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19, 2018
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Ratification of Appointment of MaloneBailey, LLP
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Name | | | Age | | | Position | |
Jeffrey Busch | | 58 | | | Chairman of the Board, Chief Executive Officer and President | | |
| 52 | | | Chief Financial Officer and Treasurer | | ||
| 41 | | General Counsel and Secretary | | |||
Alfonzo Leon | | 42 | | | Chief Investment Officer | | |
Danica Holley | | 45 | | | Chief Operating Officer | | |
Allen Webb | | 49 | | | Senior Vice President, SEC Reporting and Technical Accounting | | |
Henry Cole† | | 73 | | | Director | | |
Matthew L. Cypher, | | 41 | | | Director | ||
Zhang Jingguo | | 54 | | | Director | | |
Ronald Marston† | | 75 | | | Director | | |
Dr. Roscoe Moore† | | 73 | | | Director | | |
Zhang Huiqi | | 28 | | | Director | |
Lori Beth Wittman† | 59 | | | Nominee for Director | |
David A. Young. Mr. Young has served as our Chief Executive Officer since February 2014 and as a director of the Company
The Nominating and Corporate Governance Committee of our Board has concluded that Mr. Young should serve as a director in recognition of his abilities to assist us in expanding our business and the contributions he can make to our strategic direction.
Jeffrey Busch. Mr. Busch has been an active investor in the real estate industry since 1985. Since 2013, Mr. Busch has served as President of Inter-American Management, LLC (the “Advisor”) our Advisor.external manager. Mr. Busch also has served as a director of our Company since September 2014, andhas served as Chairman and President of our Company from August 2015 to the present.present,
1970).
institutional real estate during his leadership tenure. Dr. Cypher personally underwrote $1.5 billion of acquisitions culminating with the purchase of 230 Park Avenue in New York, which Invesco acquired on behalf of its client capital in June 2011. He also oversaw the valuations group,
Kurt R. Harrington. Mr. Harrington began his career at Meahl, McNamara & Co. in Boston and PricewaterhouseCoopers LLP in Washington, D.C. From 1980 to 1990, he served in a number of senior financial accounting, reporting, and business planning positions at MCI Communications Corporation and Marriott Corporation. He was the Chief Financial Officer of Jupiter National, Inc., a publicly-traded, closed-end, venture capital company until 1997, when he joined Arlington Asset Investment Corp. (formerly Friedman, Billings, Ramsey Group, Inc.), a publicly traded, mortgage investment company, becoming the Chief Financial Officer and Treasurer in 2000, a position he held until March
Mr. Harrington has over forty years of experience managing the financial functions for large and small publicly traded companies. He has overseen investor, banking, and lender relationships, established and maintained Sarbanes-Oxley compliant control systems and certifications, and directed strategic planning and corporate development initiatives throughout his career. He directed the preparation of financial statements, tax returns, and disclosures filed with the SEC and IRS, and also developed budgets, forecasts, and financial statements highlighting performance and corrective actions for boards of directors and executive management teams. He has executed numerous IPO, secondary, and other debt and equity capital raising transactions, and has overseen significant corporate merger and acquisition transactions.
Mr. Harrington earned a B.S. in Accounting from Nichols College in 1974, and received his Certified Public Accountant certification in 1978. Throughout his career, he has attended programs in Executive Education at the Harvard Business School and the Wharton School of The University of Pennsylvania. He has served as a trustee and treasurer of Nichols College from October 2004 to October 2016. Mr. Harrington also serves as a director of Wheeler Real Estate Investment Trust (NASDAQ: WHLR), a position he has held since June 2015.
The Nominating and Corporate Governance Committee of our Board has concluded that Mr. Harrington should serve as a director because of his thorough knowledge of finance, accounting, capital markets, taxes, control systems, and strategic planning experience in a broad range of industries, including asset management, investment banking, venture capital, telecommunications, hospitality, and real estate management.
The committee also took into account that Mr. Harrington is “independent” under SEC Rule 10A-3 and under Sections 303A.02 and 303A.07 of the listing standards of the NYSE, that his financial expertise qualifies him to serve on our Audit Committee, and that he is an “audit committee financial expert.”
Zhang Jingguo. Mr. Zhang has approximately 20 years of experience in real estate development in China. Mr. Zhang currently serves as President of ZH USA, LLC, which is a beneficial owner of more than five percent of the outstanding shares of our common stock, and the Chairman, Chief Executive Officer and Executive Director of ZH International Holdings, Ltd., which is the owner of ZH USA, LLC. He also serves as President of Henan Real Estate Chamber of Commerce (March 2010 until present), Vice-President of Industry & Commerce Association of the Henan Province (July 2012 until present), as a graduate tutor of Zhengzhou University (May 2011 until present) and as a member of the Henan Provincial Committee of Chinese People’s Political Consultative Conference (2012 until present). From 1994 to 2001, he worked at Xingye Real Estate as general manager, where he was responsible for its overall operations. Mr. Zhang co-founded Henan Zensun Real Estate Co., Ltd., one of the top 100 property development companies in China. From 1983 to 1994, Mr. Zhang held various positions at the then Light Industry Bureau of Henan Province, the governmental authority in charge of the light industry in the Henan Province and its associated collectively-owned enterprises. Mr. Zhang was awarded “Outstanding Real Estate
Developer of Henan Province” by the Department of Housing and Urban-Rural Development of Henan Province in 2011 and “Outstanding Real Estate Developer of Zhengzhou” by the Housing Security and Real Estate Administration Bureau of Zhengzhou in 2009, 2011 and 2012. In 2012, Mr. Zhang was named “Individual with Outstanding Contribution to Market Economy of Henan Real Estate Industry” by Henan Daily and the Private Economy Research Association of Henan Province.
Safety and Health, CDC. Dr. Moore has conducted clinical research on infectious diseases, has evaluated the safety and effectiveness of medical devices, and has conducted relevant epidemiological research on the utilization experience and human health effects of medical devices and radiation.
Donald McClure.
projects. From 2005 to 2008,
Conn Flanigan. Mr. Flanigan wasis a directormember of the Company from September 2013 until the completionAmerican Institute of the Company’s IPO in July 2016. He has served as our Secretary and General Counsel since December 2013. Mr. Flanigan previously served as our Chief Financial Officer from September 2013 until September 2014 and also served as our Chief Executive Officer from September 2013 until February 2014. Mr. Flanigan is also the Secretary and General Counsel of our Advisor, a position he has held since October 2014. From September 2013 to the present, Mr. Flanigan has served as General Counsel and Secretary and as a director of American Housing REIT Inc. (f/k/a On Target360 Group, Inc.), which is also externally managed by our Advisor. Additionally, Mr. Flanigan has served as General Counsel with eBanker Corporate Services, Inc., a Colorado subsidiary of ZH International Holdings Limited, since 2007. From 2000 to 2007, Mr. Flanigan served as corporate counsel to eVision Corporate Services, Inc., a Colorado subsidiary of ZH International Holdings Limited. Mr. Flanigan received a B.A. in International Relations from the University of San Diego in 1990 and a J.D. from the University of Denver Sturm College of Law in 1996.
Certified Public Accountants.
independent consultant during October and November of 2012 before joining Empire.
Danica Holley. Ms. Holley has Mr. Webb is a Certified Public Accountant in the state of Maryland.
Sheequity and debt securities.
Name of Beneficial Owner | | | Number of Shares Beneficially Owned(1) | | | Percentage of Shares(2) | | ||||||
5% Beneficial Owners | | | | ||||||||||
ZH USA, LLC(3) | | | | | 2,604,500 | | | | | | 12% | | |
Executive Officers, Directors and Director Nominees | | | | ||||||||||
Jeffrey Busch | | | | | 78,501(4) | | | | | | * | | |
David Young | | | | | 60,000(5) | | | | | | * | | |
Robert Kiernan | | | | | 1,113(6) | | | | | | * | | |
Donald McClure | | | | | 31,852(7) | | | | | | * | | |
Alfonzo Leon | | | | | 19,349(8) | | | | | | * | | |
Allen Webb | | | | | 17,790(9) | | | | | | * | | |
Jamie Barber | | | | | 3,686(10) | | | | | | * | | |
Zhang Jingguo | | | | | 2,604,500(11) | | | | | | 12% | | |
Zhang Huiqi | | | | | 18,000(12) | | | | | | * | | |
Henry Cole | | | | | 3,750(13) | | | | | | * | | |
Ronald Marston | | | | | 2,750(14) | | | | | | * | | |
Matthew L. Cypher, Ph.D. | | | | | 3,950(15) | | | | | | * | | |
Kurt Harrington | | | | | 2,750(16) | | | | | | * | | |
Roscoe Moore | | | | | 2,750(17) | | | | | | * | | |
Lori Beth Wittman | | | | | — | | | | | | * | | |
All executive officers, directors and director nominee as a group (16 people) | | | | | 2,863,908 | | | | | | 13% | | |
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Name of Beneficial Owner | Number of Shares Beneficially Owned | Percentage of Shares(1) | ||||||
5% Beneficial Owners | ||||||||
ZH USA, LLC(2) | 2,604,500 | 14.79 | % | |||||
Executive Officers and Directors | ||||||||
David A. Young | 95,973 | (4) | * | |||||
Conn Flanigan | 23,258 | (5) | * | |||||
Donald McClure | 30,430 | (6) | * | |||||
Jeffrey Busch | 87,688 | (7) | * | |||||
Zhang Jingguo(2)(3) | 2,604,500 | 14.79 | % | |||||
Ronald Marston | 2,750 | (8) | * | |||||
Roscoe Moore | 2,750 | (8) | * | |||||
Henry Cole | 2,750 | (8) | * | |||||
Allen Webb | 25,430 | (9) | * | |||||
Danica Holley | 24,887 | (10) | * | |||||
Alfonzo Leon | 29,774 | (11) | * | |||||
Matthew L. Cypher, Ph. D | 2,750 | (8) | * | |||||
Kurt R. Harrington | 2,750 | (8) | * | |||||
Zhang Huiqi | 30,000 | (12) | * | |||||
All executive officers and director nominees as a group (14 people) | 2,965,690 | 16.51 | % |
compensation to our executive officers.officers, except for a portion of the General Counsel and Secretary’s salary for 2017, as previously disclosed. Instead, our executive officers’ cash compensation is paid by our Advisor or its affiliates. The Compensation Committee and Board do not have input regarding such cash compensation. The Compensation Committee has overall responsibility for evaluating and recommending changes to the director and officer compensation plans, policies and programs of the Company and approving and recommending to the Board for its approval awards under the Plans and amendments to the Plans. The Compensation Committee has the authority to retain legal, accounting and other advisors as it determines necessary to carry out its functions. In 2016,2017, the Compensation Committee retained an independent compensation consultant, FTI Consulting, Inc. (“FTI”FTI”), to review the compensation program for our independent directors and the equity-based compensation program for our officers and key employees of our Advisor who perform services for us and to assist the Compensation Committee in developing a new 20172018 annual and long-term performance-based equity compensation program for our officers and key employees of our Advisor who perform services for us.
Our
The Board believes an effective risk management system will (1) timely identify the material risks that we face; (2) communicate necessary information with respect to material risks to our principal executive officer or principal financial officer and officers of our Advisor and, as appropriate, to our Board or relevant committee thereof; (3) implement appropriate and responsive risk management strategies consistent with our risk profile; and (4) integrate risk management into management and our Board’s decision-making.
the vote when making future executive compensation decisions.
We have granted,
| | | Annual Equity Incentive Plan | | | Long-Term Equity Incentive Plan | |
Structure | | | Threshold, Target and Maximum Awards based on the achievement of various annual performance goals | | | Threshold, Target and Maximum Awards based on achievement of various long-term stockholder return goals. | |
Performance Metrics | | | Generally divided into multiple categories based on the following metrics: • Acquisition activity; • Adjusted Funds from Operations (“AFFO”); • Capital raising; • Net asset value; and • Individual performance. | | | Performance-based component (beginning with our 2018 plan, 60% of overall long-term equity award) generally divided into the following two categories: • Absolute total stockholder return (75%); and • Relative total stockholder return (25%). Beginning with our 2018 plan, the remaining 40% of the long-term equity award is subject to time-based vesting only.(1) | |
| | | Annual Equity Incentive Plan | | | Long-Term Equity Incentive Plan | |
Timing of Payout and Vesting | | | Awards are paid, through the issuance of LTIP Units, annually based on achievement of performance metrics for the prior year, and vest once issued as follows: • 50% immediately at the time of issuance; and • 50% on the one year anniversary of the issuance date(2). | | | Performance-based awards are paid through the issuance of LTIP Units, at the end of a three-year performance period based on the achievement of absolute and relative total stockholder return goals, and vest once issued as follows: • 50% immediately at the time of issuance; and • 50% on the first anniversary of the date of issuance. Time-based awards vest in equal one-third installments on the first, second and third anniversary of the date of grant. | |
| | | As of and for the year ended | | |||
| | | 2017 | | | 2016 | |
Gross investment in real estate | | | $471.5 million | | | $206.9 million | |
Rental revenue | | | $28.5 million | | | $8.1 million | |
Net loss attributable to common stockholders per share | | | $(0.09) | | | $(0.68) | |
Revolving credit facility capacity | | | $250 million | | | $200 million | |
Preferred stock outstanding | | | $75 million | | | — | |
Total equity | | | $259 million | | | $155 million | |
Internal control over financial reporting | | | No material weaknesses | | | Material weakness | |
Prior to the completion of the IPO on July 1,
Units;
An aggregate of 414,50459,966 LTIP unitsUnits were grantedissued during the year ended December 31, 20162017 pursuant to the 2016 Plan. No equity-based awards were granted or issued, and no other compensation was paid by the Company, prior to 2016.
Name | | | Title | | | 2017 Annual Award Target | | | Number of Target Annual Award Units | | | 2017 Long- Term Award Target | | | Number of Target Long- Term Award Units | | ||||||||||||
Jeffrey Busch | | | Chairman, current CEO and President | | | | $ | 110,000 | | | | | | 13,095 | | | | | $ | 200,008 | | | | | | 25,975 | | |
David Young | | | Former Director and Former CEO | | | | $ | 100,000 | | | | | | 11,904(1) | | | | | $ | 300,000 | | | | | | 38,961(1) | | |
Donald McClure | | | Former CFO and Treasurer | | | | $ | 77,500 | | | | | | 9,226(2) | | | | | $ | 75,000 | | | | | | 9,740(2) | | |
Robert Kiernan | | | Current CFO and Treasurer | | | | $ | 25,000 | | | | | | 2,994 | | | | | $ | 80,000 | | | | | | 10,621 | | |
Alfonzo Leon | | | Chief Investment Officer | | | | $ | 92,500 | | | | | | 11,011 | | | | | $ | 100,000 | | | | | | 12,987 | | |
Jamie Barber | | | General Counsel and Secretary | | | | $ | 50,000 | | | | | | 5,230 | | | | | $ | 80,000 | | | | | | 7,133 | | |
Allen Webb | | | SVP — SEC Reporting and Technical Accounting | | | | $ | 90,000 | | | | | | 10,714 | | | | | $ | 80,006 | | | | | | 10,390 | | |
Target No. of LTIP Units | | | Component | | | Performance Goal | | | 2017 Performance Result | |
20% of total Target LTIP Units | | | Acquisitions including (i) closed acquisitions during 2017 and (ii) acquisitions placed under definitive purchase contract on or before December 31, 2017 and closed by February 28, 2018. | | | Threshold: $300 million Target: $500 million Maximum: $600 million | | | $314.1 million 10.71% of Target LTIP Units earned | |
20% of total Target LTIP Units | | | Capital raising measured by gross proceeds actually raised through the issuance and sale of primary Company equity securities during the period from January 1, 2017 through December 31, 2017. | | | Threshold: $75 million Target: $200 million Maximum: $300 million | | | $108.75 million 12.70% of Target LTIP Units earned | |
20% of total Target LTIP Units | | | Net Asset Value (NAV) calculated as total assets minus total liabilities, in each case calculated under GAAP as reported on the Company’s audited balance sheet as of December 31, 2017. | | | Threshold: $250 million Target: $350 million Maximum: $450 million | | | $259 million 10.90% of Target LTIP Units earned | |
20% of total Target LTIP Units | | | Adjusted FFO (AFFO) per share for the fourth quarter ended December 31, 2017, as reported by the Company in its year-end earnings announcement for the fiscal year and fourth quarter ended December 31, 2017. | | | Threshold: $0.18 per share Target: $0.20 per share Maximum: $0.22 per share AFFO per share for the fourth quarter of 2017 excludes the dilutive effect, if any, of any capital raising completed during the period beginning on July 1, 2017 and ending on December 31, 2017. | | | $0.18 per share 10.00% of Target LTIP Units earned | |
Target No. of LTIP Units | | | Component | | | Performance Goal | | | 2017 Performance Result | |
20% of total Target LTIP Units | | | Discretionary Component | | | Entirely at the discretion of the Committee based on the Committee’s assessment of the Grantee’s individual performance in areas the Committee deems in its discretion to be important based on the Grantee’s job duties and position within the organization. | | | The Compensation Committee determined that each executive officer (with the exception of Messrs. Young and McClure), based upon an evaluation of the individual performance of each, earned 30% of total Target LTIP Units.(1) | |
TSR | | | Percentage of Absolute TSR Component Earned | | |||
Less than 24% | | | | | 0% | | |
24% | | | | | 50% | | |
30% | | | | | 100% | | |
36% or greater | | | | | 200% | | |
Relative Performance | | | Percentage of Relative TSR Component Earned | | |||
TSR below the 35th percentile of Peer Companies | | | | | 0% | | |
TSR equal to the 35th percentile of Peer Companies | | | | | 50% | | |
TSR equal to the 55th percentile of Peer Companies | | | | | 100% | | |
TSR equal to or greater than the 75th percentile of Peer Companies | | | | | 200% | | |
Name | | | Title | | | Number of 2017 Target Annual Award Units | | | Number of 2017 Earned Annual Award Units | | ||||||
Jeffrey Busch | | | Chairman, current CEO and President | | | | | 13,095 | | | | | | 9,730 | | |
David Young | | | Former Director and Former CEO | | | | | 11,904(1) | | | | | | —(1) | | |
Donald McClure | | | Former CFO and Treasurer | | | | | 6,420(2) | | | | | | 2,845(2) | | |
Robert Kiernan | | | Current CFO and Treasurer | | | | | 2,994 | | | | | | 2,225 | | |
Alfonzo Leon | | | Chief Investment Officer | | | | | 11,011 | | | | | | 8,182 | | |
Jamie Barber | | | General Counsel and Secretary | | | | | 5,230 | | | | | | 3,886 | | |
Allen Webb | | | SVP – SEC Reporting and Technical Accounting | | | | | 10,714 | | | | | | 7,961 | | |
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Name and Principal Position | Year | Salary ($) | Stock Awards(1) ($) | Other | Total ($) | |||||||||||||||
Jeffrey Busch President, Chairman | 2016 | — | $ | 780,016 | (2) | — | $ | 780,016 | ||||||||||||
2015 | — | — | — | — | ||||||||||||||||
David A. Young Chief Executive Officer, Director | 2016 | — | $ | 955,011 | (3) | — | $ | 955,011 | ||||||||||||
2015 | — | — | — | — | ||||||||||||||||
Donald McClure Chief Financial Officer | 2016 | — | $ | 300,010 | (4) | — | $ | 300,010 | ||||||||||||
2015 | — | — | — | — |
Name and Principal Position | | | Year | | | Salary(1) | | | Stock Awards(2) | | | Other(3) | | | Total | | |||||||||||||||
Jeffrey Busch Chairman, Current CEO and President | | | | | 2017 | | | | | $ | — | | | | | $ | 610,009(4) | | | | | $ | 69,507 | | | | | $ | 679,516 | | |
| | | 2016 | | | | | $ | — | | | | | $ | 780,016(5) | | | | | $ | 29,738 | | | | | $ | 809,754 | | | ||
| | | 2015 | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | ||
David Young Former Director and Former CEO | | | | | 2017 | | | | | $ | — | | | | | $ | 400,000(6) | | | | | $ | 38,389 | | | | | $ | 438,389 | | |
| | | 2016 | | | | | $ | — | | | | | $ | 955,011(7) | | | | | $ | 37,195 | | | | | $ | 992,206 | | | ||
| | | 2015 | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | ||
Robert Kiernan CFO and Treasurer | | | | | 2017 | | | | | $ | — | | | | | $ | 155,002(8) | | | | | $ | 2,390 | | | | | $ | 157,392 | | |
| | | 2016 | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | ||
| | | 2015 | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | ||
Donald McClure Former CFO and Former Treasurer | | | | | 2017 | | | | | $ | — | | | | | $ | 152,500(9) | | | | | $ | 12,172 | | | | | $ | 164,672 | | |
| | | 2016 | | | | | $ | — | | | | | $ | 300,010(10) | | | | | $ | 20,860 | | | | | $ | 320,870 | | | ||
| | | 2015 | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | ||
Alfonzo Leon Chief Investment Officer | | | | | 2017 | | | | | $ | — | | | | | $ | 192,500(11) | | | | | $ | 23,819 | | | | | $ | 216,319 | | |
| | | 2016 | | | | | $ | — | | | | | $ | 290,019(12) | | | | | $ | 9,995 | | | | | $ | 300,014 | | | ||
| | | 2015 | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | ||
Jamie Barber General Counsel and Secretary | | | | | 2017 | | | | | $ | 125,000(13) | | | | | $ | 179,999(14) | | | | | $ | 2,092 | | | | | $ | 307,091 | | |
| | | 2016 | | | | | $ | — | | | | | $ | — | | | | | $ | | | | | | $ | — | | | ||
| | | 2015 | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | ||
Allen Webb Senior Vice President — SEC Reporting and Technical Accounting | | | | | 2017 | | | | | $ | — | | | | | $ | 170,006(15) | | | | | $ | 20,344 | | | | | $ | 190,350 | | |
| | | 2016 | | | | | $ | — | | | | | $ | 250,010(16) | | | | | $ | 9,086 | | | | | $ | 259,096 | | | ||
| | | 2015 | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | |
Name | | | Type of Award | | | Grant Date | | | Date of Board Approval | | | Estimated Future Payouts Under Equity Incentive Plan Awards(1) | | | All Other Stock Awards: Number of Shares or Units of Stock | | | Grant Date Fair Value(2) | | ||||||||||||||||||||||||
| Threshold | | | Target | | | Maximum | | |||||||||||||||||||||||||||||||||||
Jeffrey Busch | | | | | LTIP Units | | | | February 28, 2017; October 11, 2017 | | | February 28, 2017; October 10, 2017 | | | | | 19,535 | | | | | | 39,070 | | | | | | 71,593 | | | | | | 32,787(3) | | | | | $ | 610,010 | | |
David Young(4) | | | | | LTIP Units | | | | February 28, 2017 | | | February 28, 2017 | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | $ | 400,000 | | |
Robert Kiernan | | | | | LTIP Units | | | | August 23, 2017 | | | August 13, 2017 | | | | | 6,808 | | | | | | 13,615 | | | | | | 25,733 | | | | | | 5,974(5) | | | | | $ | 155,000 | | |
Donald McClure(6) | | | | | LTIP Units | | | | February 28, 2017 | | | February 28, 2017 | | | | | 9,483 | | | | | | 18,966 | | | | | | 33,319 | | | | | | — | | | | | $ | 52,500 | | |
Alfonzo Leon | | | | | LTIP Units | | | | February 28, 2017 | | | February 28, 2017 | | | | | 11,999 | | | | | | 23,998 | | | | | | 42,491 | | | | | | — | | | | | $ | 192,500 | | |
Jamie Barber | | | | | LTIP Units | | | | May 8, 2017 | | | May 5, 2017 | | | | | 6,182 | | | | | | 12,363 | | | | | | 22,111 | | | | | | 5,230(7) | | | | | $ | 180,000 | | |
Allen Webb | | | | | LTIP Units | | | | February 28, 2017 | | | February 28, 2017 | | | | | 10,552 | | | | | | 21,104 | | | | | | 36,851 | | | | | | — | | | | | $ | 170,006 | | |
| | | Stock Awards | | |||||||||||||||||||||
Name | | | Number of Shares or Units of Stock That Have Not Vested | | | Market Value of Shares or Units of Stock That Have Not Vested(1) | | | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Yet Vested | | | Equity Incentive Plan Awards: Market Value of Unearned Shares, Units or Other Rights That Have Not Yet Vested(1) | | ||||||||||||
Jeffrey Busch | | | | | 66,579(2) | | | | | $ | 545,948 | | | | | | 26,083(3) | | | | | $ | 213,881 | | |
David Young(4) | | | | | — | | | | | $ | — | | | | | | — | | | | | $ | — | | |
Robert Kiernan | | | | | 5,974(5) | | | | | $ | 48,987 | | | | | | 8,305(6) | | | | | $ | 68,101 | | |
Donald McClure(7) | | | | | — | | | | | $ | — | | | | | | 7,288 | | | | | $ | 59,762 | | |
Alfonzo Leon | | | | | 14,516(8) | | | | | $ | 119,031 | | | | | | 17,505(9) | | | | | $ | 143,541 | | |
Jamie Barber | | | | | 5,230(10) | | | | | $ | 42,886 | | | | | | 8,797(11) | | | | | $ | 72,131 | | |
Allen Webb | | | | | 11,620(12) | | | | | $ | 95,284 | | | | | | 15,909(13) | | | | | $ | 130,454 | | |
| | | Stock Awards | | |||||||||
Name | | | Number of Shares Acquired on Vesting | | | Value Realized on Vesting(1) | | ||||||
Jeffrey Busch | | | | | 44,896(2) | | | | | $ | 368,147 | | |
David Young | | | | | 60,000(3) | | | | | $ | 492,000 | | |
Robert Kiernan | | | | | — | | | | | $ | — | | |
Donald McClure | | | | | 30,430(4) | | | | | $ | 249,526 | | |
Alfonzo Leon | | | | | 15,258(5) | | | | | $ | 125,116 | | |
Jamie Barber | | | | | — | | | | | $ | — | | |
Allen Webb | | | | | 13,820(6) | | | | | $ | 113,324 | | |
Name | | | Stock Awards | | | Total(1) | | ||||||
Jeffrey Busch | | | | | 76,309(2) | | | | | $ | 625,734 | | |
David Young(3) | | | | | — | | | | | $ | — | | |
Robert Kiernan | | | | | 8,199(4) | | | | | $ | 67,232 | | |
Donald McClure(5) | | | | | 2,845 | | | | | $ | 23,329 | | |
Alfonzo Leon | | | | | 22,698(6) | | | | | $ | 186,124 | | |
Jamie Barber | | | | | 9,116(7) | | | | | $ | 74,751 | | |
Allen Webb | | | | | 19,581(8) | | | | | $ | 160,564 | | |
Plan Category | | | Number of securities to be issued upon exercise of outstanding options, warrants and rights (a) | | | Weighted-average exercise price of our outstanding options, warrants and rights (b) | | | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (c) | | |||||||||
Equity compensation plans approved by security holders | | | | | 435,737(1) | | | | | | N/A | | | | | | 796,660(2) | | |
Name | | | Fees Earned or Paid in Cash(1) | | | Stock Awards(2) | | | All Other Compensation(3) | | | Total | | ||||||||||||
Henry Cole(4) | | | | $ | 57,352 | | | | | $ | 30,384 | | | | | $ | 1,278 | | | | | $ | 89,014 | | |
Matthew L. Cypher(5) | | | | $ | 41,460 | | | | | $ | 30,384 | | | | | $ | 1,278 | | | | | $ | 73,122 | | |
Kurt Harrington(5) | | | | $ | 43,013 | | | | | $ | 30,384 | | | | | $ | 1,278 | | | | | $ | 74,675 | | |
Ronald Marston(4) | | | | $ | 55,841 | | | | | $ | 30,384 | | | | | $ | 1,278 | | | | | $ | 87,503 | | |
Dr. Roscoe Moore(4) | | | | $ | 51,486 | | | | | $ | 30,384 | | | | | $ | 1,278 | | | | | $ | 83,148 | | |
Zhang Jinguo | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | |
Zhang Huiqi | | | | $ | — | | | | | $ | — | | | | | $ | 24,000 | | | | | $ | 24,000 | | |
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Name | Fees Earned or Paid in Cash(1) ($) | Stock Awards(2) ($) | Total ($) | |||||||||
Huang Yanping(3) | — | — | — | |||||||||
Qin Yufei(4) | — | $ | 100,000 | (5) | $ | 100,000 | ||||||
Henry Cole | $ | 10,000 | $ | 27,500 | (6) | $ | 37,500 | |||||
Matthew L. Cypher | $ | 12,500 | $ | 27,500 | (6) | $ | 40,000 | |||||
Kurt R. Harrington | $ | 12,500 | $ | 27,500 | (6) | $ | 40,000 | |||||
Zhang Jingguo | — | — | — | |||||||||
Ronald Marston | $ | 10,000 | $ | 27,500 | (6) | $ | 37,500 | |||||
Dr. Roscoe Moore | $ | 12,500 | $ | 27,500 | (6) | $ | 40,000 | |||||
Zhang Huiqi | — | $ | 300,000 | (5) | $ | 300,000 |
(1) Represents the annual retainer fees. (2) The number of LTIP Units comprising each LTIP award was based on a price of $9.51 per unit, the closing price for the Company’s common stock on May 18, 2017, the date of grant. The stock award values disclosed in this director compensation table are based on market values of the Company’s common stock at the time of grant, which differ from the values calculated in accordance with GAAP as reported in the Company’s audited historical financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2017. See Note 7 — |
During 2016 subsequentEquity Incentive Plan in our Annual Report on Form 10-K for the fiscal year ended December 31, 2017.
The Company did not pay any compensation to its directors in 2016 prior to its July 1, 2016 IPO; however, on February 28, 2017, the Board approved a one-time cash fee to the independent directors who were appointed to serve as directors prior to the closing date of the IPO in an amount equal to (i) $15,000 for the first of such independent directors to be appointed as a director of the Company and (ii) a pro rata amount of $15,000 for the independent directors appointed as directors of the Company after the first such independent director was appointed based on the number of calendar days served fromhis appointment through the closing date of the IPO relativeCompany’s initial public offering.
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Name | Number of shares or units of stock that have not vested (#) | Market value of shares or units of stock that have not vested ($)(1) | ||||||
David A. Young | 59,973 | $ | 595,011 | |||||
Jeffrey Busch | 50,688 | $ | 500,016 | |||||
Henry Cole | 2,750 | $ | 27,500 | |||||
Matthew L. Cypher | 2,750 | $ | 27,500 | |||||
Kurt R. Harrington | 2,750 | $ | 27,500 | |||||
Zhang Jingguo | — | — | ||||||
Ronald Marston | 2,750 | $ | 27,500 | |||||
Dr. Roscoe Moore | 2,750 | $ | 27,500 | |||||
Zhang Huiqi | 18,000 | $ | 180,000 | |||||
Qin Yuifei | 6,000 | $ | 60,000 |
On November 10, 2014, the Company entered into a management agreement, with an effective date of April 1, 2014, with the Advisor, an affiliate of the Company.
Upon completion of the Company’s IPO on July 1, 2016, the Company and the Advisor entered into an amended and restated management agreement (the “Management Agreement”).our Advisor. Certain material terms of the Management Agreement are summarized below:
the IPO, or in any subsequent offering (allocated on a pro rata daily basis for such issuances during the fiscal quarter of any such issuance), less (b) any amount that the Company pays to repurchase shares of its common stock or equity securities of the operating partnership. Stockholders’ equity also excludes (1) any unrealized gains and losses and other non-cash items (including depreciation and amortization) that have impacted stockholders’ equity as reported in the Company’s financial statements prepared in accordance with GAAP, and (2) one-time events pursuant to changes in GAAP, and certain non-cash items not otherwise described above, in each case after discussions between the Advisor and its independent directors and approval by a majority of the Company’s independent directors. As a result, the Company’s stockholders’ equity, for purposes of calculating the base management fee, could be greater or less than the amount of stockholders’ equity shown on its financial statements.
quarters.
The Company received funds from its related party ZH USA, LLC in the form of convertible interest bearing notes (8% per annum, payable in arrears) due on demand unsecured debt (the “Convertible Debenture”). Under the terms$125,000 of the Convertible Debenture, the Company could prepay the notes at any time, in whole or in part. Additionally, ZH USA, LLC could elect to convert all or a portion of the outstanding principal amount of the notes into shares of common stock in an amount equal to the principal amount outstanding, together with accrued but unpaid interest, divided by $12.748.
On March 2, 2016, ZH USA, LLC converted $15,000,000 of principal under the Convertible Debenture into 1,176,656 sharesannual salary of the Company’s then unregistered common stock based on a conversion rate of $12.748 per share.
On June 15, 2016, in anticipation of its IPO, the Company entered into a Pay-Off LetterGeneral Counsel and Conversion Agreement (the “Pay-Off Letter and Conversion Agreement”) with ZH USA, LLC with regards to the Convertible Debenture. Under the terms of the Pay-Off Letter and Conversion Agreement, upon the closing date of the IPO on July 1, 2016, ZH USA, LLC converted $15,030,134 of the principal under the Convertible Debenture into 1,179,019 shares of the Company’s registered common stock based on a conversion rate of $12.748 per share. Additionally, in accordance with the Pay-Off Letter and Conversion Agreement, on July 8, 2016 the Company paid off the remaining principal amount of $10,000,000 outstanding under the Convertible Debenture.
On July 8, 2016, also in accordance with the Pay-Off Letter and Conversion Agreement, the Company paid all accrued interest owed and outstanding on the Convertible Debentures in the amount of $1,716,811.
During the year ended December 31, 2016, the Company received total funds in the amount of $450,000 in the form of an interest bearing note payable from a related party. The note incurred interest at 4% per annum and was due on demand. Interest expense incurred on this note was $10,284 for the year ended December 31, 2016. This note was paid in full with a payment of $450,000 during the year ended December 31, 2016.
During the year ended December 31, 2015, the Company received funds in the amount of $382,805 from ZH USA, LLC in the form of a non-interest bearing due on demand note payable. No funds were received from ZH USA, LLC during the year ended December 31, 2016. The balance from this related party loan was $421,000 as of December 31, 2016 and December 31, 2015, respectively.
On June 7, 2016, the Company received an interest free loan from ZH USA, LLC in the principal amount of $1.5 million, which was repaid in full on July 8, 2016, using a portion of the proceeds from the IPO.
Additionally, under our Code of Business Conduct and Ethics, related party transactions are subject to appropriate review and oversight by the Board’s Audit Committee.
| | | Year Ended December 31, 2017 | | | Year Ended December 31, 2016 | | ||||||
Audit Fees | | | | $ | 506,400 | | | | | $ | 346,900 | | |
Audit-Related Fees | | | | | 35,500 | | | | | | 42,600 | | |
Tax Fees | | | | | — | | | | | | — | | |
All Other Fees | | | | | — | | | | | | — | | |
Total | | | | $ | 541,900 | | | | | $ | 389,500 | | |
|
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Year Ended December 31, 2016 | Year Ended December 31, 2015 | |||||||
MaloneBailey: | ||||||||
Audit Fees | $ | 350,000 | (1) | $ | 65,000 | |||
Audit-Related Fees | — | — | ||||||
Tax Fees | — | — | ||||||
All Other Fees | — | — | ||||||
Total | $ | 350,000 | $ | 65,000 |
TABLESTOCKHOLDERS OFGLOBAL MEDICAL REIT INC.to be held on May 30, 2018NOTICE OF CONTENTS