 2024 PROXY STATEMENT / 45 | |
| 46 / gpmtreit.com/investors | |
| | | | | | | ||||||||||
| | | | Level of Performance | | | “Run-rate” ROAE | | | Percentage Earned | | |||||
| | | | Below Threshold | | | | | <3.0% | | | | 0% of Target | | ||
| | | | Threshold | | | | | 3.0% | | | | 25% of Target | | ||
| | | | Target | | | | | 6.0% | | | | 100% of Target | | ||
| | | | Maximum | | | | | ≥9.0% | | | | 200% of Target | | ||
| | | | Actual | | | | | 5.2% | | | | 80.2% of Target | |
| | | | | | | |||||||
| | | | Level of Performance | | | Change in Book Value per Share | | | Percentage Earned | | ||
| | | | Below Threshold | | | <(15.0)% | | | 0% of Target | | ||
| | | | Threshold | | | (15.0)% | | | 25% of Target | | ||
| | | | Target | | | 0.0% | | | 100% of Target | | ||
| | | | Maximum | | | ≥15.0% | | | 200% of Target | | ||
| | | | Actual | | | (13.1)% | | | 34.5% of Target | |
| | | | | | | | | | | | | |
Total Financial Component Results | | | | | | ||||||||
| | | | “Run-Rate” ROAE Percentage Earned (50% weighting) | | | Change in Book Value per Share Percentage Earned (50% weighting) | | | Total Percentage Earned | | ||
| | | | 80.2% of Target | | | 34.5% of Target | | | 57.4% of Target | |
| | | | | | | | | | | | | | | | |
2023 AIP Award Payouts | | | | | | | ||||||||||
| | | | Strategic Component Percentage Earned (50% weighting) | | | Financial Component Percentage Earned (50% weighting) | | | Total Award Percentage Earned | | | ||||
| | | | 100% of Target | | | 57.4% of Target | | | 78.7% of Target | | |
| 2024 PROXY STATEMENT / 47 | |
Named Executive Officer | | | RSU Award Grant Date Value | | | PSU Award Grant Date Value | | | Total 2023 LTIP Award Grant Date Value | | |||||||||
John (“Jack”) A. Taylor | | | | $ | 1,125,000 | | | | | $ | 1,125,000 | | | | | $ | 2,250,000 | | |
Marcin Urbaszek | | | | $ | 485,000 | | | | | $ | 485,000 | | | | | $ | 970,000 | | |
Stephen Alpart | | | | $ | 600,000 | | | | | $ | 600,000 | | | | | $ | 1,200,000 | | |
Peter Morral | | | | $ | 600,000 | | | | | $ | 600,000 | | | | | $ | 1,200,000 | | |
Steven Plust | | | | $ | 600,000 | | | | | $ | 600,000 | | | | | $ | 1,200,000 | | |
| 48 / gpmtreit.com/investors | |
Absolute “Run-Rate” ROAE (25%) | | | Relative “Run-Rate” ROAE (25%) | | ||||||
Performance | | | Percentage Earned | | | Performance | | | Percentage Earned | |
Target value -2% | | | 25% of target (threshold) | | | 25th percentile | | | 25% of target (threshold) | |
Target value | | | 100% of target | | | 50th percentile | | | 100% of target | |
Target value +2% | | | 200% of target (maximum) | | | 75th percentile | | | 200% of target (maximum) | |
Absolute Change in Book Value per Share (25%) | | | Relative Change in Book Value per Share (25%) | | ||||||
Performance | | | Percentage Earned | | | Performance | | | Percentage Earned | |
Target value -10.0% | | | 25% of target (threshold) | | | 25th percentile | | | 25% of target (threshold) | |
Target value | | | 100% of target | | | 50th percentile | | | 100% of target | |
Target value +10.0% | | | 200% of target (maximum) | | | 75th percentile | | | 200% of target (maximum) | |
| 2024 PROXY STATEMENT / 49 | |
| | | | | | | ||||||||||
| | | | Level of Performance | | | Absolute “Core” ROAE | | | Percentage Earned | | |||||
| | | | Below Threshold | | | | | <5.0% | | | | 0% of Target | | ||
| | | | Threshold | | | | | 5.0% | | | | 25% of Target | | ||
| | | | Target | | | | | 6.5% | | | | 100% of Target | | ||
| | | | Maximum | | | | | ≥8.0% | | | | 200% of Target | | ||
| | | | Actual | | | | | 1.8% | | | | 0% of Target | |
| | | | | | | |||||||
| | | | Level of Performance | | | Relative “Core” ROAE | | | Percentage Earned | | ||
| | | | Below Threshold | | | <25th percentile | | | 0% of Target | | ||
| | | | Threshold | | | 25th percentile | | | 25% of Target | | ||
| | | | Target | | | 50th percentile | | | 100% of Target | | ||
| | | | Maximum | | | ≥75th percentile | | | 200% of Target | | ||
| | | | Actual | | | 13th percentile | | | 0% of Target | |
| | | | | | | | | | | | | |
PSU Awards Vested (2021-2023 Performance Period) | | | | | | ||||||||
| | | | Absolute “Core” ROAE (50% weighting) | | | Relative “Core” ROAE (50% weighting) | | | Total Award Percentage Earned | | ||
| | | | 0% of Target | | | 0% of Target | | | 0% of Target | |
| 50 / gpmtreit.com/investors | |
Executive Officer | | | Minimum Ownership Level | |
Chief Executive Officer | | | Market value of stock held ≥5x base salary | |
Other executive officers | | | Market value of stock held ≥3x base salary | |
| 2024 PROXY STATEMENT / 51 | |
| | Risk-Mitigating Features of Executive Compensation Program | | | | | |
| | • Earnout of performance-based equity (PSU) and annual cash (AIP) awards is capped at 200% of target • Performance-based awards have a sliding scale earnout structure, not an all-or-nothing structure • A significant percentage of the executives’ total direct compensation is paid as equity with three-year vesting • PSUs have a three-year performance period • All officers and employees are prohibited from hedging Company securities through our Insider Trading Policy • Executive stock ownership levels and retention requirements are governed by stock ownership guidelines • Diversification of performance metrics that determine results under incentive-based awards reduces potential risk of focus on one financial measure • Our clawback policy requires recoupment of excess cash or equity paid pursuant to incentive-based awards upon a financial restatement | | |
| 52 / gpmtreit.com/investors | |
| 2024 PROXY STATEMENT / 53 | |
Name and Principal Position | | | Year | | | Salary ($) | | | Stock Awards(1) ($) | | | Non-Equity Incentive Plan Compensation(2) ($) | | | All Other Compensation(3) ($) | | | Total ($) | | ||||||||||||||||||
John (“Jack”) A. Taylor President and Chief Executive Officer | | | | | 2023 | | | | | | 1,000,000 | | | | | | 2,249,997 | | | | | | 786,923 | | | | | | 12,900 | | | | | | 4,049,820 | | |
| | | 2022 | | | | | | 1,000,000 | | | | | | 2,249,979 | | | | | | 500,000 | | | | | | 12,150 | | | | | | 3,762,129 | | | ||
| | | 2021 | | | | | | 1,000,000 | | | | | | 2,718,454 | | | | | | 1,000,000 | | | | | | 11,700 | | | | | | 4,730,154 | | | ||
Marcin Urbaszek Vice President, Chief Financial Officer and Treasurer | | | | | 2023 | | | | | | 600,000 | | | | | | 969,998 | | | | | | 354,115 | | | | | | 12,900 | | | | | | 1,937,013 | | |
| | | 2022 | | | | | | 560,000 | | | | | | 969,980 | | | | | | 210,000 | | | | | | 12,150 | | | | | | 1,752,130 | | | ||
| | | 2021 | | | | | | 560,000 | | | | | | 809,487 | | | | | | 420,000 | | | | | | 11,700 | | | | | | 1,801,187 | | | ||
Stephen Alpart Vice President and Chief Investment Officer | | | | | 2023 | | | | | | 600,000 | | | | | | 1,199,994 | | | | | | 354,115 | | | | | | 12,900 | | | | | | 2,167,009 | | |
| | | 2022 | | | | | | 600,000 | | | | | | 1,199,984 | | | | | | 225,000 | | | | | | 12,150 | | | | | | 2,037,134 | | | ||
| | | 2021 | | | | | | 600,000 | | | | | | 1,449,848 | | | | | | 450,000 | | | | | | 11,700 | | | | | | 2,511,548 | | | ||
Peter Morral Vice President and Chief Development Officer | | | | | 2023 | | | | | | 600,000 | | | | | | 1,199,994 | | | | | | 354,115 | | | | | | 9,900 | | | | | | 2,164,009 | | |
| | | 2022 | | | | | | 600,000 | | | | | | 1,199,984 | | | | | | 225,000 | | | | | | 9,150 | | | | | | 2,034,134 | | | ||
| | | 2021 | | | | | | 600,000 | | | | | | 1,449,848 | | | | | | 450,000 | | | | | | 8,700 | | | | | | 2,508,548 | | | ||
Steven Plust Vice President and Chief Operating Officer | | | | | 2023 | | | | | | 600,000 | | | | | | 1,199,994 | | | | | | 354,115 | | | | | | 12,900 | | | | | | 2,167,009 | | |
| | | 2022 | | | | | | 600,000 | | | | | | 1,199,984 | | | | | | 225,000 | | | | | | 12,150 | | | | | | 2,037,134 | | | ||
| | | 2021 | | | | | | 600,000 | | | | | | 1,449,848 | | | | | | 450,000 | | | | | | 11,700 | | | | | | 2,511,548 | | |
| 54 / gpmtreit.com/investors | |
Name | | | Award Type | | | Grant Date | | | Date of Committee Action | | | Estimated Future Payouts Under Non-Equity Incentive Plan Awards(1) | | | Estimated Future Payouts Under Equity Incentive Plan Awards(3) | | | All Other Stock Awards: Number of Shares of Stock or Units(5) (#) | | | Grant Date Fair Value of Stock Awards(6) ($) | | ||||||||||||||||||||||||||||||||||||||||||
| Threshold ($)(2) | | | Target ($) | | | Maximum ($) | | | Threshold (#)(4) | | | Target (#) | | | Maximum (#) | | |||||||||||||||||||||||||||||||||||||||||||||||
John (“Jack”) A. Taylor | | | AIP | | | | | — | | | | | | — | | | | | | 125,000 | | | | | | 1,000,000 | | | | | | 2,000,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
| PSU | | | | | 3/15/2023 | | | | | | 3/8/2023 | | | | | | — | | | | | | — | | | | | | — | | | | | | 55,804 | | | | | | 223,214 | | | | | | 446,428 | | | | | | — | | | | | | 1,124,999 | | | ||
| RSU | | | | | 3/15/2023 | | | | | | 3/8/2023 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 223,214 | | | | | | 1,124,999 | | | ||
Marcin Urbaszek | | | AIP | | | | | — | | | | | | — | | | | | | 56,250 | | | | | | 450,000 | | | | | | 900,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
| PSU | | | | | 3/15/2023 | | | | | | 3/8/2023 | | | | | | — | | | | | | — | | | | | | — | | | | | | 24,058 | | | | | | 96,230 | | | | | | 192,460 | | | | | | — | | | | | | 484,999 | | | ||
| RSU | | | | | 3/15/2023 | | | | | | 3/8/2023 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 96,230 | | | | | | 484,999 | | | ||
Stephen Alpart | | | AIP | | | | | — | | | | | | — | | | | | | 56,250 | | | | | | 450,000 | | | | | | 900,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
| PSU | | | | | 3/15/2023 | | | | | | 3/8/2023 | | | | | | — | | | | | | — | | | | | | — | | | | | | 29,762 | | | | | | 119,047 | | | | | | 238,094 | | | | | | — | | | | | | 599,997 | | | ||
| RSU | | | | | 3/15/2023 | | | | | | 3/8/2023 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 119,047 | | | | | | 599,997 | | | ||
Peter Morral | | | AIP | | | | | — | | | | | | — | | | | | | 56,250 | | | | | | 450,000 | | | | | | 900,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
| PSU | | | | | 3/15/2023 | | | | | | 3/8/2023 | | | | | | — | | | | | | — | | | | | | — | | | | | | 29,762 | | | | | | 119,047 | | | | | | 238,094 | | | | | | — | | | | | | 599,997 | | | ||
| RSU | | | | | 3/15/2023 | | | | | | 3/8/2023 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 119,047 | | | | | | 599,997 | | | ||
Steven Plust | | | AIP | | | | | — | | | | | | — | | | | | | 56,250 | | | | | | 450,000 | | | | | | 900,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
| PSU | | | | | 3/15/2023 | | | | | | 3/8/2023 | | | | | | — | | | | | | — | | | | | | — | | | | | | 29,762 | | | | | | 119,047 | | | | | | 238,094 | | | | | | — | | | | | | 599,997 | | | ||
| RSU | | | | | 3/15/2023 | | | | | | 3/8/2023 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 119,047 | | | | | | 599,997 | | |
| 2024 PROXY STATEMENT / 55 | |
| 56 / gpmtreit.com/investors | |
| 2024 PROXY STATEMENT / 57 | |
| | | | | | Stock Awards | | |||||||||||||||||||||
Name | | | Grant Date | | | Number of Shares or Units of Stock that Have Not Vested (#) | | | Market Value of Shares or Units of Stock that Have Not Vested(1) ($) | | | Equity Incentive Plan Awards: Number of Unearned Units That Have Not Vested (#) | | | Equity Incentive Plan Awards: Market Value or Payout Value of Unearned Units That Have Not Vested(1) ($) | | ||||||||||||
John (“Jack”) A. Taylor | | | 3/15/2023 | | | | | — | | | | | | — | | | | | | 223,214(2) | | | | | | 1,325,891 | | |
| 3/15/2023 | | | | | 223,214(3) | | | | | | 1,325,891 | | | | | | — | | | | | | — | | | ||
| 2/16/2022 | | | | | — | | | | | | — | | | | | | 23,754(4) | | | | | | 141,099 | | | ||
| 2/16/2022 | | | | | 63,344(3) | | | | | | 376,263 | | | | | | — | | | | | | — | | | ||
| 1/29/2021 | | | | | — | | | | | | — | | | | | | 28,153(5) | | | | | | 167,229 | | | ||
| 1/29/2021 | | | | | 37,538(6) | | | | | | 222,976 | | | | | | — | | | | | | — | | | ||
| 12/31/2020 | | | | | 100,100(7) | | | | | | 594,594 | | | | | | — | | | | | | — | | | ||
Marcin Urbaszek | | | 3/15/2023 | | | | | — | | | | | | — | | | | | | 96,230(2) | | | | | | 571,606 | | |
| 3/15/2023 | | | | | 96,230(3) | | | | | | 571,606 | | | | | | | | | | | | | | | ||
| 2/16/2022 | | | | | — | | | | | | — | | | | | | 10,241(4) | | | | | | 60,829 | | | ||
| 2/16/2022 | | | | | 27,308(3) | | | | | | 162,210 | | | | | | — | | | | | | — | | | ||
| 1/29/2021 | | | | | — | | | | | | — | | | | | | 8,383(5) | | | | | | 49,797 | | | ||
| 1/29/2021 | | | | | 11,178(6) | | | | | | 66,397 | | | | | | — | | | | | | — | | | ||
| 12/31/2020 | | | | | 56,056(7) | | | | | | 332,973 | | | | | | — | | | | | | — | | | ||
Stephen Alpart | | | 3/15/2023 | | | | | — | | | | | | — | | | | | | 119,047(2) | | | | | | 707,139 | | |
| 3/15/2023 | | | | | 119,047(3) | | | | | | 707,139 | | | | | | — | | | | | | — | | | ||
| 2/16/2022 | | | | | — | | | | | | — | | | | | | 12,669(4) | | | | | | 75,252 | | | ||
| 2/16/2022 | | | | | 33,784(3) | | | | | | 200,677 | | | | | | — | | | | | | — | | | ||
| 1/29/2021 | | | | | — | | | | | | — | | | | | | 15,015(5) | | | | | | 89,189 | | | ||
| 1/29/2021 | | | | | 20,020(6) | | | | | | 118,919 | | | | | | — | | | | | | — | | | ||
| 12/31/2020 | | | | | 60,060(7) | | | | | | 356,756 | | | | | | — | | | | | | — | | | ||
Peter Morral | | | 3/15/2023 | | | | | — | | | | | | — | | | | | | 119,047(2) | | | | | | 707,139 | | |
| 3/15/2023 | | | | | 119,047(3) | | | | | | 707,139 | | | | | | — | | | | | | — | | | ||
| 2/16/2022 | | | | | — | | | | | | — | | | | | | 12,669(4) | | | | | | 75,252 | | | ||
| 2/16/2022 | | | | | 33,784(3) | | | | | | 200,677 | | | | | | | | | | | | | | | ||
| 1/29/2021 | | | | | — | | | | | | — | | | | | | 15,015(5) | | | | | | 89,189 | | | ||
| 1/29/2021 | | | | | 20,020(6) | | | | | | 118,919 | | | | | | — | | | | | | — | | | ||
| 12/31/2020 | | | | | 60,060(7) | | | | | | 356,756 | | | | | | — | | | | | | — | | | ||
Steven Plust | | | 3/15/2023 | | | | | — | | | | | | — | | | | | | 119,047(2) | | | | | | 707,139 | | |
| 3/15/2023 | | | | | 119,047(3) | | | | | | 707,139 | | | | | | — | | | | | | — | | | ||
| 2/16/2022 | | | | | — | | | | | | — | | | | | | 12,669(4) | | | | | | 75,252 | | | ||
| 2/16/2022 | | | | | 33,784(3) | | | | | | 200,677 | | | | | | | | | | | | | | | ||
| 1/29/2021 | | | | | — | | | | | | — | | | | | | 15,015(5) | | | | | | 89,189 | | | ||
| 1/29/2021 | | | | | 20,020(6) | | | | | | 118,919 | | | | | | — | | | | | | — | | | ||
| 12/31/2020 | | | | | 60,060(7) | | | | | | 356,756 | | | | | | — | | | | | | — | | |
| 58 / gpmtreit.com/investors | |
| 2024 PROXY STATEMENT / 59 | |
| | | Stock Awards | | |||||||||
Name | | | Number of Shares Acquired on Vesting (#) | | | Value Realized on Vesting(1) ($) | | ||||||
John (“Jack”) A. Taylor | | | | | 90,866 | | | | | | 533,636 | | |
Marcin Urbaszek | | | | | 29,344 | | | | | | 172,353 | | |
Stephen Alpart | | | | | 50,446 | | | | | | 297,304 | | |
Peter Morral | | | | | 52,251 | | | | | | 308,856 | | |
Steven Plust | | | | | 50,446 | | | | | | 297,304 | | |
(3)
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| 2024 PROXY STATEMENT / 61 | |
| 62 / gpmtreit.com/investors | |
Name and Form of Benefit | | | Termination without Cause or Resignation for Good Reason (not related to a Change of Control) ($) | | | Termination without Cause or Resignation for Good Reason (related to a Change of Control) ($) | | | Death ($) | | | Disability ($) | | | Retirement(1) ($) | | |||||||||||||||
John (“Jack”) A. Taylor | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Severance | | | | | 4,000,000 | | | | | | 5,000,000 | | | | | | — | | | | | | — | | | | | | — | | |
Cash Bonus(2) | | | | | 786,923 | | | | | | 1,000,000 | | | | | | 1,000,000 | | | | | | 1,000,000 | | | | | | 1,000,000 | | |
Equity | | | | | 4,004,328(3) | | | | | | 5,078,926(4) | | | | | | 4,004,328(3) | | | | | | 4,004,328(3) | | | | | | 4,004,328(3) | | |
Other Benefits | | | | | 65,703(5) | | | | | | 65,703(5) | | | | | | — | | | | | | 65,703(5) | | | | | | — | | |
Totals | | | | | 8,856,954 | | | | | | 11,144,629 | | | | | | 5,004,328 | | | | | | 5,070,031 | | | | | | 5,004,328 | | |
Marcin Urbaszek | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Severance | | | | | 1,050,000 | | | | | | 1,575,000 | | | | | | — | | | | | | — | | | | | | — | | |
Cash Bonus(2) | | | | | 354,115 | | | | | | 450,000 | | | | | | 450,000 | | | | | | 450,000 | | | | | | 450,000 | | |
Equity | | | | | 1,684,022(3) | | | | | | 2,147,292(4) | | | | | | 1,684,022(3) | | | | | | 1,684,022(3) | | | | | | 1,684,022(3) | | |
Other Benefits | | | | | 65,703(5) | | | | | | 65,703(5) | | | | | | — | | | | | | 65,703(5) | | | | | | — | | |
Totals | | | | | 3,153,840 | | | | | | 4,237,995 | | | | | | 2,134,022 | | | | | | 2,199,725 | | | | | | 2,134,022 | | |
Stephen Alpart | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Severance | | | | | 1,575,000 | | | | | | 2,100,000 | | | | | | — | | | | | | — | | | | | | — | | |
Cash Bonus(2) | | | | | 354,115 | | | | | | 450,000 | | | | | | 450,000 | | | | | | 450,000 | | | | | | 450,000 | | |
Equity | | | | | 2,175,280(3) | | | | | | 2,748,396(4) | | | | | | 2,175,280(3) | | | | | | 2,175,280(3) | | | | | | 2,175,280(3) | | |
Other Benefits | | | | | 46,054(5) | | | | | | 46,054(5) | | | | | | — | | | | | | 46,054(5) | | | | | | — | | |
Totals | | | | | 4,150,449 | | | | | | 5,344,450 | | | | | | 2,625,280 | | | | | | 2,671,334 | | | | | | 2,625,280 | | |
Peter Morral | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Severance | | | | | 1,050,000 | | | | | | 1,575,000 | | | | | | — | | | | | | — | | | | | | — | | |
Cash Bonus(2) | | | | | 354,115 | | | | | | 450,000 | | | | | | 450,000 | | | | | | 450,000 | | | | | | 450,000 | | |
Equity | | | | | 2,175,280(3) | | | | | | 2,748,396(4) | | | | | | 2,175,280(3) | | | | | | 2,175,280(3) | | | | | | 2,175,280(3) | | |
Other Benefits | | | | | 82,392(5) | | | | | | 82,392(5) | | | | | | — | | | | | | 82,392(5) | | | | | | — | | |
Totals | | | | | 3,661,787 | | | | | | 4,855,788 | | | | | | 2,625,280 | | | | | | 2,707,672 | | | | | | 2,625,280 | | |
Steven Plust | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Severance | | | | | 1,575,000 | | | | | | 2,100,000 | | | | | | — | | | | | | — | | | | | | — | | |
Cash Bonus(2) | | | | | 354,115 | | | | | | 450,000 | | | | | | 450,000 | | | | | | 450,000 | | | | | | 450,000 | | |
Equity | | | | | 2,175,280(3) | | | | | | 2,748,396(4) | | | | | | 2,175,280(3) | | | | | | 2,175,280(3) | | | | | | 2,175,280(3) | | |
Other Benefits | | | | | 39,478(5) | | | | | | 39,478(5) | | | | | | — | | | | | | 39,478(5) | | | | | | — | | |
Totals | | | | | 4,143,873 | | | | | | 5,337,874 | | | | | | 2,625,280 | | | | | | 2,664,758 | | | | | | 2,625,280 | | |
| 2024 PROXY STATEMENT / 63 | |
| 64 / gpmtreit.com/investors | |
Year | | | Summary Compensation Table Total for PEO(1) ($) | | | Compensation Actually Paid to PEO(2) ($) | | | Average Summary Compensation Table Total for Non-PEO NEOs(3) ($) | | | Average Compensation Actually Paid to Non-PEO NEOs(4) ($) | | | Value of Initial Fixed $100 Investment Based On: | | | Net Income (Loss) (in thousands)(7) ($) | | | “Run- rate” ROAE(8) | | |||||||||||||||||||||||||||
| Total Shareholder Return(5) ($) | | | Peer Group Total Shareholder Return(6) ($) | | ||||||||||||||||||||||||||||||||||||||||||||
2023 | | | | | 4,049,820 | | | | | | 4,599,551 | | | | | | 2,108,760 | | | | | | 2,403,221 | | | | | | 49 | | | | | | 79 | | | | | | (63,198) | | | | | | 5.2% | | |
2022 | | | | | 3,762,129 | | | | | | 219,887 | | | | | | 1,965,133 | | | | | | 170,832 | | | | | | 38 | | | | | | 69 | | | | | | (40,825) | | | | | | 5.0% | | |
2021 | | | | | 4,730,154 | | | | | | 5,205,864 | | | | | | 2,333,208 | | | | | | 2,602,997 | | | | | | 74 | | | | | | 91 | | | | | | 68,353 | | | | | | 7.0% | | |
2020 | | | | | 3,199,995 | | | | | | 1,921,617 | | | | | | 1,682,491 | | | | | | 1,116,462 | | | | | | 58 | | | | | | 78 | | | | | | (40,439) | | | | | | 8.4% | | |
| Summary Compensation Table Total for PEO ($) | | | - | | | Grant Date Fair Value of Value of Equity Awards Granted During the Year(a) ($) | | | + | | | Year-End Fair Value of Outstanding Equity Awards Granted During the Year(a) ($) | | | +/- | | | Change in Fair Value as of Year-End of Any Prior Year Equity Awards that Remain Unvested as of Year-End(a)(b) ($) | | | +/- | | | Change in Fair Value as of the Vesting Date of Equity Awards Granted in Prior Years that Vested During the Year(a) ($) | | | + | | | Value of Dividends and Dividend Equivalent Rights Paid on Unvested Equity Awards During the Year(c) ($) | | | = | | | Compensation Actually Paid to PEO ($) | | ||||||||||||||||||
| 4,049,820 | | | | | | | | (2,249,997) | | | | | | | | | 2,651,782 | | | | | | | | | (211,535) | | | | | | | | | 46,594 | | | | | | | | | 312,887 | | | | | | | | | 4,599,551 | | |
| 2024 PROXY STATEMENT / 65 | |
| Average Summary Compensation Table Total for Non-PEO NEOs ($) | | | - | | | Average Grant Date Fair Value of Value of Equity Awards Granted During the Year(a) ($) | | | + | | | Average Year- End Fair Value of Outstanding Equity Awards Granted During the Year(a) ($) | | | +/- | | | Average Change in Fair Value as of Year-End of Any Prior Year Equity Awards that Remain Unvested as of Year-End(a)(b) ($) | | | +/- | | | Average Change in Fair Value as of the Vesting Date of Equity Awards Granted in Prior Years that Vested During the Year(a) ($) | | | + | | | Average Value of Dividends and Dividend Equivalent Rights Paid on Unvested Equity Awards During the Year(c) ($) | | | = | | | Average Compensation Actually Paid to Non-PEO NEOs ($) | | ||||||||||||||||||
| 2,108,760 | | | | | | | | (1,142,495) | | | | | | | | | 1,346,512 | | | | | | | | | (98,335) | | | | | | | | | 24,422 | | | | | | | | | 164,357 | | | | | | | | | 2,403,221 | | |
| 66 / gpmtreit.com/investors | |
| 2024 PROXY STATEMENT / 67 | |
| 68 / gpmtreit.com/investors | |
| | | PROPOSAL 2: ADVISORY APPROVAL OF EXECUTIVE COMPENSATION The Board of Directors recommends that you vote FOR this advisory Say on Pay proposal. Our executive compensation program is designed to reward performance and align with stockholders’ interests. | | | FOR | |
| 2024 PROXY STATEMENT / 69 | |
(4)Tocompensation program and our Compensation Committee can consider the outcome of these votes when making its decisions on executive compensation.
| | | PROPOSAL 3: ADVISORY APPROVAL OF FREQUENCY OF SAY ON PAY VOTES The Board of Directors recommends that you vote on an advisory basis to hold a Say on Pay vote EVERY YEAR. | | | EVERY YEAR | |
| 70 / gpmtreit.com/investors | |
(5)To transact2024. Although ratification is not required by our Bylaws or otherwise, our Board is submitting the selection of Ernst & Young LLP to our stockholders for ratification as a matter of good corporate practice.
Record Date:You may vote at the Annual Meeting if you were a holder of recordbest interests of our common stock asCompany. A representative of the close of business on March 21, 2018.
Proxy Materials:On or about March 27, 2018, we expectErnst & Young LLP is expected to begin mailing a Notice of Internet Availability of Proxy Materials, which contains information regarding how to access our proxy materials and vote. Our Proxy Statement and 2017 Annual Report are available at www.proxyvote.com.
Admission Policy:Only holders of record of common stock as of the record date may attend the Annual Meeting. We encourage you to register to attend in advance of the Annual Meeting by contacting our Investor Relations department by phone at 212-364-3200 or by email at investors@gpmortgagetrust.com. Attendancebe present at the Annual Meeting, will have an opportunity to make a statement if he or she so desires and is expected to be limitedavailable to stockholders presenting valid government-issued photo identificationrespond to appropriate questions.
| | | Year Ended December 31, | | |||||||||
| | | 2023 | | | 2022 | | ||||||
Audit fees(1) | | | | $ | 1,175,000 | | | | | $ | 1,063,000 | | |
Audit-related fees | | | | $ | — | | | | | $ | — | | |
Tax fees(2) | | | | $ | 328,231 | | | | | $ | 235,954 | | |
All other fees | | | | $ | — | | | | | $ | — | | |
Total | | | | $ | 1,503,231 | | | | | $ | 1,298,954 | | |
| 2024 PROXY STATEMENT / 71 | |
| | | PROPOSAL 4: RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITOR The Board of Directors recommends that you vote FOR the ratification of the appointment of Ernst & Young LLP as our independent auditor for the year ending December 31, 2024. | | | FOR | |
| 72 / gpmtreit.com/investors | |
| 2024 PROXY STATEMENT / 73 | |
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IMPORTANT NOTICE REGARDINGMeeting except items incident to the conduct of the meeting. However, on all matters properly brought before the meeting by our Board or others, the persons named as proxy holders in the accompanying proxy, or their substitutes, will vote on such matters in their discretion to the extent permitted by law.
THE 2018 ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON MAY 15, 2018:
STATEMENT
TABLE OF CONTENTS
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GENERAL INFORMATION ABOUT THE 2018 ANNUAL MEETING AND VOTING
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting to be held on May 15, 2018
This proxy statement and our 2017 Annual Report, which includes our Annual Report on Form 10-K for the fiscal year ended December 31, 2017, are available at www.proxyvote.com.
Pursuant to rules adopted by the U.S. Securities and Exchange Commission (“SEC”), we have elected to provide access to our proxy materials over the Internet. Accordingly, we are sending a Notice of Internet Availability of Proxy Materials (the “Notice of Availability”) to the holders of our common stock as of the close of business on March 21, 2018. All common stockholders will be able to access our proxy materials on the Internet at the SEC’s website, referred to in the Notice of Availability (www.proxyvote.com)www.sec.gov, or request to receive a printed set ofon our proxy materials. Instructions on how to access our proxy materials over the Internet or request a printed copy of our proxy materials may be found in the Notice of Availability.
We anticipate that the Notice of Availability will be mailed to common stockholders beginning on or about March 27, 2018.
website at www.gpmtreit.com.
| 74 / gpmtreit.com/investors | |
statement;
officers
A list of the holders of our common stock as of the record date will be available at our principal executive office, during normal business hours offor the ten days preceding the Annual Meeting, for examination by any registered holder of common stockholderstock as of the record date for any purpose pertaining to the Annual Meeting. Our principal executive office is located at 590 Madison Avenue, 38th Floor,3 Bryant Park, Suite 2400A, New York, New York 10022. This list will also be available to common stockholders of record for such purposes at the Annual Meeting.
10036.
| 2024 PROXY STATEMENT / 75 | |
NYSE.
Why did I receive more than one noticeNotice of Availability or printed set of proxy materials?
| 76 / gpmtreit.com/investors | |
How can I vote prior to the Annual Meeting?
Stockholders of Record. If you are a holder of record of our common stock, you may vote your shares or submit a proxy to be voted at the Annual Meeting by one of the following methods:
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Can I vote my shares in person atduring the Annual Meeting?
If you are a holder of record of our common stock, you
If you are a beneficial ownercard, voting instruction form or Notice of our common stock, you may vote your shares in person at the Annual Meeting only if you obtain and bring to the Annual Meeting a signed letter or other formInternet Availability of proxy from your broker, bank, trustee or other nominee giving you the right to vote those shares at the Annual Meeting.
How does the Board recommend that I vote my shares, and what vote is required for approval of each proposal at the Annual Meeting?
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If I submit my proxy, how will my shares of common stock be voted?
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How are abstentions and broker non-votes treated?
| 2024 PROXY STATEMENT / 77 | |
Proposal | | | Board Recommendation | | | Available Voting Options | | | Voting Approval Standard | | | Effect of an Abstention | | | Effect of a Broker Non-Vote | |
1 Election of directors | | | FOR each of the six nominees | | | FOR, AGAINST or ABSTAIN, with respect to each nominee | | | A nominee who receives a majority of all votes cast FOR such nominee is elected as a director | | | No Effect | | | No Effect | |
2 Advisory approval of executive compensation | | | FOR | | | FOR, AGAINST or ABSTAIN | | | Majority of all votes cast FOR the proposal | | | No Effect | | | No Effect | |
3 Advisory approval of frequency of Say on Pay votes | | | EVERY YEAR | | | EVERY YEAR, EVERY TWO YEARS, or EVERY THREE YEARS | | | The choice of frequency that receives the greatest number of votes | | | No Effect | | | No Effect | |
4 Ratification of appointment of independent auditor | | | FOR | | | FOR, AGAINST or ABSTAIN | | | Majority of all votes cast FOR the proposal | | | No Effect | | | Not Applicable | |
How Do You Hold Your Shares? | | | How Your Shares Will Be Voted if You Specify How to Vote: | | | How Your Shares Will Be Voted if You Do Not Specify How to Vote: | |
Stockholder of Record (your shares are registered in your name) | | | The named proxy holders will vote your shares as you direct on the proxy card. | | | The named proxy holders will vote as recommended by our Board. In the case of Proposal 1, that means your shares will be voted FOR each director nominee. In the case of Proposals 2 and 4, that means your shares will be voted FOR each proposal. In the case of Proposal 3, that means your shares will be voted for a Say on Pay frequency of EVERY YEAR. | |
Beneficial Owner (your shares are held in “street name”) | | | Your broker, bank, trustee or other nominee will vote your shares as you direct them to. | | | Your broker, bank, trustee or other nominee may use its discretion to vote only on items deemed by the NYSE to be “routine,” such as Proposal 4: Ratification of Appointment of Independent Auditor. For non-routine items, such as Proposals 1-3, your shares will be considered “uninstructed” and result in a broker non-vote. | |
ballot at
| 78 / gpmtreit.com/investors | |
10036.
votes.
Stockholders of Record. If your shares of common stock are registered directly in your name with our transfer agent, Equiniti Trust Company, you will need to present the following items to gain admission to the Annual Meeting:
·valid government-issued photo identification; and
·proof of ownership as of the record date, which may include a copy of your account statement from our transfer agent or a copy of your stock certificate.
Beneficial Owners. If you are a beneficial owner of shares of common stock held in street name by a broker, bank, trustee or other nominee, you will need to present the following to gain admission to the Annual Meeting:
·valid government-issued photo identification; and
·proof of share ownership as of the record date, by providing a bank or brokerage firm account statement or a letter from the broker, trustee, bank or nominee holding your shares.
What is householding?
Householding Department
51 Mercedes Way
Edgewood, New York 11717
1-866-540-7095
| 2024 PROXY STATEMENT / 79 | |
associated costs and expenses.
Attention: Investor Relations
590 Madison Avenue, 38th Floor
3 Bryant Park, Suite 2400A
New York, New York 10022
10036
Phone 212-364-3200
212-364-5500
Email: investors@gpmortgagetrust.com
PROPOSAL 1: ELECTION
Director Nominations
Action will be taken at the Annual Meeting for the election of nine directors, each to hold office until our annual meeting of stockholders to be held in 2019 and until his or her successor is duly elected and qualified. Proxies cannot be voted for a greater number of persons than the number of nominees named.
Information concerning each of the nine director nominees standing for election to our Board of Directors at the Annual Meeting is set forth below. Each of the nominees has been recommended for nomination by the Nominating and Corporate Governance Committee and nominated by our Board of Directors. If elected, it is expected that each of the director nominees will be able to serve, but if any such nominee is unable or unwilling to serve, the proxies reserve discretion to vote or refrain from voting for a substitute nominee or nominees.
We believe that each of the director nominees displays personal and professional integrity; satisfactory levels of education and/or business experience; business acumen; an appropriate level of understanding of our business and its industry and other industries relevant to our business; the ability and willingness to devote adequate time to the work of our Board of Directors and its Committees; a fit of skills and personality with those of our other directors that helps build a board that is effective and responsive to the needs of our company; strategic thinking and a willingness to express ideas; a diversity of experiences, expertise and background; and the ability to represent the interests of our stockholders. The information presented below regarding each director nominee also sets forth specific experience, qualifications, attributes and skills that led our Board of Directors to conclude that he or she should be nominated to stand for election to serve as a director.
Director Nominees
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THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE ELECTION OF EACH OF THE DIRECTOR NOMINEES NAMED ABOVE.
CORPORATE GOVERNANCE AND BOARD OF DIRECTORS
Our Board of Directors is committed to maintaining the highest standards of business conduct and corporate governance. As described more fully below, we have adopted a Code of Business Conduct and Ethics applicable to the conduct of our officers and directors, as well as to the employees of our external manager, Pine River Capital Management L.P., and its affiliates. We have also adopted Corporate Governance Guidelines, which, in conjunction with our Charter, Bylaws and our board committee charters, provide the framework for our corporate governance practices.
You can access our Code of Business Conduct and Ethics, our Corporate Governance Guidelines, the charters for our Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee, and certain other policies under “Corporate Governance” in the Investors section of our website at www.gpmortgagetrust.com or by writing to our Investor Relations department at Granite Point Mortgage Trust Inc., 590 Madison Avenue, 38th Floor, New York, New York 10022.
Code of Business Conduct and Ethics
We have adopted a Code of Business Conduct and Ethics that applies to our officers and directors and to Pine River’s officers, directors and employees when such individuals are acting for us or on our behalf. Among other matters, our Code of Business Conduct and Ethics is designed to detect and deter wrongdoing and to promote:
·honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;
·full, fair, accurate, timely and understandable disclosure in our SEC reports and other public communications;
·compliance with applicable governmental laws, rules and regulations;
·prompt internal reporting of violations of the Code of Business Conduct and Ethics to appropriate persons identified in the Code; and
·accountability for adherence to the Code of Business Conduct and Ethics.
Any waiver of the Code of Business Conduct and Ethics for our executive officers or directors may be made only by our Board of Directors or a committee thereof and will be promptly disclosed as required by law or stock exchange regulations. The Code of Business Conduct and Ethics was adopted by the Board of Directors on June 14, 2017.
Director Independence
NYSE rules require that a majority of a company’s board of directors be composed of “independent directors,” which is defined generally as a person other than an executive officer or employee of the company or its subsidiaries or any other individual having a relationship which, in the opinion of the company’s board of directors, would interfere with the director’s exercise of independent judgment in carrying out the responsibilities of a director. Consistent with these considerations, our Board of Directors has affirmatively determined, upon the review and recommendation of our Nominating and Corporate Governance Committee, that the following directors and director nominees each meet the qualifications of an independent director: Tanuja M. Dehne, Martin A. Kamarck, Stephen G. Kasnet, W. Reid Sanders and Hope B. Woodhouse.
Board Leadership Structure
Our Board of Directors is led by a Chairman who is appointed by the directors. Both independent and non-independent directors are eligible for appointment as the Chairman. The Chairman presides at all meetings of our stockholders and of our Board of Directors. The Chairman performs such other duties and exercises such powers as from time to time shall be prescribed in our Bylaws or by our Board of Directors. Our Board of Directors has appointed Mr. Brian Taylor to serve as our Chairman.
Our Corporate Governance Guidelines provide that the independent directors shall appoint a director to serve as the lead independent director. The lead independent director is responsible for coordinating the activities of the other independent directors, including scheduling and conducting separate meetings of the independent directors and for such other duties as are assigned from time to time by our Board of Directors. Our independent directors have appointed Mr. Kasnet to serve as our lead independent director.
Our Board of Directors consists of a majority of independent directors and exercises a strong, independent oversight function. All of the committees of our Board of Directors – Audit, Compensation, and Nominating and Corporate Governance – are comprised entirely of independent directors. A number of board committee processes and procedures, including regular executive sessions of independent directors and a regular review of the performance of our external manager, provide substantial independent oversight of our management’s performance. Under our Bylaws and Corporate Governance Guidelines, our Board of Directors has the ability to change its structure if it determines that such a change is appropriate and in the best interest of our company. Our Board of Directors believes that these factors provide the appropriate balance between the authority of those who oversee our company and those who manage it on a day-to-day basis.
We currently separate the roles of Chairman and Chief Executive Officer. However, our Chairman and Chief Executive Officer are both affiliated with our external manager, Pine River Capital Management L.P. Our Board of Directors believes that this affiliation benefits our company because these individuals are knowledgeable about our company’s business and they are able to ensure that adequate resources are devoted to the company by Pine River pursuant to our Management Agreement between us and Pine River Capital Management dated June 28, 2017 (the “Management Agreement”).
Board Committees
Our Board of Directors has formed three committees, including our Audit, Compensation, and Nominating and Corporate Governance Committees, and has adopted charters for each of these committees. Each committee is composed exclusively of directors who meet the independence and other requirements established by the rules and regulations of the SEC and the NYSE listing standards. Additionally, the Compensation Committee is composed exclusively of individuals intended to be, to the extent required by Rule 16b-3 under the Securities Exchange Act of 1934, as amended, or the Exchange Act, non-employee directors.
The following table summarizes the current membership of each of our committees.
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Audit Committee
Our Audit Committee is responsible for engaging our independent registered public accounting firm, preparing Audit Committee reports, reviewing with the independent registered public accounting firm the plans and results of the audit engagement, approving professional services provided by the independent registered public accounting firm, reviewing the independence of the independent registered public accounting firm, considering the range of audit and non-audit fees, and reviewing the adequacy of our internal accounting controls.
Our Audit Committee is, and will at all times be, composed exclusively of “independent directors” as defined under the NYSE listing standards and who otherwise meet the NYSE listing standards. Each member of our Audit Committee is also financially literate, in that they are able to read and understand fundamental financial statements, including a company’s balance sheet, income statement and cash flow statement.
In addition, as a listed company, we must certify that our Audit Committee has and will continue to have at least one member who is financially sophisticated in that he or she has past employment experience in finance or accounting, requisite professional certification in accounting, or other comparable experience or background that results in the individual’s financial sophistication. Our Board of Directors has determined that each of Mr. Kasnet and Ms. Woodhouse satisfies the definition of financial sophistication and also qualifies as an “audit committee financial expert,” as defined under rules and regulations of the SEC.
Our Audit Committee’s purpose and responsibilities are more fully set forth in its charter.
Compensation Committee
The principal functions of our Compensation Committee are to:
·evaluate the performance of our executive officers;
·in consultation with senior management, establish the company’s general compensation philosophy and review the compensation philosophy of the company’s external manager;
·evaluate the performance of our external manager Pine River;
·review the compensation and fees payable to Pine River under the Management Agreement;
·review the compensation and fees payable to any affiliates of Pine River or any other related party;
·prepare Compensation Committee reports;
·make recommendations to our Board of Directors with respect to our company’s incentive compensation plans and equity-based plans; and
·administer any equity incentive plan, including the issuance of any common stock or other equity awards there under to employees of Pine River who provide services to us under the Management Agreement.
Our Compensation Committee is responsible for reviewing and making recommendations to our Board of Directors regarding the compensation of our company’s independent directors. In doing so, the Compensation Committee will work with our independent compensation consultant and consider, among other things, the following:
·the compensation that is paid to directors of other companies that are comparable to us;
·the amount of time directors are expected to devote to preparing for and attending meetings of our Board of Directors and the committees on which they serve;
·the success of our company;
·whether a director is a lead independent director or chairman of one of the committees of our Board of Directors and the time commitment related thereto;
·if a committee on which a director serves undertakes a special assignment, the importance of that special assignment to our company and its stockholders; and
·the risks involved in serving as a director on our Board of Directors or a member of its committees.
All decisions concerning independent director compensation are made by the non-independent, disinterested members of our Board of Directors, none of whom are paid for their service on our Board. Other than our Chief Executive Officer, who serves as a non-independent director, none of our executive officers are involved in determining independent director compensation levels, although our management team may provide support to the Compensation Committee and its independent compensation consultant, including certain information, data and other resources in connection with its compensation recommendations to our Board of Directors.
Our Compensation Committee may delegate all or a portion of its duties and responsibilities to a subcommittee of the Compensation Committee. Our Compensation Committee’s purpose and responsibilities are more fullyProfessional Appraisal Practice) set forth in the Compensation Committee’s charter.
Nominating and Corporate Governance Committee
Our Nominating and Corporate Governance Committee is responsibleoriginal appraisal. As stabilized value may be based on certain assumptions, such as future construction completion, projected re-tenanting, payment of tenant improvement or leasing commissions allowances or free or abated rent periods, or increased tenant occupancies.
Our Nominating and Corporate Governance Committee considers the following factors in making its recommendations to the Board of Directors: background experience, skills, expertise, accessibility and availability to serve effectively on the Board of Directors. The Nominating and Corporate Governance Committee also conducts inquiries into the background and qualifications of potential candidates.
Our Nominating and Corporate Governance Committee’s purpose and responsibilitiesall-in yield at origination are more fully set forth in its charter.
Role of Our Board of Directors in Risk Oversight
Our management is responsible for assessing and managing the risks faced by our company, subject to the oversight of our Board of Directors. Our Board of Directors exercises its oversight of our company’s risks, including through the review of our business plans, capital structure, financial results, and infrastructure. The Board has also established investment guidelines, which set parameters for the type and size of investments we can make without further Board approval. Additionally, the Board of Directors relies upon our Audit Committee to oversee risks related to the quality and integrity of our financial reports, the performance and independence of our external auditor, the performance of our internal audit function, our policies regarding accounting and financial matters and internal controls, and performance of our information technology and data security function, including as it relates to cybersecurity.
Management routinely informs the Board of Directors and its Committees of developments that could affect our risk profile or other aspects of our business.
Cyber Security
Our external manager provides our company with personnel, including its Chief Information Security Officer, to help manage the growing complexity of cyber risks. Our external manager’s Chief Information Security Officer will report to the Board of Directors and/or the Audit Committeebased on a regular basis regarding our company’s exposure to cyber risk, including with respect to our cyber security infrastructure, the development and implementation of policies, procedures, standards and technical measures to create an environment that is designed to minimize exposure to cyber threats and recovery from adverse events, if any.
Board Meetings
We commenced operating as a public company on June 28, 2017. During the remainder of 2017, our Board of Directors held three meetings. During certain meetings of our Board of Directors, the independent directors also met separately in executive sessions without management present to discuss various matters. During that same period, our Audit Committee held four meetings. Our Compensation Committee and Nominating and Corporate Governance Committee did not hold in-person meetings during that time, but the Chairs of each committee were actively working with management in 2017 to develop processes and agendas for future meetings, and the Compensation Committee took action on a variety of matters by unanimous written consent in lieu of holding formal meetings. Each of our directors attended at least 75% of the aggregate total number of meetings held by the Boardassumptions (some or all of Directorswhich may not occur) and all committees on which heare expressed as monthly equivalent yields that include net origination fees and exit fees and exclude future fundings and any potential or she served during 2017.
Director Nomination Process
Our Corporate Governance Guidelines provide the following minimum qualifications for directorscompleted loan amendments or modifications. Calculations of all-in weighted average yield at origination exclude fixed-rate loans.
·possession of the highest personal and professional ethics, integrity and values;
·the ability to exercise good business judgment and be committed to representing the long-term interests of the company and its stockholders;
·having an inquisitive and objective perspective, practical wisdom and mature judgment; and
·willingness to devote the necessary time and effort to board of director duties, including preparing for and attending meetings of the Board of Directors and its committees.
In considering candidates for nomination as a director, the Nominating and Corporate Governance Committee generally assembles all information regarding a candidate’s background and qualifications, evaluates a candidate’s mix of skills and qualifications and determines the contribution that the candidate could be expected to make to the overall functioning of our Board of Directors. AlthoughCertain financial measures we do not have a formal policy on diversity, our corporate governance guidelines provide that our company shall endeavor to have a Board of Directors representing a diverse education and experience that provides knowledge of business, financial, governmental or legal matters that are relevant to our business and to our status as a publicly owned company. With respect to the re-nomination of current directors, the Committee considers the foregoing factors as well as past participation in and contributions to the activities of our Board of Directors and its committees.
Our Nominating and Corporate Governance Committee will consider candidates recommended for nomination to our Board of Directors by our stockholders. Stockholder recommendations for nominees to the Board of Directors should be submitted in writing to our Secretary. The manner in which such Committee evaluates candidates recommended by stockholders is generally the same as any other candidate, including customary diligence, interviews and background checks. However, the Committee will also seek and consider information concerning any relationship between a stockholder recommending a candidate and the candidateuse to determine if the candidate can represent the interests of all of the stockholders. The Committee willexecutive compensation are non-GAAP measures. These measures are not evaluate a candidate recommended by a stockholder unless the stockholder’s proposal provides a certification that the potential candidate consents to being named in our proxy statement and will serve as a director if elected.
Majority Voting for Directors and Director Resignation Policy
Our Bylaws provide that a director nominee will be elected by receiving the affirmative vote of a majority of the votes cast on the election of such nominee on a per nominee basis in an uncontested election (which occurs when the number of director nominees is the same as the number of directors to be elected). If a director nominee who is an incumbent director receives a greater number of votes “against” than votes “for” his or her election and with respect to whom no successor has been elected, such incumbent director shall promptly tender his or her offer to resign to our Board of Directors for its consideration following certification of the stockholder vote. Within 90 days following certification of the stockholder vote, our Nominating and Corporate Governance Committee shall consider the tendered resignation offer and make a recommendation to our Board of Directors whether or not to accept such offer, and our Board of Directors shall act on our Nominating and Corporate Governance Committee’s recommendation. In determining whether to accept the resignation, our Nominating and Corporate Governance Committee and Board of Directors may consider any factors they deem relevant in deciding whether to accept a director’s resignation, including, among other things, whether accepting the resignation of such director would cause our company to fail to meet any applicable stock exchange or SEC rules or requirements. Thereafter, our Board of Directors shall promptly and publicly disclose its decision-making process regarding whether to accept the director’s resignation offer or the reasons for rejecting the resignation offer, if applicable, on a Form 8-K furnished to the SEC. Any director who tenders
his or her resignation will not participate in our Nominating and Corporate Governance Committee’s recommendation or our Board of Directors’ action regarding whether to accept the resignation offer. If our Board of Directors does not accept the director’s resignation, such director will continue to serve until the next annual meeting of stockholders and until such director’s successor is duly elected and qualified or until the director’s earlier resignation or removal.
In a contested election, the director nominees who receive a plurality of votes cast will be elected as directors. Under the plurality standard, the number of persons equal to the number of vacancies to be filled who receive more votes than other nominees are elected to our Board of Directors, regardless of whether they receive a majority of votes cast.
Communications with our Board of Directors
We provide the opportunity for our stockholders and all other interested parties to communicate with members of our Board of Directors. Stockholders and all other interested parties may communicate with the independent directors or the chairperson of any of the committees of the Board of Directors by email or regular mail. All communications should be sent to the company’s Secretary, Rebecca B. Sandberg, by email to secretary@gpmortgagetrust.com or by regular mail to the attention of the Independent Directors, the Chair of the Audit Committee, the Chair of the Compensation Committee, or the Chair of the Nominating and Corporate Governance Committee, as the case may be, in each instance in care of the Secretary at the company’s office at 590 Madison Avenue, 38th Floor, New York, New York 10022.
Our Secretary will review each communication received in accordance with, this process to determine whether the communication requires immediate action. The Secretary will forward all appropriate communications received, or a summary of such communications, to the appropriate member(s) of our Board of Directors. However, we reserve the right to disregard any communication that we determine is unduly hostile, threatening or illegal, or does not reasonably relate to us or our business, or is similarly inappropriate. The Secretary has the authority to disregard any inappropriate communications or to take other appropriate actions with respect to any such inappropriate communications.
Stockholder proposals must be madesubstitute for, measures prepared in accordance with GAAP, and they may differ from the procedures set forth in our current Bylaws or the procedures set forth in Rule 14a-8 of the Exchange Act and not the procedures set forth in the preceding paragraph or the procedures set forth under “Corporate Governance and Board of Directors – Director Nomination Process” above. Nominationsnon-GAAP financial measures reported by other companies. See below for the Board of Directors proposed may only be made in accordance with the procedures set forth in our Bylaws. Certain matters set forth in our Bylaws for stockholder proposals, including nominations for our Board of Directors, as well as certain matters set forth in Rule 14a-8 for stockholders proposals are described in “Other Matters – Stockholder Proposals and Director Nominations for 2019 Annual Meeting” in this proxy statement.
Director Compensation
We compensate the independent members of our Board of Directors for their service. It is our belief that director compensation should:
·align the interests of our directors and our stockholders;
·ensure our company can attract and retain outstanding director candidates who meet the selection criteria set forth in our Corporate Governance Guidelines and Nominating and Corporate Governance Committee Charter; and
·reflect the substantial time commitment of our directors necessary to oversee our business.
Generally, it has been our practice to compensate our independent directors with a mix of cash and equity-based compensation. We do not pay any compensation to the non-independent directors for their service on our Board of Directors. However, all members of our Board of Directors are reimbursed for their costs and expenses of serving on the Board of Directors, including costs and expenses of attending all meetings of our Board of Directors and its Committees. As discussed above, the Compensation Committee Charter provides that the Compensation Committee has the primary responsibility for reviewing and recommending any changes to director compensation. Our Board of Directors reviews the Compensation Committee’s recommendations and the non-independent, disinterested directors make all decisions concerning the amount and manner of independent director compensation.
Independent Director Compensation for 2017
For the partial-year term that began on the day we commenced operations (June 28, 2017) and ends at the 2018 Annual Meeting, our director compensation policy specifies that each of our independent directors, which includes the individuals listed below,information about how these measures were entitled to earn the following fees for their service:
·for each independent director, an annual fee of $100,000, paid half in cash and half in shares of our common stock;
·for the Audit Committee Chair, an additional fee of $15,000, paid half in cash and half in shares of our common stock; and
·for the lead independent director, an additional fee of $35,000, paid half in cash and half in shares of our common stock.
The cash portion of these annual fees is paid in four equal quarterly installments over the course of the term. The common stock portion of the annual fees is granted under our 2017 Equity Incentive Plan (the “Equity Incentive Plan”), which generally occurs on the first business day following the annual meeting of stockholders at which such director is elected, and in the case of the 2017 partial-year term, on effective as of the date that such individuals began their service, as applicable. The number of shares of common stock subject to issuance is determined using the fair market value of our common stock on the grant date, which is based on the closing market price on the NYSE on the grant date. The common stock granted to the independent directors under our Equity Incentive Plan as part of the director fees noted above vests immediately on the grant date.
calculated.
(in thousands, except share data) | | | December 31, 2023 | | | December 31, 2022 | | ||||||
Stockholders’ equity | | | | $ | 858,898 | | | | | $ | 983,545 | | |
7.00% Series A cumulative redeemable preferred stock liquidation preference | | | | $ | (205,738) | | | | | $ | (205,738) | | |
Common stockholders’ equity (A, B) | | | | $ | 653,160 | | | | | $ | 777,807 | | |
Shares: | | | | | | | | | | | | | |
Common stock | | | | | 50,577,841 | | | | | | 52,258,404 | | |
Restricted stock | | | | | — | | | | | | 92,585 | | |
Total outstanding | | | | | 50,577,841 | | | | | | 52,350,989 | | |
Book value per share of common stock (C, D) | | | | $ | 12.91 | | | | | $ | 14.86 | | |
Dollar change in book value per common share (E = C – D) | | | | $ | (1.95) | | | | | | | | |
Percentage change in book value per common share (F = E / D) | | | | | (13.1)% | | | | | | | | |
| 2024 PROXY STATEMENT / 81 | |
Name |
| Annual Fees Paid in Cash(1) | Stock Awards(2) | Total | ||
Tanuja M. Dehne |
| $25,000.00 |
| $49,998.00 |
| $74,998.00 |
Martin A. Kamarck |
| $25,000.00 |
| $49,998.00 |
| $74,998.00 |
Stephen G. Kasnet |
| $37,500.00 |
| $74,540.56 |
| $112,040.56 |
W. Reid Sanders |
| $25,000.00 |
| $49,998.00 |
| $74,998.00 |
Hope B. Woodhouse |
| $25,000.00 |
| $49,998.00 |
| $74,998.00 |
(1)This column sets forth the cash fees paid by us during the year ended2020, and for all subsequent reporting periods ending on or after December 31, 2017. The current term of each of the independent directors expires on the date of the 2018 Annual Meeting.
(2)The values in this column were computed2021, we have elected to present Distributable Earnings, a measure that is not prepared in accordance with FASB ASC Topic 718 andGAAP, as a supplemental method of evaluating our operating performance. Distributable Earnings replaces our prior presentation of Core Earnings with no changes to the definition. In order to maintain our status as a REIT, we are based on the closing market pricerequired to distribute at least 90% of our common stock on the NYSE on the grant date of the stock award.
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
Compensation Committee Interlocks and Insider Participation
None of the memberstaxable income as dividends. Distributable Earnings is intended to serve as a general, though imperfect, proxy for our taxable income. As such, Distributable Earnings is considered a key indicator of our Compensation Committee or Nominating and Corporate Governance Committeeability to generate sufficient income to pay our common dividends, which is or has been employed by us. Nonethe primary focus of income-oriented investors who comprise a meaningful segment of our executive officers currently servesstockholder base. We believe providing Distributable Earnings on a supplemental basis to our net income (loss) and cash flow from operating activities, as a member of the board of directors or compensation committee of another entity that has one or more executive officers serving on our Board of Directors or our Compensation or Nominating and Corporate Governance Committees, except that in 2017 each of Messrs. Brian Taylor, Siering and Roth, each of whom are partners of Pine River, participated in making compensation decisions for officers and employees of Pine River and its affiliates.
Transactions with Related Persons
Management Agreement with Pine River Capital Management L.P.
We are party to a Management Agreement with Pine River Capital Management L.P., pursuant to which Pine River provides the day-to-day management of our business, including providing us with our executive officers and all other personnel necessary to support our operations. The Management Agreement requires Pine River to manage our business in conformity with the policies and the investment guidelines that are approved and monitored by our Board of Directors. The Management Agreement has an initial three-year term, which expires on June 28, 2020, and renews automatically for successive one-year terms unless earlier terminated by either us or Pine Riverdetermined in accordance with GAAP, is helpful to stockholders in assessing the terms thereof. Pine River is entitled to receive a termination fee from us under certain circumstances. In exchange for its services, we are obligated to pay Pine River a management fee as well as reimburse it for certain expenses incurred by it and its affiliates in rendering management services to us. Mr. Brian Taylor, our Chairman, is Chief Executive Officer and a Partner of Pine River. Messrs. Siering and Roth, membersoverall run-rate operating performance of our Boardbusiness.
We incurred charges of $8.5 million for year ended December 31, 2017 related to the Management Agreement, of which $6.3 million was for the base management fee and $2.2 million represented expense reimbursements for general and administrative expenses incurred by the company in the normal course of its operations and certain compensation expenses incurred by Pine River under the Management Agreement as described in greater detail below. No incentive fees were earned by or paid to Pine River during the year.
Under the Management Agreement, we pay Pine River a base management fee equal to 1.5% of equity on an annualized basis. For purposes of calculating the management fee, equity means the sum of the net proceeds from all issuancesnot necessarily indicative of our equity securities, plus cumulative “core earnings” at the end of the most recently completed calendar quarter, less any distributions to stockholders, any amount paid to repurchase stock,current loan portfolio and any incentive fees earned by Pine River, but excluding the incentive fee earned in the current quarter. Beginning in the fourth quarter of 2018, incentive fees, if earned, will be payable to Pine River. The incentive fee will be the excess of (1) the product of (a) 20% and (b) the result of (i) “core earnings” for the previous 12-month period, minus (ii) the product of (A) equity in the previous 12-month
period, and (B) 8% per annum, less (2) the sum of any incentive fees paid to Pine River with respect to the first three calendar quarters of such previous 12-month period; provided, however, that no incentive fees are payable with respect to any calendar quarter unless “core earnings” for the 12 most recently completed calendar quarters in the aggregate is greater than zero.
operations. For purpose of calculating the base management and incentive fees, “core earnings” meansreporting purposes, we define Distributable Earnings as net income (loss) attributable to commonour stockholders, excludingcomputed in accordance with GAAP, excluding: (i) non-cash equity compensation expense, incentive fees earned by Pine River,expenses; (ii) depreciation and amortization,amortization; (iii) any unrealized gains or losses(losses) or other similar non-cash items that are included in net income (loss) for the applicable reporting period (regardless of whether such items are included in other comprehensive income or loss or in net income)income (loss) for such period); and (iv) certain non-cash items and one-time expenses. Distributable Earnings may also be adjusted from time to time for reporting purposes to exclude one-time events pursuant to changes in U.S. GAAP and certain other material non-cash income or expense items in each case after discussions between Pine River and the independent members of our Board of Directors and approved by a majority of our independent directors.
As noted above, The exclusion of depreciation and amortization from the calculation of Distributable Earnings only applies to debt investments related to real estate to the extent we reimburse Pine River for (i) our allocable shareforeclose upon the property or properties underlying such debt investments.
Transactions with Significant Stockholders
As described in greater detail below under “Beneficial Owners of More than Five Percent of Our Common Stock,” as of February 8, 2018, Goldman Sachs Asset Management reported that it was a beneficial owner of more than five percent (5%) of our common stock and, therefore, is considered a related party under SEC rules. In 2017, prior to Goldman Sachs Asset Management becoming a related party, we entered into a Master Repurchase and Securities Contract Agreement and subsequent amendments with an affiliate of Goldman Sachs Asset Management. This financing arrangement, pursuant to which we finance certain of our loans held for investment, was entered into on an arm’s-length basis. As of December 31, 2017, we had an aggregate outstanding balance of approximately $253 million under this financing arrangement.
Related Person Transaction Policies
Our Audit Committee Charter requires our Audit Committee to review, approve and oversee any related party transactions involving our company and also authorizes such Committee to develop policies and procedures for its approval of related party transactions.
Our Management Agreement places restrictions on Pine River from entering into transactions with its related parties or providing services under the Management Agreement on terms that are no more favorable to Pine River or its affiliates than would be obtained from a third party on an arm’s-length basis, in any event unless approved by a majority of our independent directors.
STOCK OWNERSHIP
Beneficial Ownership of Directors, Director Nominees and Named Executive Officers
Our common stock is listed on the NYSE under the symbol “GPMT.” As of March 21, 2018, we had 353 registered holders and 64,486 beneficial owners of our common stock. The following table sets forth information regarding the beneficial ownership of our common stock as of March 21, 2018 (unless otherwise indicated) by each of our executive officers, current directors and director nominees and all of such individuals as a group.
Beneficial ownership is determined in accordance with Rule 13d-3ultimate realization of the Exchange Act. A person is deemed to beloan.
Name and Address of Beneficial Owner(1) |
| Number of Shares Beneficially Owned(2) |
| Percent of |
Directors and Director Nominees:
|
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Tanuja M. Dehne |
| 3,564 |
| * |
Martin A. Kamarck |
| 2,564 |
| * |
Stephen G. Kasnet(3) |
| 17,319 |
| * |
William Roth |
| 153,829 |
| * |
W. Reid Sanders |
| 70,428 |
| * |
Thomas E. Siering(3) |
| 185,482 |
| * |
Brian C. Taylor |
| 23,014 |
| * |
John A. Taylor |
| 195,862 |
| * |
Hope B. Woodhouse(3) |
| 12,927 |
| * |
Officers: |
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Stephen Alpart |
| 85,220 |
| * |
Steven Plust |
| 83,213 |
| * |
Rebecca B. Sandberg |
| 40,390 |
| * |
Marcin Urbaszek |
| 38,711 |
| * |
All director nominees and executive officers as a group (13 individuals) |
| 912,523 |
| 2.10% |
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*Represents ownership of less than 1.0% of our outstanding common stock as of March 21, 2018.
(1)The business address of each of the individuals is 590 Madison Avenue, 38th Floor, New York, New York 10022.
(2)Based on 43,437,059 shares of common stock outstanding as of March 21, 2018. Our directors and named executive officers are prohibited from hedging company stock and from pledging company stock in any manner, whether as collateral for a loan, in a margin account held at a broker, or otherwise.
(3)Includes shares of common stock acquired by the reporting person in connection with the pro rata stock dividend by Two Harbors Investment Corp. to its stockholders on November 1, 2017; the dividend distribution was exempt from Section 16 of the Securities Exchange Act of 1934 pursuant to Rule16a-9 thereof.
Beneficial Owners of More than Five Percent of Our Common Stock
Based on filings made under Section 13(g) of the Exchange Act, the persons known by us to be beneficial owners of five percent (5%) or more of our common stock were as follows:
Name and Address of Beneficial Owner |
| Number of Shares Beneficially Owned |
| Percent of |
The Vanguard Group(2) 100 Vanguard Blvd. Malvern, PA 19355 |
| 3,491,935 |
| 8.04% |
BlackRock, Inc.(3) 55 East 52nd Street New York, NY 10055 |
| 3,772,127 |
| 8.68% |
Goldman Sachs Asset Management (4) 200 West Street New York, NY 10282 |
| 3,119,531 |
| 7.18% |
|
|
|
|
|
(1)Based on 43,437,059 shares of our common stock outstanding as of March 21, 2018.
(2)Based on a Schedule 13G filed with the SEC on February 8, 2018, by The Vanguard Group reporting that it has sole voting power with respect to 47,072 shares, shared voting power with respect to 3,173 shares, sole dispositive power with respect to 3,444,175 shares, and shared dispositive power with respect to 47,760 shares.
(3)Based on a Schedule 13G filed with the SEC on February 1, 2018, by BlackRock, Inc. reporting that it has sole voting power with respect to 3,684,349 shares and sole dispositive power with respect to all shares reported.
(4)Based on a Schedule 13G filed with the SEC on February 6, 2018, by Goldman Sachs Asset Management reporting that it has shared voting power with respect to 2,992,040 shares and shared dispositive power with respect to all shares reported, but does not hold sole voting power or sole dispositive power with respect to any of the shares reported.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act and the disclosure requirements of Item 405 of SEC Regulation S-K require that our directors and executive officers, and any persons holding more than 10% of our common stock (“10% holders”), file reports of ownership and changes in ownership with the SEC. Officers, directors and 10% holders are required by Item 405 of Regulation S-K to furnish us with copies of all Section 16(a) forms that they file. To our knowledge, based solely on a review of the copies of such reports furnished to us or written representations from reporting persons that all reportable transactions were reported, we believe that during the fiscal year ended December 31, 2017, all reports required to be filed2023, we recorded provision for credit losses of $(104.8) million, which has been excluded from Distributable Earnings, consistent with other unrealized gains (losses) and other non-cash items pursuant to Section 16(a) by such executive officers, directorsour existing policy for reporting Distributable Earnings referenced above. During the year ended December 31, 2023, we recorded $(3.4) million in depreciation and 10% holders were timely filed.
Director Stock Ownership Guidelines
Our directors are encouragedamortization on REO and related intangibles, which has been excluded from Distributable Earnings consistent with other unrealized gains (losses) and other non-cash items pursuant to own sharesour existing policy for reporting Distributable Earnings referenced above. During the year ended December 31, 2023, we recorded a $0.2 million gain on early extinguishment of debt, which has been excluded from Distributable Earnings consistent with certain one-time events pursuant to our existing policy for reporting Distributable Earnings as a helpful indicator in assessing the overall run-rate operating performance of our common stockbusiness.
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EXECUTIVE OFFICERS
Executive Officers
Our Board of Directors generally appoints our executive officers annually following our annual meeting of stockholders to serve one year terms. Set forth below is information about each of our named executive officers.
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Executive Compensation Overview
As described more fully above underevaluate and compare the section titled “Certain Relationships and Related Party Transactions – Transactions with Related Persons – Management Agreement with Pine River Capital Management L.P.,” we are externally managed by Pine River Capital Management L.P. (“Pine River”) under the terms of a Management Agreement, pursuant to which Pine River provides us with all of the personnel required to manage and operate our business, including our named executive officers, each of whom is an employee of an affiliate of Pine River. Accordingly, as discussed below under “Compensation Discussion and Analysis,” the cash compensation received by our named executive officers is paid by Pine River. Any equity incentive compensation awarded to our named executive officers is the responsibility of our Compensation Committee and is determined by our Compensation Committee in accordance with our Equity Incentive Plan.
Compensation Discussion and Analysis
This compensation discussion and analysis describes our compensation objectives and policies in relation to compensation received by our named executive officers during the fiscal year ended December 31, 2017.
Executive Compensation Overview; Management Agreement
As described more fully above under the section titled “Certain Relationships and Related Party Transactions – Transactions with Related Persons – Management Agreement with Pine River,” we are externally managed by Pine River under the terms of a Management Agreement. As an externally managed company with no employees of our own, we rely on our external manager to provide us with the employees we need to operate our business.
Under the Management Agreement, Pine River is responsible for managing our assets and the day-to-day operationsperformance of our company including, among other things:
·investigating, analyzing and selecting possible investment opportunities;
·conducting negotiationsour peers.
·negotiatingsales and entering into financing agreements;
·managing and supervising third party vendors and contractors, including lawyers and auditors;
·providing executive and administrative personnel, office space and office services;
·maintaining a financial accounting and reporting function,similar developments within our Company’s portfolio or borrowings, to (ii) our Company’s average common stockholders’ equity during the activities of which include monitoring compliance with REIT and 1940 Act tests;
·providing a legal and regulatory compliance function;
·providing investor relations services; and
·providing and maintaining computer and technology resources.
Additionally, Pine River is responsible for providing us with allperformance period, as measured on each of the personnel required to managefirst and operatelast day of the period. For these purposes, Distributable Earnings are as reported in our business, including our named executive officers, eachCompany’s publicly filed financial reports, excluding the effects of whom is an employee of an affiliate of Pine River. Pine River recognizescertain non-cash items and one-time charges that providing a talented and motivated workforce is critical to the successwe believe are not indicative of our businessCompany’s overall operating performance.
directors, discusses with Pine River the compensation philosophy of Pine River and its affiliates to understand the extent to which such philosophy affects the performance, retention, incentives and risk-taking of the named executive officers and other personnel supporting our business. This interaction between our Compensation Committee and Pine River helps ensure that the Committee can assess whether the compensation practices of Pine River promote the long-term best interests of our business and our stockholders.
As compensation for the services provided under the Management Agreement, we pay Pine River a base management fee and reimburse it for certain expenses incurred in the course of rendering such services. The based management fee is a fixed fee that we pay to Pine River on a quarterly basis. Additionally, beginning in the fourth quarter of 2018, Pine River is eligible to earn incentive fees if the company achieves certain performance criteria, as further described in the Management Agreement. We disclose the amount of the base management fee, expense reimbursements and incentive fees, if any, to stockholders in our Quarterly Reports on Form 10-Q and Annual Reports on Form 10-K that we file with the SEC. As previously disclosed in our filings with the SEC, our payments to Pine River included base management fees of $6.3 million, and expense reimbursements of $2.2 million,“Run-Rate” ROAE for the year ended December 31, 2017. We did2023:
| 2024 PROXY STATEMENT / 83 | |
($ in millions, except per share data) | | | 2023 | | |||
GAAP Net (Loss) | | | | $ | (77.6) | | |
Adjustments: | | | | | | | |
Provision for Credit Losses | | | | $ | 104.8 | | |
Depreciation and amortization on real estate owned | | | | $ | 3.4 | | |
(Gain) Loss on Extinguishment of Debt | | | | $ | (0.2) | | |
Non-Cash Equity Compensation | | | | $ | 7.0 | | |
Distributable Earnings before realized losses (G)(1) | | | | $ | 37.3 | | |
Realized losses on write-offs, loan sales and REO conversions | | | | $ | (54.3) | | |
Distributable (Loss) Earnings (H) | | | | $ | (17.0) | | |
Basic Wtd. Avg. Common Shares | | | | | 51,641,619 | | |
Distributable (Loss) Earnings Per Basic Share | | | | $ | (0.33) | | |
Distributable Earnings before realized losses Per Basic Share | | | | $ | 0.72 | | |
Average Common stockholders’ equity (I = (A+B)/2) | | | | $ | 716 | | |
“Run-Rate” ROAE (J = G/I) | | | | | 5.2% | | |
“Core” ROAE (K = H/I) | | | | | (2.4)% | | |
Compensation Program
As an externally managed company with no employees, we utilize a hybrid approach to the compensation program for our named executive officers. Pine River is responsible under the Management Agreement for all cash compensation paid to our named executive officers. Equity incentive compensation that may be awarded to our named executive officers from time to time is the responsibility of our company and is determined by our Compensation Committee in accordance with our Equity Incentive Plan. As described in more detailresult in the following sections, we believe thattotal presented
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Cash Compensation
We do not pay any cash compensation to our named executive officers or to any other employees of Pine River who support our business. Pine River is responsible for all such cash compensation and for making decisions relating thereto based on such factors as Pine River determines appropriate. However, Pine River takes into consideration the company’s interests in hiring and retaining qualified personnel to operate our business and discusses its compensation philosophy with the Compensation Committee to enable the Committee to understand and assess the extent to which such philosophy affects the incentives and risk-taking of the named executive officers and other personnel supporting our business. Additionally, our Compensation Committee reviews the cash compensation paid by Pine River to our Chief Financial Officer, Chief Operating Officer and General Counsel, which includes salaries and performance-based bonuses; we reimburse Pine River for our allocable share of such amounts based on the amount of time that such individuals devote to our business. We do not reimburse Pine River for any cash compensation paid by Pine River to the individuals serving as our Chief Executive Officer and Chief
Investment Officer, as those amounts are borne entirely by Pine River in accordance with the Management Agreement.
Our Management Agreement with Pine River does not require that any specified amount or percentage of the management fees we pay to Pine River be allocated to our named executive officers. However, we estimate that the aggregate cash compensation paid to our named executive officers that may reasonably be associated with their management of our company for the period beginning June 28, 2017 and ending December 31, 2017 totaled $730,000 for the period. This aggregate amount represents approximately 8.6% of the $8.5 million in total management fees and reimbursements paid by us to Pine River for the same period of time in 2017. Of the aggregate cash compensation paid by Pine River to our named executive officers in 2017 that was reasonably associated with their management of our company, 100% represented fixed compensation (e.g., salaries).
Equity Incentive Compensation
Our Compensation Committee, which consists solely of independent directors, is responsible for overseeing the equity incentive component of our compensation program, and approves and recommends all equity awards granted pursuant to our Equity Incentive Plan, which awards are then ratified by our Board of Directors.
The equity compensation paid to our named executive officers is intended to drive and reward corporate performance annually and over the long term. In developing our equity compensation program, we intend to design a program that reflects strong governance practices and the best interests of our stockholders, while striving to meet the following core objectives:
·Pay for Performance – We intend to develop an equity compensation program that is designed to generate and reward superior individual and collective performance by ensuring that equity compensation is commensurate with the level of achieved company results.
·Hire and Retain a Strong Team of Professionals – We operate in a highly competitive industry, and our continued success depends on retaining our talented executive team. We intend to develop an equity compensation program that will assist us in attracting and retaining highly qualified executives whose abilities and expertise are critical to our long-term success and our competitive advantage. We believe our success over the long term will create opportunities for our named executive officers through their common stock ownership by enabling them to participate in any future appreciation of our common stock and receive dividends.
·Align Risk and Reward – We are committed to creating an environment that encourages increased profitability for our company without undue risk taking. We strive to focus our executive officers’ decisions on goals that are consistent with our overall business strategy without threatening the long-term viability of our company.
·Align Interests with Stockholders – We are committed to using our equity compensation program to increase executive stock ownership over the long term and focus our named executive officers’ attention on creating value for our stockholders. We believe that equity ownership directly aligns the interests of our named executive officers with those of our stockholders and encourages our named executive officers to focus on creating long-term stockholder value. Accordingly, our named executive officers are prohibited from hedging company stock.
Restricted stock awards that are granted to our named executive officers under our Equity Incentive Plan provide for ratable vesting on an annual basis over a three-year period, with accelerated vesting occurring under certain circumstances, as described in greater detail below under “Potential Payments
Upon Termination or Change in Control.” Under certain circumstances, our named executive officers may be required to forfeit their restricted stock awards pursuant to Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”), the Sarbanes-Oxley Act of 2002, applicable stock exchange listing rules, or any clawback or recoupment policy adopted by our Board of Directors or Compensation Committee. The restricted stock awards are treated as issued and outstanding as of the grant date and each named executive officer is entitled to vote the shares and receive dividends as declared and paid thereon; however, the restricted stock remains subject to forfeiture if the executive officer does not comply with the terms of the award agreement, including if the executive officer voluntarily terminates employment with our external manager prior to any applicable vesting dates.
In connection with our initial public offering and formation transaction in June 2017 (“IPO”), our Board of Directors approved the grant of an aggregate amount of 141,250 shares of restricted common stock (the “2017 IPO Awards”) under our Equity Incentive Plan to our named executive officers, which awards are set forth in greater detail below under “Grants of Plan-Based Awards.” The 2017 IPO Awards were granted to our named executive officers in recognition of our successful IPO and to align the interests of our newly appointed executives with our new stockholder base. Because we are a newly formed company, we did not issue any other stock awards to our executive officers in 2017.
We do not have an equity compensation program in place that establishes a fixed schedule for granting restricted stock awards to our named executive officers. Rather, our Compensation Committee has sole discretion to determine whether to approve any equity awards in future periods and will depend on a number of factors, including our company’s performance, expense implications, market and industry trends, peer practices, or other considerations that the Compensation Committee deems relevant.
Role of Compensation Consultant in Compensation Decisions
In 2017, our Compensation Committee engaged Pay Governance LLC as its independent compensation consultant to provide advice and guidance in developing a long-term equity incentive program that would be available for the Committee in contemplating future restricted stock awards for our named executive officers and other key personnel or other compensation matters, such as compensation for independent directors. Pay Governance does not provide services to our company other than the advice provided to our Compensation Committee, and Pay Governance had advised our Compensation Committee that the fees and direct expenses it received from us during 2017 were immaterial as a percentage of their respective incomes for the period. Pay Governance has also advised us that neither they nor, to their knowledge, any member of their consulting team who served or are serving our Compensation Committee owns any shares of our common stock. After considering the foregoing, as well as Pay Governance’s conflict of interest policies and procedures and the lack of known business and personal relationships between Pay Governance, its team members servicing our Compensation Committee and its members, and our named executive officers, our Compensation Committee concluded that the provision of services to the Committee by Pay Governance does not raise any conflict of interest concerns.
Role of Named Executive Officers in Equity-Based Compensation Decisions
Other than the 2017 IPO Awards, our Compensation Committee is responsible for making all equity-based compensation decisions related to our named executive officers. Our Compensation Committee will consider input from Mr. Taylor, our Chief Executive Officer, regarding the equity compensation and performance of named executive officers other than himself, including recommendations as to the equity compensation levels that he believes are commensurate with an individual’s job performance, skills, experience, qualifications and criticality to our company, as well as with our compensation philosophy, external market data and considerations of internal equity. Mr. Taylor regularly attends meetings of our
Compensation Committee, except when our Compensation Committee is meeting in executive session. Our Compensation Committee will communicate its views and decisions regarding equity compensation arrangements for our named executive officers to Mr. Taylor, who is generally responsible for implementing such arrangements.
Tax Treatment of Compensation
Section 162(m) disallows a federal income tax deduction for any publicly held corporation with respect to individual compensation exceeding $1 million in any taxable year paid to a corporation’s chief executive officer and certain other executive officers; beginning in 2018, pursuant to a change to Section 162(m), this limitation generally applies to payments made to employees or former employees who held those positions at any time beginning in 2017. The changes to Section 162(m) also greatly restrict the ability to design compensation for these officers in a way to ensure its deductibility. Because we do not have any employees and, therefore, do not take any federal income tax deductions, we do not believe that Section 162(m) has been or is currently applicable to us; accordingly, we do not currently consider the effects of Section 162(m) on the compensation paid to our named executive officers by our external manager or the degree to which it would be advisable to structure the amount and form of equity compensation to our named executive officers so as to maximize our ability to deduct it. If we were to determine that Section 162(m) was applicable to us, our Compensation Committee retains the discretion to provide compensation in an amount or form that would not be deductible under Section 162(m) in circumstances under which it believes the exercise of such discretion would be in the best interest of our company.
Our Equity Incentive Plan provides that, with respect to awards intended to qualify for relief from the limitations of Section 162(m) of the Code, the maximum number of shares that may underlie awards over any three-year period to any eligible person may not exceed 1,500,000 as options and 600,000 as other grants. If we were subject to Section 162(m) these limitations on awards would be required under prior Section 162(m) to qualify for deduction of payments to certain officers to settle the awards. As indicated above, management does not believe that Section 162(m) is applicable to us and, moreover, these limitations on awards no longer qualify payments of the awards for deduction; therefore, management does not currently consider and has not previously considered such restrictions in connection with the granting of prior awards.
Compensation Risk Assessment
We intend to develop compensation policies and practices that are aligned with the interests of our stockholders and do not create risks that are reasonably likely to have a material adverse effect on our company. We do not believe that our fee arrangement with Pine River or the equity awards granted by us to our named executive officers encourages inappropriate risk taking by our named executive officers.
As noted above, we are externally managed by Pine River pursuant to the terms of the Management Agreement and all decisions regarding cash compensation paid to our named executive officers are made by Pine River. The cash compensation paid by Pine River to our Chief Financial Officer, Chief Operating Officer and General Counsel for the period from June 28, 2017 through December 31, 2017 represents salaries for services provided to our company; we reimburse Pine River for our allocable share of such amounts based on the amount of time that such individuals devote to our business. We do not reimburse Pine River for any cash compensation paid by Pine River to the individuals serving as our Chief Executive Officer and Chief Investment Officer, as those amounts are borne entirely by Pine River in accordance with the Management Agreement.
In connection with our IPO in June 2017, the Board of Directors approved the grant of the 2017 IPO Awards to our named executive officers under the terms of our Equity Incentive Plan. The 2017 IPO
Awards provide for ratable vesting over a three-year period, with accelerated vesting occurring under certain circumstances, as described in greater detail below under “Potential Payments Upon Termination or Change in Control.” We expect any future restricted stock awards granted to our executive officers to provide for similar vesting restrictions. We believe that the vesting restrictions are an important retention device and encourage our named executive officers to focus on sustaining our company’s long-term performance and delivering total return to our stockholders rather than encouraging decisions that result in a short-term benefit for our company.
Employment Agreements
We are externally managed by Pine River and have no employees. Accordingly, we do not have any employment agreements with any of our named executive officers.
Pension Benefits or Nonqualified Deferred Compensation
We do not provide any of our named executive officers with pension benefits or nonqualified deferred compensation plans.
Summary Compensation Table
The following table summarizes the equity compensation paid to our named executive officers during the fiscal year ending December 31, 2017(1):
Name and Principal Position | Year |
Restricted | All Other | Total(4) |
John A. Taylor, President and Chief Executive Officer | 2017 | $1,516,125 | $24,880 | $1,541,005 |
Stephen Alpart, Chief Investment Officer | 2017 | $390,000 | $6,400 | $396,400 |
Steven Plust Chief Operating Officer | 2017 | $390,000 | $6,400 | $396,400 |
Marcin Urbaszek, Chief Financial Officer and Treasurer | 2017 | $263,250 | $4,320 | $267,570 |
Rebecca B. Sandberg, Secretary and General Counsel | 2017 | $195,000 | $3,200 | $198,200 |
(1)The company commenced operations on June 28, 2017 following the consummation of its IPO and Formation Transaction. Accordingly, no information is presented for fiscal years ending December 31, 2015 and 2016.
(2)See also “Grants of Plan-Based Awards” below. The shares of restricted stock were granted pursuant to our Equity Incentive Plan and will vest in three equal annual installments beginning on the first anniversary of the grant date, so long as the named executive officer complies with the terms and conditions of the applicable award agreement. The values in this column represent the fair value of the restricted stock awards on the grant date, which was June 22, 2017.
(3)All Other Compensation paid during 2017 represents dividends on unvested shares of restricted common stock payable in 2017.
(4)Because we do not pay cash compensation to our named executive officers, any such compensation paid to our named executive officers by Pine River is not included in this Summary Compensation Table. See “Cash Compensation” above for information regarding cash compensation paid by Pine River.
Grants of Plan-Based Awards
We adopted our Equity Incentive Plan, which was approved by our stockholder on June 14, 2017, to provide incentive compensation to attract and retain qualified directors, officers, advisers, consultants and other personnel, including Pine River, its affiliates and employees of Pine River and its affiliates. Our Equity Incentive Plan is administered by our Compensation Committee and permits grants of restricted common stock, phantom shares, dividend equivalent rights and other equity awards. Our Compensation Committee is authorized to issue up to 3,242,306 shares of our common stock pursuant to our Equity Incentive Plan. As of December 31, 2017, 3,078,203 shares of our common stock remained available for future issuance pursuant to our Equity Incentive Plan.
The following table summarizes each equity award granted to our named executive officers pursuant to our Equity Incentive Plan during the fiscal year ended December 31, 2017(1):
Name |
| Grant |
|
All Other Stock Awards: Number of Shares(2) |
| Grant Date Fair Value of Stock Awards(3) |
John A. Taylor |
| 06/22/2017 |
| 77,750 |
| $1,516,125 |
Stephen Alpart |
| 06/22/2017 |
| 20,000 |
| $390,000 |
Steven Plust |
| 06/22/2017 |
| 20,000 |
| $390,000 |
Marcin Urbaszek |
| 06/22/2017 |
| 13,500 |
| $263,250 |
Rebecca B. Sandberg |
| 06/22/2017 |
| 10,000 |
| $195,000 |
(1)The company commenced operations on June 28, 2017 following the consummation of its IPO and Formation Transaction. Accordingly, no information is presented for fiscal years ending December 31, 2015 and 2016.
(2)See also “Summary Compensation Table” above. The shares of restricted stock were granted pursuant to our Equity Incentive Plan and will vest in three equal annual installments beginning on the first anniversary of the grant date, so long as the named executive officer complies with the terms and conditions of his or her restricted stock award agreement.
(3)The values in this column are based on the $19.50 issuance price of our common stock established for our IPO, which represents the value attributed to the restricted stock awards for the June 22, 2017 grant date.
Outstanding Equity Awards at Fiscal Year End
The following table sets forth information concerning unvested restricted stock awards for each named executive officer as of December 31, 2017(1).
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John A. Taylor |
| 6/22/2017 |
| 77,750 |
| $1,379,285 |
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Stephen Alpart |
| 6/22/2017 |
| 20,000 |
| $354,800 |
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Steven Plust |
| 6/22/2017 |
| 20,000 |
| $354,800 |
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Marcin Urbaszek |
| 6/22/2017 |
| 13,500 |
| $239,490 |
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Rebecca B. Sandberg |
| 6/22/2017 |
| 10,000 |
| $177,400 |
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(1)The company commenced operations on June 28, 2017 following the consummation of its IPO and Formation Transaction. Accordingly, no information is presented for fiscal years ending December 31, 2015 and 2016.
(2)The shares of restricted stock were granted pursuant to our Equity Incentive Plan and will vest in three equal annual installments beginning on the first anniversary of the grant date, so long as the named executive officer complies with the terms and conditions of his or her restricted stock award agreement.
(3)The values in this column are based on the $17.74 closing market price of our common stock on the NYSE on December 29, 2017, which was the last trading day of the year.
Stock Vested in 2017
The company first issued restricted stock awards in June of 2017 with ratable three-year vesting restrictions. Accordingly, no shares of restricted stock vested during the year ended December 31, 2017.
Potential Payments upon Termination or Change in Control
Our Equity Incentive Plan and the restricted stock award agreements with our named executive officers provide for accelerated vesting of any unvested restricted stock awards in the event of termination of service without cause or due to death, disability or retirement and, potentially, in connection with a change in control of our company. The following table sets forth estimates of the potential benefits to our named executive officers in connection with such circumstances, assuming such event occurred on December 31, 2017 and assuming our Compensation Committee exercised its
discretion to accelerate vesting of unvested restricted stock awards upon a change in control. The actual payments due upon the occurrence of certain events could materially differ from the estimates provided in the table if such events occur on a different date.
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(1)Comprised of all outstanding shares of restricted stock held by such named executive officer that had not vested as of December 31, 2017. The values in this column are based on the $17.74 closing market price of our common stock on the NYSE on December 29, 2017, which was the last trading day of the year.
COMPENSATION COMMITTEE REPORT
The Compensation Committee of the Board of Directors reviewed and discussed with management of the company the “Compensation Discussion and Analysis” contained in this proxy statement. Based on that review and discussion, the Compensation Committee recommended that the “Compensation Discussion and Analysis” be included in the company’s proxy statement for the 2018 Annual Meeting of Stockholders.
By the Compensation Committee:
Martin A. Kamarck, Chairman
Tanuja M. Dehne
W. Reid Sanders
CEO PAY RATIO DISCLOSURE
The SEC issued final rules implementing the provision of the Dodd-Frank Wall Street Reform and Consumer Protection Act that require U.S. publicly-traded companies to disclose in their proxy statement filed beginning in 2018 the ratio of their chief executive officer’s compensation to that of their median employee. Because the company has no employees, disclosure pursuant to such rules is not included in this proxy statement.
PROPOSAL 2: ADVISORY VOTE RELATING TO EXECUTIVE COMPENSATION
The SEC adopted rules pursuant to Section 951 of the Dodd-Frank Act that require public companies to provide stockholders with periodic advisory (non-binding) votes on executive compensation, also referred to as “say-on-pay” proposals.
As more fully described under the sections of this proxy statement entitled “Executive Officers” and “Certain Relationships and Related Party Transactions,” we are externally managed by Pine River pursuant a Management Agreement and, consequently, we do not have any employees and have not paid any cash compensation directly to any of our named executive officers. Each named executive officer’s compensation is comprised of cash compensation paid to them directly by Pine River and equity awards granted by our company pursuant to our Equity Incentive Plan. The amount of cash compensation paid to each named executive officer is determined by and is the responsibility of Pine River and the amount of the equity awards granted to each named executive officer is determined by our Compensation Committee. For more information regarding our executive compensation, please see “Executive Officers” above.
Accordingly, we are asking you to vote “FOR” the adoption of the following resolution:
“RESOLVED: That the stockholders of the company approve, on a non-binding advisory basis, the compensation paid to the company’s executive officers, as disclosed in the company’s proxy statement for the 2018 Annual Meeting of Stockholders pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the Compensation Discussion and Analysis and related narrative discussions in the proxy statement.”
Because this say-on-pay vote is advisory in nature, it is not binding on us, our Board of Directors, our Compensation Committee, or Pine River. Our Board of Directors has determined that our company will hold an advisory vote on executive compensation on an annual basis. We currently expect to conduct our next advisory vote on executive compensation at our next annual meeting of stockholders in May 2019, though we will take into consideration the outcome of the advisory vote under Proposal 3 of this proxy statement.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE ADVISORY VOTE RELATED TO EXECUTIVE COMPENSATION.
PROPOSAL 3: ADVISORY VOTE ON THE FREQUENCY OF FUTURE ADVISORY VOTES RELATING TO EXECUTIVE COMPENSATION
In accordance with SEC rules, we are providing our stockholders with an opportunity to cast an advisory vote on the frequency of future advisory votes on executive compensation, such as that provided for in Proposal 2 of this proxy statement. This non-binding advisory vote is commonly referred to as a “say on frequency” vote. Under this proposal, stockholders may vote to have the company hold an advisory vote on executive compensation: (i) every year; (ii) every two years; or (iii) every three years. The option that receives the highest number of votes cast will reflect the frequency for future say-on-pay votes that has been selected by our stockholders.
This vote on the frequency of future advisory votes relating to executive compensation is advisory in nature and is not binding on us, our Board of Directors, our Compensation Committee, or Pine River.
However, our Board and the Compensation Committee value the opinions expressed by our stockholders in their vote on this proposal, and expect to take into account the outcome of this vote when considering the frequency of future advisory votes on our executive compensation.
While we will continue to monitor developments in this area, our Board believes that a say-on-pay vote should be conducted every year so that our stockholders may express their views on our executive compensation program and our Compensation Committee can consider the outcome of these votes in making its decisions on executive compensation.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR A FREQUENCY OF “EVERY YEAR” WITH RESPECT TO THE SAY-ON-PAY VOTE.
PROPOSAL 4: RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We are asking our stockholders to ratify the appointment of Ernst & Young LLP as our independent registered public accounting firm for our fiscal year ending December 31, 2018. Although ratification is not required by our Bylaws or otherwise, our Board of Directors is submitting the selection of Ernst & Young LLP to our stockholders for ratification as a matter of good corporate practice. In the event stockholders do not ratify the appointment, the appointment will be reconsidered by our Audit Committee. Even if the selection is ratified, our Audit Committee in its discretion may select a different registered public accounting firm at any time during the year if it determines that such a change would be in the best interests of our company. A representative of Ernst & Young LLP is expected to be present at the Annual Meeting, will have an opportunity to make a statement if he or she so desires and is expected to be available to respond to appropriate questions.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” RATIFICATION OF ERNST & YOUNG LLP AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM.
AUDIT COMMITTEE REPORT AND AUDITOR FEES
Audit Committee Report
The Board of Directors has appointed an Audit Committee presently composed of independent directors Stephen G. Kasnet, W. Reid Sanders, and Hope B. Woodhouse. Mr. Kasnet serves as Chairman of the Audit Committee. Each of the directors on our Audit Committee is an independent director under the NYSE listing standards and SEC rules. The Board of Directors has determined that each of Mr. Kasnet and Ms. Woodhouse satisfies the definition of financial sophistication and is an “audit committee financial expert,” as defined under rules and regulations promulgated by the SEC.
The Audit Committee’s responsibility is one of oversight as set forth in its charter, which is available on our website at www.gpmortgagetrust.com. It is not the duty of the Audit Committee to prepare our financial statements, to plan or conduct audits or to determine that our financial statements are complete and accurate and are in accordance with generally accepted accounting principles. Our management is responsible for preparing our financial statements and for maintaining internal controls. Our independent registered public accounting firm is responsible for auditing the financial statements and for expressing an opinion as to whether those audited financial statements fairly present our financial position, results of operations and cash flows in conformity with generally accepted accounting principles.
The Audit Committee has reviewed and discussed our audited financial statements with management and with Ernst & Young LLP, our independent registered public accounting firm for 2017.
The Audit Committee has discussed with Ernst & Young LLP the matters required to be discussed by Auditing Standard No. 1301, Communications with Audit Committees, as adopted by the Public Company Accounting Oversight Board, or PCAOB.
The Audit Committee has received from Ernst & Young LLP the written disclosures and the letter from Ernst & Young LLP required by the PCAOB regarding Ernst & Young LLP’s communication with the Audit Committee concerning independence, and has discussed Ernst & Young LLP’s independence with Ernst & Young LLP.
Based on the review and discussions referred to above, the Audit Committee has recommended to the Board of Directors that the audited consolidated financial statements for the year ended December 31, 2017, be included in our Annual Report on Form 10-K for the year ended December 31, 2017, for filing with the SEC. The Audit Committee also has recommended the appointment of Ernst & Young LLP to serve as the company’s independent registered public accounting firm for the year ending December 31, 2018.
By the Audit Committee:
Stephen G. Kasnet, Chairman
W. Reid Sanders
Hope B. Woodhouse
Use of Audit Committee Report
In accordance with and to the extent permitted by applicable law or regulation, the information contained in the foregoing Report of the Audit Committee is not “soliciting material,” is not deemed to be “filed” with the SEC, and is not to be incorporated by reference into any future filing under the Securities Act of 1933, as amended, or under the Exchange Act.
Auditor Fees
We retained Ernst & Young LLP to audit our consolidated financial statements for the year ended December 31, 2017. We also retained Ernst & Young LLP, as well as other accounting and consulting firms, to provide various other services in 2017.
The table below presents the aggregate fees billed to us for professional services performed by Ernst & Young LLP for the years ended December 31, 2017:
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Audit fees(1) |
| $ | 798,920 |
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Tax fees(3) |
| 107,150 |
| 17,311 | ||
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Total principal accountant fees |
| $ | 906,070 |
| $ | 17,311 |
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Auditor Services Pre-Approval Policy
The services performed by Ernst & Young LLP in 2017 were pre-approved by our Audit Committee in accordance with the pre-approval policy set forth in our Audit Committee Charter. This policy requires that all engagement fees and the terms and scope of all auditing and non-auditing services be reviewed and approved by the Audit Committee in advance of their formal initiation.
OTHER MATTERS
Meeting Matters
Our Board of Directors does not intend to bring other matters before the Annual Meeting except items incident to the conduct of the meeting. However, on all matters properly brought before the meeting by our Board of Directors or others, the persons named as proxies in the accompanying proxy, or their substitutes, will vote on such matters in their discretion to the extent permitted by law.
Stockholder Proposals and Director Nominations for 2019 Annual Meeting
Our 2019 annual meeting is expected to be held on or about May 14, 2019. If a stockholder intends to submit a proposal for inclusion in our proxy statement for our 2019 annual meeting pursuant to Rule 14a-8 under the Exchange Act, the stockholder proposal must be received by the Secretarywebcast of Granite Point Mortgage Trust Inc., 590 Madison Avenue, 38th Floor,’s 2024 Annual Meeting of Stockholders (the “Annual Meeting”) at the offices of Skadden, Arps, Slate, Meagher & Flom LLP (located at One Manhattan West, New York, New York 10022, on or before November 27, 2018. If such proposal is in compliance with all of10001), you must complete the requirements of Rule 14a-8 underfollowing information and return the Exchange Act, the proposal will be included in our proxy statement and proxy card relating to such meeting. We suggest such proposals be submitted by certified mail, return receipt requested. Nothing in this paragraph shall be deemed to require us to include any stockholder proposal that does not meet all the requirements for such inclusion established by the SEC in effect at that time.
Stockholders may (outside of Rule 14a-8) nominate candidates for election to the Board of Directors or propose business for consideration at our 2019 annual meeting under Maryland law and our Bylaws. Our Bylaws provide that, with respect to an annual meeting of stockholders, nominations of individuals for election to our Board of Directors and the proposal of other business to be considered by stockholders may be made only (i) pursuant to our notice of the meeting; (ii) by or at the direction of our Board of Directors; or (iii) by a stockholder who was a stockholder of record both at the time of giving the notice required by our Bylaws and at the time of the meeting, who is entitled to vote at the meeting and who has complied with the advance notice provisions set forth in our Bylaws. Under our Bylaws, notice of such a nomination or proposal of other business must generally be provided to the Secretary not earlier than the 150th day nor later than 5:00 p.m., Eastern Time, on the 120th day prior to the first anniversary of the date of the proxy statement for the preceding year’s annual meeting. In addition, any such nomination or proposal must include the information required by our Bylaws. Accordingly, any stockholder who intends to submit such a nomination or such a proposal at our 2019 annual Meeting of Stockholders must notify us in writing of such proposal by November 27, 2018, but in no event earlier than October 28, 2018.
Annual Report
A copy of our Annual Report on Form 10-K for the fiscal year ended December 31, 2017, as filed with the SEC, will be sent to any stockholder, without charge, upon written requestform to Granite Point Mortgage Trust Inc., Attention: Investor Relations, 590 Madison Avenue, 38th Floor,Michael J. Karber, General Counsel and Secretary, 3 Bryant Park, Suite 2400A, New York, New York 10022. You also10036. Please note that no members of management or our Board will be in attendance at Skadden, Arps, Slate, Meagher & Flom LLP’s offices and you will not have the ability to vote your shares from that location. This form must be received by Granite Point Mortgage Trust Inc. no later than June 4, 2024.
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*** Exercise Your Right to Vote *** Important Notice Regarding the Availability of Proxy Materials for the Stockholder Meeting to Be Held on May 15, 2018.
Before You Vote How to Access the Proxy Materials Have the information that is printed in the box marked by the arrow XXXX XXXX XXXX XXXX (located on the by the arrow XXXX XXXX XXXX XXXX (located on the following page) in the subject line. How To Vote Please Choose One of the Following Voting Methods marked by the arrow XXXX XXXX XXXX XXXX (located on the following page) available and follow the instructions. E43097-P05202 Vote In Person: Many stockholder meetings have attendance requirements including, but not limited to, the possession of an attendance ticket issued by the entity holding the meeting. Please check the meeting materials for any special requirements for meeting attendance. At the meeting, you will need to request a ballot to vote these shares. Vote By Internet: To vote now by Internet, go to www.proxyvote.com. Have the information that is printed in the box Vote By Mail: You can vote by mail by requesting a paper copy of the materials, which will include a proxy card. Proxy Materials Available to VIEW or RECEIVE: NOTICE AND PROXY STATEMENTANNUAL REPORT How to View Online: following page) and visit: www.proxyvote .com. How to Request and Receive a PAPER or E-MAIL Copy: If you want to receive a paper or e-mail copy of these documents, you must request one. There is NO charge for requesting a copy. Please choose one of the following methods to make your request: 1) BY INTERNET:www.proxyvote.com 2) BY TELEPHONE: 1-800-579-1639 3) BY E-MAIL*:sendmaterial@proxyvote.com * If requesting materials by e-mail, please send a blank e-mail with the information that is printed in the box marked Requests, instructions and other inquiries sent to this e-mail address will NOT be forwarded to your investment advisor. Please make the request as instructed above on or before April 30, 2018 to facilitate timely delivery.
The Board of Directors recommends you vote FOR the following proposal: 1. Election of Directors Nominees: The Board of Directors recommends you vote FOR the following proposal: 1a. Tanuja M. Dehne 2. Advisory vote on the compensation of our executive officers. 1b. Martin A. Kamarck The Board of Directors recommends you vote FOR 1 YEAR on the following proposal: 1c. Stephen G. Kasnet 3. Advisory vote relating to the frequency of future advisory votes on executive compensation. 1d. William Roth 1e. W. Reid Sanders The Board of Directors recommends you vote FOR the following proposal: 1f. Thomas E. Siering 4. Ratification of the appointment of Ernst & Young LLP to serve as our independent registered public accounting firm for our fiscal year ending December 31, 2018. 1g. Brian C. Taylor NOTE: The proxies are authorized to vote in their discretion on any matter that may properly come before the Annual Meeting or any adjournment or postponement thereof. 1h. John A. Taylor 1i. Hope B. Woodhouse E43098-P05202 Voting Items
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VOTE BY INTERNET - www.proxyvote.com UseQR Barcode aboveUse the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 p.m.P.M. Eastern Time on May 14, 2018.June 5, 2024. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form. GRANITE POINT MORTGAGE TRUST INC. 590 MADISON AVENUE, 38TH FLOOR NEW YORK, NY 10022 VOTEform.During The Meeting — Go to www.virtualshareholdermeeting.com/GPMT2024You may attend the meeting via the Internet and vote during the meeting. Have the information that is printed in the box marked by the arrow available and follow the instructions.VOTE BY PHONE - 1-800-690-6903 Use— 1-800-690-6903Use any touch-tone telephone to transmit your voting instructions up until 11:59 p.m.P.M. Eastern Time on May 14, 2018.June 5, 2024. Have your proxy card in hand when you call and then follow the instructions. VOTEinstructions.VOTE BY MAIL Mark,MAILMark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51