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SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement [ ] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
GETTY REALTY CORP.
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(Name of Registrant as Specified in Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
[X] No fee required.
[ ] Fee 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:
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(2) Aggregate number of securities to which transaction applies:
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(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):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
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[ ] Check 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:
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(2) Form, schedule or registration statement no.:
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(3) Filing party:
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(4) Date filed:
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GETTY LOGO
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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD JUNE 17, 1999
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To the Stockholders of
GETTY REALTY CORP.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of Getty
Realty Corp. (hereinafter called the "Company" or "Getty") will be held at 270
Park Avenue, 11th Floor, Conference Room "C," New York, New York, on June 17,
1999 at 3:00 p.m., for the following purposes:
(1) To elect a Board of five directors to hold office for the ensuing year
or until the election and qualification of their respective successors.
(2) To ratify the appointment of PricewaterhouseCoopers L.L.P. as
independent auditors for the Company for the fiscal year ended January
31, 2000.
(3) To transact such other business as may properly come before the meeting
or any adjournment or adjournments thereof.
The transfer books of the Company will not be closed, but only stockholders
of record at the close of business on April 22, 1999 are entitled to notice of
and to vote at this meeting or any adjournments thereof.
You are cordially invited to attend the meeting. Whether or not you expect
to attend, please promptly vote, sign, date and return the enclosed proxy
instruction card in the enclosed U.S. postage-paid envelope. This will ensure
that your shares are voted in accordance with your wishes and that a quorum will
be present. Even though you have returned your proxy card, you may withdraw your
proxy at any time prior to its use and vote in person at the meeting should you
so desire.
By Order of the Board of Directors,
/s/ Randi Young Filip
RANDI YOUNG FILIP
Corporate Secretary
Jericho, New York
April 30, 1999
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PLEASE NOTE--IF YOU DO NOT PLAN TO ATTEND THE MEETING, IT WOULD BE APPRECIATED
IF YOU WOULD PROMPTLY SIGN AND RETURN THE ENCLOSED PROXY IN THE ENCLOSED
ENVELOPE WHICH REQUIRES NO POSTAGE.
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GETTY REALTY CORP.
125 JERICHO TURNPIKE, JERICHO, NEW YORK 11753
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PROXY STATEMENT FOR
ANNUAL MEETING OF STOCKHOLDERS
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This Proxy Statement is furnished in connection with the solicitation of
proxies by and on behalf of the Board of Directors of Getty Realty Corp.
(hereinafter called the "Company" or "Getty"), to be voted at the Annual Meeting
of Stockholders to be held at 270 Park Avenue, 11th Floor, New York, New York,
on June 17, 1999 at 3:00 p.m., and at any adjournments thereof, for the purpose
of electing a Board of Directors, ratifying the appointment of independent
auditors for the Company, and transacting such other business as may properly
come before the meeting.
On the April 22, 1999 record date for securities entitled to vote at the
meeting, the Company had outstanding 13,566,233 shares of Getty Common Stock and
2,888,798 shares of Getty Preferred Stock. Each outstanding common share is
entitled to one vote and each outstanding preferred share is entitled to 1.1312
votes. The common and preferred shares vote together as a single class. In order
to constitute a quorum at the meeting, there must be present or voting by proxy,
holders of common and preferred shares holding a majority of the outstanding
common shares (including common shares issuable upon conversion of the Getty
Preferred Stock). In conformity with Maryland law, shares abstaining from voting
or not voted on certain matters will not be treated as votes cast with respect
to those matters, and, therefore, will not affect the outcome of any such
matter.
This Proxy Statement and form of proxy will be sent to stockholders in an
initial mailing on or about April 30, 1999. The Company must receive stockholder
proposals that are intended to be presented at the next annual meeting no
earlier than March 20, 2000 and no later than April 19, 2000 in accordance with
the Company's by-laws. Stockholder proposals to be considered for inclusion in
next year's proxy statement must be received by the Company by December 31,
1999.
FORMATION OF THE COMPANY AND CONVERSION
OF SHARES OF OLD GETTY
The Company was incorporated in Maryland on December 23, 1997, for the
purpose of effecting the acquisition of Power Test Investors Limited Partnership
("PTI"), which was completed on January 30, 1998 (the "Merger"). As a result of
the Merger, each share of common stock of Getty Realty Corp., a Delaware
corporation formerly known as Getty Petroleum Corp. ("Old Getty"), was converted
into the right to receive one share of Common Stock of the Company ("Getty
Common Stock") and PTI unitholders received shares of the Company's Series A
Participating Convertible Redeemable Preferred Stock ("Getty Preferred Stock").
All of the directors and officers of Old Getty became officers and directors of
the Company. All information herein provided for the period prior to January 30,
1998 pertains to Old Getty and directors and officers of the Company when they
were directors and officers of Old Getty.
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ELECTION OF DIRECTORS
Five directors are to be elected at the meeting for a term of one year or
until their respective successors are elected and qualified. The plurality vote
of the holders of a majority of the shares having voting power, present in
person or represented by proxy at the meeting, is necessary for the election of
the directors.
We intend that you will use the enclosed proxy to cast your votes for the
election of the nominees named in the table below. In the event that any of the
nominees should become unable or unwilling to serve as a director, we intend
that your proxy will be voted for the election of the person, if any, that is
designated by the Board of Directors. The names of, and certain information with
respect to, the persons nominated for election as directors are as follows:
NAME--AGE OFFICES HELD IN GETTY AND/OR
SERVED AS DIRECTOR SINCE PRINCIPAL OCCUPATIONS FOR PAST FIVE YEARS
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Milton Cooper--70 Chairman of the Board of Kimco Realty Corporation, a real
May 1971 estate investment trust, for more than five years. Served as
Vice President of Getty until June 1992. Director, Secretary
and Assistant Treasurer of CLS General Partnership Corp.,
Director of Blue Ridge Real Estate/Big Boulder Corporation,
a real estate management and land development firm, and a
Trustee of MassMutual Corporate Investors and MassMutual
Participation Investors.
Philip E. Coviello--56 Partner of Latham & Watkins, an international law firm, for
June 1996 more than five years. Latham & Watkins has performed legal
services for the Company for many years.
Leo Liebowitz--71 President and Chief Executive Officer of Getty. Chairman,
May 1971 Chief Executive Officer and Director of Getty Petroleum
Marketing Inc. ("Marketing"). Director, President and
Treasurer of CLS General Partnership Corp.
Howard Safenowitz--40 Vice President, Business Affairs of Walt Disney Pictures and
December 1998 Television, and prior thereto an attorney for Walt Disney
Company for more than five years. Director of Marketing
since December 1998.
Warren G. Wintrub--65 Retired Partner, former member of the Executive Committee
June 1993 and Chairman of the Retirement Committee of Coopers &
Lybrand, an international professional services
organization, for more than five years prior to his
retirement in January 1992. Director of Chromcraft
Revington, Inc., Corporate Property Associates 10 Inc.,
Corporate Property Associates 14 Inc. and Carey
Institutional Properties, Inc.
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BENEFICIAL OWNERSHIP OF CAPITAL STOCK
Under the rules of the Securities and Exchange Commission (the "SEC"), a
person who directly or indirectly has or shares voting power and/or investment
power with respect to a security is considered a beneficial owner of the
security. Voting power includes the power to vote or direct the voting of shares
and investment power includes the power to dispose of or direct the disposition
of shares.
The following table sets forth the beneficial ownership of Getty Common
Stock and Getty Preferred Stock based on beneficial ownership as of January 31,
1999, of (i) each person who is a beneficial owner of more than 5% of the
outstanding shares of Getty Common Stock or Getty Preferred Stock, (ii) each
director, (iii) the Named Executive Officers (as defined below), and (iv) all
directors and executive officers as a group. The number of shares column
includes shares as to which voting power and/or investment power may be acquired
within 60 days (such as upon exercise of outstanding stock options) because such
shares are deemed to be beneficially owned under the SEC rules.
SHARES OF APPROXIMATE SHARES OF APPROXIMATE
COMMON STOCK PERCENT OF CLASS(1) PREFERRED STOCK PERCENT OF CLASS(1)
BENEFICIALLY OWNED COMMON STOCK BENEFICIALLY OWNED PREFERRED STOCK
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Milton Cooper 1,054,749(2) 7.68% 219,711(3) 7.61%
Director
c/o Kimco Realty Corporation
3333 New Hyde Park Road
New York, NY 11042
Philip E. Coviello 29,069(4) * -- --
Director
Leo Liebowitz 2,335,006(5) 17.01% 555,331(6) 19.22%
Director, President and
Chief
Executive Officer
c/o Getty Realty Corp.
125 Jericho Turnpike
Jericho, NY 11753
Howard Safenowitz 2,352,481(7) 17.14% 369,726(8) 12.80%
Director
21767 Los Alimos Street
Chatsworth, CA 91311
Warren Wintrub 53,424(4) * -- --
Director
John J. Fitteron 118,416(4) * 880 *
Senior Vice President,
Treasurer and Chief
Financial Officer
Directors and Executive 5,943,145 43.30% 1,145,648 39.66%
Officers as a group
(6 persons)
Southeastern Asset 1,223,800(9) 8.92% -- --
Management, Inc., et al.
6410 Poplar Ave., Suite 900
Memphis, TN 38119
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SHARES OF APPROXIMATE SHARES OF APPROXIMATE
COMMON STOCK PERCENT OF CLASS(1) PREFERRED STOCK PERCENT OF CLASS(1)
BENEFICIALLY OWNED COMMON STOCK BENEFICIALLY OWNED PREFERRED STOCK
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Safenowitz Partners, LP 1,510,801(10) 11.01% 289,156(10) 10.01%
c/o Howard Safenowitz
President of Safenowitz
Family Corp., general
partner
21767 Los Alimos Street
Chatsworth, CA 91311
CLS General Partnership
Corp. -- -- 665,760(11) 23.05%
c/o Leo Liebowitz, President
125 Jericho Turnpike
Jericho, NY 11753
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* Total shares beneficially owned constitute less than one percent of the
outstanding shares.
(1) The percentage is determined by dividing the number of shares shown by the
aggregate number of shares outstanding and the shares which may be acquired
within 60 days.
(2) Includes 10,311 shares held in a partnership of which Mr. Cooper is a
partner, 2,013 shares held by his wife as to which he disclaims beneficial
ownership and 165,000 shares held by a charitable foundation.
(3) Includes 4,321 shares held by a retirement fund of which Mr. Cooper is a
beneficiary, 17,820 shares held by a charitable foundation of which he is
the president and 118,505 shares held by CLS General Partnership Corp.
Excludes 56,157 shares held by Mr. Cooper's wife, and 14,720 shares held by
his children and grandchildren, as to which he disclaims beneficial
ownership.
(4) Includes with respect to Messrs. Coviello, Wintrub and Fitteron, options
covering 14,413, 28,040 and 117,646 shares, respectively, that are
presently exercisable or will become exercisable within 60 days.
(5) Includes 230,977 shares held by Mr. Liebowitz' wife as to which he
disclaims beneficial ownership, 30,724 shares held by a charitable
foundation and 30,485 shares held in Getty's Retirement (401(k)) and Profit
Sharing Plan.
(6) Includes 75,306 shares held by Mr. Liebowitz' wife and 274,892 shares held
by CLS General Partnership Corp. Excludes 225,515 shares held by his
children, as to which he disclaims beneficial ownership.
(7) Includes 23,479 shares held as custodian for 3 minor children, 176,118
shares held by The Marilyn Safenowitz Irrevocable Trust (of which Mr.
Safenowitz is a co-trustee and as to which he disclaims beneficial
ownership), 515,000 shares held by The Safenowitz Family Partnership, LP
and 1,510,801 shares held by Safenowitz Partners, LP (as to which in each
case he is the president of the general partner and as to which he
disclaims beneficial ownership except to the extent of his pecuniary
interest therein), and 11,523 shares held by Mr. Safenowitz' wife as to
which he disclaims beneficial ownership.
(8) Includes 289,156 shares held by Safenowitz Partners, LP, of which Mr.
Safenowitz is the president of the general partner and as to which he
disclaims beneficial ownership except to the extent of his pecuniary
interest therein, and 37,136 shares held by The Marilyn Safenowitz
Irrevocable Trust, of which he is a co-trustee and as to which he disclaims
beneficial ownership.
(9) On February 17, 1999, the Company received a Schedule 13G, Amendment No. 1,
dated January 26, 1999, that was filed with the SEC in respect of ownership
of an aggregate of 1,223,800 shares of Getty Common Stock by a group
comprised of Southeastern Asset Management, Inc., Longleaf Partners Realty
Fund (a series of Longleaf Partners Funds Trust) and Mr. O. Mason Hawkins.
Each of Southeastern Asset Management, Inc. and Longleaf Partners Realty
Fund reported shared voting power and shared dispositive power with respect
to all of such shares. Mr. O. Mason Hawkins was included in the group by
virtue of his position as Chairman of the Board and Chief Executive Officer
of Southeastern Asset Management, Inc. The Company has not attempted to
verify independently any of the information contained in the Schedule 13G.
(10) Safenowitz Partners, LP is separate and distinct from The Safenowitz Family
Partnership, LP referred to in Note 7 above. These shares are also included
in the total number of shares attributable to Howard Safenowitz as set
forth in the table above and further described in Notes 7 and 8.
(11) The shareholders of CLS General Partnership Corp. are Leo Liebowitz
(41.29%) Milton Cooper (17.80%) and The Estate of Milton Safenowitz
(40.91%).
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DIRECTORS' MEETINGS, COMMITTEES AND EXECUTIVE OFFICERS
During the fiscal year ended January 31, 1999, the Board of Directors of
the Company held four regular meetings and two special meetings. Each director
attended all of the meetings of the Board of Directors of the Company and of the
Committees of the Board on which the director served held during the time he was
a director. Mr. Milton Safenowitz was a director until his death in October 27,
1998. At the December 1998 Board Meeting, Mr. Howard Safenowitz, who is the late
Mr. Milton Safenowitz' son, was elected to the Board of Directors.
The Board of Directors of the Company has certain standing committees,
including an Audit Committee, a Nominating Committee and a Compensation and
Stock Option Committee, the membership and functions of which are described
below.
The Audit Committee, consisting of Messrs. Wintrub (Chairman), Coviello and
Cooper, met once last year. Mr. Milton Safenowitz served as a member of the
committee until June 1998, at which time Mr. Cooper became a member. The
Committee selects the firm of independent public accountants which audits the
consolidated financial statements of Getty and its subsidiaries, discusses the
scope and the results of the audit with the accountants and discusses Getty's
financial accounting and reporting principles. The Committee also examines the
summary reports of the internal auditors for the Company and discusses the
adequacy of Getty's financial controls with the accountants and with management.
The Nominating Committee, consisting of Messrs. Liebowitz (Chairman),
Cooper and Wintrub, met one time last year. The Committee recommends candidates
to the Board for election as officers. The Committee recommends nominees for
election to the Board and reviews the role, composition and structure of the
Board and its committees. The Committee will consider nominees recommended by
shareholders upon submission in writing to the Secretary of the Company, in
accordance with the provisions of the Company's Bylaws, with the names of such
nominees, together with their qualifications for service as a director of the
Company.
The Compensation and Stock Option Committee (the "Compensation Committee"),
which met one time last year, consists of Messrs. Cooper (Chairman), Coviello
and Wintrub. Mr. Milton Safenowitz served as a member of the committee until
June 1998, at which time Mr. Coviello became a member. The Compensation
Committee administers Getty's Incentive Compensation Plan, Supplemental
Retirement Plan and 1998 Stock Option Plan, and reviews the compensation of the
directors and officers of Getty.
DIRECTORS' COMPENSATION
Directors receive annual retainer fees of $12,000, and committee and board
meeting fees of $1,000 for each meeting attended. Directors who are employees of
the Company do not receive retainers or board meeting fees.
OTHER EXECUTIVE OFFICERS
The other executive officer during fiscal 1999 was John J. Fitteron, age
57, Senior Vice President and Chief Financial Officer of Getty since 1986 and
Treasurer of Getty since 1994. Management is not aware of any family
relationships between any of its directors, nominees or executive officers.
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COMPENSATION
EXECUTIVE COMPENSATION
The following tables provide information about executive compensation.
SUMMARY COMPENSATION TABLE
The following table sets forth information about the compensation of the
Chief Executive Officer and each of the other Executive Officers of Getty (the
"Named Executive Officers") for services in all capacities to Getty and its
subsidiaries during the periods indicated.
LONG TERM COMPENSATION
ANNUAL COMPENSATION RESTRICTED SECURITIES
FISCAL YEAR OTHER ANNUAL STOCK UNDERLYING ALL OTHER
NAME AND PRINCIPAL ENDED SALARY BONUS COMPENSATION AWARDS OPTIONS COMPENSATION
POSITION JANUARY 31 ($) ($) ($)(1) ($) (#) ($)(2)
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Leo Liebowitz 1999 313,452 100,000 59,728
Director, 1998 260,822 250,000 36,207
President and Chief 1997 404,103 123,400 69,843
Executive Officer
John J. Fitteron 1999 229,129 140,000 20,000(3) 50,642
Senior Vice
President, 1998 222,428 225,000 20,000 46,086
Treasurer and Chief 1997 215,775 190,000 20,000 44,954
Financial Officer
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(1) None of the Named Executive Officers received perquisites or other personal
benefits that exceeded the lesser of $50,000 or 10% of the officer's salary
and bonus.
(2) All other compensation includes Company contributions to the defined
contribution retirement profit sharing plan, matching contributions under
the Company's 401(k) savings plan, Company contributions to the Supplemental
Retirement Plan for executives and term life insurance premiums as set forth
in the following table.
(3) Represents fiscal year 1998 stock option grant which was repriced on
December 14, 1998. See "Report of the Compensation and Stock Option
Committee."
OTHER EXECUTIVE COMPENSATION
FISCAL YEAR DEFINED COMPANY SUPPLEMENTAL TERM
ENDED CONTRIBUTION MATCH RETIREMENT LIFE
JANUARY 31 RETIREMENT PLAN 401(K) PLAN PLAN INSURANCE
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Leo Liebowitz 1999 $2,516 $ -- $54,808 $2,404
1998 2,546 -- 31,437 2,224
1997 2,373 -- 65,246 2,224
John J. Fitteron 1999 2,516 4,800 38,522 4,804
1998 2,546 4,750 34,346 4,444
1997 2,373 4,750 33,871 3,960
In December 1994, the Company entered into agreements (collectively, the
"Change of Control Agreements") with its non-director officers and certain key
employees, wherein the Company agreed to make certain payments under certain
circumstances upon a "change of control" of the Company. Under such
circumstances, the Company also agreed that all Getty stock options granted to
such officer or key employee would immediately vest. In March 1996, the Company
amended the Change of Control Agreements to treat a spinoff or similar
transaction involving a substantial portion of the Company's marketing or real
estate business or assets as a "change of control". Accordingly, a "change of
control" for purposes of the Change of
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Control Agreements occurred on March 21, 1997, when Marketing was spun off to
Getty shareholders. On April 8, 1997, the Company formally confirmed to Mr.
Fitteron and to each covered employee its obligations under the Change of
Control Agreements including a minimum guaranteed annual compensation (the
"Guaranteed Salary"). On March 9, 1998, the Change of Control Agreements were
further amended, so as to provide that in the event of the termination of an
officer or covered employee by the Company for other than cause, or by either
party following the assignment to such officer or covered employee of materially
less favorable job responsibilities or duties, then for the 24-month period
after the date of termination for officers and a shorter period of time for the
covered employees, Getty will make payments to each such individual over the
applicable period at an annual rate of not less than the Guaranteed Salary,
reduced by the amount of compensation, if any, the officer or key employee
receives from any other employer during the covered period. In addition, the
Company will continue to pay at least the foregoing Guaranteed Salary to Mr.
Fitteron and each covered employee as long as he or she remains an employee of
the Company.
STOCK OPTIONS
The following table sets forth additional information with respect to the
stock options granted to the Named Executive Officers during the fiscal year
ended January 31, 1999, including the potential realizable value from the stock
options assuming they are exercised at the end of the option term and assuming
5% and 10% annual rates of stock price appreciation during the option term.
OPTION GRANTS IN LAST FISCAL YEAR
INDIVIDUAL GRANTS
----------------------------------------------------
% OF TOTAL
OPTIONS POTENTIAL REALIZABLE VALUE
NUMBER OF GRANTED TO AT ASSUMED ANNUAL RATES
SECURITIES EMPLOYEES IN OF STOCK PRICE APPRECIATION
UNDERLYING FISCAL YEAR EXERCISE OR FOR OPTION TERM(1)
OPTIONS ENDED BASE PRICE EXPIRATION ----------------------------
NAME GRANTED(#) 1-31-99 ($/SHARE) DATE 5%($) 10%($)
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Leo Liebowitz -- -- -- -- -- --
John J. Fitteron 20,000(2) 47.1% $17.188 l2/13/07 $81,789 $333,855
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(1) The dollar amounts under the potential realizable value column are the
result of calculations of assumed annual compound rates of appreciation over
the ten-year life of the options in accordance with the rules of the SEC and
are not intended to forecast possible future appreciation, if any, of the
Company's Common Stock. The actual value, if any, a Named Executive Officer
may realize will depend on the excess of the market price of the shares over
the exercise price on the date the option is exercised. The Company did not
use an alternative formula for a grant date valuation, as the Company is not
aware of any formula which will determine with reasonable accuracy a present
value based on unknown or volatile factors. If the price of Getty Common
Stock appreciates, the aggregate value of Getty Common Stock held by the
Company's stockholders will also increase. For example, the aggregate market
value of Getty Common Stock on January 31, 1999 was approximately
$212,820,000, based upon the market price on that date. If the share price
of Getty Common Stock increases by 5% per year, the aggregate market value
on January 31, 2009 of the same number of shares would be approximately
$346,662,000. If the price of Getty Common Stock increases by 10% per year,
the aggregate market value on January 31, 2009 would be approximately
$552,001,000.
(2) No new options were granted in the last fiscal year. On December 14, 1998,
however, the options granted to officers, directors and key employees on
December 16, 1997 were repriced to an exercise price of $17.188 per share
from $21.313 per share. The closing price of Getty Common Stock on December
14, 1998 was $13.0625 per share. See "Report of the Compensation and Stock
Option Committee" and the table below entitled "10-Year Option Repricings."
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AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR END OPTION VALUES
The following table provides information as to options exercised by each of
the Named Executive Officers of Getty during the fiscal year ended January 31,
1999 and the value of options held by such officers at year end measured in
terms of the closing price of Getty Common Stock on January 31, 1999.
VALUE OF UNEXERCISED
NUMBER OF UNEXERCISED IN-THE-MONEY OPTIONS
OPTIONS AT FISCAL YEAR END(#) AT FISCAL YEAR END($)
SHARES ACQUIRED VALUE EXERCISABLE/ EXERCISABLE/
NAME ON EXERCISE(#) REALIZED($) UNEXERCISABLE UNEXERCISABE
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Leo Liebowitz -- -- -- --
-- --
John J. Fitteron -- -- 117,646 --
15,000 --
10-YEAR OPTION REPRICINGS
The following table provides information concerning the repricing of
options held by executive officers of the Company during the last 10 completed
fiscal years.
LENGTH OF
NUMBER OF ORIGINAL
SECURITIES MARKET PRICE OPTION TERM
UNDERLYING OF STOCK AT EXERCISE PRICE REMAINING AT
OPTIONS TIME OF AT TIME OF NEW DATE OF
REPRICED OR REPRICING OR REPRICING OR EXERCISE REPRICING OR
NAME DATE AMENDED(#) AMENDMENT($) AMENDMENT($) PRICE($) AMENDMENT
- ----------------------------------------------------------------------------------------------------------------
John J. Fitteron 12/14/98 20,000 $13.0625 $21.313 $17.188 9 years
Senior Vice President
Treasurer and Chief
Financial Officer
STOCK OPTION PLAN
The Company's 1998 Stock Option Plan, as amended (the "Stock Option Plan"),
which has been approved by the Company's stockholders, authorizes the grant to
directors, officers and other key employees of the Company and its subsidiaries
of long-term incentive share awards in the form of options ("Options") to
purchase shares of the Company's Common Stock. In connection with the Merger,
all outstanding stock options under Old Getty's stock option plans were assumed
by Getty under the Stock Option Plan effective as of January 30, 1998, and each
then outstanding option under the Old Getty stock option plans became options
with respect to the Company's Common Stock at that time. The Stock Option Plan
is administered by a committee of three members of the Company's Board of
Directors (the "Compensation Committee"). The maximum number of shares which may
be the subject of outstanding Options under the 1998 Stock Option Plan is
1,100,000 and is subject to further adjustments for stock dividends and stock
splits. As of January 31, 1999, 358,119 shares of the Company's Common Stock
were issuable upon the exercise of options then outstanding under the Stock
Option Plan (including 124,884 shares issuable upon the exercise of options
granted to certain officers, directors and key employees of Marketing who were
granted options under the Old Getty stock option plans and who retained such
options following the Distribution). No grants may be made under the Stock
Option Plan after January 30, 2008. The number of remaining shares available for
grant under the Stock Option Plan was 741,669 at April 22, 1999.
The recipients, terms (including price and exercise period) and type of
Option to be granted under the Stock Option Plan is determined by the
Compensation Committee; however, the Option price per share under the Stock
Option Plan generally must be at least equal to the fair market value of a share
of the Company's Common Stock (110% of the amount in the case of Incentive Stock
Options granted to any individual who
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owns stock representing more than 10% of the voting power of the Company's
Common Stock) on the date the Option is granted. Subject to certain limitations,
Options granted under the Stock Option Plan may be either Incentive Stock
Options (within the meaning of Section 422(b) of the Internal Revenue Code) or
Non-Qualified Stock Options. With certain limited exceptions, Options may not be
exercised for a period of twelve months following the grant of the Option and
are exercisable in installments as are specified in the Stock Option Plan or the
terms of each Option. The exercise period of an Option may not extend more than
10 years following its grant.
RETIREMENT PLANS
The Company has a retirement profit-sharing plan with Deferred 401(k)
Savings Plan Provisions (the "Retirement Plan") for employees meeting certain
service requirements. Under the terms of the Retirement Plan the annual
discretionary contribution portion of the Retirement Plan is determined by the
Board of Directors. For the 401(k) portion of the Retirement Plan, the Board of
Directors has elected to contribute to the Retirement Plan for each
participating employee an amount equal to 50% of the employee's contribution to
the Retirement Plan but in no event more than 3% of the employee's compensation.
The Company also has a Supplemental Retirement Plan for Executives (the
"Supplemental Plan"). Under the Supplemental Plan, which is not qualified for
purposes of Section 401(a) of the Internal Revenue Code of 1986, as amended (the
"Code"), a participating executive may receive in his trust account an amount
equal to 10% of his compensation, reduced by the amount of any contributions
allocated to the executive under the Retirement Plan. The amounts paid to the
trustee under the Supplemental Plan may be used to satisfy claims of general
creditors in the event of the Company's or any of its subsidiaries' bankruptcy.
The trustee may not cause the Supplemental Plan to be other than "unfunded" for
purposes of the Employee Retirement Income Security Act of 1974, as amended. An
executive's account vests in the same manner as under the Retirement Plan and is
paid upon termination of employment. Under the Supplemental Plan, the Board of
Directors may during any fiscal year elect not to make any payment to the
account of any or all executives.
Pursuant to a long-standing arrangement, in the event of the death of Mr.
Liebowitz, benefits in an amount equal to twelve months' salary will be paid to
his estate. In the event of termination of Mr. Liebowitz' employment due to
illness or incapacity for a period of one year or longer, benefits equal to
twenty-four months salary will be payable to Mr. Liebowitz.
Mr. Liebowitz receives an annual pension of $3,500 from a subsidiary's
defined benefit retirement plan which was terminated effective October 1, 1985.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
As previously noted, the current members of the Compensation Committee are
Messrs. Cooper (a former Vice President), Coviello (since June 18, 1998) and
Wintrub. Mr. Cooper and the late Mr. Milton Safenowitz, both former officers of
the Company, served on the Compensation Committee during the past fiscal year.
Mr. Milton Safenowitz participated in the Compensation Committee until June 18,
1998 and did not participate thereafter.
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REPORT OF THE COMPENSATION AND STOCK OPTION COMMITTEE
To Our Stockholders:
This report addresses the Company's compensation policies with respect to
the compensation of the Chief Executive Officer and the other executive officers
during fiscal 1999. The Compensation and Stock Option Committee of the Board of
Directors (the "Compensation Committee") is responsible for setting the policies
which govern base salary compensation, the Incentive Compensation Plan, the
Retirement Plan, the Supplemental Retirement Plan, and the Stock Option Plan,
and for determining amounts payable under these plans.
Compensation of the Company's executive officers (with the exception of the
Chief Executive Officer) is recommended by the Chief Executive Officer to the
Compensation Committee and is discussed, reviewed and approved by the full Board
of Directors. The compensation of the Chief Executive Officer is also discussed,
reviewed and approved by the full Board of Directors. The Company's philosophy
is that under its total compensation program, the Chief Executive Officer and
other executives should: (1) have a greater portion of compensation at risk than
other employees and (2) have a significant portion of their compensation tied
directly to the performance of the business.
BASE SALARY
The base salary program is designed to provide each employee with a salary
competitive with salaries paid for similar positions in similar companies.
Besides being able to attract and retain capable people, Getty will endeavor to
ensure that each employee's compensation will be based on the person's ability,
effort and achievement. In December 1998, consistent with the practice of the
prior few years, Messrs. Liebowitz and Fitteron received a small increase in
base salary.
ANNUAL INCENTIVE AWARDS
Annual Incentive Awards are provided under the Getty Incentive Compensation
Plan ("ICP"). The purpose of the ICP is to promote the achievement of the
Company's targeted business objectives by providing competitive incentives to
those employees who can impact the Company's performance. The total amount of
cash available for annual ICP awards is approved by the Board of Directors after
it evaluates a combination of criteria, and achievement of specific goals.
Awards are based on a combination of Company performance, business unit
performance, and individual performance based on specific objectives.
The Compensation Committee determined that the incentive compensation of
Mr. Liebowitz, the Chief Executive Officer and Mr. Fitteron, the Senior Vice
President, Treasurer and Chief Financial Officer as shown under the caption
"Bonuses" in the Summary Compensation Table, should be between 32% and 69% of
the targeted amount each of these individuals could have received under the ICP
for the fiscal year ended January 31, 1999.
STOCK OPTIONS
Stock options are granted to encourage and facilitate personal stock
ownership by the directors, executives and certain other key employees and thus
strengthen their personal commitment to Getty and provide a longer term
perspective to their managerial responsibilities. The stock option portion of
the compensation program directly links the executive's interests with those of
the stockholders. The Compensation Committee's policy is to grant stock option
awards based on individual performance and the potential to contribute to the
future success of the Company. There were no stock options granted in the last
fiscal year. However, on December 14, 1998, the Compensation Committee approved
a repricing of the stock options which were granted to officers, directors and
key employees on December 16, 1997 in order to provide continued incentive to
optionees in light of the decline in the price of Getty Common Stock. The
repricing covered 50,000 options which were repriced at $17.188 per share, the
average of the original option exercise price of $21.313 and the closing price
on December 14, 1998 of $13.0625 per share.
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The Compensation Committee believes that the three components described
above provide compensation that is competitive with that offered by other
corporations, and effectively links executive and stockholder interests through
varied plans that are structured to coincide with the long term vision of Getty.
Section 162(m) of the Code denies the federal income tax deduction by
publicly held corporations of compensation in excess of $1 million paid to
certain executives and highly compensated officers during a fiscal year. It is
the Company's policy to take this rule into account in setting the compensation
of its affected executives. In addition to salaries and bonuses, compensation
income recognized upon the exercise of stock options may represent compensation
subject to the Section 162(m) limitation. Although it is possible that in any
given year, some portion of the compensation paid to a Company executive will
not be tax deductible under Section 162(m), the Compensation Committee believes
that portions of the affected executive's total compensation that are
performance based are excepted from application of Section 162(m). Deductibility
will also depend upon the amount of any bonus paid as an ICP award, upon the
market price of the Company's shares on the date stock options are exercised,
and the number of options exercised by an executive in any fiscal year.
The report of the Compensation Committee should not be deemed incorporated
by reference by any general statement incorporating by reference this Proxy
Statement into any filing under the Securities Act of 1933, as amended or under
the Securities Exchange Act of 1934, as amended, except to the extent that the
Company specifically incorporates this information by reference, and should not
otherwise be deemed filed under such Acts.
April 30, 1999 Compensation and Stock Option
Committee:
Milton Cooper (Chairman)
Philip Coviello
Warren Wintrub
CERTAIN TRANSACTIONS
As a result of the Marketing spin-off, Messrs. Liebowitz and Cooper
beneficially own approximately 17% and 7.6%, respectively, of the outstanding
common stock of Marketing. Mr. Safenowitz is the President of the General
Partner of Safenowitz Partners, LP and of The Safenowitz Family Partnership, LP.
Mr. Safenowitz and members of his family, together with the two limited
partnerships, in the aggregate beneficially own approximately 17% of Marketing.
Messrs. Liebowitz and Safenowitz serve as directors of Marketing, and Mr.
Liebowitz serves as Marketing's Chairman and Chief Executive Officer.
In connection with the Marketing spin-off, the Company and Marketing
entered into a Master Lease Agreement (the "Master Lease") with respect to
approximately 1,000 service station and convenience store properties and 10
distribution terminals and bulk plants. The initial term of the Master Lease is
fifteen years (or periods ranging from one to fifteen years with respect to
approximately 400 properties leased by Getty from third parties), and generally
provides Marketing with four ten-year renewal options (or with respect to such
leased properties, such shorter period as the underlying lease may provide). The
Master Lease is a "triple-net" lease, so Marketing is responsible for the cost
of all taxes, maintenance, repair, insurance and other operating expenses. Rent
for each of the properties was set using the fair market value of each property,
assuming certain environmental conditions for which the Company is responsible.
The Company anticipates that it will receive, during fiscal year 2000, on an
annual basis, net lease payments from Marketing aggregating approximately $56.2
million.
The Company and Marketing also entered into a Services Agreement (the
"Services Agreement"), under which the Company receives certain administrative
and technical services from Marketing and provides certain limited services to
Marketing. The original Services Agreement expired in February, 1999, and a new
Services Agreement was entered into as of March 1, 1999, which agreement may be
terminated in whole or in part by either party upon 30 days notice. The net fees
paid by the Company during the past fiscal year to
11
14
Marketing under the Services Agreement were $960,000. The Company presently
expects that many of the same services will be provided by Marketing for the
coming year.
In addition, the Company and Marketing entered into a Trademark License
Agreement providing for an exclusive, royalty-free license to Marketing of
certain Getty trademarks, service marks and trade names (including the name
"Getty") used in connection with Marketing's business, within the territory
specified in the agreement. The term of the agreement is 55 years, but in the
event that the Master Lease terminates before then, the license will become
non-exclusive and Marketing will pay the Company certain customary signage
rental and royalty fees.
The Company and Marketing also entered into a Tax Sharing Agreement that
defines the parties rights and obligations with respect to filing of returns,
payments, deficiencies and refunds of federal, state and other income, franchise
or motor fuel taxes relating to the Company's business for tax years prior to
and including March 21, 1997 and with respect to certain tax attributes of the
Company after that date.
12
15
STOCK PERFORMANCE GRAPH
COMPARATIVE FIVE-YEAR TOTAL RETURNS*
GETTY (GTY), S&P 500, AND PEER GROUP
(Performance results through 1/31/99)
Set forth below is a line graph comparing the yearly percentage change in
the cumulative total shareholder return on the Company's Common Stock against
the cumulative total return of the Standard & Poor's 500 Stock Index and the
Peer Group for the period of five years ended January 31, 1999.
GRAPH
GETTY REALTY CORP. STANDARD & POOR'S 500 PEER GROUP
------------------ --------------------- ----------
'1994' 100.00 100.00 100.00
'1995' 69.40 100.58 95.57
'1996' 79.46 139.42 128.28
'1997' 107.32 176.48 162.59
'1998' 186.98 224.10 185.25
'1999' 125.84 296.19 168.52
- -----------------------------------------------------------------------------------------------------------
1994 1995 1996 1997 1998 1999
- -----------------------------------------------------------------------------------------------------------
Getty Realty Corp. $100.00 $ 69.40 $ 79.46 $107.32 $186.98 $125.84
- -----------------------------------------------------------------------------------------------------------
Standard & Poor's 500 $100.00 $100.58 $139.42 $176.48 $224.10 $296.19
- -----------------------------------------------------------------------------------------------------------
Peer Group $100.00 $ 95.57 $128.28 $162.59 $185.25 $168.52
- -----------------------------------------------------------------------------------------------------------
Assumes $100 invested at the close of trading on 1/31/94 in Getty Common Stock,
Standard & Poor's 500, and Peer Group.
*Cumulative total return assumes reinvestment of dividends, and in the case of
the Company includes a special dividend relating to the Marketing spin-off.
The Company has chosen as its Peer Group the following companies: Franchise
Finance Corp. of America, U.S. Restaurant Properties, Inc., Realty Income Corp.
and FFP Partners, LP. The Company has chosen these companies as its Peer Group
because a substantial segment of each of their businesses is as a real estate
company that owns and leases commercial properties.
The Stock Performance Graph should not be deemed incorporated by reference
by any general statement incorporating by reference this Proxy Statement into
any filing under the Securities Act or under the Exchange Act, except to the
extent that the Company specifically incorporates this graph by reference, and
should not otherwise be deemed filed under such Acts.
We cannot assure you that the Company's stock performance will continue in
the future with the same or similar trends depicted in the graph above. The
Company will not make or endorse any predictions as to future stock performance.
13
16
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
Pursuant to the direction of the Board of Directors, on March 24, 1999, the
Audit Committee appointed the firm of PricewaterhouseCoopers L.L.P., subject to
ratification by the stockholders at the Annual Meeting, to audit the accounts of
the Company with respect to its operations for the fiscal year ending January
31, 2000 and to perform such other services as may be required. Should this firm
of auditors be unable to perform these services for any reason, the Board of
Directors will appoint other independent auditors to perform these services. A
majority of votes cast at the meeting is necessary in order to ratify the
appointment of the independent auditors.
Representatives of the firm of PricewaterhouseCoopers L.L.P., the Company's
principal auditors for the most recently completed fiscal year, are expected to
be present at the Annual Meeting, will have the opportunity to make a statement
if they desire to do so, and will be available to respond to appropriate
questions from stockholders.
The Board of Directors recommends a vote "FOR" the proposal to ratify the
selection of PricewaterhouseCoopers L.L.P. as the Company's independent public
auditors for the fiscal year ending January 31, 2000.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Pursuant to Section 16(a) of the Securities Exchange Act and the rules
issued thereunder, Getty's executive officers and directors are required to file
with the Securities and Exchange Commission and the New York Stock Exchange
reports of ownership and changes in ownership of Getty equity securities. Copies
of such reports are required to be furnished to Getty. Based on its review of
Forms 3 and 4 received by it during fiscal 1999 and of Forms 5 received by it
with respect to fiscal 1999, Getty believes that during fiscal 1999 all of its
executive officers and directors complied with the Section 16(a) requirements.
OTHER MATTERS
Management does not know of any matters, other than those referred to
above, to be presented at the meeting for action by the stockholders. However,
if any other matters are properly brought before the meeting, or any adjournment
or adjournments thereof, we intend to cast votes pursuant to the proxies with
respect to such matters in accordance with the best judgment of the persons
acting under the proxies.
The proxy may be revoked at any time prior to its exercise. Brokerage
houses and other custodians will be requested to forward solicitation material
to beneficial owners of stock held of record by such persons. The Company will
reimburse brokerage houses, banks and custodians for their out-of-pocket
expenses in forwarding proxy material to the beneficial owners. The cost of this
solicitation, which will be effected by mail, will be borne by the Company.
April 30, 1999 By Order of the Board of Directors,
/s/ Randi Young Filip
Randi Young Filip
Corporate Secretary
14
17
COMMON VERSION:
- --------------
[X] PLEASE MARK VOTES REVOCABLE PROXY
AS IN THIS EXAMPLE GETTY REALTY CORP.
WITH- FOR ALL
FOR HOLD EXCEPT
[ ] [ ] [ ]
ANNUAL MEETING OF STOCKHOLDERS 1. ELECTION OF DIRECTORS.
JUNE 17, 1999 FOR all nominees listed (except as
marked to the contrary below)
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
NOMINEES: M. COOPER, P. COVIELLO, L. LIEBOWITZ,
The undersigned stockholder of Getty Realty H. SAFENOWITZ, W. WINTRUB
Corp. hereby constitutes and appoints LEO
LIEBOWITZ and JOHN FITTERON, and each of them, the INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL
true and lawful attorneys, agents and proxies of NOMINEE, MARK "FOR ALL EXCEPT" AND WRITE THAT NOMINEE'S NAME IN THE
the undersigned, each with full power of SPACE PROVIDED BELOW.
substitution, to vote at the meeting, (or if only
one shall be present and acting at the meeting -------------------------------------------------------------------
then that one,) all of the shares of stock of the
corporation that the undersigned would be FOR AGAINST ABSTAIN
entitled, if personally present, to vote at the 2. The ratification of the appointment [ ] [ ] [ ]
annual meeting of stockholders of the corporation of PricewaterhouseCoopers L.L.P.
to be held at 270 Park Avenue, 11th Floor, New as independent auditors for the
York, New York, on June 17, 1999 and at any Company for the fiscal year ended
adjournments thereof. January 31, 2000.
3. In their discretion, the Proxies are authorized to vote upon
such other business as may properly come before the meeting.
Receipt is acknowledged of notice and proxy statement for
the foregoing meeting and of annual report to stockholders for
the fiscal year ended January 31, 1999.
-------------------------| THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE
Please be sure to sign and date | Date | MANNER DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO
this Proxy in the box below. | | DIRECTION IS MADE, THIS PROXY WILL BE VOTED "FOR" ITEMS 1, 2
- -----------------------------------------------------------| AND 3.
|
|
|
- ---Stockholder sign above---Co-holder (if any) sign above---
* DETACH ABOVE CARD, SIGN, DATE AND MAIL IN POSTAGE PAID ENVELOPE PROVIDED. *
GETTY REALTY CORP.
125 Jericho Tpke., Jericho, NY 11753
- ------------------------------------------------------------------------------------------------------------------------------------
Please sign exactly as name appears hereon. When shares are held by joint tenants, both should sign. When signing as attorney,
executor, administrator, trustee or guardian, please give full title as such. If a corporation, please sign in full corporate name
by President or other authorized officer. If a partnership, please sign in partnership name by authorized person.
PLEASE DATE, SIGN AND MAIL YOUR PROXY CARD BACK AS SOON AS POSSIBLE!
- ------------------------------------------------------------------------------------------------------------------------------------
18
PREFERRED VERSION:
- -----------------
[X] PLEASE MARK VOTES REVOCABLE PROXY
AS IN THIS EXAMPLE GETTY REALTY CORP.
WITH- FOR ALL
FOR HOLD EXCEPT
[ ] [ ] [ ]
ANNUAL MEETING OF STOCKHOLDERS 1. ELECTION OF DIRECTORS.
JUNE 17, 1999 FOR all nominees listed (except as
marked to the contrary below)
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
NOMINEES: M. COOPER, P. COVIELLO, L. LIEBOWITZ,
The undersigned stockholder of Getty Realty H. SAFENOWITZ, W. WINTRUB
Corp. hereby constitutes and appoints LEO
LIEBOWITZ and JOHN FITTERON, and each of them, the INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL
true and lawful attorneys, agents and proxies of NOMINEE, MARK "FOR ALL EXCEPT" AND WRITE THAT NOMINEE'S NAME IN THE
the undersigned, each with full power of SPACE PROVIDED BELOW.
substitution, to vote at the meeting, (or if only
one shall be present and acting at the meeting -------------------------------------------------------------------
then that one,) all of the shares of stock of the
corporation that the undersigned would be FOR AGAINST ABSTAIN
entitled, if personally present, to vote at the 2. The ratification of the appointment [ ] [ ] [ ]
annual meeting of stockholders of the corporation of PricewaterhouseCoopers L.L.P.
to be held at 270 Park Avenue, 11th Floor, New as independent auditors for the
York, New York, on June 17, 1999 and at any Company for the fiscal year ended
adjournments thereof. January 31, 2000.
3. In their discretion, the Proxies are authorized to vote upon
such other business as may properly come before the meeting.
Receipt is acknowledged of notice and proxy statement for
the foregoing meeting and of annual report to stockholders for
the fiscal year ended January 31, 1999.
-------------------------| THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE
Please be sure to sign and date | Date | MANNER DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO
this Proxy in the box below. | | DIRECTION IS MADE, THIS PROXY WILL BE VOTED "FOR" ITEMS 1, 2
- -----------------------------------------------------------| AND 3.
|
|
|
- ---Stockholder sign above---Co-holder (if any) sign above---
* DETACH ABOVE CARD, SIGN, DATE AND MAIL IN POSTAGE PAID ENVELOPE PROVIDED. *
GETTY REALTY CORP.
125 Jericho Tpke., Jericho, NY 11753
- ------------------------------------------------------------------------------------------------------------------------------------
Please sign exactly as name appears hereon. When shares are held by joint tenants, both should sign. When signing as attorney,
executor, administrator, trustee or guardian, please give full title as such. If a corporation, please sign in full corporate name
by President or other authorized officer. If a partnership, please sign in partnership name by authorized person.
PLEASE DATE, SIGN AND MAIL YOUR PROXY CARD BACK AS SOON AS POSSIBLE!
- ------------------------------------------------------------------------------------------------------------------------------------