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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No.  )
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Check the appropriate box:

Preliminary Proxy Statement

Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

Definitive Proxy Statement

Definitive Additional Materials

Soliciting Material under §240.14a-12
BRT APARTMENTS CORP.
(Name of Registrant as Specified In Its Charter)
 
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
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BRT Apartments Corp.APARTMENTS CORP.
60 Cutter Mill Road
Suite 303
Great Neck, New York 11021
(516) 466-3100
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
June 30, 202014, 2023
The annual meeting of stockholders of BRT Apartments Corp., a Maryland corporation (“we”, “us”, “our”, or the “Company”) will be held at our offices, located at 60 Cutter Mill Road, Great Neck, NY on Thursday,Wednesday, June 30, 2020,14, 2023, at 9:00 a.m., local time, forto consider and vote on the following purposes:matters:
1.
To elect threeThe election of four Class III Directors, each to serve until the 20232026 Annual Meeting of Stockholders and until their successors arehis or her successor is duly elected and qualify;qualifies;
2.
To consider and vote on aA proposal to approve, aby non-binding advisory resolution regarding thevote, executive compensation of our executive officers for the year ended December 31, 2019,2022, as more fully described in the accompanying proxy statement;
3.
To consider and vote upon aA proposal to approverecommend, by non-binding vote, the BRT Apartments Corp. 2020 Incentive Plan; andfrequency of future non-binding votes on executive compensation;
4.
To transact anyA proposal to ratify the appointment of Ernst & Young LLP as our independent registered public accounting firm for the year ending December 31, 2023; and
5.
Any other business as may properly comebrought before the meeting.
The Board of Directors recommends that you vote “FOR” the election of each of the nominees listed in the accompanying proxy statement, “FOR” proposal 2 to approve executive compensation for 2022, “FOR” three years with respect to proposal 3 regarding the frequency of stockholder votes on executive compensation and “FOR” proposal 4 to ratify the appointment of Ernst & Young LLP as our independent registered public accounting firm for the year ending December 31, 2023.
Holders of record of our common stock at the close of business on April 14, 2020March 23, 2023 are entitled to notice of and to vote at ourthe annual meeting and any adjournment or postponement thereof.
It is important that your shares of common stock be represented and voted at the meeting. You canTo assure that your vote your shares of common stock by completingwill be counted, please complete, date and returningsign the enclosed proxy card. Certaincard and return it in the enclosed prepaid envelope, whether or not you plan to attend the meeting. Most stockholders can also vote their shares of common stock overby telephone or via the internet. Telephone and internet or by telephone. If internet or telephone voting information is available to you, voting instructions are printedprovided on the accompanying proxy card sent to you. You can revoke acard. Your proxy at any time prior to its exercise atmay be revoked in the meeting by following the instructionsmanner described in the accompanying proxy statement.
Our Board of Directorsstatement at any time before it has fixedbeen voted at the offices of BRT Apartments Corp., 60 Cutter Mill Road, Suite 303, Great Neck New York 11021 as the location for the annual meeting. However, due to the continuing public health impact of coronavirus disease 2019 (COVID-19), we are planning for the possibility that our annual meeting of stockholders may be held solely by means of remote communication, via webcast or teleconference. If we take this step, we will announce the decision to do so in advance, and details on how to participate in the webcast or teleconference will be set forth in a press release issued by us and available at www.brtapartments.com.
 
By order of the Board of Directors
 
 
 
S. Asher Gaffney
 

 
Vice President and Corporate Secretary
Great Neck, New York
May 27, 2020
April 21, 2023

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BRT APARTMENTS CORP.
PROXY STATEMENT
GENERAL
Our Board of Directors is furnishing you with this proxy statement to solicit proxies on its behalf to be voted at the 20202023 annual meeting of stockholders of BRT Apartments Corp. The meeting will be at our offices, 60 Cutter Mill Road, Suite 303, Great Neck, New York, at 9:00 a.m., local time, on Wednesday, June 14, 2023. The proxies will be voted at the meeting and at any adjournments or postponements. All properly executed proxy cards, and all properly completed proxies submitted by telephone or by the internet, that are delivered pursuant to this solicitation, will be voted at the meeting in accordance with your directions, unless the proxy is properly revoked before the meeting.
In this proxy statement, we refer to BRT Apartments Corp. as “BRT,” “we,” “our,” “us,” “our company,” to our Board of Directors as the “board of directors”, “Board” or “board”, and to our shares of common stock as “common stock” or “shares.” Our telephone number is (516) 466-3100. Our Board of Directors has fixed our offices, 60 Cutter Mill Road, Suite 303, Great Neck, New York, at 9:00 a.m., local time, on Tuesday, June 30, 2020 as the date, time and place of the annual meeting. However, due to the continuing public health impact of coronavirus disease 2019 (COVID-19), we are planning for the possibility that our annual meeting of stockholders may be held solely by means of remote communication. If we take this step, we will announce the decision to do so in advance, and details on how to participate in the webcast or teleconference will be set forth in a press release issued by us and available at www.brtapartments.com.
As a result of a change in our fiscal year approved by our Board in January 2019, our fiscal year ended December 31, 2019. Accordingly, unless otherwise indicated or the context otherwise requires, references to: (i) 2020, refer to the twelve months ending December 31, 2020, (ii) 2019, refer to the twelve months ended December 31, 2019, (iii) the “Transition Period”, refer to the three months ended December 31, 2018, and (iv) 2018 or 2017, refer to the twelve months ended September 30, 2018 and 2017, respectively.
QUESTIONS AND ANSWERS ABOUT THE MEETING AND VOTING
What is the purpose of the annual meeting?
At our annual meeting, stockholders will consider and vote on the following matters:
the election of threefour Class III directors to hold office until the 20232026 annual meeting and until their respective successors are duly elected and qualify;
a proposal to approve a non-binding advisory resolution regarding thevote on executive compensation, of our executive officers for the year ended December 31, 2019; and
a proposal to approve the BRT Apartments Corp. 2020 Incentive Plan, which we refer to as the “Plan” or“Say-on-Pay Proposal”;
a non-binding advisory vote on the “2020 Incentive Plan.frequency of non-binding votes on executive compensation, which we refer to as the “Say-on-Frequency Proposal”;
ratification of the appointment of Ernst &Young LLP, which we refer to as “E&Y”, as our independent registered public accounting firm for the year ending December 31, 2023; and
such other matters as may properly come before the meeting.
How does the Board recommend I vote at the Annual Meeting?
Our Board recommends that you vote:
“FOR” the election of each of the nominees listed in this proxy statement as a director (each, a “nominee” and collectively, the “nominees”);
FOR the Say-on-Pay Proposal;
FOR” three years with respect to the Say-on-Frequency Proposal; and
FOR” the proposal to ratify the appointment of E&Y as our independent registered public accounting firm for the year ending December 31, 2023.
The persons named as proxies will vote in their discretion onor any other matter properly brought before the annual meeting.
Who is entitled to vote?
We are mailing this proxy statement on or about May 27, 2020April 28, 2023 to holders of record of our common stock as of the close of business on April 14, 2020,March 23, 2023, which we refer to as the “record date”. The record date was established by our Board.board. Stockholders of record as of the close of business on the record date are entitled to notice of and to vote their shares at the meeting. At the close of business on the record date, there were 19,144,381 shares of common stock outstanding and entitled to vote. Each outstanding share of common stock
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entitles the holder to cast one vote on each director to be elected and stockholders do not haveeach other matter to be considered at the right to vote cumulatively in the election of directors.meeting. Shares of our common stock constitute our only outstanding class of voting securities and will vote as a single class on all matters to be considered at the annual meeting.
What constitutes a quorum?
A quorum is the presence in person or by proxy of stockholders entitled to cast a majority of the votes entitled to be cast at the meeting. On the record date, there were 17,190,106 shares of common stock outstanding and entitled to vote.meeting on any matter. In order to carry on the business at the meeting, holders of a majority of our outstanding shares must be present in person or by proxy. This means that at least 8,595,0899,572,191 shares of common stock must be present at the meeting, either in person or by proxy, to constitute a quorum. Generally, action cannot be taken at the meeting unless a quorum is present.
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Abstentions and brokers non-votes, as described herein, will be considered present for the purpose of determining the presence of a quorum.
How do I vote?
If your shares are registered directly in your name with our transfer agent, American Stock Transfer & Trust Co., LLC, you are considered the stockholder of record with respect to those shares and the proxy card was sent directly to you by us.the transfer agent. In that case, you may instruct the proxy holders named in the proxy card how to vote your shares of common stock in one of the following ways:
Vote online. You may vote www.voteproxy.com online at www.voteproxy.com. To vote online, you must have your control number provided in the proxy card.
Vote by telephone. You may vote by telephone by calling 1-800-PROXIES (1-800-776-9437). To vote by telephone, you must have the control number provided in your proxy card.
Vote by regular mail. If you would like to vote by mail, please mark, sign and date your proxy card and return it promptly in the postage-paid envelope provided.
Vote by attending the meeting in person.
Proxies submitted over the internet, by telephone or by mail must be received by 11:59 p.m. New York City time, on June 29, 2020.13, 2023. If you vote by telephone or via the internet, it is not necessary to return your proxy card.
If your shares are held in an account at a brokerage firm, bank, broker-dealer, or other similar organization (collectively, an “Agent”), then you are the beneficial owner of shares held in “street name,” and a voting instruction form was forwarded to you by that organization.your Agent. As a beneficial owner, you have the right to instruct that organizationyour Agent on how to vote the shares held in your account. You should instruct your broker or nomineeAgent how to vote your shares by following the voting instructions provided by your broker or nominee.the Agent. If you wish to vote in person at the annual meeting, you must contact the broker or nominee to obtain a legal proxy from the broker or nominee.your Agent.
How doeswill my shares be voted?
If you are a stockholder of record as of the Board recommend Iclose of business on the record date and you do not mark any selections but return the signed proxy card, your shares will be voted by the proxies named on the proxy card “FOR” each of the nominees listed in this proxy statement. “FOR” the approval of the Say-on-Pay Proposal, “FOR” three years as the frequency on the Say-on-Frequency Proposal, and “FOR” the proposal to ratify the appointment of E&Y as our independent registered public accounting firm for the year ending December 31, 2023. If you are a stockholder of record as of the close of business on the record date and you return the signed proxy card, the proxy holders may vote atin their discretion with respect to any other matters that properly come before the Annual Meeting?
Our Board recommends that you vote:
“FOR” the election of three directorsmeeting. If any nominee named in this proxy statement (Fredric H. Gould, Gary Hurand and Elie Y. Weiss)is unwilling or unable to hold office untilserve as a director, our board may nominate another individual for election as a director at the 2023 annual meeting, and until their respective successorsthe persons named as proxy holders will vote “FOR” the election of any substitute nominee.
If you are duly electeda stockholder of record as of the close of business on the record date and qualify;you wish to name as a proxy someone other than the proxies named on the proxy card, you may do so by crossing out the name of the designated proxies and inserting the name of another person. In that case, it will be necessary to sign the proxy card and deliver it to the person so named and for the person so named to be present at and vote at the meeting with the properly executed and marked proxy card. Proxy cards so marked should not be mailed to us or to American Stock Transfer and Trust Company, LLC.
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If my shares are held in “street name” by my Agent, will the Agent vote my shares without specific instructions from me?
Not in most circumstances. In the absence of your voting instructions, your Agent may only vote your shares in its discretion on “routine matters” and your Agent may not vote your shares on proposals that are not “routine.” We believe that the proposal to approveratify the selection of E&Y is a non-binding advisory resolution regarding the compensation of our executive officers for the year ended December 31, 2019; and
“FOR” the approvalroutine matter on which your Agent can vote on your behalf if you do not furnish voting instructions. All of the BRT Apartments Corp. 2020 Incentive Plan.
other proposals may be considered non-routine matters so your Agent may not be entitled to vote your shares on these proposals without your instructions. A broker non-vote occurs when an Agent does not vote on a particular proposal because the Agent does not have discretionary voting power for that particular matter and has not received instructions from the beneficial owner. If you hold your shares in street name and do not give your Agent specific voting instructions on the election of directors, the Say-on-Pay Proposal or the Say-on-Frequency Proposal, your shares will not be voted on such proposal, and a broker non-vote will occur. If your shares are held in “street name” by your Agent, you should follow the directions provided by your Agent in order to instruct them to how to vote your shares.
Is my vote important?
Yes. Under applicable rules, brokers, banks and other nominees are prohibited from voting shares held in street name on matters pertaining to the election of directors unless the client specifically instructs his or her nominee to vote their shares. Shares held in street name and for which voting instructions are not provided and accordingly, as to which bank, brokers and other nomineesIf you do not have discretionary authoritysubmit a proxy or vote in person at the annual meeting, it may be more difficult for us to vote on their clients’ behalf, are referredobtain the necessary quorum to “broker non-votes.”hold the annual meeting.
How many votes are needed to approve each of the proposals assuming that a quorum is present at the annual meeting?
The affirmative vote of a majority of the total votes cast “for” and “against” as to a nominee is required for the election of such nominee as director. Abstentions, if any, and broker non-votes, will not be counted as votes cast and will have no effect on the results of the election of any director.
The affirmative vote of a majority of all of the votes cast onat the proposalmeeting is required for approval of the proposals relatingSay-on-Pay Proposal and to ratify the non-binding advisory vote on executive compensation.selection of Ernst & Young LLP. For purposes of the non-binding advisory vote on executive compensation,Say-on-Pay Proposal, abstentions and broker non-votes will not be counted as votes cast and will have no effect on the resultsresult of the vote. For the purposes of the vote on the selection of Ernst & Young LLP, abstentions will not be counted as votes cast and will have no effect on the result of the vote.
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The affirmativeoption of one year, two years or three years that receives a majority of all the votes cast at a meeting will be the frequency that has been recommended by stockholders with respect to the Say-on-Frequency Proposal. For purposes of this advisory vote, abstentions and broker non-votes will not be counted as votes cast and will have no effect on the result of the vote. In the event that no option receives a majority of the votes cast, we will consider the option that receives the most votes to be the option selected by stockholders. In either case, this vote is advisory and not binding on the proposalBoard or us in any way, and the Board may determine that it is our best interest to approvehold an advisory vote on executive compensation more or less frequently than the Plan is required for its approval. Abstentions will have the effect of a vote against the Plan, but broker non-votes will not have any impact on such proposal.
When are stockholder proposals due for the 2021 annual meeting?
We expect that our annual meeting of stockholders for the year ending December 31, 2020 will be held in June 2021.
Our bylaws require that we be given advance written notice of nominations for election to our Board and other matters which stockholders wish to present for action at an annual meeting of stockholders (other than matters included in our proxy materials in accordance with Rule 14a-8(e) under the Exchange Act). The Office of the Corporate Secretary must receive such notice, as well as the information and other materials requiredoption recommended by our bylaws, at our principal executive office not later than January 27, 2021 and no earlier than December 28, 2020 for matters or nominations to be properly presented at the 2021 annual meeting of our stockholders.
Stockholders who wish to have proposals considered for inclusion in the proxy statement and form of proxy for our 2021 Annual Meeting pursuant to Rule 14a-8 under the Exchange Act must cause their proposals to be received in writing by the OfficeAlthough each of the Corporate Secretary at the address set forthSay-on-Pay Proposal and Say-on Frequency Proposal is advisory and not binding on the cover page of this proxy statement no later than January 27, 2021. Any proposal should be addressed toBoard or us in any way, the OfficeCompensation Committee and the Board will review the results of the Corporate Secretaryvote and may be includedwill consider our stockholders' concerns and take them into account in next year’s proxy materials for our 2021 annual meeting of stockholders only if such proposal compliesfuture determinations with the rules and regulations promulgated by the Securities and Exchange Commission, which we referrespect to as the “SEC.” We are not required to include in our proxy statement or our proxy card relating to any annual meeting any stockholder proposal that does not meet all of the requirements for inclusion established by the SEC.these matters.
Who will count the vote?
A representative of our transfer agent, American Stock Transfer and Trust Company, LLC, or another person designated by or at the direction of our Board,board, will tabulate the votes and act as inspector of elections.
Can I revoke my proxy before it is exercised?
If you hold stock directly in your name, you can revoke your proxy at any time before it is voted at the annual meeting by filing a written revocation with theour Office of the Corporate Secretary, or delivering to American Stock Transfer and Trust Company, LLC a properly executed proxy bearing a later date. You may also revoke your proxy with a timely and valid later telephone or Internet vote or by attending the meeting and voting in person. If not so revoked, the shares represented by such proxy will be voted.
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If your shares are held in the name of a broker, bank or other nominee,an Agent, you must contact such nomineethe Agent and comply with the nominee’sits procedures if you want to revoke or change the instructions that you previously provided to the nominee.Agent. Attendance at the meeting will not by itself automatically revoke a previously granted proxy.
Who is soliciting my vote and who pays the cost?
We are soliciting proxies and will pay the entire cost of soliciting proxies, including preparing and mailing this proxy statement. In addition to the solicitation of proxies by mail and through our and our affiliates full-time and part-time employees, we will request banks, brokers, custodians, nomineesAgents and other stockholders of record holders to forward copies of the proxy statement and other soliciting materials to persons for whom they hold common shares and to request instruction on how to vote the shares. We will reimburse such record holders for their reasonable out-of-pocket expenses in forwarding proxies and proxy materials to stockholders. We have retained DF King for a fee of $6,000$7,000 and the reimbursement of certain expenses, to aid in the solicitation of proxies from our stockholders. To the extent necessary in order to ensure sufficient representation at the meeting, we or our proxy solicitor may solicit the return of proxies by personal interview, mail, telephone, facsimile, Internet or other means of communication or electronic transmission. The extent to which this will be necessary depends upon how promptly proxies are returned. We urge you to send in your proxy without delay.
What happens if a change to the annual meeting is necessary due to exigent circumstances?
While we have every intention of holding the annual meeting in person, if unexpected circumstances, including the continuing public health crisis relating to COVID-19, make it reasonable, prudent and advisable to
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do so, our Board of Directors may determine to change the meeting to a virtual meeting or change the date, time or location for the meeting. If we need to take such action, we will issue a press release notifying our stockholders of such development, which will also be available at www.brtapartments.com. A change to the meeting date, time, place or format will have no impact on our stockholders’ ability to provide their proxy by using the Internet or telephone or by completing, signing, dating and mailing their proxy card, each as explained in this proxy statement.
What is householding?
Stockholders who share the same address and last name may receive only one copy of the proxy materials unless we, in the case of stockholders of record, or such stockholder’s broker, bank or nominee, in the case of stockholders whose shares are held in street name, receive contrary instructions. This practice, known as “householding,” is designed to reduce printing and mailing costs. Stockholders desiring to discontinue householding and receive a separate copy of the proxy materials, may (1) if their shares are held in street name, notify their broker, bank or nominee or (2) if they are stockholders of record, direct a written request to: BRT Apartments Corp., 60 Cutter Mill Road, Suite 303, Great Neck, NY 11021, Attn: Office of the Corporate Secretary.
When are stockholder proposals due for the 2024 annual meeting?
We expect that our 2024 annual meeting of stockholders will be held in June 2024.
Our bylaws require that we be given advance written notice of nominations for election to our board and other matters which stockholders wish to present for action at an annual meeting of stockholders (other than matters included in our proxy materials in accordance with Rule 14a-8(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The Office of the Corporate Secretary must receive such notice, as well as the information and other materials required by our bylaws, at our principal executive office not later than 5:00 PM, Eastern Time, on December 29, 2023 and no earlier than November 30, 2023 for matters or nominations to be properly presented at the 2024 annual meeting of our stockholders.
Stockholders who wish to have proposals considered for inclusion in the proxy statement and form of proxy for our 2023 annual meeting pursuant to Rule 14a-8 under the Exchange Act must cause their proposals to be received in writing by the Office of the Corporate Secretary at the address set forth on the cover page of this proxy statement no later than December 29, 2023. Any proposal should be addressed to the Office of the Corporate Secretary and may be included in next year’s proxy materials for our 2024 annual meeting of stockholders only if such proposal complies with the rules and regulations promulgated by the Securities and Exchange Commission, which we refer to as the “SEC.” We are not required to include in our proxy statement or our proxy card relating to any annual meeting any nominee for director or stockholder proposal that does not meet all of the requirements for inclusion established by the SEC.
What other information about us is available?
Stockholders can call (516) 466-3100 or write to us at 60 Cutter Mill Road, Suite 303, Great Neck, NY 11021, Attention: Office of the Corporate Secretary, to request a copy of our Annual Report on Form 10-K. This and other important information about us is also available on our web site which is located at www.brtapartments.com. Our 2022 Annual Report to Stockholders for 2019 accompanies this proxy statement.
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GOVERNANCE OF OUR COMPANY
General
Our business, property and affairs are managed by or under the direction of our Boardboard and its committees. Directors are kept informed about our business through discussions with our Chairman,chairman, our Chief Executive Officerchief executive officer and our other officers, by reviewing materials provided to them and by participating in meetings of the Board and its committees. During 2022, the Transition Period and in 2019, the Boardboard held one meeting and four meetings, respectively, and each director during each of such periods, attended at least 75% of the aggregate number of meetings of the Boardboard and all committees on which such director served during such periods. We typically schedule a Boardboard meeting in conjunction with our annual meeting of stockholders and encourage our directors to attend such meeting – 70%meeting— 73% of our directors attended our 20192022 annual meeting of stockholders.
Code of Business Conduct and Ethics
We have adopted an amended and restated code of business conduct and ethics, which we refer to as the “Conduct Code”, that applies to all of our directors, officers and employees. The Conduct Code covers a variety of topics, including conflicts of interest, confidentiality of information, and compliance with laws and regulations. See “Additional Information and Notice of Internet Availability” to obtain access for or copies of our Conduct Code. During the Transition Period and in 2019,2022, there were no waivers of the provisions of the Conduct Code with respect to any of the persons subject thereto. We will post any amendments to, or waivers of, the Conduct Code on our website.
Risk Oversight
Management is responsible for the day-to-day management of risks we face. Our Boardboard has overall responsibility for overseeing risk management with a focus on the more significant risks facing us. Our audit committee oversees risk policies and processes related to our financial statements, financial reporting processes and liquidity risks;risk, and other risks presented to it from time-to-time by management; our nominating and corporate governance committee, which we refer to as the “nominating committee,” oversees corporate governance risks; and our compensation committee oversees risks relating to remunerationthe compensation of our officers and employees.full-time executive officers. The compensation committee does not believe that the compensation programs which are in place give rise to any risk that is reasonably likely to have a material adverse effect on us.
A portion of each quarterly meeting of the audit committee is devoted to reviewing the status of our properties and other matters (including related party transactions) which might have a material adverse impact on current or future operations. An executive officer reports to the committee regarding the activities of our disclosure controls and procedures committee – this committee is comprised primarily of the individuals responsible for our financial and regulatory reporting, meets approximately four times a year and is responsible for identifying areas of risk and in particular, risks with respect to disclosure controls and internal controls over financial reporting. In addition, an executive officer, our internal auditor and the independent registered public accounting firm reviewing or auditing, as the case may be, our financial statements, reports to the committee with respect to our compliance with our internal control policies in order to ascertain that no failures of a material nature have occurred. This process assists the audit committee in overseeing the risks related to our financial statements and the financial reporting process.
At Boardboard meetings, the directors review significant risk issues brought to their attention by management and committees of the Board.board.
Leadership Structure
Our company is led by Israel Rosenzweig, Chairman of our Board, whom we refer to as our Chairman, and Jeffery A. Gould, President and Chief Executive Officer, whom we refer to as our Chief Executive Officer. The Boardboard believes that: (i) separating the role of Chairman and Chief Executive Officer is the most appropriate structure at this time because it makes the best use of the abilities of Messrs. Rosenzweig and Gould; and (ii) this leadership structure provides appropriate risk oversight of our activities.
Committees of the Board
Our Boardboard has three standing committees: audit, compensation and nominating. The Boardboard has adopted charters for these committees which require that they be comprised of at least three independent directors and, in the case of the audit committee, also requires that at least one member of such committee qualify as a “financial
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expert.” All of the members of each committee were independent during their period of service on such committee and in the case of the audit committee, each such member was also financially literate. The Boardboard has also adopted corporate governance guidelines that address the make-up and functioning of the Boardboard and its committees. See “Additional Information and Notice of Internet Availability” to obtain access for or copies of our corporate governance guidelines and committee charters.
The table below provides membership and meeting information for each of our committees for 2019:2022:
Name
Audit
Compensation
Nominating
Audit
Compensation
Nominating
Carol Cicero
 
 
 
Alan H. Ginsburg
 
 
 
 
Louis C. Grassi
Chair*
 
Chair*
 
Gary Hurand
 
Chair
 
Chair
Jeffrey Rubin
 
Chair
 
 
Chair
 
Jonathan H. Simon
 
 
 
 
 
Elie Weiss
 
Elie Y. Weiss
 
Number of Meetings
4
1
2
6
6
3
*
Audit committee financial expert.
Audit Committee
This committee is responsible for assisting the board in overseeing, among other things, (i) the integrity of our financial statements, (ii) our compliance with legal and regulatory requirements, (iii) our independent registered public accounting firm’s qualification and independence, (iv) the performance of our independent registered public accounting firm, (v) the performance of the accounting firm performing our internal control audit function, (vi) its responsibilities described under “— Risk Oversight”,and (v)(vii) the preparation of the audit committee report required by the SEC for inclusion in this proxy statement. This committee is also responsible for the selection and engagement of our independent registered public accounting firm, for approving the fees payable to such firm, and for approving related party transactions.
Compensation Committee
This committee reviews(i) determines the base salary, annual bonus and makes recommendations and/or determinations with respectperquisites paid to our full-time executive officers, the salaries, bonuses and stock awards offees paid to our directors, the fees for the Services (as described in “Executive Compensation – Compensation Setting Process – Part Time Executive Officers – Services), the grant of awards pursuant to our equity based plans and full-time named executive officers.(ii) performs the risk oversight function described in “ — Risk Oversight”.
Nominating Committee
This committee’s principal responsibilities include proposing to the Board a slate of nominees for election to the Boardboard at the annual meeting of stockholders, recommending committee assignments to the Board,board of directors, making a recommendation to the Boardrecommendations with respect to the independence of each director and nominee for directors, identifying and recommending candidates to fill vacancies on the Boardboard or committees thereof, between annual meetings of stockholders, overseeing Board and committeeboard performance evaluations, proposing a slate of officers to the directors for election at the annual meeting of the Boardboard, its risk oversight responsibilities described in “ — Risk Oversight”, and monitoring corporate governance matters, including overseeingand recommending changes to our corporate governance guidelines.
Director Qualifications
The Boardboard believes that it should be comprised of directors with complementary backgrounds, and that directors should, at a minimum, have expertise that may be useful to us. Our nominating committee considers the personal and professional attributes and the business experience of each candidate for director to promote diversity of expertise and experience among our directors and will give strong consideration to nominating a woman to fill any vacancy in our Board.directors. Additionally, directors should possess the highest personal and professional ethics and should be willing and able to devote the required amount of time to our business.
When considering candidates for director, the nominating committee will take into account a number of factors, including the following:
Independence from management;
Whether the candidate has relevant business experience;
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Judgment,When considering candidates for director, the nominating committee will take into account various factors, including the following:
the candidate’s ability to qualify as an independent director;
whether the candidate has relevant business experience;
the candidate’s judgment, skill, integrity and reputation;
Financial and accounting background, to enable the committee to determine whether the candidate would be suitable for audit committee membership;
Executive compensationhas a background to enablein accounting or finance or other skills deemed relevant by the committee to determine whether the candidate would be suitable for compensation committee membership;board; and
Thethe size and composition of the existing board.
The nominating committee will consider candidates for director suggested by stockholders, (provided that the advance notice and other requirements set forth in our bylaws (collectively, the “Advance Notice Provisions”) have been followed), applying the criteria for candidates described above, and considering the additional information referred to below and evaluating such nominees in the same manner as other candidates.below. Stockholders wishing to suggest a candidate for nomination for election as a director should write to the Office of the Corporate Secretary and in addition to including the information called for by, and complying with the requirements of, the Advance Notice Provisions, should include:
Aa statement that the writer is a stockholder and is proposing a candidate for consideration by the committee;
Thethe name of and contact information for the candidate;
Aa statement of the candidate’s business and educational experience;
Informationinformation regarding each of the factors listed above sufficient to enable the committee to evaluate the candidate;
Aa statement detailing any relationship between the candidate and any of our competitors;
Detaileddetailed information about any relationship or understanding between the proposing stockholder and the candidate; and
Aa statement that the candidate is willing to be considered and willing to serve as a director if nominated and elected.
Before nominating an incumbent director for re-election at an annual meeting of stockholders, the nominating committee will consider:
The director’s performance on the Board; and
Whether the director’s re-election would be consistent with our corporate governance guidelines.
When seeking candidates for director, the nominating committee may solicit suggestions from management, incumbent directors or others. The committee or its chairmanchairperson will interview a candidate if it is believed the candidate might be suitable to be a director. The nominating committee may also ask the candidate to meet with management. If the nominating committee believes a candidate would be a valuable addition to the Board, it will recommend the candidate’s election to the Board.
The nominating committee generally intends to recommend that the Board nominate incumbent directors who the committee believes will continue to make important contributions to us, inasmuch as the committee believes that the continuing service of qualified incumbents promotes stability and continuity, giving us the benefit of the familiarity and insight into our affairs that such directors have accumulated during their tenure, while contributing to the Board’sboard’s ability to work as a collective body.
Independence of Directors
The Board affirmatively determined that for the purposes of the corporate governance requirements of the New York Stock Exchange and applicable SEC requirements, each of (i) Carol Cicero, Alan H. Ginsburg, Louis C. Grassi, Gary Hurand, Jeffrey Rubin, Jonathan H. Simon and Elie Y. Weiss, constituting 60%approximately 64% of our directors, and (ii) the members of our audit, compensation and nominating committees, are independent. The Board based these determinations primarily on a review of the responses of our directors to questions regarding employment and compensation history, affiliations and family and other relationships, discussions with directors and relevant facts and circumstances provided to management of any relationships bearing on the independence of a director.
In evaluating independence, the board applied the independence standards of Sections 303A.01 and 303A.02 of the New York Stock Exchange Listed Company Manual (the “NYSE Manual”), as well as our categorical independence standard included in our corporate governance guidelines. The board also applied, with respect to the: (i) audit committee, the independence standards imposed by Rule 10A-3 promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Section 303A.07(a) of the NYSE Manual, and
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(ii) compensation committee, the independence standards imposed by Rule 10C-1 promulgated under the Exchange Act and Section 303A.02(a)(ii) of the NYSE Manual. See “Additional Information and Notice of Internet Availability of Proxy Materials” for information about accessing our corporate governance guidelines.
In evaluating theGary Hurand’s independence, of Messrs. Ginsburg, Grassi and Hurand, the Board was aware that (i) these individuals or members of their families have passive investmentsa family entity in which his wife has a significant interest owns a preferred limited partnership interest in Gould Investors orL.P. with a stated redemption value of approximately $2.9 million and that several of Mr. Hurand’s family members and their affiliates have invested an aggregate of approximately $1.1 million in entitiesinvestment funds managed by affiliates of Gould Investors, (ii)Investors. In concluding that Mr. Hurand is independent, the agreement enteredBoard took into in 2019 between Gould Investorsaccount, among other things, the limited voting rights associated with these interests and an entity owned by membersthat no member of the Hurand family, including Mr. Hurand’s family with respect to the interest that such family entityHurand, has any management involvement in Gould Investors and (iii) the services provided, and to be provided, by the company of which Mr. Grassi is chief executive officer, to Gould Investors and an entity managed by an affiliate of Gould Investors. Gould Investors is an affiliatea significant stockholder of ours and is primarily engaged in the ownership and operation of real estate properties held for investment. See “Certain Relationships and Related Transactions.”
Compensation Committee Interlocks and Insider Participation
None of the members of the compensation committee has ever been an officer or employee of our company or any of our subsidiaries or has had any relationship with us that would require disclosure under Item 404 of Regulation S-K (Certain Relationships and Related Party Transactions).
Compensation of Directors
The following table sets forth the cash compensation payable during the Transition Period andpaid in 20192022 to the directors for service on the Boardboard and its committees, all of whom, except as indicated in footnote 41 below, are non-management directors (i.e., those directors who are not employees or officers of ours or our affiliates):
 
Committee
 
Committee
Board
Audit
Compensation
Nominating
Board
Audit
Compensation
Nominating
Annual retainer(1)
$20,000
$5,000
$4,000
$3,000
$23,000
$5,750
$4,600
$3,450
Presence in-person at meeting(2)
1,250
1,000
1,000
1,000
1,450
1,150
1,150
1,150
Presence by telephone at meeting(3)
750
750
750
750
875
875
875
875
Chairman’s annual retainer(1)
265,000(4)
10,000
8,000
4,000
282,225(1)
11,500(2)
9,200(2)
4,600(2)
(1)
The committee chairman receives both the annual retainer and the annual retainer for serving as chairman of such committee. Effective as of January 1, 2020, the annual retainer for service on the Board and the audit, compensation and nominating committees is $23,000, $5,750, $4,600 and $3,450, respectively.
(2)
Effective January 1, 2020, the fees for participating in-person at Board and committee meetings is $1,450 and $1,150, respectively.
(3)
Effective January 1, 2020, the fee for participating by telephone at Board and committee meetings is $875 per meeting.
(4)
Reflects the compensation paid to Israel Rosenzweig, a management director, for his service as Chairmanchairman of our Board. Effective January 1, 2020, such retainer was increased to $280,900.board. See “Executive Compensation—Chairman of the Board’s Compensation.CompensationFor information regarding additional compensation paid to Mr. Rosenzweig, seeandCertain Relationships and Related Transactions..
(2)
The committee chairman receives the annual retainer and the annual retainer for serving as chairman of such committee. In 2023, the fee for serving as chairman of the audit committee or compensation committee is $14,500.
In addition, in 2019, eachon an annual basis, non-management director wasdirectors are awarded 3,900 shares of restricted stock under our 2018 Incentive Plan.stock. The restricted stock has a five-year vesting period, subject to acceleration upon the occurrence of specified events, during which period the ownerholder is entitled to vote and receive distributions, if any, on such shares. In 2022 and 2023, each non-management director was issued 4,100 shares of restricted stock. Non-management directors who reside outside of the local area in which our executive office is located are reimbursed for travel expenses incurred in attending Board and committee meetings.
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The following table sets forth the cash and non-cash compensation paid to our directors for their service in such capacity in 2019 and the Transition Period,2022, all of whom, except for Israel Rosenzweig, are non-management directors:
Year
Fees
Earned
or Paid
in Cash
($)(1)
Stock
Awards
($)(2)
All
Other
Compensation
($)
Total
($)
Fees
Earned
or Paid
in Cash
($)(1)
Stock
Awards
($)(2)
Total
($)
Alan H. Ginsburg
2019
 
27,750
33,130
60,880
2018
(T)
7,500
7,500
Carol Cicero
28,225
28,225
Alan Ginsburg
35,475
87,125
122,600
Louis C. Grassi
2019
 
48,000
33,130
81,130
55,575
87,125
142,700
2018
(T)
12,750
12,750
Gary Hurand
2019
 
39,500
33,130
72,630
47,300
87,125
134,425
2018
(T)
10,250
10,250
Israel Rosenzweig
2019
 
265,000(4)
39,526
—(3)
304,526
282,225(3)
236,559(4)
518,784
2018
(T)
62,500
—(3)
62,500
Jeffrey Rubin
2019
 
37,500
33,130
70,630
46,400
87,125
133,525
2018
(T)
10,250
10,250
Jonathan H. Simon
2019
 
29,250
33,130
62,380
36,625
87,125
123,750
2018
(T)
8,250
8,250
Elie Weiss
2019
 
36,000
33,130
69,130
2018
(T)
9,750
9,750
Elie Y. Weiss
43,550
87,125
130,675
(1)
This table does not reflect: (a) the compensation we paid Jeffrey A. Gould, our President, Chief Executive Officer and a director; Fredric H. Gould, a director; and Matthew J. Gould, an executive officer and director; and (b) compensation paid to Fredric H. Gould, Matthew J. Gould and Israel Rosenzweig by Majestic Property Management Corp. (“Majestic Property”), which is wholly-owned by Fredric H. Gould. See “Executive Compensation—Summary Compensation Table” and “Certain Relationships and Related Transactions” for information regarding the compensation paid these individuals.
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(2)
Represents the aggregate grant date fair value computed in accordance with Accounting Standards Codification Topic 718 – Stock Compensation, which we refer to as “ASC Topic 718”. Generally, the aggregate grant date fair value is the amount that we expect to expense in our financial statements over the award’s vesting schedule. These amounts reflect our accounting expense and do not correspond to the actual value that will be realized by these directors.
(3)
With respect to Mr. Rosenzweig, excludesReflects the retainer paid for serving as Chairman of the Board. Excludes fees for Services (as defined in “Executive Compensation – General”) of $57,900$63,840 for 2019 and $13,782 for the Transition Period.2022. See “Executive Compensation – Compensation—General” and “Certain Relationships and Related Transactions.”
(4)
Reflects the retainer paid for servinggrant date fair value of 2,734 shares of restricted stock and 10,412 shares subject to restricted stock units, which we refer to as Chairman.RSUs (excluding the peer group adjustment) as described in “Executive Compensation – Grant of Plan Based Awards”) that vest in three-years subject to the satisfaction of performance and/or market conditions.
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The table below shows the aggregate number of unvested stock awards held by the named directors and the value thereof as of the dates indicated:December 31, 2022:
Unvested Stock
Awards (#)
At December 31
Market Value
of Unvested
Stock
Awards ($)
At December 31,
Name
2019
2018
2019
2018
Unvested Stock
Awards (#)
Market Value
of Unvested
Stock
Awards ($)(1)
Carol Cicero
Alan H. Ginsburg(1)(2)
17,900
17,250
303,763
197,340
19,825
389,363
Louis C. Grassi(1)(2)
17,900
17,250
303,763
197,340
19,825
389,363
Gary Hurand(1)(2)
17,900
17,250
303,763
197,340
19,825
389,363
Israel Rosenzweig(2)(3)
52,888
54,903
897,509
628,090
Israel Rosenzweig(3)
47,764
938,085
Jeffrey Rubin(1)(2)
17,900
17,250
303,763
197,340
19,825
389,363
Jonathan H. Simon(1)(2)
17,900
17,250
303,763
197,340
19,825
389,363
Elie Weiss(1)
17,900
17,250
303,763
197,340
Elie Y. Weiss(2)
19,825
389,363
(1)
In January 2020, 2021,The closing price on the NYSE on December 30, 2022 March 2023 and January 2024, 3,250 shares, 3,500 shares, 3,625 shares, 3,625 shares and 3,900 shares are scheduled to vest, respectively.for a share of our common stock was $19.64.
(2)
In January 2020, 2021, 2022, March 2023, and January 2024, 5,2002025, 2026 and 2027, 3,625 shares, 4,1403,900 shares, 3,4504,200 shares, 3,1634,000 shares, and 3,1854,100 shares are scheduled to vest, respectively.
(3)
Includes up to 33,750Mr. Rosenzweig is the Chairman of our Board. In March 2023, January 2024 and 2025, January and June 2026, and January 2027, the following shares of common stock underlying restricted stock units, which we referare scheduled to asvest: 3,163 shares, 3,185 shares, 3,055 shares, 2,803, 12,000 and 2,734 shares, respectively. In each of March 2024 and June 2025, 20,824 shares (excluding the peer group adjustment) underlying RSUs are scheduled to vest, in September 2021, subject to satisfaction of market and/or performance conditions. RSUs include dividend equivalents rights. See “Executive Compensation – Components of Executive Compensation—Long-Term Equity and Long-Term Equity Incentive Awards”, “Executive Compensation–Outstanding Equity Awards at Fiscal Year-End” and note 10 of our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 20192022 (the “Annual Report”).
Non-Management Director Executive Sessions
In accordance with New York Stock Exchange listing standards, our non-management directors meet regularly in executive sessions without management. The person who presides over executive sessions of non-management directors is one of the committee chairmen. To the extent practicable, the presiding director at the executive sessions is rotated among the chairmen of the Board’s committees.
Communications with Directors
Stockholders and interested persons who want to communicate with our Boardboard or any individual director can write to:
BRT Apartments Corp.
60 Cutter Mill Road, Suite 303
Great Neck, NY 11021
Attention: Office of the Corporate Secretary
Your letter should indicate that you are a stockholder of BRT Apartments Corp. Depending on the subject matter, the Office of the Corporate Secretary will:
Forward the communication to the director or directors to whom it is addressed;
Attempt to handle the inquiry directly; for example where it is a request for information about our company or it is a stock-related matter; or
Not forward the communication if it is primarily commercial in nature or if it relates to an improper or irrelevant topic.
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At each Board meeting, the Secretary will present a summary of communications received, if any, since the last meeting and make those communications available to the directors on request.
In the event that a stockholder, employee or other interested person would like to communicate with our non-management directors confidentially, they may do so by sending a letter to “Non-Management Directors” at the address set forth above. Please note that the envelope should contain a clear notation that it is confidential.
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INFORMATION REGARDING BENEFICIAL OWNERSHIP OF PRINCIPAL
STOCKHOLDERS, DIRECTORS AND MANAGEMENT
The following table sets forth information concerning our shares owned as of the close of business on April 24, 20203, 2023 by (i) each person beneficially owning five percent or more of our outstanding shares, (ii) each director, (iii) each executive officer named in the Summary Compensation Table, and (iv) all directors and executive officers as a group.group:
Name of
Beneficial Owner
Number of
Shares
Beneficially
Owned(1)
Percent
of Class
Alan H. Ginsburg
46,130
*
Fredric H. Gould(2)(3)
3,374,736
19.6
Jeffrey A. Gould(2)(4)
3,444,417
20.0
Matthew J. Gould(2)(5)
3,424,802
19.9
Mitchell Gould
177,554
1.0
Louis C. Grassi
51,693
*
Gary Hurand(6)
388,895
2.3
David W. Kalish(7)
501,517
2.9
Israel Rosenzweig(8)
713,855
4.2
Steven Rosenzweig
40,308
*
Jeffrey Rubin(9)
52,860
*
Jonathan H. Simon
46,130
*
Elie Weiss(10)
63,471
*
George Zweier
80,190
*
Gould Investors L.P(11)
2,989,898
17.4
Black Rock, Inc.(12)
978,929
5.7
All directors and executive officers as a group (17 persons)
6,680,181
38.5
Name of Beneficial Owner
Number of
Shares
Beneficially
Owned(1)
Percent
of Class
Carol Cicero
4,100
*
Alan H. Ginsburg
58,330
*
Fredric H. Gould(2)
403,972
2.1
Jeffrey A. Gould(3)
3,920,713
20.4
Matthew J. Gould(4)
3,905,773
20.4
Mitchell Gould
200,762
1.0
Louis C. Grassi
66,773
*
Gary Hurand(5)
384,125
2.0
David W. Kalish(6)
562,240
2.9
Israel Rosenzweig(7)
753,829
3.9
Jeffrey Rubin(8)
65,060
*
Jonathan H. Simon(9)
59,330
*
Elie Y. Weiss(10)
76,789
*
George Zweier
119,240
*
Gould Investors L.P(11)
3,357,244
17.5
All directors and executive officers as a group (18 persons)
7,329,784
38.3
*
Less than 1%
(1)
Shares are listed as beneficially owned by a person who directly or indirectly holds or shares the power to vote or to dispose of the shares. A person is deemed a beneficial owner if he or she has the right to acquire beneficial ownership of shares within 60 days of April 3, 2023. The percentage of beneficial ownership is based on 17,176,40119,144,381 shares outstanding as the close of business on April 24, 2020.3, 2023.
(2)
Includes 291,76011,500 shares owned byin a pension plan over which this individual shares voting and investment power.
(3)
Includes (i) 33,259 shares owned by a trust for the benefit of his grandchildren of which he is athe trustee (as to which shares he disclaims beneficial interest), (ii) 25,260and the beneficiary is his spouse. Excludes (i) 10,012 shares owned by a partnership in which an entity wholly owned by him is the managing general partner,his spouse and (iii)(ii) 2,468 shares held by him as custodian for a grandson, (as to which shares he disclaims beneficial interest). Also includes 2,989,898 shares owned by Gould Investors, as Mr. Fredric H. Gould is the sole owner of the managing general partner of Gould Investors. Excludes 7,512 shares owned by his spouse, as to which shares she has sole voting and investment power and as toeach of which he disclaims beneficial ownership.
(4)(3)
Includes 23,469 shares owned by a charitable foundation of which he is a director, as to which shares he has shared voting and investment power, 33,25934,523 shares owned by a trust for the benefit of his children and other relatives of which he is a trustee (as to which he disclaims beneficial ownership), 26,219 shares owned by a limited liability company of which he is a manager, and 2,989,8983,357,244 shares owned by Gould Investors. He is a director and senior vice president of the managing general partner of Gould Investors.
(5)(4)
Includes 118,432 shares owned directly which are pledged as collateral for a personal loan, 20,874 shares owned by a pension trust over which Matthew J. Gouldhe has shared voting and investment power, 23,469 shares owned by a charitable foundation of which he is a director, as to which shares he has shared voting and investment power, 33,25934,523 shares owned by a trust for the benefit of his children and other relatives, of which he is a trustee (as to which he disclaims beneficial ownership), 26,219 shares owned by a limited liability company of which he is a manager, and 3,357,244 shares owned by Gould Investors. He is Chairman of the Board of the managing general partner of Gould Investors.
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beneficial ownership), and 2,989,898 shares owned by Gould Investors. Matthew J. Gould is Chairman of the Board of the managing general partner of Gould Investors.
(6)(5)
Includes 101,94473,322 shares owned by limited liability companies in which Mr. Hurand is a member, and 161,479163,591 shares owned by a corporation in which Mr. Hurand is an officer and shareholder.shareholder, and 4,770 shares in a trust of which Mr. Hurand is a trustee. Mr. Hurand shares voting and investment power with respect to the shares owned by these entities.
(7)(6)
Includes 312,634 shares owned by the pension and profit sharing trusts of BRT Apartments Corp., REIT Management Corp. and Gould Investors as to which Mr. Kalish,he, as trustee, has shared voting and investment power. Does not include 4,870Excludes 5,051 shares owned by his spouse, as to which shares she has sole voting and investment power and as to which he disclaims beneficial ownership.
(8)(7)
Includes 41,194 shares owned by the pension trust of Gould Investors L.P. and 250,566 shares owned by REIT Management Corp. pension and profit sharing trusts, as to which Mr. Rosenzweig,he, as trustee, has shared voting and investment power.
(9)(8)
Includes 13,10234,410 shares pledged as collateral for a line of credit. No amounts are outstanding on such credit line.
(9)
Excludes 425 shares held by his spouse in trust for a minor.
(10)
Excludes 271 shares owned by his spouse, as to which shares he disclaims beneficial ownership.
(11)
Such person’s address is: 60 Cutter Mill Road, Suite 303, Great Neck, NY 11021.
(12)
As of December 31, 2019, based (other than with respect to percentage ownership) on information set forth in Amendment No. 1 to Schedule 13G filed with the SEC on February 5, 2020 by this reporting person whose business address is 55 East 52nd Street, New York, NY 10055. This reporting person reported that it has sole voting power with respect to 963,292 shares and sole dispositive power with respect to 978,929 shares and that it does not share voting or dispositive power with respect to the shares it beneficially owns.
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PROPOSAL 1
ELECTION OF DIRECTORS
(Proposal 1)
The Boardboard is divided into three classes, each of which is elected for a staggered term of three years. Our Articles of Incorporation provides for ten directors, subject to increase or decrease as determined by the Board.board. The Boardboard may, following the annual meeting, increase the size of the Boardboard and fill any resulting newly created directorships.
At the annual meeting of stockholders, threefour Class III Directors will be elected to our Board.board. Each nominee Fredric H. Gould, Gary Hurand and Elie Y. Weiss,identified below has been recommended to our Boardboard by the nominating and corporate governance committee for election at the annual meeting and each nominee has been nominated by our Boardboard to stand for election at the annual meeting, to hold office until our 20232026 annual meeting and until his or her successor is elected and qualified. Class III Directors and Class III Directors will continue to serve as directors until our 20212025 and 20222024 annual meetings, respectively, and until their respective successors are duly elected and qualify. Proxies will not be voted for a greater number of persons than the number of nominees named in the proxy statement.
We expect each nominee to be able to serve if elected. However, ifIt is contemplated that all the nominees will stand for election. Should any nominee is unablebecome unavailable for election, all proxies (except proxies marked to serve asthe contrary) will be voted for the election of a director, the persons named in the proxy card may vote for any substitute nominee proposedrecommended by the Board.board of directors.
In an uncontested election, each nominee for director will be elected only if he or she receives the affirmative vote of a majority of the total votes cast “for,”“for” and “against” and “withheld” for such nominee. As set forth in our Corporate Governance Guidelines,corporate governance guidelines, any nominee for director who is an incumbent director but who is not elected by the vote required in the Bylaws, and with respect to whom no successor has been elected, is required to promptly tender his offer to resign to the Boardboard for its consideration. The nominating committee will recommend to the Boardboard whether to accept the offer to resign. No later than the next regularly scheduled Boardboard meeting to be held at least ten days after the date of the election, the Boardboard will decide whether to accept such offer and promptly and publicly disclose its decision. If the resignation is not accepted, the director will continue to serve until the next annual meeting of stockholders and until the director’s successor is duly elected and qualified or
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until the director’s earlier resignation or removal. If the resignation is accepted, the Boardboard will either leave such position vacant, reduce the size of the Boardboard or elect another individual to serve in place of the resigning director. The nominating committee and the Boardboard may consider any factors they deem relevant in deciding whether to accept a director’s resignation.
Nominees for Election as Class III Directors
Name
Class
Term to
Expire at
Annual
Meeting in
Carol Cicero
III
2026
Fredric H. Gould
III
2026
Gary Hurand
III
2026
Elie Y. Weiss
III
2026
Directors Whose Term Will Expire in 2023Terms are not Expiring
Name
Class
Term to
Expire at
Annual
Meeting in
Alan Ginsburg
I
2024
Jeffrey A. Gould
I
2024
Jonathan H. Simon
I
2024
Matthew J. Gould
II
2025
Louis C. Grassi
II
2025
Israel Rosenzweig
II
2025
Jeffrey Rubin
II
2025
The following table sets forth certain information regarding each nominee
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Nominees for election to the Board:Election as Directors
Name and Age
Principal Occupation for the past Five Years and
other Directorships or Significant Affiliations
Carol Cicero
63 years
Director since January 2022; From 2014 through 2021, Group Vice President and from 2000 through 2013, Area Vice President of RAM Partners, LLC, a full service real estate management firm that provides property management services, including the provision of such services for several of our multi-family properties; from 2013 through 2014, director of asset management at Arenda Capital Management, a real estate focused private investment firm. Ms. Cicero’s 30 years of multi-family property management experience led our nominating committee to conclude that she should continue to serve on our board.
Fredric H. Gould
84 years
88 Years
Director since 1983 and Chairman of our Board from 1984 through 2013; with respect to One Liberty Properties, Inc., Chairman of the Board of Directors from 1989 to 2013, Vice Chairman of the Board since 2013, Chief Executive Officer from 2005 to 2007, and President from 2005 to 2006;2006 of One Liberty Properties, Inc., an NYSE listed REIT focused on net leased commercial properties; Chairman of the Board of Georgetown Partners, Inc., managing general partner of Gould Investors, from 1997 to 2012 and director since 2013; President since 1986 of REIT Management Corp., former advisor to the Company;from 2013 through 2021; Director of EastGroup Properties, Inc., from 1998 through 2019. He is the father of Matthew J.Jeffrey A. Gould and Jeffrey A.Matthew J. Gould. Mr. Gould has been involved in the real estate industry for more than 50 years, as an investor, owner, manager, and as the chief executive officer of publicly traded real estate entities and real estate investment trusts.companies. He has served as a director of four real estate investment trusts, and as a former director and a member of the loan committee of two savings and loan associations. His knowledge and experience in business, finance, real estate tax, accounting and legal matters and his knowledge of our company’s business and history makes him an important member ofcompany led our Board.nominating committee to conclude that he should continue to serve on our board.
 
 
Gary Hurand
73 years
76 Years
Director since 1990; President of Dawn Donut Systems, Inc. since 1971; President of Management Diversified, Inc., a real property management and development company, since 1987; Director of Citizens Republic Bancorp Inc. and predecessor from 1990 through 2013. He is the father-in-law of Elie Y. Weiss. Mr. Hurand brings valuable business and leadership skills to the Board in light of hisHis extensive experience in commercial real estate and in business operations, and as a former director and member of the audit committee of a publicly traded financial institution.institution, led our nominating committee to conclude that he should continue to serve on our board.
 
 
Elie Y. Weiss
47
50 years
Director since 2007; engaged in real estate development since 1997; Since 2007, Mr. Weiss has served as CEO of Five Forty Real Estate, a family office that manages various investments, and since 2017, he has been a principal at Ponsky Capital Partners, a real estate private equity sponsor at which he is chair of the investment committee; From 1997-2007, Executive Vice President of Robert Stark Enterprises, Inc., a company engaged in the development and management of retail, office and multi-family residential properties from 1997 to 2007;properties; President of Real Estate for American Greetings from 2013 to 2017. Mr. Weiss is currently CEO of Five Forty Investments and a principal in a restaurant development and operating group, Paladar Restaurant Group. He is also actively engaged in managing his personal real estate investments. He is the son-in-law of Gary Hurand. His entrepreneurial real estate and entrepreneurialdiverse business experiences makes him a valuable member ofled our nominating committee to conclude that he should continue to serve on our board.
THE BOARD RECOMMENDS A VOTE FOR THE ELECTION OF CAROL CICERO, FREDRIC H. GOULD, GARY HURAND AND ELIE Y. WEISS AS CLASS III DIRECTORS.
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The following table sets forth certain information regarding directors whose terms will continue after the date of the annual meeting:
Class IContinuing Directors Whose Term Will Expire in 2021
Name and Age
Principal Occupation for the past Five Years and
other Directorships or Significant Affiliations
Alan H. Ginsburg
81 years
84 Years
Director since 2006; Chief Executive Officer since 1987 of The CED Companies, a private company which develops, builds and manages multi-family apartment communities. His more than 3035 years of experience as chief executive officer of a multi-family real estate developer/manager provides our boardhim with a long-term perspective onexpertise and in-depth knowledge of the real estatemulti-family property industry.
 
 
Jeffrey A. Gould
54
57 years
Director since 1997, President and Chief Executive Officer since 2002 and President and Chief Operating Officer from 1996 to 2001; Senior Vice President and director since 1999 of One Liberty Properties; Senior Vice President of Georgetown Partners, Inc., since 1996. He is the son of Fredric H. Gould and the brother of Matthew J. Gould. Mr. Jeffrey A. Gould’s experience in a broad range of real estate activities, including real estate evaluation and management, real estate acquisitions and dispositions, mortgage lending and his 15 years as our President enables him to provide key insights on strategic, operational and financial matters related to our business.
 
 
Jonathan H. Simon
54 years
Director since 2006; President and Chief Executive Officer since 1994 of The Simon Baron Development Group (f/k/a The Simon Development Group), a private company which develops, owns and manages a diverse portfolio of residential, retail and commercial real estate, primarily in New York City. His background in the real estate industry and in particular, his experience in real estate development, affords him an understanding of the challenges faced in real estate development activities which is helpful in our development and acquisition activities.
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Class II Directors Whose Term Will Expire in 2022
Name and Age
Principal Occupation for the past Five Years and
other Directorships or Significant Affiliations
Matthew J. Gould
60
63 years
Director since 2001 and a Senior Vice President since 1993. Vice President of REIT Management Corp., former advisor to the Company, since 1986;1993; from 1999 through 2011, Director and Senior Vice President, from 1989 through 1999, President, from 2011 through 2013, Vice Chairman and from 2013, Chairman of the Board of Directors of One Liberty Properties; from 1996 through 2012, President, and from 2013, Chairman of the Board of Georgetown Partners Inc. He is the sonLLC. Since 2019, Chief Executive Officer of Fredric H. Gould and brother of Jeffrey A. Gould. His experience inRainbow MJ Advisors, which manages real estate matters, includingloans and investments in the acquisitioncannabis industry, since 2021, a Director of Halsa Holdings LLC, which is engaged in commercial activities in such industry and salesince 2022, a Director of real property, mortgage financingMJ Real Estate Investment Trust, a private REIT that acquires interests in, and originates loans secured by, real estate management, makes him a valuable memberassets operated by state licensed cannabis operators. He brings to the board his extensive knowledge of our boardcompany and his more than 35 years of experience as real estate executive with expertise in its deliberations.evaluating, managing, financing, acquiring and selling various types of properties.
 
 
Louis C. Grassi
64
67 years
Director since 2003; ManagingSince 1980, managing partner and chief executive officer of Grassi & Co. CPAs, P.C. since 1980;, CPAs; Director of Flushing Financial Corp. since 1998 and serves as chairman of its audit committee. Mr. Grassi has been involved for more than 28 years in accounting and auditing issues.issues and has extensive management and leadership with private and public companies. His knowledge of financial and accounting matters and his experience as a director and memberchairman of the audit committee of a publicly traded financial institution providesequip him with the accounting and governance background and the skillskills needed to serve as the chairman and financial expert of our audit committee.committee and as our audit committee financial expert.
 
 
Israel Rosenzweig
72
75 years
Chairman of the Board since 2013, Director and Vice Chairman of the Board from 2012 through 2013 and Senior Vice President from 1998 through 2012; Vice President of Georgetown Partners, Inc., since 1997; from 2000 to 2009, President of GP Partners, Inc., an affiliate of Gould Investors L.P., which provided advisory services in the real estate and financial services industries to an investment advisor; Senior Vice President of One Liberty Properties Inc. since 1989. His experience as a lending officer at a major financial institution, his knowledge and experience in business, finance and accounting matters and his more than 34 years of experience in the real estate industryexperience provides theour Board with an experienced and knowledgeable chairman.
 
 
Jeffrey Rubin
51
54 years
Director since 2004; since 2009, President and CEO of The JR Group, which provides consulting services to the electronic payment processing industry; President and Chief Executive Officer of Premier Payments, a provider of credit
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Name and Age
Principal Occupation for the past Five Years and
other Directorships or Significant Affiliations
card processing services for merchants throughout the United States, from 2012 until its sale in 2015; President and director of Newtek Business Services, Inc., a provider of business services and financial products to small and medium sized businesses, from 1999 to 2008; Chief Executive Officer of Summit Processing Group LLC since 2008. Mr. Rubin’s experience as the president and a director of a public company and his experience in business and financial matters are valuableleadership experiences contribute to our companyhis ability to serve as the chairman of our compensation committeecommittee.
Jonathan H. Simon
57 years
Director since 2006; President and Chief Executive Officer since 1994 of The Simon Development Group and predecessors, a private company which develops, owns and manages a diverse portfolio of residential, retail and commercial real estate, primarily in his activities as a director.New York City. His 30 years of experience in the real estate industry affords him an understanding of the challenges we face.
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EXECUTIVEHIGHLIGHTS OF OUR COMPENSATION PROGRAM AND GOVERNANCE PRACTICES
Compensation Program
The following features of our executive compensation programand corporate governance programs are evidence of our commitment to good corporate governance practice – and compensation practices—we encourage you to read the more detailed information set forth herein:
WHAT WE DO
WHAT WE DO

Alignment of pay and performance. For the year ended December 31, 2019, our total stockholder return was 57.1% and Jeffrey A. Gould’s base compensation (i.e. salary, bonus and grant date fair value of restricted stock) as set forth in the Summary Compensation Table included herein increased 7.8% during the period beginning September 30, 2018 through December 31, 2019. For the three years ended December 31, 2019, our total stockholder return was 34.4% and Jeffrey A. Gould’s base compensation increased 16.1% during the period beginning September 30, 2017 through December 31, 2019.

Use rigorous performance goals.Only 44.4%56% of the long-term equity incentive awards (i.e., RSUs)RSUs awarded to our executive officers in 20162021 and 2022, excluding the impact of the peer group adjustment, would have vested as of December 31, 2019,2022, demonstrating the rigorous performance and market conditions established for suchour equity incentive awards.

Emphasize equity awards as a significant portion of the performance/incentive component of compensation. Long-term equity awards (i.e.(i.e., the grant date fair value of the restricted stock awarded in 20202023 for performance during2022 performance) and equity incentive awards (i.e., the 12 months ended December 31, 2019)grant date fair value of the RSUs awarded in 2022; the long-term equity awards and equity incentive awards are referred to collectively as the “Equity Awards”) accounted for 62.5%68%, 86% and 90% of the performance/incentive basedincentive-based comportment of compensation awarded to Mr.Jeffrey A. Gould, our CEO, Mitchell Gould, our Executive Vice President and George Zweier, our Chief Financial Officer, respectively, for 2019.2022.

Long-term equity
Equity awards as a growingsignificant component of annual base compensation. Long-term equity awards,In 2022, Equity Awards, as a percentage of base annual compensation (i.ei.e.., salary, cash bonus and the grant date fair value of the restricted stock awarded in 2020,Equity Awards), was 35%, 40% and 47% for 2019 performance,Jeffrey A. Gould, Mitchell Gould and in 2019, for 2018 performance, as applicable), increased for Mr. Gould to 20.2% in 2019 from 16.1% in 2018.George Zweier, respectively.

Mitigate undue risk in compensation programs. programs. The executive compensation program includes features that reduce the possibility of our executive officers, either individually or as a group, making excessively risky business decisions that could maximize short-term results at the expense of longer-term value.

Balance of short-term and long-term incentives.incentives. Our incentive programs provide an appropriate balance between shorter and longer-term incentives.

Capped equity award payouts. SharesThe number of shares that can be earned under our long-term equity incentive program are capped.

Independent compensation consultant. We engage an independent compensation consultant to advise the compensation committee on compensation matters.

Independent compensation committee. Our compensation committee is comprised entirely of independent directors and it oversees risks with respect to our compensation practices.

Clawback policy. We are entitled to recoup compensation or cause the forfeiture of compensation as more fully described under “—Clawbacks.”
Stock ownership guidelines. All of our named executive officers and non-management directors own a meaningful amount of our stock as required by these guidelines – see “– Components of Executive Compensation – Clawbacks”.Stock Ownership Guidelines.”
Diversity; Responsiveness to Stockholders’ Corporate Governance Comments. We are responsive to comments and concerns raised by our stockholders. In response to comments raised by stockholders regarding board diversity, we appointed Carol Cicero, a highly-qualified woman, as a director.
WHAT WE DON’T DO
WHAT WE DON’T DO

No employment agreements. None of our officers have employment agreements. Employment of all of our full-time executive officers is “at will.”

No severance arrangements. There are no severance or similar arrangements for our executive officers, other than accelerated vesting of shares of restricted stock and RSUs upon the occurrence of specified events (e.g., death, disability, retirement or change of control).

No golden parachute tax gross-ups. There are no excise tax gross ups or similar arrangements for our executive officers.
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No dividend or dividend equivalents on unearned equity incentive awards. No dividends are paid on the RSUs until the underlying shares are earned.

Anti-Hedging policy. We prohibit our directors, officers, employees and others from engaging in short sales involving our shares or hedging transactions — see “— Policy Prohibiting Hedging of our Securities.
No multi-year or guaranteed bonuses or equity grants. We do not pay guaranteed bonuses to anyone and currently have no guaranteed commitments to grant any equity-based awards. This ensures that we are able to base all compensation awards to measurable performance factors and business results.

No costly defined benefit pension or supplemental retirement plans. plans. We do not provide costly retirement benefits to our executive officers that reward longevity rather than contributions to our performance.
Total Stockholder Return
The following charts comparechart compares the cumulative return of our common stock with the Standard and Poor’s 500 index, SNL U.S. – EquityMSCI US REIT Index, MSCI US REITthe Nareit Apartment Index and the average of our Compensation Peer Group (as described under Executive Compensation – Compensation Consultant”) for the periods indicated. (We start with September 30 because until recently, our fiscal yearthree years ended on such date). These charts assume $100 was invested on September 30, 2018 and 2016, respectively, in our common stock and each of these indices, and assumes the reinvestment of dividends:December 31, 2022:

Pay-for-Performance AlignmentOur Total Stockholder Return Compared to the Total Stockholders Return of Other REITs
We believe that the total compensation paid to Jeffrey A. Gould,Based on a report prepared by KeyBanc Capital Markets, set forth below is our Chief Executive Officer and President, from September 30, 2018 through December 31, 2019 is appropriately aligned with our performance since ourranking in terms of total stockholder return over such period was 39.7% comparedin comparison to a 12.2% increase in Mr. Gould’s total compensation overapproximately 168 publicly traded REITs for each of the corresponding period.indicated periods ended December 31, 2022:

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EXECUTIVE COMPENSATION
General
We describe below our compensation objectives and policies as applied to our chief executive officer, chief financial officer and our three other most highly compensated officers named in the Summary Compensation Table (collectively, the “named executive officers”) in 2019.. This discussion focuses on the information contained in the compensation tables that appear in this proxy statement but also describes our historic compensation structure and practices to enhance an understanding of our executive compensation disclosure. Generally,programs.
Historically, except with respect to equity based awards which were determined by our compensation committee, oversees our compensation program, recommends to our Board for its approvaldeterminations (i.e., the compensation of our full-time executive officers, employed by us on a full-time basisthe annual fee paid to the chairman of our board of directors, the grants of Equity Awards, and the compensation paid those performingfee for Services (as such term is described below). Our audit committee reviewsin “ – Compensation Setting Process – Part Time Executive Officers – Services”), were made by our Board after taking into account the appropriateness of the allocation to us under a shared services agreementrecommendations of the compensation of executive officers who perform services for us on a part-time basis andand/or audit committee. In late 2022, our board delegated to the compensation committee the authority to make these compensation determinations. As a result (i) base salary, perquisites and fees for Services to be paid for the Services. Historically, another element of our compensation program was the fee paid by us to our former advisor, REIT Management, pursuant to the amended and restated advisory agreement, as amended, which we refer to as the “advisory agreement,” and the related paymentin 2022 were recommended by such advisor ofcommittee and approved by the board in late 2021 and (ii) bonuses for 2022, which were paid in early 2023, were determined by the compensation to certain of our executive officers. The services the former advisor performed for us included, among other things, participatingcommittee in our property acquisition analysis (which included executives of REIT Management serving on our investment committee), property disposition consultation and review, developing and maintaining banking and financing relationships, providing investment advice, long-term planning and consulting with our executives and employees in other aspects of our business, as required. Effective as of December 31, 2015, the advisory agreement was terminated and in lieu thereof, we retained certain related parties on an at-will basis to continue to perform the services, which we refer to as the Services, previously provided pursuant to the advisory agreement.
late 2022.
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For the past several years, we have usedWe use the following compensation structure with respect to the compensation paid by us to our executive officers:
executive officers who devote all, or substantially all, their business time to our affairs are compensated directly by us. The named executive officers who fit into this category are Jeffrey A. Gould, our President and Chief Executive Officer, Mitchell Gould, our Executive Vice President and George Zweier, our Vice President and Chief Financial Officer. These named executive officers are involved on a full-time basis in our multi-family property activities, management of our other real estate assets, and/or financial reporting; and
executive officers who devote their time to us on a part-time basis, whose basic annual compensation (base salary, bonus, if any, and perquisites) is allocated to us under a shared services agreement based upon the estimated time each devotes to our business activities compared to the estimated time each devotes to the other parties to the shared services agreement. These executive officers perform services to us related primarily to legal, accounting, insurance and tax matters, corporate governance, SEC and New York Stock Exchange reporting and other regulatory matters, and consult with our executives and employees in areas involving multi-family property acquisitions, dispositions and financings, property management, and capital raising. These executive officers mayare also be compensated by us for their provision of the Services. See “Certain Relationships and Related Transactions.” David W. Kalish, Senior Vice President, Finance and Steven Rosenzweig, Vice President, respectively, areis the only named executive officer who fits into this category in 2022; and
executive officers who devote their time to us on a part-time basis, who are compensated for the Services, but do not receive basic annual compensation from us and whose basic annual compensation is not allocated to us under the shared services agreement. Matthew J. Gould is our only named executive officer who fit into this category.category in 2022.
The Role of Say-on-Pay
In reviewing our compensation philosophy and practices and in approving compensation for 2019,2021, the compensation committee was aware of the results of our March 2017June 2020 “say-on-pay” vote in which approximately 96.4%95.5% of the shares that voted on such proposal voted to approve our executive compensation determinations and practices. The compensation committee viewed such results as supportive of our compensation philosophy, practices and determinations.
Compensation Consultant
Our compensation committee is authorized by its charter to retain independent counsel, compensation and benefits consultants, and other outside experts or advisors. In 2022, our compensation committee retained Ferguson Partners Consulting L.P., which we refer to as “Ferguson”, to analyze the competitiveness of our compensation practices in a benchmarking study. Ferguson, a nationally recognized compensation consulting firm specializing in the real estate industry, has no relationship with us or any of our affiliates. (Ferguson also serves as the independent compensation consultant for One Liberty Properties).
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As part of its benchmarking evaluation, Ferguson compared our compensation practices to the following REITs, which we refer to as the “Compensation Peer Group”: Armada Hoffler Properties, Inc., CatchMark Timber Trust, Centerspace, Community Healthcare Trust Incorporated, CTO Realty Growth, Inc., Farmland Partners, Inc., Hersha Hospitality Trust, INDUS Realty Trust, Inc., Postal Realty Trust, Inc., UMH Properties, Inc., and Urstadt Biddle Properties Inc. The Compensation Peer Group is comprised of the following types of REITs: three diversified, one healthcare, one hotel, one land, one manufactured home, one multi-family, one shopping center, one specialized and one timber. The Compensation Peer Group was selected by Ferguson using the peer group it previously used in preparing its last report for the compensation committee, as adjusted in 2022 in consultation with management and the compensation committee. These adjustments generally eliminated certain companies that were in the process of being acquired or were significantly larger than us, and added REITs that were similar in size or based in New York.
Ferguson’s report, which was presented to the compensation committee in November 2022, analyzed BRT's executive team in a variety of ways, including benchmarking each individual compared to an appropriate benchmark (either by similar role and/or pay ranking level) as well as the executive team in the aggregate. The findings indicated that BRT's executive team, overall, was generally in line with the median of our Compensation Peer Group (in line defined as being +/ - 10% of the median).
Objectives of our Executive Compensation Program
The principal objectives of our compensation program for full-time executive officers are to: (a) retain highly experienced officers who have worked together for a long time and contribute to our success, (b) motivate these officers to contribute to the achievement of the Company’s success, (c) ensure that the total compensation paid to such officers is fair and competitive (b) retain highly experienced officers who have worked together for a long timeboth internally (i.e., within our company), and contributedexternally (i.e., with respect to our success, (c) motivate these officers to contribute to the achievement of the Company’s successpeers), and (d) align the interests of these executives and our stockholders. The compensation committee believes that relying on this principlethese objectives permits us to retain and motivate these officers.
With respect to senior executive officers whose compensation is allocated to us under the shared services agreement (i.e., part-time officers) it is our objective that each of these officers receives compensation which, as allocated to us, is reasonable for the services they perform on our behalf, and that these executives provide us with sufficient time and attention to meet our needs and to perform their duties on our behalf. The compensation committee believes that:
our part-time executive officers perform valuable services on our behalf, devote sufficient time and attention to our business needs, are able to fully meet our needs and perform their duties effectively; and
using part-time executive officers pursuant to the shared services agreement enables us to benefit from access to, and the services of, a group of senior executives with experience and knowledge in real estate acquisitions and dispositions, real estate management, finance (including mortgage financing), banking, legal (including SEC reporting), accounting and tax matters that an organization our size could not otherwise afford.
Compensation Consultant
Our compensation committee is authorized by its charter to retain independent counsel, compensation and benefits consultants, and other outside experts or advisors. In 2019, our compensation committee engaged FPL Associates L.P., which we refer to as “FPL”, to conduct, among other things, a comprehensive compensation
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study of several of our senior full-time executive officers. FPL, a nationally recognized compensation consulting firm specializing in the real estate industry, has no relationship with us or any of our affiliates, except that it also serves as the independent compensation consultant for One Liberty Properties, Inc., a NYSE listed REIT, which may be deemed an affiliate of ours.
In its analysis, FPL compared our compensation practices to the following REITs, which we refer to as the “Compensation Peer Group”: Armada Hoffler Properties, Inc., Bluerock Residential Growth REIT, Inc., CatchMark Timber Trust, Inc., Community Healthcare Trust Incorporated, Farmland Partners Inc., Hersha Hospitality Trust, Independence Realty Trust, Inc., Investors Real Estate Trust, UMH Properties, Inc., and Urstadt Biddle Properties Inc. FPL noted that it defines “in line” as +/- 10% variance from a particular statistic.
FPL’s report, which was presented to the compensation committee in November 2019 in connection with the committee’s determinations with respect to long-term equity compensation and bonuses to be awarded for 2019 and base compensation to be paid for 2020, concluded that (i) base salaries for the three full-time executive officers fell in line with the 75th percentile of the peer group by rank and role, (ii) total annual cash fell in line with the peer group by role and in between the 25th percentile and the median by rank, (iii) long-term awards lagged the 25th percentile of the peer group by rank and role, (iv) actual total annual renumeration lags the 25th percentile on a weighted average basis, and (v) BRT’s pay falls below the minimum of the peer group across a three-year period while performance over the same period ranks above the maximum of the peer group.
Compensation Setting Process
Full-Time Executive Officers
Since we have only eight full-time employees, weWe determine compensation for our full-time employees, including ournamed executive officers on a case- by-casecase-by-case basis and our compensation decisions include subjective determinations. We do not use formal quantitative performance targets to determine compensation, except with respect to RSUs which are equity based incentive awards that vest upon satisfaction of market and/or performance based conditions. Base salaries are determined immediately preceding the performance metrics establishedyear in connection with our RSUs, our compensation decisionswhich such salaries are subjective.
For our full-time executive officers,to be paid, cash bonuses, which are paid after taking into account the recommendationsPerformance Criteria (as described in the following paragraph) are determined at the end of the Chief Executive Officer play a significant roleyear in which services are rendered and paid in the compensation setting process, since hefollowing year, restricted stock is awareawarded for service in a particular year and granted in the following the year and RSUs are granted in June/July of each executive officer’s duties and responsibilities and is most qualified to assess the level of each officer’syear as an additional three-year performance in carrying out his duties and responsibilities. The Chief Executive Officer, prior to making recommendations to the compensation committee concerning each executive officer’s compensation, consults with other senior executive officers. incentive.
In considering base compensation and bonuses, the Chief Executive Officer and other senior executive officerswe assess an individual’s performance, which assessment is highly subjective, and our overall performance for the preceding year including, without limitation, the progress of our business in general, our multi-family property acquisition and disposition activities, our revenues, results
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of operations, funds from operations, adjusted funds from operations, total stockholder return, gains on property sales, the management of our real estate portfolio and subjective considerations (collectively, the “Performance Criteria”). Since executive officers have different responsibilities, no Performance Criteria is given moreThe weight thanassigned to any other. Based on the foregoing, the Chief Executive Officer proposes to the compensation committee with respect to each full-time executive officer, a base salary for the following year, a cash bonus applicable to the recently completed year (which is paid in the following year), the perquisites to be made available for the following year and the numberparticular element of shares of restricted stock to be awarded to each individual executive officer in the following year. The compensation committee reviews and discusses (including discussions without management’s participation), the CEO’s recommendations and takes into account the Performance Criteria. The compensation committee has discretion to accept, reject or modify the recommendations. The final decision by the compensation committee on compensation matters related to executive officers is reported to the Board, which can approve, modify or reject recommendation of the committee.
With respect to our Chief Executive Officer, the (i) chairman of the compensation committee and the Chief Executive Officer may meet to discuss the Chief Executive Officer’s compensation, and/or (ii) Chief Executive Officer or other senior executives may make recommendations to the compensation committee as to the appropriate level of compensation to be paid the Chief Executive Officer. The compensation committee then meets, without management, to discuss the Chief Executive Officer’s base salary for the following year, a cash bonus applicable to the recently completed year (which is paid in the following year), and the perquisites to be made available for the following year. The committee takes into account the Performance Criteria changes over time, and in its discretion, may take into account any compensationvaries based on, among other things, subjective factors and the Chief Executive Officer received from the parties to the shared services agreement. The compensation committee then reports its recommendations to the Board, whichofficer’s specific responsibilities.
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can approve, modify or reject the recommendation of the committee. The number of shares of restricted stock to be awarded to the Chief Executive Officer is considered and determined by the committee annually, at the same time the committee considers and approves all restricted stock awards to be made for that year.
Part-Time Executive Officers
Shared Services Agreement
Fredric H. Gould, the former chairman of our Board, is a principal executive and/or sole owner of each entity which participates with us in the shared services agreement. In such capacity, he, in consultation with our Chief Executive Officer and other senior executives, determines theThe annual base compensation of our part-time executive officers to be paid in the aggregate by one or more of the entities which are parties to the shared services agreement is determined by the senior officers (including one or more of Fredric H. Gould, Jeffrey A. Gould and Matthew J. Gould) of the entities which are parties to such agreement. Our audit committee reviews the allocations made under the shared services agreement to determine that the allocations have been made in accordance with the terms of this agreement and its conclusions are reported to the Board.board. See “Certain Relationships and Related Transactions.”
Services
Several of our part-time executive officers and a management director perform Services on our behalf. The term “Services” refers to the following: participating in our property analysis and approval process, property disposition consultation and review, developing and maintaining banking and financing relationships, providing investment advice, and long-term planning and consulting with our executives and employees in other aspects of our business, as required. Our Chief Executive Officer, in connection with other senior executive officers and a management directors,director, recommends to the compensation and/or audit committees,committee(s) and such committee determines the compensation to be paid for the performance of the Services by our part-time executive officers and others. One or more of such committees review and approve the individuals performing the Services and the amounts such individuals are to be compensated. Such committees and the Board have the authority to accept, modify or reject such recommendation and such determinations are approved by the Board.Services.
Components of Executive Compensation
The following table summarizes each element of executive compensation used in 2019 for our named executive officers based on the philosophy and process described in this proxy statement as well as each element’s link to our compensation philosophy.
Compensation
Element
Philosophy Statement
Retention
Reward
short-term
performance
Reward
long-term
performance
Align to
stockholder
interests
Participation of
part-time
executive
officers
Base Pay
We intend to provide base pay at least as competitive to our peers. Base pay maintains a standard of living, is used to compete in the market for talent and forms the foundation for our other reward vehicles.
X
Cash Bonus Plan
Rewards annual performance in the form of an annual cash bonus. The amount of the cash bonus is recommended by the compensation committee and approved by the Board.
X
X
X
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Compensation
Element
Philosophy Statement
Retention
Reward
short-term
performance
Reward
long-term
performance
Align to
stockholder
interests
Participation of
part-time
executive
officers
Pay-for-Performance Incentive Plan
Provides for long-term equity based incentive award in the form of RSUs that rewards, after five years and assuming a continued relationship with us, achievement of pre-established performance targets relating to absolute and relative compounded annual growth rate in total stockholder return and/or compounded annual growth rate in adjusted funds from operations.
X
X
X
X
Time-Based Restricted Stock Awards
Emphasis on retention while providing an opportunity for increased rewards as stockholder return increases. These awards vest on a cliff vesting basis after five years assuming a continued relationship with us.
X
X
X
X
Other Compensation and Benefits Programs
We offer benefits programs that provide health and retirement benefits for all employees.
X
The principal elements of our compensation program for our full-time executive officers in 20192022 were:
base salaries;
annual cash bonuses, which are available only to full-time executive officers and are provided in the form of a cash payment (and to the extent part-time executive officers are awarded cash bonuses by any of our affiliates that are party to the shared services agreement, our share of such bonuses is allocated to us pursuant to such agreement (see “Certain Relationships and Related Transactions—Related Party Transactions”);
compensation paid to part-time executive officers in connection with their performance of the Services;
long-term equity in the form of restricted stock;stock and long-term equity awards in the form of RSUs; and
special benefits and perquisites (i.e., contributions to defined contribution plan, additional disability insurance, long term care insurance, payment of education benefits and an automobile allowance (including insurance, maintenance and repairs)).
In determining 20192022 compensation, the compensation committee did not have a specific allocation goal between cash and equity-based compensation.
Base Salary
Full-Time Executive Officers
Base salary is the basic, least variable form of compensation for the job an executive officer performs and provides each full-time executive officer with a guaranteed annual income. Base salaries of executive officers compensated by us directly are generally targeted to be competitive with the salaries paid to executives
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performing substantially similar functions at other REITs with a market capitalization similar to ours, taking into consideration the region in which our executive officers are located. Any increase in base salary is determined on a case-by-case basis, is not based upon a structured formula and is based upon, among other considerations, (i) such executive’s current base salary, (ii) the recommendation of the Chief Executive Officer and other senior
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executive officers, (iii) our performance in the preceding year (e.g., acquisition, disposition and financing activities, revenues, net income, funds from operations, adjusted funds from operations, stock price performance, dividends and any one or more of the foregoing), (iv) the individual’s performance, (v) years of service, (vi) job responsibilities;responsibilities, and (vii) subjective factors.
Part-Time Executive Officers
Their annual base salaries are allocated to the entities which are parties to the shared services agreement, including us, based on the estimated time devoted by them to each entity that is a party to such agreement.
Bonus
Full-Time Executive Officers
We provide the opportunity for our full-time executive officers and other full and part-time employees to earn an annual cash bonus. We provide this opportunity both to reward our officers and employeesthese individuals for past performance and to motivate and retain talented people. We recognize that annual bonuses are almost universally provided by other companies with which we might compete for talent. Annual cash bonuses for our executive officers (including the three named executive officers who devote substantially all of their business time to our affairs) are determined on an individual basis based upontaking into account the Performance Criteria. These determinations are highly subjective. Once our compensation committee has approved
Part-Time Executive Officers
Their bonuses are allocated in the annual bonus to be paid to each executive officer, the compensation committee presents its recommendations to the Board forsame manner as their approval. Based on our present structure and our small number of full-time executive officers, our compensation committee has not established quantitative formulas or performance goals to determine cash bonuses for our executive officers, other than the Performance Criteria.base salaries are allocated as described above under “— Part-Time Executive Officers.”
Services
Our management directors and certain part-time executive officers, including two named executive officers (i.e., David W. Kalish and Steven Rosenzweig)Matthew J. Gould), provide Services. See “Executive Compensation– General” for a description of the Services. The other executive officers and management directorsindividuals performing Services are: Fredric H. Gould, Isaac Kalish, Israel Rosenzweig, Matthew J. GouldSteven Rosenzweig and Mark H. Lundy. See “Certain Relationships and Related Transactions.”
Long-Term Equity and Long-Term Equity Incentive Awards
We provide the opportunity for our full-time and part-time executive officers to receive long-term equity (i.e., restricted stock) and long-term equity incentive awards.awards (i.e., RSUs). These compensation programs are designed to recognize responsibilities, reward performance, retain our executive officers, motivate future performance and align the interests of our executive officers with our stockholders’ interests. The compensation committee reviews annually management’s recommendations for long-term equity awards for all our officers, directors and employees and makes determinations with respect to the grant of such awards. In making these determinations, the compensation committee considers the factors it considers relevant, including our performance and an individual’s performance. Existing ownership levels are not a factor in award determinations.
In 2022, with Ferguson’s input, we adopted a long-term pay-for-performance equity incentive program (the “2022 Performance Plan”) pursuant to which we issued to 16 individuals, including all our named executive officers, RSUs exchangeable for up to an aggregate of 212,470 shares of common stock, including up to approximately 23,608 shares issuable pursuant to the peer group adjustment described below. Generally, these RSUs vest if and to the extent pre-established market or performance conditions are met for the three-years ending June 30, 2025. Further, the awards tied to market performance are subject to increase or decrease, which we refer to as the “peer group adjustment”, based upon our market performance compared to the market performance of a peer group. Finally, recipients are entitled to an amount equal to the cumulative dividends that would have been paid on the shares underlying the RSUs that vest had the shares been outstanding during the performance cycle (the “RSU Dividend Equivalents”). See “ — Grant of Plan Based Awards” for further information. We use RSUs as an element of our long-term equity incentive compensation program with the expectation that in light of the three-year vesting period and the need to satisfy market and/or financial performance conditions, these awards will further align the interests of our executive officers with our stockholders and reward long-term market and financial performance.
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The conditions that must be satisfied to earn the performance-based compensation are tied to the achievement of rigorous, sustained performance and/or market goals – as further described below, 50% of the award is based on adjusted funds from operation (“AFFO”) and 50% on total stockholder return (“TSR”), in each case as calculated pursuant to the applicable award agreement. The specific goals and the other material terms and conditions of the 2022 Performance Plan are as follows:
Long–Term Equity Incentive
Awards Performance
Criteria
Weight
Minimum Performance
Criteria
Target Performance
Criteria
Maximum Performance
Criteria
Adjusted Funds from Operations (AFFO)
50%
Compounded annual growth rate of 4%
Compounded annual growth rate of 6%
Compounded annual growth rate of 8%
Total Stockholder Return (TSR)
50%(1)
Compounded annual growth rate of 5%
Compounded annual growth rate of 8%
Compounded annual growth rate of 11% or greater
(1)
Does not give effect to the increase or decrease in the number of shares subject to the award as a result of the peer group adjustment.
The RSUs granted during the two years ended December 31, 2022 are, as of such date, at the 56% level (excluding the impact of the peer group adjustment) of the full payout of the performance objectives at which the RSUs vest. See Note 10 of our consolidated financial statements included in our 2022 Annual Report to Stockholders and “— Grant of Plan Based Awards During 2022” for a more extensive description of the metrics applicable to the 2022 Performance Plan.
We do not have a formal policy with respect to whether equity compensation should be paid in the form of stock options, restricted stock or RSUs. For approximately the past ten years, we have awarded onlyWe generally grant on an annual basis, restricted stock awards which vest after five years of service and in 2016, initiated the useRSUs that vest after three years subject to satisfaction of RSUs. We do not anticipate issuing any additional RSUs until 2021, the expiration of the vesting period with respect to the RSUs granted in 2016.market and/or performance conditions. The compensation committee generally believes restricted stock awards and RSUs are more effective than options in achieving our compensation objectives. Restricted stock has a greater retention value than options because of the five-year cliff vesting requirement and is entitled tobecause before vesting, dividends prior to vesting.are paid on restricted stock as an additional element of compensation. Executive officers also realize value upon the vesting of the restricted stocks,stock, with the value potentially increasing during the five-year vesting period if our stock performanceprice increases. RSUs provide an additional incentive component to equity based awards in that the units only vest if, and to the extent, performance or market conditions are satisfied. Restricted stock awards and RSUs align the interests of our officers with our stockholders and, because fewer shares are normally awarded than in connection with the grant of options, they are potentially less dilutive than option grants.
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All the outstandingGenerally, our grants of restricted stock awards and RSUs provide for five-year “cliff” vesting. The compensation committee believes that awards with five-year “cliff” vesting provide a strong retention incentive for executives, reduces the potential risk associated with equity awards and aligns the interestsare made in January of our executive officers with our stockholders. We view our capital stock as a valuable asset that should be awarded judiciously. For that reason, it has been our policy that the aggregate restricted stock awards granted each year to our executive officers, employees, directorsin recognition of services provided for the prior year and consultants should not exceed approximately 1%the RSUs are granted in June/July of our issued and outstanding common stocks. In 2019, the restricted stock awards constituted approximately 1% of our outstanding shares of common stock at the time of grant.
each year. We do not have a formal policy on timing equity compensationthese grants in connection with the release of material non-public information. Generally, equity awards are grantedinformation and in Januaryview of each year. Our compensation committee has reviewed our compensation policiesthe three-year and practices to ascertain if the risks arising from such policies or practices are reasonably likely to have a materially adverse effect on our company. The compensation committee concluded that while our compensation program takes into account the company’s performance the program does not encourage excessive or unnecessary risk-taking and our policies and practices achieve a balance between annual performance and long-term growth.
In 2016, we adopted an equity based long-term pay-for-performance equity incentive program (the “2016 Performance Plan”) pursuant to which we issued to 15 individuals, including our named executive officers, RSUs exchangeable for up to an aggregate of 450,000 shares of common stock. As described in further detail in the table below, these RSUs vest if and to the extent pre-established market or performance conditions are met through the June 30, 2021five-year cliff vesting date. (Further,requirements with respect to RSUs that vest, recipients are entitled to cash dividends that would have been paid in respect of the shares underlying such RSUs had such shares been outstanding during such period). We use RSUs as an element of our long-term equity incentive compensation program with the expectation that in light of the five-year vesting period and the need to satisfy market and/or financial performance conditions, theserestricted stock awards, will further align the interests of our executive officers with our stockholders and reward long-term market and financial performance. Werespectively, we do not anticipate granting any further RSU’s until after June 30, 2021.
The conditions that must be satisfied to earn these performance-based RSUs are tied to the achievement of rigorous, sustained performance and/or market goals – 44% of the awardbelieve such a formal policy is based on compounded annual growth rate (“CAGR”) in adjusted funds from operations (“AFFO”) and 44% is based on CAGR in total stockholder return (“TSR”). The 12% balance of the award (the “Additional TSR Units”) vests in the event that CAGR in our TSR is in the top quartile of the corresponding growth rate of our Performance Plan Peer Group (i.e., the FTSE NAREIT Equity Apartment Index, excluding companies whose primary focus is the provision of housing for college and/or grad students) over the corresponding period (the “TSR Positive Adjustment”). However, in the event that CAGR in our total stockholder return is in the bottom quartile of the corresponding growth rate of the Performance Plan Peer Group, 25% of the RSUs tied to TSR are forfeited (the “TSR Negative Adjustment;” and together with the TSR Positive Adjustment, the “TSR Adjustment”). The specific goals and the other material terms and conditions of the 2016 Performance Plan are as follows (in the event that a metric is satisfied between two levels in the table below, straight line linear interpolation will be used to determine the number of RSUs that vest):necessary.
Long–Term Equity Incentive
Awards Performance Criteria
Threshold
Performance
Criteria
Target Performance
Criteria
Maximum
Performance
Criteria
AFFO (1)
If CAGR of 8% is achieved – 50,000 shares vest
If CAGR of 9% is achieved – 100,000 shares vest
If CAGR of 10% is achieved – 200,000 shares vest
TSR (2)
If CAGR of 6% is achieved – 50,000 shares vest
If CAGR of 9% is achieved – 100,000 shares vest
If CAGR of 12% is achieved –200,000 shares vest
Additional TSR Units
Upon satisfaction of the TSR Positive Adjustment –50,000 shares vest
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(1)
AFFO is defined as funds from operations determined in accordance with the National Association of Real Estate Investment Trusts definition, less straight-line rent accruals, adding back restricted stock expense, amortization of deferred mortgage costs, property acquisition costs and adjusting for the impact of non-controlling interests and subject to any changes in generally accepted accounting principles applicable to us.
(2)
Awards subject to reduction pursuant to the TSR Negative Adjustment.
As reflected in the graphic below, the RSUs granted in 2016 are, as of December 31, 2019, at the 44.4% level of the full payout of the performance objectives at which the RSUs vest (the extent to which the objectives for these awards are deemed to have been satisfied is determined in the manner described in note 10 of our consolidated financial statements included in our Annual Report and assumes no TSR Adjustment):

See “—Outstanding Equity Awards at Fiscal Year End” and note 10 of our consolidated financial statements included in the Annual Report for additional information about our RSUs.
Clawbacks
We are entitled to clawback or obtain reimbursement of an executive’s compensation under the following circumstances:
in the event we are required to restate our financial statements due to our material non-compliance, as a result of misconduct, with any financial reporting requirement under the securities laws, our chief executive officer and chief financial officer are required to reimburse us for (i) any bonus or other incentive based compensation or equity based compensation they receive from us during the 12 months following the initial public issuance of the financial document embodying such financial reporting requirement and (ii) profits from the sale of our common stock during such 12 months;
if an executive officer’s relationship with us is terminated for cause (e.g., insubordination, dishonesty, incompetence, moral turpitude, the refusal to perform such person’s duties and responsibilities and other misconduct of any kind, as determined by the compensation committee, then (i) all options (except to the extent exercised) immediately terminate and (ii) the officer’s rights to all restricted stock, RSUs and performance share awards (except to the extent such awards have vested) are forfeited immediately; and
in accordance with any additional claw-back policy implemented by us, whether implemented prior to or after the grant of an award pursuant to our equity incentive plans.
Executive Benefits and Perquisites
We provide our executive officers and our employees with a competitive benefits and perquisites program. For 2019,2022, the executive benefits and perquisites we provided to executive officers generally accounted for a small percentage of the compensation provided by, or allocated to, us for our executive officers. In addition to
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the benefits and perquisites provided to all our full-time employees, we provided to certain of our full-time executive officers an automobile allowance (including payments for automobile maintenance and repairs), the payment of college tuition expense and the payment of premiums for additional disability insurance and/or long-term care insurance. The cost of the executive benefits and perquisites provided to our part-time executive officers, which benefits are similar to those provided to our full-time executive officers, is allocated among us and other entities pursuant to the shared services agreement.
Employment and Severance Agreements; Post-Employment Benefits; Change of Control
None of our named executive officers has employment or severance agreements with us. They are “at will” employees who serve at the pleasure of our Board.
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We do not provide for any post-employment benefits to our named executive officers other than their excitement to the benefits payable pursuant to our defined contribution pension plan and, as described below and under “ — Potential Payments Upon Termination or Change-in-Control,”the accelerated vesting of our restricted stock awards and RSUs.
In 2022, we modified the acceleration provisions of the RSUs granted in 2022 (from the corresponding provisions of the RSUs granted in 2021) with respect to a (i) DDR Event to ensure that all recipients are treated equally (i.e., the metrics are not adjusted for any single participant as a result of the early termination of their relationship with us) and that the metrics to be attained are those that were established at the time of grant and (ii) with respect to a change of control and a DDR Event, to simplify the determinations required with respect to the vesting of such awards upon the occurrence of such events. See “—Outstanding Equity Awards at Fiscal Year End” and note 10 of our consolidated financial statements included in the Annual Report for additional information about our RSUs. Set forth below is a summary of the accelerated vesting provisions with respect to our RSUs and restricted stock awards.
Accelerated Vesting of RSUs
2022 RSUs
Upon the occurrence of a:
DDR Event (as described below.below), these RSUs vest proportionally (i.e., if the participant retires one-year into the three-year performance cycle, they only get 1/3 of the award) if and to the extent the performance metrics are met at the end of the three-year cycle, and
Change of control, these RSUs vest proportionately (based on the time elapsed) if the change takes place during the first half of the performance cycle and thereafter, vest in full.
2021 RSUs
Upon the occurrence of a:
DDR Event, subject to the satisfaction of the applicable performance criteria proportionately adjusted to give effect to a reduction in the three-year performance cycle, which we refer to as the “adjusted performance conditions”, a pro rata portion (based on the percentage of days in the performance cycle that have elapsed) of these RSUs will vest, and
change of control, these RSUs will vest to the extent the applicable as adjusted market and/or performance conditions have been met.
Accelerated Vesting of Restricted Stock Awards
Generally, a person’s restricted stock award will vest fully in the event of such person’s death, disability (i.e., the inability to engage in gainful activity due to a life threatening or long lasting mental or physical impairment), or retirement (having reached the age of 65 and worked for us for at least ten consecutive years; death, disability and retirement referred to collectively as a “DDR Event”) or in the event of a change of control in our company. Subject to the specific terms and conditions of the applicable plan and award agreement, a change of control is generally deemed to occur if (i) any person, with specified exceptions, becomes the “beneficial owner” of securities representing 20% or more of the combined voting power of our then outstanding securities, (ii) a business combination or sale of all or substantially all of our assets is completed or (iii) there is a change in the composition of a majority of our Board, other than changes approved by incumbent directors.
Accelerated Vesting of RSUs
Upon the occurrence of a DDR Event, subject to the satisfaction of the applicable performance criteria proportionately adjusted to give effect to a reduction in the five year performance cycle, which we refer to as the “adjusted performance conditions”, a pro rata portion (based on the percentage of days in the performance cycle that have elapsed) of the RSUs will vest.
Upon a change of control (as described above), the RSUs will vest to the extent the applicable as adjusted market and/or performance conditions have been met.
See “—Outstanding Equity Awards at Fiscal Year End” and note 10 of our consolidated financial statements included in the Annual Report for additional information about our RSUs.
Chairman of the Board’s Compensation
For the Transition Period2021 and 2019,2022, our Chairman of the Board earned, and in 2020,2023, he will earn, fees of $62,500, $260,500$280,900, $282,225 and $280,900,$282,225, respectively. Our Chairman does not receive any additional direct compensation from us, other than fees for the Services and long-term equity awards and long-term equity incentive awards, if any, granted to him by our compensation committee.Equity Awards. Our Chairman may also receivereceives compensation from one or more other entities that are parties to the shared services agreement. For additional information regarding payments to our Chairman, see “Certain Relationships and Related Transactions.”
DeductibilityPolicy Prohibiting Hedging of Executive CompensationOur Securities
PriorThe board believes that transactions in our securities engaged in by Covered Persons (as defined below) (i) that are designed to hedge (i.e., eliminate or reduce), the 2017 Tax Cuts and Jobs Act, compensation that satisfied conditions set forth under Section 162(m)risks of ownership of our securities, or (ii) allow for the Internal Revenue Code to qualify as “performance-based compensation” was not subject to a $1 million limit on deductibility. The 2017 Tax Cuts and Jobs Act eliminatesprofit from any decrease in the performance-based compensation exception and additionally applies the limit to certain former executive officers. However, it provides a transition rule with respect to remuneration which is provided pursuant to a written binding contract which was in effect on November 2, 2017, and which was not materially modified after that date. With the eliminationvalue of the exemption for performance-based compensation, we expect that we will be unable to deduct all compensation in excess of $1 million paid to the executive officers covered by the new tax law, other than previously granted awards that comply with the transition rules. Notwithstanding the repeal of the exemption forour securities, are inappropriate.
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“performance-basedAccordingly, the board has adopted an anti-hedging policy that applies to transactions in securities by directors, officers, employees, persons performing services pursuant to our shared services agreement and certain relatives of the foregoing (collectively, the “Covered Persons”). Under the policy, Covered Persons are prohibited from:
engaging in short sale transactions in our securities,
engaging in hedging or monetizing transactions through transactions in our securities or through the use of financial instruments designed for such purposes,
engaging in any transaction in securities where a reasonable investor would conclude that such transaction is for short-term gain or is speculative, and
owning financial instruments (other than those issued by us) or participating in investment strategies that represent a direct or indirect hedge of the economic risk of owning our securities or any other that give the holder any rights to acquire any such securities.
Clawbacks
We are entitled to clawback or obtain reimbursement of an executive’s compensation under the following circumstances:
in the event we are required to restate our financial statements due to our material non-compliance, as a result of misconduct, with any financial reporting requirement under the securities laws, our chief executive officer and chief financial officer are required to reimburse us for (i) any bonus or other incentive based compensation or equity based compensation they receive from us during the 12 months following the initial public issuance of the financial document embodying such financial reporting requirement and (ii) profits from the sale of our common stock during such 12 months;
if an executive officer’s relationship with us is terminated for cause (e.g., insubordination, dishonesty, incompetence, moral turpitude, the refusal to perform such person’s duties and responsibilities and other misconduct of any kind, as determined by the compensation committee intendscommittee) then (i) all options (except to maintain its commitmentthe extent exercised) immediately terminate and (ii) the officer’s rights to structuringall restricted stock, RSUs and performance share awards (except to the Company’s executive compensation programs extent such awards have vested) are forfeited immediately; and
in a manner designedaccordance with any additional claw-back policy implemented by us, whether implemented prior to align pay with performance.or after the grant of an award pursuant to our equity incentive plans.
For 2019,Stock Ownership Guidelines
Because we believe that mostthe ownership by our named executive officers and non-employee directors of a meaningful financial stake in us serves to align their interests with those of our stockholders, we adopted stock ownership guidelines. Our guidelines reflect that the individuals identified below should own shares of common stock with a value not less than:
Title
Minimum Ownership Requirement
Chief Executive Officer
4 times current base salary
Full-Time NEO
2 times current base salary
Part-Time NEO
2 times allocated base salary
Non-Management Directors
3 times annual base retainer
All shares deemed to be beneficially owned as determined under Rule 13d-3 promulgated pursuant to the Exchange Act (including shares as to which beneficial ownership is disclaimed), are counted towards meeting the guidelines. The individuals subject to these guidelines generally have five years from the date they assume such title to achieve the requisite ownership, which will be measured as of December 31 of each year. The stock price used in determining satisfaction of the compensation paid to our full-time executivesguidelines is deductible by us. While the compensation committee generally intends to preservemost favorable price during the deductibility of compensation payments and benefitstwo years ending on the December 31 measurement date. “Allocated base salary” refers to the extent reasonably practicable, it hasamount reflected in the salary column of the summary compensation table of our proxy statement for the preceding year. Although they were not adopted a formal policy that requires all such compensationthen subject to be fully deductible.these guidelines, as of December 31, 2022, each of our named executive officers and non-management directors satisfied these guidelines.
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Analysis
Base Salary, Bonus and BonusEquity Awards
Full-Time Executive Officers
In accordance with the compensation setting process described above, base salary, and cash bonuses for 2019and equity awards were approved as follows for theour full-time named executive officers compensated directly by us:for the periods indicated:
 
2019
Base
Salary ($)
2018
Base
Salary ($)
2019
Bonus
($)(1)
2018
Bonus
($)(2)
Percentage
Increase(3)
Jeffrey A. Gould,
838,941
806,844
150,000
120,000
6.7
President and CEO
 
 
 
 
 
Mitchell Gould,
419,953
397,975
60,300
60,300
4.8
Executive Vice President
 
 
 
 
 
George Zweier,
308,704
292,275
36,400
36,400
5.0
Vice President and CFO
 
 
 
 
 
 
Base Salary
Cash Bonus
Equity Grants
 
2022
($)
2021
($)
%
Change
2022
($)(2)
2021
($)(2)
%
Change
2022
($)(3)
2021
($)(4)
Change
Jeffrey A. Gould(1)
886,471
864,004
2.6
300,000
200,000
50
672,629
778,898
(13.6)
Mitchell Gould(1)
467,851
436,296
7.2
55,100
51,255
7.5
365,448
446,647
(18.2)
George Zweier(1)
344,236
321,004
7.2
37,900
35,200
7.7
354,823
424,714
(16.5)
(1)
Represents the bonus applicable to 2019 which was paid in January 2020.Messrs. Jeffrey Gould, Mitchell Gould and George Zweier’s base salaries for 2023 are $930,300, $467,224 and $360,964, respectively.
(2)
RepresentsReflects the bonus applicable to 2018 which wascash bonuses paid in January 2019.recognition of performance for such year, which are paid in the following year.
(3)
Represents the percentage increase from 2018aggregate grant date fair value of the (i) shares of restricted stock granted in 2023 for 2022 performance and (ii) RSUs granted in 2022. Messrs. J. Gould, M. Gould and G. Zweier were granted (i) in 2023, for 2022 performance, 14,206, 8,900 and 8,400 shares of restricted stock, respectively, and (ii) in 2022, without giving effect to 2019the peer group adjustment, 21,534, 10,286 and 10,286 RSUs, respectively.
(4)
Represents the aggregate grant date fair value of shares of the (i) restricted stock granted in 2022 for 2021 performance and (ii) RSUs granted in 2021. Messrs. J. Gould, M. Gould and G. Zweier’s were granted (i) in 2022, for 2021 performance, 14,282, 8,900 and 8,400 shares of restricted stock, respectively, and (ii) in 2021, without giving effect to the sum of such person’s salarypeer group adjustment, 19,532, 10,286 and bonus.10,286 RSUs, respectively.
In setting Jeffrey A. Gould’s base salary for 2019, ourOur compensation committee took into account his strong leadership skillsdetermined in late 2021 that increases in base salaries for the full-time executive officers was appropriate in recognition of their performance in 2021 and the fact that his base salary for 2019 representedas a 4.0% increase from his 2018 base salary. general cost of living increase.
In determining his bonusin late 2022, the cash bonuses to be paid in early 2023 to these executive officers for 2019,their 2022 performance, the compensation committeeCompensation Committee took into account the Performance Criteria and in particular:
our sale, including purchase of the interests of our joint venture partners in 11 joint ventures,
the sale by an unconsolidated joint venture, of three multi-family properties and other assets for a gain to us, net of minority interests and prepayment charges, of $17.4 million, our acquisition, through unconsolidated joint ventures of threefour multi-family properties forwhich resulted in an aggregate purchase pricegain of $109.5$64.5 million,
the amendment of our purchase of the interest of a joint venture partner for an aggregate purchase price of $1.6 million, the continuation of an “at-the-market” equity offering program pursuant to which we raised $7.5 million of equity, obtaining a $10 million credit facility subjective factors,which, among other things, increased the amount we can borrow from $35 million to $60 million and increased the 10% increaseamount we can use for working capital purposes from $15 million to $25 million,
the increases, through the nine months ended September 30, 2022, in our quarterly dividend.
The 5.5% increase in Mitchell Gould’s 2019 base salarynet income, funds from his 2018 base salary is due primarily to his individual performance in 2018operations and a costadjusted funds from operations, from the corresponding period of living adjustment. 2021, and,
that our total stockholder return for three-years was ranked 8th out of 147 REITs.
In determining hisJeffrey A. Gould’s bonus for 2019,2022 performance, the compensation committee took into account the Performance Criteria, his efforts with respect to the identifying, evaluating, negotiating and completing multi-family property purchases and sales, subjective factors and his oversight of our employees.
The 5.6% increase in Mr. Zweier’s 2019 base salary from his 2018 base salary is due primarily to his individual performance in 2018 and a cost of living adjustment. In determining his bonus for 2019, the compensation committeeCompensation Committee took into account the Performance Criteria and his oversight of financial and accounting matters.leadership role in effectuating the foregoing achievements.
The Compensation Committee used the Ferguson Report as a “market check” to confirm its belief that the bonuses were not inappropriate.
Part-Time Named Executive Officers
David W. Kalish, Senior Vice President, Finance, has overall responsibility for implementation and enforcement of our internal controls, performs oversight and guidance in connection with our annual audit and
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our quarterly reports, performs oversight and guidance related to tax matters, including REIT compliance, is involved in banking relationships, is a participant in our disclosure control and procedures committee and participates in the preparation and review of our press releasereleases and our disclosures under the Exchange Act.
Steven Rosenzweig,Matthew J. Gould, Senior Vice President – Legal, serves as lead legal counsel in our acquisition, disposition and mortgage financing activities. He is also a member of our investment committee and as such is involved in analyzing and reviewing operating results of each property in our portfolio and in analyzing, reviewing and approving each of our acquisition, disposition and financing transactions.
The compensation committee determined that based on the value of Messrs. D. Kalish’s and S. Rosenzweig’s services on our behalf, the compensation of these officers, which is allocated to us, is reasonable.
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Long-Term Equity and Equity Incentive Awards
We believe that our long-term equity and equity incentive compensation program,programs, using RSUs that vest after three years subject to satisfaction of market or performance-based conditions, and restricted sharestock awards and RSUs with five-year cliff vesting, provides motivationprovide an appropriate incentive for our executivesexecutive officers and employees and isare a beneficial retention tool. In determining the awards to be granted to the named executive officers, the compensation committee took into account our performance in 2022, the responsibilities and performance of each named executive officer and the committee’s desire to emphasize equity-based awards as a significant component of total compensation for our full-time named executive officers while minimizing stockholder dilution. The compensation committee used the Ferguson Report as a “market check” to confirm its belief that the restricted stock awarded in early 2023 for performance in 2022 was not inappropriate.
We are mindfulbelieve the cumulative effect of the potential dilution and compensation cost associated with awarding restricted shares. Our policy remains to limit dilution and compensation costs. In January 2019 and March 2018, we issued 156,399 and 144,797 restricted stock awards respectively, representing approximately 0.99% and 1.03% ofRSUs is not overly dilutive and has created significant incentives for our outstanding shares, respectively. In the past five years, excluding the one-time grant in June 2016 of 450,000 shares of common stock subjectofficers and employees. We intend to RSUs, we have awarded an average of 146,539 shares ofcontinue to award restricted stock each year, representing an average of 1.02% per annum of our outstanding shares of common stock.
Fees for Services
The fees for Services were first paid in 2016 and in approving same, the compensation committee, the audit committee and Board took into account that after paying such fees, we would realize significant savings in comparison to the fees that would have been paid pursuant to the advisory agreement. The aggregate fee paid to seven individuals for Services in 2019 and the Transition Period was $1,331,325 and $316,982, respectively. See “Certain Relationships and Related Transactions.”
Stock Ownership Policy
In view of the fact that our executive officers and directors beneficially own in the aggregate approximately 6.7 million, or 38.5%, of our outstanding shares of common stock, we do not have, nor doRSUs as we believe there is a need to adopt, a policy regarding ownership of our shares of common stock by executive officerssuch awards (i) align management’s interests and directors since their ownership interest aligns their interestgoals with thestockholders’ interests of our stockholders.and goals and (ii) are an excellent motivator and employee retention tool.
Perquisites
The perquisites we provide to our executive officers, which are in addition to the benefits we provide to all our employees, generally account for a small percentage of the compensation paid by us to or allocated to us for our executive officers. We believe that such perquisites are appropriate.
Post-Employment Benefits ProgramFees for Services
The following table sets forth the value (based on the closing price of our stock on December 31, 2019 of $16.97 per share) of equity awards held by our named executive officers that would vest upon a DDR Event or a changeaggregate fee paid to seven individuals for Services in control as of December 31, 2019:2022 was $1,467,796. See “Certain Relationships and Related Transactions.”
 
Upon Death or Disability
Upon a Change of Control
Name
Restricted
Stock ($)
RSUs
($) (2)
Restricted
Stock ($)
RSUs
($)(2)
Jeffrey A. Gould
1,163,531
235,933
1,163,531
313,945
George Zweier
590,566
127,530
590,566
169,700
Mitchell Gould
961,775
140,283
961,775
186,670
David W. Kalish(1)
613,686
213,612
613,686
284,248
Steven Rosenzweig
287,964
159,412
287,964
212,125
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(1)
Because Mr. Kalish is over 65 and has satisfied the period of service requirement, only his RSUs (assuming satisfaction of the performance and market condition as of the end of the measurement period) and restricted stock would vest upon his retirement as of December 31, 2019; the market value of his restricted stock and RSUs are reflected in the applicable column.
(2)
Assumes that the target performance criteria is achieved and that there is no TSR Adjustment. See “– Components of Executive Compensation – Long-Term Equity and Long-Term Equity Incentive Awards” and “– Outstanding Equity Awards at Fiscal Year End” and note 10 of our consolidated financial statements included in the Annual Report.
Summary Compensation Table
The following table discloses the compensation paid and accrued for services rendered in all capacities to us for our named executive officers for 2019,each of the Transition Period, and 2018 and 2017:three years ended December 31, 2022:
Name and Principal Position
Year
Salary
($)(2)(3)
Bonus
($)(2)(4)
Stock
Awards
($)(5)
All Other
Compensation
($)(6)(7)
Total
($)
Jeffrey A. Gould
2019
838,941
150,000
178,381(8)
101,550(9)
1,268,872
President and CEO
2018(T)
200,888
34,904
235,792
 
2018
806,844
120,000
156,584
125,122
1,208,550
 
2017
784,375
110,000
110,648
126,290
1,131,313
George Zweier
2019
308,704
36,400
90,593
47,969(10)
483,666
Vice President and CFO
2018(T)
75,050
11,906
86,956
 
2018
292,275
36,400
82,880
45,481
457,036
 
2017
278,366
35,000
63,300
45,773
422,439
Mitchell Gould
2019
419,953
60,300
134,028
114,121(11)
728,402
Executive Vice President
2018(T)
102,008
 
39,407
141,415
 
2018
397,975
60,300
124,320
76,083
658,678
 
2017
382,638
55,000
96,005
46,513
580,156
David W. Kalish
2019
227,582
86,870
240,810(12)
555,262
Senior Vice President, Finance
2018(T)
54,352
55,328
109,680
 
2018
207,057
84,810
231,742
523,609
 
2017
214,591
59,080
227,237
500,908
Steven Rosenzweig
2019
268,394
41,040
280,519(13)
589,953
Senior Vice President - Legal
2018(T)
81,526
61,429
142,955
 
2018
254,304
35,520
250,674
540,498
 
2017
260,200
26,687
215,630
502,517
Name and Principal Position
Year
Salary
($)(1)(2)
Bonus
($)(1)(3)
Stock
Awards
($)(4)
All Other
Compensation
($)(5)(6)
Total
($)
Jeffrey A. Gould
President and CEO
2022
886,471
300,000
672,629
65,134(7)
1,924,234
2021
864,004
200,000
778,898
148,386
1,991,288
2020
867,169
135,000
250,027
119,134
1,371,330
George Zweier
Vice President and CFO
2022
344,236
37,900
354,823
51,305(8)
788,264
2021
321,004
35,200
424,714
87,521
868,439
2020
322,329
45,000
130,950
48,688
546,967
Mitchell Gould
Executive Vice President
2022
467,851
55,100
365,448
115,275(9)
1,003,674
2021
436,296
51,255
446,647
212,053
1,146,251
2020
438,096
51,255
174,600
110,593
774,514
David W. Kalish
Senior Vice President, Finance
2022
249,026
441,976
262,227(10)
953,229
2021
256,827
600,212
323,215
1,180,254
2020
255,766
129,571
258,752
664,089
Matthew J. Gould
Senior Vice President
2022
672,629
255,256(11)
927,885
2021
778,898
314,788
1,093,686
2020
250,027
243,100
493,127
(1)
2018(T) refers to the Transition Period.
(2)
The salary and bonus for each of Jeffrey A. Gould, George Zweier and Mitchell Gould is paid directly by us. Messrs.David W. Kalish and RosenzweigMatthew Gould do not receive salary or bonus directly from us but receive an annual salary and bonus from Gould Investors L.P. and related companies; a portion of their respective salariesMr. Kalish’s salary and bonusesbonus are allocated to us pursuant to the shared services agreement. See “—Compensation Setting Process—Part-time Executive Officers. The amount of salary and bonus that is allocated to us is set forth under the “Salary” column in the Summary Compensation Table. See “Certain Relationships and Related Transactions” for a discussion of additional compensation paid to Messrs. J.Jeffrey A. Gould, Kalish and Rosenzweig byMatthew J. Gould from other entities owned by Fredric H. Gould, a management director and the former Chairman of our Board.with which we are affiliated or for which there is common ownership.
(3)(2)
The annual base salaries in 20202023 for each of Jeffrey A. Gould, George Zweier and Mitchell Gould are $860,524, $319,775,$930,300, $360,964, and $434,624,$467,224, respectively.
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(4)(3)
The table sets forth the year in which the bonus was earned, not the year it was paid. The bonus for 2019, 20182022, 2021 and 20172020 reflects our performance and the performance of our named executive officers for such years and was paid in January 2020, 20192023, 2022 and 2018,2021, respectively. There was no bonus paid for, or specifically allocated to, the Transition Period.
(5)(4)
ReflectsRepresents restricted stock granted in 2022, 2021 and 2020 and RSUs granted in 2022 and 2021 (RSUs were not granted in 2020) at the grant date fair value of restricted stocksuch awards in each case calculated in accordance with Item 402 of Regulation S-K and ASC Topic 718, excluding718. Assumes that the maximum number of shares subject to RSUs will vest and does not give effect of estimated forfeitures. Generally,to the aggregate grant date fair value is the amount that we expect to expense in our financial statements over the award’s vesting schedule.peer group adjustment. These amounts reflect our accounting expense and do not correspond to the actual valuevalues that will be realized by the named executives. Grant date fair valuesvalue assumptions are consistent with those disclosed in noteNote 10 to— Stockholders’ Equity, in the consolidated financial statements included in our Annual Report. See “—Grant of Plan Based Awards During 2022” for additional information. On January 5, 2023, we granted Jeffrey A. Gould, George Zweier, Mitchell Gould, David W. Kalish and Matthew J. Gould, 14,206, 8,400, 8,900, 8,153 and 14,206 shares of restricted stock, respectively, with a grant date fair value of $19.18 per share.
(6)(5)
We maintain a tax qualified defined contribution plan for all of our full-time officers and full and part-time employees, and entities which are parties with us to a shared services agreement (including Gould Investors) maintain substantially similar defined contribution plans for their officers and employees. We make an annual contribution to the plan for each officer and employee whose base salary is paid directly by us (and entities which are parties to the shared services agreement make annual contributions to their respective plans for their respective employees, which amounts are allocated to the parties to the shared service agreement in accordance with its terms) equal to 15% of such person’s annual earnings, not to exceed $42,000$45,750, for any person in 2019.2022. The estimated amount payable as of December 31, 20192022 to Jeffrey A. Gould, George Zweier and Mitchell Gould pursuant to this plan upon termination of their employment is $2,714,000, $1,076,000$3.59 million, $1.74 million, and $1,267,000,$1.49 million, respectively. The method of payment upon termination of employment is determined solely by the participant who may elect a lump sum payment, the purchase of an annuity or a rollover into an individual retirement account.
(6)
Except with respect to dividend equivalents paid in 2021 upon the vesting of RSUs granted in 2016, excludes dividends and dividend equivalents paid or payable on stock and similar awards.
(7)
Pursuant to Item 402(c)(2)(ix)(G) of Regulation S-K, excludes dividends on unvested restricted stock.
(8)
Mr. Gould beneficially owns approximately 3.4 million shares or 20% of our outstanding common stock.
(9)
Includes our contribution of $42,000$45,750 paid for his benefit to our defined contribution plan and perquisites totalling $59,550,totaling $19,384, of which $12,181$7,833 represents an automobile allowance, $8,079$4,236 represents a premium paid for additional disability insurance, $11,830and $7,315 represents a premium paid for long-term care insurance and $27,460 represents an education benefit.insurance.
(10)(8)
Includes our contribution of $42,000$45,750, paid for his benefit to our defined contribution plan and a $5,969$5,555, automobile allowance.
(11)(9)
Includes an education benefit of $62,132, our contribution of $42,000$45,750 paid for his benefit to our defined contribution plan an education benefit of $63,264 and a $8,857$7,393 automobile allowance.
(12)(10)
Includes $220,500 we paid him$243,100 for the Services, our contribution of $12,050$11,958 paid for his benefit to the Gould Investors L.P. defined contribution plan, and perquisites of $8,260,$7,169, of which $6,119$1,697, and $2,141 represents$5,472, represent our share of the amounts incurred by Gould Investors for long-term care and disability insurance benefits and an automobile allowance, respectively. The amounts reflected as contributions to the defined contribution plan and as perquisites are allocated to us pursuant to the shared services agreement. In 2023 he is to be paid $243,101 for the Services.
(13)(11)
Includes $240,652 we paid him$255,256 for the Services, our contribution of $26,756Services. In 2023, he is to be paid $278,018 for his benefit to the Gould Investors L.P. defined contribution plan, and perquisites of $13,111, of which $1,545 and $11,566 represents our share of the amounts incurred by Gould Investors for long-term care insurance and an automobile allowance, respectively. The amounts reflected as contributions to the defined contribution plan and as perquisites are allocated to us pursuant to the shared services agreement.Services.
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Grants of Plan-Based Awards
The following table below discloses the grantgrants of plan-based awards during 2022 to our named executive officers ofofficers. The restricted stock awards, which are scheduledreferred to in such table as “RS” were issued pursuant to our 2020 Incentive Plan and the restricted stock units, which are referred to in the table as “RSUs”, were issued pursuant to our 2022 Incentive Plan.
Restricted Stock
Vesting of the restricted stock occurs, with certain exceptions, subject to the continuation of an employment, consulting or similar relationship with us through 2027. Upon vesting, each restricted stock award entitles the recipient to one share of common stock. Holders of restricted stock are entitled to the dividends paid on, and to vote, their shares.
RSUs
Vesting of the RSUs occurs, with certain exceptions, subject to the continuation of an employment, consulting or similar relationship with us through 2025, upon satisfaction of benchmarks related to the compounded annual growth rate from 2022 through 2025 in (i) total stockholder return (as calculated pursuant to the applicable award agreement), which awards are referred to in the table below as “RSU-TSR” and (ii) adjusted funds from operations, (as presented in our filings with the SEC), which awards are referred to in the table below as “RSU-AFFO.”
The RSU – TSR awards are subject to an increase or decrease, which we refer to as the peer group adjustment, depending on our performance relative to a peer group (i.e., the FTSE Nareit Equity Apartment Index, excluding companies whose primary focus is the provision of housing for college/graduate students). Specifically, if the compounded annual growth rate in total stockholder return during the performance cycle is in the (i) top quartile of our peer group, the recipient is entitled to additional RSUs equal to 25% of the RSU-TSR awards that vest at the applicable threshold, target and maximum levels and (ii) in 2024:the bottom quartile of the peer group, the recipient will forfeit 25% of the RSU-TSR awards that vest at the applicable threshold, target and maximum levels. This peer group adjustment is not reflected in the table below.
Name
Grant Date
All Other Stock Awards:
Number of Shares of
Stock or Units (#)
Grant Date
Fair Value of
Stock Awards ($)
Jeffrey A. Gould
1/08/19
14,374
178,381
George Zweier
1/08/19
7,300
90,593
Mitchell Gould
1/08/19
10,800
134,028
David W. Kalish
1/08/19
7,000
86,870
Steven Rosenzweig
1/08/19
3,307
41,040
Each RSU is coupled with a dividend equivalent right entitling the holder to an amount in cash equal to the aggregate amount of cash dividends that would have been paid in respect of the shares underlying such RSUs, if and to the extent such RSU vest, had such shares been outstanding during the performance cycle applicable to such RSU.
Estimated Future Payouts
under Equity Incentive Plan Awards:(1)(#)
Name
Grant Date
Grant Type
Threshold(1)
Target(2)
Maximum(3)
All Other Stock
Awards:
Number of
Shares of Stocks
or Units(#)
Grant Date
Fair Value of
Stock Awards
($)(4)
Jeffrey A. Gould
1/13/22
RS
14,282
303,493
6/24/22
RSU-TSR
2,692
5,384
10,767
133,339
6/24/22
RSU-AFFO
2,692
5,384
10,767
235,797
George Zweier
1/13/22
RS
8,400
178,500
6/24/22
RSU-TSR
1,286
2,572
5,143
63,691
6/24/22
RSU-AFFO
1,286
2,572
5,143
112,632
Mitchell Gould
1/13/22
RS
8,900
189,125
6/24/22
RSU-TSR
1,286
2,572
5,143
63,691
6/24/22
RSU-AFFO
1,286
2,572
5,143
112,632
David W. Kalish
1/13/22
RS
7,971
169,384
6/24/22
RSU-TSR
1,988
3,976
7,950
98,465
6/24/22
RSU-AFFO
1,988
3,976
7,950
174,127
Matthew J. Gould
1/13/22
RS
14,282
303,493
6/24/22
RSU-TSR
2,692
5,834
10,767
133,339
6/24/22
RSU-AFFO
2,692
5,834
10,767
235,797
(1)
To achieve the threshold award, a compounded annual growth rate of 5% and 4% is required during the Performance Cycle with respect to the RSU-TSR awards and RSU-AFFO awards, respectively.
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(2)
To achieve the target award, a compounded annual growth rate of 8% and 6% is required during the Performance Cycle with respect to the RSU-TSR awards and RSU-AFFO awards, respectively.
(3)
To achieve the maximum award, a compounded annual growth rate of 11% and 8% is required during the Performance Cycle with respect to the RSU-TSR awards and RSU-AFFO awards, respectively.
(4)
The per share grant date fair value of the: (a) restricted stock granted on January 13, 2022 is $21.25, and (b) RSU – TSR and RSU – AFFO awards are $12.38 and $21.90, respectively. These amounts do not correspond to the actual values that will be realized by the executives. The aggregate grant date fair value for the RSU-AFFO awards gives effect to management’s assessment of the probable outcome as to whether, and the extent to which, the RSU-AFFOs will vest. The values for the RSUs assume that the maximum number of such units vest.
Outstanding Equity Awards at Fiscal Year-End
The following table discloses the number and value (based on the closing price per common share of common stock of $16.97$19.64 on December 31, 2019)30, 2022) of the outstanding equity awards at December 31, 20192022 for our named executive officers:
Stock Awards
Stock Awards
Name
Number of
Shares or
Units of
Stock that
Have Not
Vested
(#)
Market
Value of
Shares or
Units of
Stock That
Have Not
Vested
($)
Equity
Incentive
Plan
Awards:
Number of
Unearned
Shares,
Units or
Other
Rights That
Have Not
Vested
(#)(6)
Equity
Incentive
Plan
Awards:
Market or
Payout
Value of
Shares,
Units or
Other
Rights That
Have Not
Vested
($)(6)
Number of
Shares or
Units of
Stock that
Have Not
Vested
(#)
Market
Value of
Shares or
Units of
Stock That
Have Not
Vested
($)
Equity
Incentive
Plan
Awards:
Number of
Shares
Subject to
RSUs
That
Have Not
Vested
(#)(1)
Equity
Incentive
Plan
Awards:
Market or
Payout
Value of
Share,
That
Have Not
Vested
($)(1)
Jeffrey A. Gould(2)
68,564(1)
1,163,531
41,625
706,376
85,321
1,675,704
46,199
907,353
George Zweier(3)
34,800(2)
590,556
22,500
381,825
46,450
912,278
23,144
454,538
Mitchell Gould(4)
56,675(3)
961,774
24,750
420,008
57,750
1,134,210
23,144
454,538
David W. Kalish(5)
36,163(4)
613,686
37,687
639,548
50,819
998,085
35,777
702,655
Steven Rosenzweig
16,969(5)
287,964
28,125
477,281
Matthew J. Gould(6)
85,321
1,675,704
46,199
907,353
(1)
In January 2020, 2021, 2022, March 2023 and January 2024, restricted stock awards with respect to 14,625, 13,230, 13,110, 13,225 and 14,374 shares, respectively, are scheduled to vest.
(2)
In January 2020, 2021, 2022, March 2023 and January 2024, restricted stock awards with respect to 6,500, 7,500, 7,000 and 7,300 shares, respectively, are scheduled to vest.
(3)
In January 2020, 2021, 2022, March 2023 and January 2024, restricted stock awards with respect to 12,000, 12,000, 11,375, 10,500 and 10,800 shares, respectively, are scheduled to vest.
(4)
In January 2020, 2021, 2022, March 2023 and January 2024, restricted stock awards with respect to 8,000, 7,000, 7,000, 7,163 and 7,000 shares, respectively, are scheduled to vest.
(5)
In January 2020, 2021, 2022, March 2023 and January 2024, restricted stock awards with respect to 3,500, 4,000, 3,162, 3,000 and 3,307 shares, respectively, are scheduled to vest.
(6)
Reflects the maximum number of shares subject to RSUs (including the additional shares potentially issuable as a result of the peer group adjustment) scheduled to vest in 20212024 and 2025 upon satisfaction of market and/or performance based conditions. Approximately (i) 44% of the award vests upon achieving a 12% compounded annual growth rate in total stockholder return from 2016 through 2021, (ii) 44% of the award vests upon achieving a 10% compounded annual growth rate over such period in adjusted funds from operations (as calculated pursuant
(2)
In March 2023, January 2024, 2025, 2026, June 2026 and January 2027 restricted stock awards with respect to 13,225, 14,374, 14,320, 14,320, 14,800 and 14,282 shares, respectively, are scheduled to vest. In March 2024 and June 2025, subject to the awardsatisfaction of specified conditions, a maximum (including the peer group adjustment) of 21,974 shares and 24,226 shares, respectively, subject to RSUs are scheduled to vest.
(3)
In March 2023, January 2024, 2025, 2026, June 2026 and January 2027, restricted stock awards with respect to 7,000, 7,300, 7,500, 8,250, 8,000 and 8,400 shares, respectively, are scheduled to vest. In March 2024 and June 2025, subject to the satisfaction of specified conditions, a maximum (including the peer group adjustment) of 11,572 shares and 11,572 shares, respectively, subject to RSUs are scheduled to vest.
(4)
In March 2023, January 2024, 2025, 2026, June 2026 and January 2027, restricted stock awards with respect to 10,500, 10,800, 10,000, 8,750, 8,800 and 8,900 shares, respectively, are scheduled to vest. In March 2024 and June 2025, subject to the satisfaction of specified conditions, a maximum (including the peer group adjustment) of 11,572 shares and 11,572 shares, respectively, subject to RSUs are scheduled to vest.
(5)
In March 2023, January 2024, 2025, 2026, June 2026 and January 2027, restricted stock awards with respect to 7,163, 7,000, 7,421, 7,864, 13,400 and 7,971 shares, respectively, are scheduled to vest. In March 2024 and June 2025, subject to the satisfaction of specified conditions, a maximum (including the peer group adjustment) of 17,888 shares and 17,890 shares, respectively, subject to RSUs are scheduled to vest.
(6)
In March 2023, January 2024, 2025, 2026, June 2026 and January 2027 restricted stock awards with respect to 13,225, 14,474, 14,320, 14,320, 14,800 and 14,282 shares, respectively, are scheduled to vest. In March 2024 and June 2025, subject to the satisfaction of specified conditions, a maximum (including the peer group adjustment) of 21,974 shares and 24,226 shares, respectively, subject to RSUs are scheduled to vest.
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agreement), and (iii) 12% of the award vests if compounded annual growth in our total stockholder return over such period is in the top 25% of our peer group. We can provide no assurance that any value will be realized from these awards.
Option Exercises and Stock Vested
The following table discloses information with respect to the shares of restricted stock that vested in 2022 ($23.28 on January 3, 2022):
 
Stock Awards
Name
Number of
Shares
Acquired
on Vesting
(#)
Value
Realized on
Vesting
($)
Jeffrey A. Gould
13,110
305,201
George Zweier
7,500
174,600
Mitchell Gould
11,375
264,810
David W. Kalish
7,000
162,960
Matthew J. Gould
13,110
305,201
Potential Payments Upon Termination or Change-in-Control
We do not provide for any post-employment benefits to our named executive officers other than their entitlement to the benefits payable pursuant to our defined contribution pension plan and the accelerated vesting of our restricted stock awards and RSUs as a result of death, disability, retirement, or a change of control. See “ — Employment and Severance Agreements; Post Employment Benefits; Change of Control.” The following table sets forth the value (based on the closing price of our stock on December 30, 2022 of $19.64 per share) of equity awards held by our named executive officers that vestedwould vest upon a DDR Event or a change in 2019:control as of December 31:
Stock Awards
Upon Death, Disability or Retirement
Upon a Change of Control
Name
Number of
Shares Acquired
on Vesting
(#)
Value
Realized
on Vesting
($)
Restricted
Stock ($)
RSUs
($)(2)
Restricted
Stock ($)
RSUs
($)(2)
Jeffrey A. Gould
14,625
173,891
1,675,704
147,308
1,675,704
227,083
George Zweier
6,500
77,285
912,278
75,872
912,278
117,900
Mitchell Gould
10,750
127,818
1,134,210
75,872
1,134,210
117,900
David W. Kalish(1)
9,575
113,847
998,085
117,237
998,085
182,174
Steven Rosenzweig
3,000
35,670
Matthew J. Gould
1,675,704
147,308
1,675,704
227,083
(1)
Because Mr. Kalish is over 65 and has satisfied the period of service requirement, upon his retirement (i) a pro rata portion of his RSUs (A) granted in 2021 would vest as and to the extent adjusted performance conditions were satisfied as of his retirement, (B) granted in 2022 would vest in 2025, as and to the extent the performance conditions are satisfied as of the end of the measurement period and (ii) all of the restricted stock would vest. The market value of his restricted stock and RSUs are reflected in the applicable column.
(2)
Assumes that the target performance criteria is achieved and that there is no peer group adjustment. See “—Components of Executive Compensation—Long-Term Equity and Long-Term Equity Incentive Awards” and “—Outstanding Equity Awards at Fiscal Year End” and note 10 of our consolidated financial statements included in the Annual Report.
Our 2022 Incentive Plan generally provides, among other things, that if any payment or benefit that a participant in such plan would otherwise receive from us constitutes a “parachute payment” within the meaning of Section 280G of the Code and as a result would be subject to the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), then such payment will either (i) be reduced to an amount equal to the largest portion of such payment that would result in no portion of such payment (after reduction) being subject to the Excise Tax or (ii) not be reduced, whichever approach, after taking into account all applicable taxes (including the Excise Tax), results in such participant’s receipt, on an after-tax basis, of the greatest amount of such payment.
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PAY RATIO
We provide below a reasonable estimate of the relationship of the annual total compensation of Jeffrey A. Gould, our Chief Executive Officer and President, to the median annual total compensation of our employees (other than the CEO). For 2019:2022:
the annual total compensation of our CEO, as reported in the Summary Compensation Table, was $1,268,872;$1,924,234;
the median annual total compensation of all our employees (other than our CEO) was $359,918;$530,580; and
our CEO’s annual total compensation was 3.533.63 times that of the median of the annual total compensation of all our employees (other than our CEO).
In calculating this estimate, we included as our employees as of the December 31, 20192022 measurement date, only those individuals to whom we are required by the Internal Revenue Code of 1986, as amended, to issue a Form W-2. We identified our median employee by calculating our employees’ total annual compensation in the same manner that the CEO’s total annual compensation is calculated for the Summary Compensation Table.
Companies adopt a variety of methodologies and apply various assumptions in presenting this ratio. As a result, the pay ratio reported by other companies may not be comparable to the pay ratio we report.
The following table sets forth information concerning the compensation of our Principal Executive Officer (“PEO”) and our other named executive officers (“NEOs”) for each of the fiscal years ended December 31, 2022 and 2021 and our financial and market performance for each such year:
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PAY VERSUS PERFORMANCE
The following table sets forth information concerning the compensation of Jeffrey A. Gould, our principal executive officer (“PEO”), and our other named executive officers (i.e., Mitchell Gould, David W. Kalish, Matthew J. Gould and George Zweier, collectively referred to as the “NEOs”) for each of 2022 and 2021 and our financial and market performance for each such year:
Year
Summary
Compensation
Table Total
for PEO ($)
Compensation
Actually Paid
to PEO(1)($)
Average
Summary
Compensation
Table Total
for NEOs ($)
Average
Compensation
Actually Paid
to NEOs(2)($)
Value of
Initial Fixed
$100
Investment
Based On:
Net
Income
(millions)
Total
Stockholder
Return ($)($)
2022
1,924,234
1,471,371
918,263
598,520
142.11
50.0
2021
1,991,288
2,817,458
1,072,158
1,648,934
165.76
29.1
(1)
Represents the amount of “compensation actually paid” to Jeffrey A. Gould, as computed in accordance with SEC requirements. Such amounts do not reflect the actual amount of compensation earned by or paid to Mr. Gould. See table immediately below for a reconciliation showing how “compensation actually paid” was calculated.
(2)
Represents the average amount of “compensation actually paid” to the NEOs as a group as computed in accordance with SEC requirements. Such amounts do not reflect the actual average amount of compensation earned by or paid to these NEOs as a group. See “– Compensation of NEOs.”
In accordance with SEC requirements, the following adjustments were made to Jeffrey A. Gould’s total compensation for the applicable year to determine the “compensation actually paid”:
Year
Reported Summary
Compensation Table
Total for PEO ($)
Reported Value
of Equity
Awards ($)
Equity Award
Adjustments ($)
Compensation Actually
Paid to PEO ($)
2022
1,924,234
(672,629)
219,766
1,471,371
2021
1,991,288
(778,898)
1,605,068
2,817,458
The table below sets forth the manner in which Equity Award Adjustments in the immediately preceding table were calculated:
Year
Year End Fair
Value of Equity
Awards ($)
Year over Year
Change in Fair Value
of Outstanding and
Unvested Equity
Awards ($)
Year over Year Change
in Fair Value of Equity
Awards Granted in
Prior Years that Vested
in the Year ($)
Total Equity Award
Adjustments($)
2022
617,198
(388,124)
(9,308)
219,766
2021
1,148,488
483,705
(27,125)
1,605,812
Compensation of NEOs
In accordance with SEC requirements, the following adjustments were made to average total compensation for the NEOs for each year to determine the “compensation actually paid” to this group:
Year
Average
Reported Summary
Compensation Table
Total for NEOs ($)
Average
Reported
Value of Equity
Awards ($)
Total Average Equity
Award Adjustments( ($)
Average
Compensation
Actually Paid to
NEOs ($)
2022
918,263
(458,719)
138,976
598,520
2021
1,072,158
(562,618)
1,139,394
1,648,934
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The table below sets forth the manner in which Average Equity Award Adjustments in the immediately preceding table were calculated:
Year
Average
Year End Fair
Value of
Equity Awards
($)
Year over Year Average
Change in Fair Value of
Outstanding and
Unvested Equity Awards
($)
Year over Year Average
Change in Fair Value of
Equity Awards Granted
in Prior Years that
Vested in the Year ($)
Total Average
Equity Award
Adjustments ($)
2022
420,955
(275,059)
(6,920)
138,976
2021
818,041
341,905
(20,551)
1,139,394
Relationship between TSR and Net Income to Compensation Actually Paid
The following charts show the relationship of the compensation actually paid to our CEO and the average compensation actually paid to our NEOs to our cumulative TSR and net income for the periods indicated (TSR amounts reported in the graph assume an initial fixed investment of $100 and that all dividends, if any, were reinvested):


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CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Introduction
Fredric H. Gould, a director and former Chairman of our Board, is Vice Chairman of the Board of Directors of One Liberty Properties, Inc., a real estate investment trust listed on the New York Stock Exchange that is engaged in the ownership of a diversified portfolio of income-producing real properties that are net leased to tenants, generally under long-term leases. He is also a director and the sole stockholder of the managing general partner of Gould Investors. Gould Investors, a limited partnership that owns and operates a diversified portfolio of real estate and invests in other companies active in the real estate and finance industries, beneficially owns approximately 19.6% of our outstanding shares of common stock. Fredric H. Gould is the father of Matthew J. Gould and Jeffrey A. Gould.
Israel Rosenzweig, Chairman of our Board, is a Senior Vice President of One Liberty Properties, Inc. (“One Liberty”) and a Senior Vice President of the managing general partner of Gould Investors. (One Liberty and Gould Investors are described below). He is the father of Steven Rosenzweig, Senior Vice President – Legal, of BRT and an executive officer of the managing general partner of Gould Investors and Alon Rosenzweig, our employee. Fredric H. Gould, a director and former Chairman of our Board, is Vice Chairman of the Board of Directors of One Liberty. He is the father of Jeffrey A. Gould and Matthew J. Gould. Jeffrey A. Gould, a director and our President and Chief Executive Officer, is a Senior Vice President and a director of One Liberty, Properties, a Senior Vice President and director of the managing general partner of Gould Investors and a member of a limited liability company which is the other general partner of Gould Investors. He is also the father of Ryan Gould, our employee. Matthew J. Gould, a director and our Senior Vice President, is the Chairman of the Board of Directors of One Liberty, Properties, Chairman of the Board of the managing general partner of Gould Investors and serves as director of a trust that is a member of a limited liability company which is the other general partner of Gould Investors. He is also an executive officer of Majestic Property. David W. Kalish, Isaac Kalish and Mark H. Lundy, each of whom is an executive officer of our company, are executive officers of One Liberty Properties and of the managing general partner of Gould Investors. Messrs. D. Kalish, I. Kalish and Lundy are also officers of Majestic Property. David W. Kalish is the father of Isaac Kalish.
One Liberty is a real estate investment trust listed on the New York Stock Exchange that is engaged in the ownership of a diversified portfolio of income-producing real properties that are net leased to tenants. Gould Investors is a limited partnership that owns and operates a diversified portfolio of real estate and invests in other companies active in the real estate and finance industries. As of April 3, 2023, Gould Investors beneficially owns approximately 17.5% of our outstanding shares of common stock.
Related Party Transactions
Our 20182021 and 20192022 Equity Awards and Equity Incentive Awards
For 2018 and 2019, respectively, each of the following individuals was granted shares of restricted stock with the indicatedThe grant date fair value:value of the equity awards (i.e., restricted stock and RSUs) granted to our executive officers (other than our named executive officers) and certain related parties in 2021 and 2022, respectively, are as follows: Fredric H. Gould – $123,941Gould—$735,107 and $142,169; Matthew J. Gould - $156,584$556,727; Steven Rosenzweig—$391,658 and $178,381;$259,297; Mark H. Lundy – $150, 392Lundy—$664,936 and $167,101;$453,564; Israel Rosenzweig – $37, 450Rosenzweig—$414,764 and $39,526;$236,581; Isaac Kalish – $82,880$540,254 and $110,548; Ryan Baltimore, $76,960 and $93,075$416,291; and Alon Rosenzweig – $94,720Rosenzweig—$439,478 and $105,485. There were no grants of restricted stock for the Transition Period.$365,448. The grant date fair value of these awards was calculated in the manner described in note 4 of the Summary Compensation Table.Table and excludes, with respect to the RSUs, the effect of the peer group adjustment. These amounts reflect our accounting expense for these awards and do not correspond to the actual value, if, any that may be realized by these individuals.
Services
For performing Services in 2018, the Transition Period2021 and 2019,2022, the following executive officers and/or directors received, and it is anticipated will receive for performing Services in 2020,2023, respectively, the compensation indicated: Fredric H. Gould, $210,000, $52,500, $210,000 and $210,000; Matthew J. Gould, $217,875, $55,125, $231,525Steven Rosenzweig, $268,700, $298,148 and $243,100;$334,415; Isaac Kalish, $245,138, $62,025, $260,500$273,525, $287,200 and $273,525;$311,561; Israel Rosenzweig, $54,469, $13,782, $57,900$60,800, $63,840 and $60,800; and$53,840; Mark H. Lundy, $108,938, $27,562,$110,250, $110,250 and $110,250. See “Executive Compensation—General” and, for information regarding named executive officers compensated for performing Services, see “Executive Compensation—Summary Compensation Table.”
Shared Services Agreement
We and certain related entities, including Gould Investors, One Liberty Properties, and Majestic Property Management, occupy common office space and share certain services and personnel in common. The allocation of these general and administrative expenses among these entities is computed in accordance with a shared services agreement based on the estimated time devoted by executive, administrative and clerical personnel to the affairs of each participating entity to such agreement. In 2018, the Transition Period2021 and 2019,2022, the amount of general and administrative expenses allocated to us represents approximately 22.6%21.3% and 22.4%, 23.5% and 21.7%,
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respectively, of the total expenses allocated to all entities which are parties to the shared services agreement. Specifically, in 2018, the Transition Period2021 and 2019,
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2022, we paid $497,000, $108,000$641,000 and $572,000,$735,000, respectively, for common general and administrative expenses, including telecommunication services, computer services, bookkeeping, secretarial and other clerical services and legal and accounting services. Other than the executive officers identified in the Summary Compensation Table, Isaac Kalish wasand Steven Rosenzweig were the only executive officerofficers engaged by us on a part-time basis in 2018, the Transition Period2021 and 20192022 whose salary, bonus and benefits allocated to us in either of such years exceeded $120,000. The amounts allocated to us in 2021 and 2022 for the services he performed in 2018, the Transition Periodof Isaac Kalish were $113,889 and 2019$127,947, respectively and Steven Rosenzweig were $122,706, $33,019$268,234 and $134,220,$281,908, respectively.
As a cost saving measure, weWe obtain certain insurance (primarily property insurance) with Gould Investors and its affiliates and in 2018, the Transition Period2021 and 2019,2022, we reimbursed Gould Investors $26,000, $0$61,000 and $40,000$67,000, respectively, for our share of insurance premiums.
Majestic Property
Majestic Property, which is wholly-owned by Fredric H. Gould, provides real property management services, real estate brokerage, and construction supervision services for us and affiliated entities, as well as companies that are non-affiliated entities. In 2018, the Transition Period2021 and 2019,2022, we paid Majestic Property fees of $33,000, $8,000$31,000 and $33,000,$36,000, respectively, representing, in the aggregate, less than 1.0% of the revenues of Majestic Property for each such period. Each of Fredric H. Gould, Jeffrey A. Gould, Matthew J. Gould, David W. Kalish, Mark H. Lundy, Israel Rosenzweig, Steven Rosenzweig, and Isaac Kalish received compensation from Majestic Property for such periods, which compensation is not included in the Summary Compensation Table. The fees paid by us to Majestic Property and the expenses reimbursed to Gould Investors under the shared services agreement were reviewed by our audit committee. These individuals also receive compensation from other entities wholly-ownedowned or controlled (including shared controlled) by one or more by Fredric H. Gould, Jeffrey A. Gould and Matthew J. Gould and parties to the shared services agreement, none of which provided services to us or received compensation from us in 2018, the Transition Period2021 or 2019.2022.
Miscellaneous
Alon Rosenzweig received compensation of $374,477, $58,053$764,685 and $377,517$673,963 in 2018, the Transition Period2021 and 20192022, respectively (including $179,375, $46,390$208,559 and $196,805$227,125 in base salary for 2018, the Transition Period2021 and 2019,2022, respectively, bonuses of $26,000$27,000 and $26,000$30,000 for 20182021 and 2019,2022, respectively, which were paid in 20192022 and 2020,2023, respectively, $439,478 and $94,720$365,448 for each such period2021 and $105,485 for 2018,2022, respectively, representing the Transition Period and 2019, respectively,grant date fair value of awards of restricted stock awards) and participatedRSUs granted in such years, $40,658 with respect to the payment in 2021 of dividend equivalents with respect to RSUs granted in 2016, and perquisites of $48,960 and $51,390 for 2021 and 2022, respectively (including $43,500 and $45,750 of contributions to a defined contribution plan for 2021 and 2022, respectively). His annual base compensation for 2023 is $242,633.
Ryan Gould, who began working for us in September 2022, received compensation in 2022 of $26,250 (including $21,250 in base salary and a bonus of $5,000 for 2022, which was paid in 2023). His annual base salary for 2023 is $95,000.
Messrs. A. Rosenzweig and R. Gould participate in the welfare and other benefit plans generally made available to executives.
Policies and Procedures
Our Conduct Code recognizes that we may enter into transactions between us and our affiliated entities, including the sharing and provision of services among us and our affiliated entities; it provides that we may enter into a contract or transaction with an affiliated entity provided that any such transaction is approved or ratified as required by the Maryland General Corporation Law and the NYSE’s listing standards.
Generally, related party transactions that are proposed are submitted to the audit committee for its prior review and, if appropriate, approval. To the extent payments are made pursuant to an agreement with a related party previously approved by the audit committee, such as payments under the shared services agreement, such payments are reviewed by the audit committee on a quarterly basis and if appropriate, approved. If a transaction relates to a member of our audit committee, such member does not participate in the audit committee’s deliberations. Our related party transactions are reported to our Board on at least an annual basis.employees.
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PROPOSAL 2
ADVISORY APPROVAL OF THE COMPENSATIONSCOMPENSATION OF EXECUTIVES
(Proposal 2)
We are required toSection 14A of the Exchange Act (“Section 14A”) requires that we seek a non-binding advisory vote from our stockholders to approve the compensation awarded to our named executive officers as disclosed in this proxy statement. Although the advisory vote is non-binding, the Compensation Committeecompensation committee and the Board will review the results of the vote and will consider our stockholders' concerns and take them into account in future determinations concerning our executive compensation program. The Board of Directors recommends that you indicate your support for our compensation policies and procedures for our named executive officers, as outlined in the resolution below. Accordingly, the following resolution will be submitted for a stockholder vote at the Annual Meeting:
RESOLVED, that the stockholders approve, on an advisory basis, the compensation of the individuals identified in the Summary Compensation Table, as disclosed in the BRT Apartments Corp 2020 proxy statements pursuant tofor the compensation disclosure rulesCompany’s 2023 annual meeting of the Securities and Exchange Commission.”stockholders.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE IN FAVOR OF THE ADOPTION OF THIS RESOLUTION.
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PROPOSAL 3
ADVISORY VOTE ON THE FREQUENCY AT WHICH WE WILL SEEK STOCKHOLDER ADVISORY VOTES ON EXECUTIVE COMPENSATION
Section 14A requires that (i) once every six years, we seek stockholder approval of the frequency with which we will seek advisory approval of executive compensation and (ii) we present every one, two or three years, or abstain as alternatives for stockholders.
The Board has determined that an advisory vote on executive compensation every three years is the best approach for us based on a number of considerations, including the following:
the elements of our executive compensation program generally do not change in a significant manner from year to year;
stockholders have various methods of providing feedback on executive compensation matters even in years in which there is no advisory vote on executive compensation — for example, by communicating directly with the Board, as discussed under “Governance of our Company — Communications with Directors”;
a three-year vote cycle gives the Board sufficient time to thoughtfully consider the results of the advisory vote and to implement any desired changes to our executive compensation policies and procedures; and
a three-year cycle will provide investors sufficient time to evaluate the effectiveness of our short- and long-term compensation programs.
Although the vote on this proposal is advisory and non-binding, the compensation committee and Board will carefully consider the voting results. The proxy card provides stockholders with the opportunity to choose among four options (holding the vote every one, two or three years, or abstaining) and, therefore, stockholders will not be voting to approve or disapprove the recommendation of the Board. The alternative (i.e., one year, two years, or three years) that receives the most votes will be deemed approved by the stockholders.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE OF EVERY THREE YEARS FOR THE FREQUENCY AT WHICH WE WILL PRESENT TO STOCKHOLDERS AN ADVISORY VOTE ON COMPENSATION OF EXECUTIVES.
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PROPOSAL 4
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
General
OurThe audit committee in accordance with its charter, routinely reviewsand the performance and retentionboard of our independent auditor anddirectors is requesting proposals from several independent registered public accounting firms to serveseeking ratification of the appointment of Ernst & Young LLP (“E&Y”), as our independent registered public accounting firm for the year ending December 31, 2020. After reviewing these proposals, the audit committee will select and appoint an independent registered public accounting firm for 2020. In light2023. A representative of this ongoing process, we are not submitting a proposal for the ratification of the appointment of our independent registered public account firm at the annual meeting. While not requiredE&Y is expected to do so, our practice has been to submit the selection of the independent auditor for ratification in order to ascertain the views of our stockholders, and we expect to resume this practice in 2021.
We expect that representatives of BDO USA, LLP (“BDO”), which served as our independent registered public accounting firm during the periods described in the table below, will be present at theour annual meeting and will have anthe opportunity to make a statement if he or she desires to do so and will be available to respond to appropriate questions fromquestions.
We are not required to have our stockholders. We currently expect to completestockholders ratify the request for proposal process to selectselection of E&Y as our independent registered public accounting firm for 2020 byfirm. We are doing so because we believe it is good corporate practice. If the end ofstockholders do not ratify the second quarter of 2020. If ourselection, the audit committee makeswill reconsider whether to retain E&Y, but may, in its discretion, decide to retain such firm. Even if the selection is ratified, the audit committee, in its discretion, may change the appointment at any time during the year if it determines that such a selection prior to the annual meeting, we expect that representatives from the firm selected by the committee willchange would be present at the annual meeting and that they will have the opportunity to make a statement and to be available to respond to appropriate questions fromin our stockholders.interest.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE FOR RATIFICATION OF THE APPOINTMENT OF ERNST & YOUNG LLP AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR 2023.
Audit and Other Fees
The following table presents except as otherwise indicated, BDO’sE&Y’s fees (including expenses) for the services and periods indicated:in the indicated years:
2019
Transition
Period
2018
2022
2021
Audit fees(1)
$462,714
$148,095
$564,906
Audit fees(1)
$576,108
$582,079
Audit-related fees
Tax fees
6,210
3,780
17,600
17,000
All other fees
Total fees
$468,924
$151,875
$564,906
$593,708
$599,079
(1)
Includes fees for the audit of our annual consolidated financial statements, the annual audit of internal controls over financial reporting, the review of the consolidated financial statements included in our quarterly reports on Form 10-Q the audits of the statements of revenue and certain expenses performed in connection with multi-family property acquisitions in accordance with Rule 3-14 of Regulation S-X, and in 2019 for services rendered in connection with registration statements filed with the SEC.
Approval Policy for Audit and Non-Audit Services
The audit committee annually reviews and approves the retention of our independent registered public accounting firm for each fiscal year and the audit of our financial statements for such fiscal year, including the fee associated with the audit. In addition, the audit committee approves the provision of tax related and other non-audit services. Any fees for the audit and any fees for non-audit services in excess of those approved by the audit committee must receive the prior approval of the audit committee.
Proposals for any non-audit services to be performed by our independent registered public accounting firm must be approved in advance by the audit committee.
For 2019,2022, the audit committee pre-approved all of the audit, tax and non-audit services rendered by our independent registered public accounting firm.
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REPORT OF THE AUDIT COMMITTEE
The information contained in this Report of the Audit Committee shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing (except to the extent that we specifically incorporate this information by reference) and shall not otherwise be deemed “soliciting material” or “filed” with the SEC or subject to Regulation 14A or 14C, or to the liabilities of Section 18 of the Exchange Act (except to the extent that we specifically incorporate this information by reference).
The role of the audit committee is to, among other things, select and engage our independent registered public accounting firm and to oversee and monitor our financial reporting process, the independence and performance of the independent registered public accounting firm and the functioning of our internal controls. It is management’s responsibility to prepare financial statements in accordance with generally accepted accounting principles and for the independent registered public accounting firm to perform an independent audit of the financial statements and to express an opinion on the conformity of those financial statements with generally accepted accounting principles.
In performing its duties, the audit committee:
metreviewed and held discussionsdiscussed our audited consolidated financial statements for the year ended December 31, 2022 (the “Audited Financial Statements”) with management the independent registered public accounting firm and the accounting firm performing the internal control audit function on our behalf;E&Y;
discussed with E&Y the independent registered public accounting firm the overall scope and plan for its activities and reviewed with the accounting firm performing the internal control function its work plan and the scope of its activities;
obtained representations from management to the effect that the year-end consolidated financial statements were prepared in accordance with generally accepted accounting principles;
was advised by the independent registered public accounting firm that it would render an unqualified opinion with respect to the year-end consolidated financial statements;
reviewed and discussed the year end consolidated financial statements with management and the independent registered public accounting firm;
discussed and evaluated our internal control procedures with management, the independent registered public accounting firm and the accounting firm performing the internal control audit function;
reviewed with management the process used for the certifications under the Sarbanes-Oxley Act of 2002 of our filings with the SEC;
reviewed the unaudited quarterly financial statements prior to filing each Form 10-Q with the SEC and reviewed the related quarterly earnings press releases prior to issuance of same;
discussed with the independent registered public accounting firm matters required to be discussed by the Public Company Accounting Oversight Board (the “PCAOB”) Auditing Standard (“AS”) No. 1301 (formerly AS 16), Communications with Audit Committees;
discussed with the independent registered public accounting firm such firm’s independencereceived from BRT and management, and receivedE&Y the written disclosures and the letter from E&Y regarding E&Y’s independence required by the applicable requirements of the PCAOB, and discussed with such firm required by PCAOB Ethicsits independence; and Independence Rule 3526 (Communication with Audit Committees Concerning Independence); and
reviewed and approved the independent registered public accounting firm’s fees, both for performing audit and non-audit services, and considered whether the provision of non-audit services by the independent registered public accounting firm was compatible with maintaining the independent registered public accounting firm’s independence and concluded that it was compatible.
The audit committee meets with the independent registered public accounting firm and the accounting firm performing the internal control audit function, with and without management present, to discuss the results of their examinations, their evaluations of the internal controls, and the overall quality of our financial reporting.
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Basedbased on the reviews and discussions referred to above, the audit committee recommended that the Company’s audited consolidated financial statements for the year ended December 31, 2019Audited Financial Statements be included in its Annual Report on Form 10-K for the year ended December 31, 20192022 for filing with the SEC.
 
Louis C. Grassi (Chairman)
 
Gary Hurand
 
Elie Y. Weiss
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BRT APARTMENTS CORP. 2020 INCENTIVE PLAN
(PROPOSAL 3)
Highlights of the Plan
Set forth below are some of the highlights of the Plan:
Options, restricted stock, restricted stock units, dividend equivalent rights and performance based awards may be granted;
A non-management director may not be granted awards with respect to more than 10,000 shares in any year;
Options may not be granted at an exercise price per share that is less than 100% of the fair market value per share on the date of the grant;
Participants may not be granted more than 100,000 shares in any year pursuant to each type of award other than with respect to stock options as to which no more than 50,000 shares may be granted in each year;
Without stockholder approval, we will not (i) reprice, replace or regrant, an outstanding option either in connection with the cancellation of such option or by amending an award agreement to lower the exercise price of such option, (ii) cancel outstanding options in exchange for cash or other awards; and (iii) repurchase outstanding unvested restricted stock or unvested RSUs in exchange for cash.
General
The Board has approved, subject to stockholder approval, the adoption of the BRT Apartment Corp. 2020 Incentive Plan. The Board believes that granting equity based compensation is an important component of our compensation structure. The purpose of the Plan is to motivate, retain and attract employees, officers and directors of experience and ability and to further the financial success of our company by aligning the interests of participants in the Plan, through the ownership of shares of common stock, with the interests of our stockholders.
As of the close of business on the record date, an aggregate of 1,194,145 shares of restricted stock and shares subject to RSUs (i.e., 744,145 shares of restricted stock and 450,000 shares subject to RSUs) issued pursuant to all of our equity incentive plans are outstanding. The outstanding restricted stock vests annually in approximately equal amounts from 2020 through 2025 and, subject to satisfaction of performance and market based conditions, the shares subject to RSUs vest in 2021. See “Executive Compensation – Long-Term Equity and Long-Term Equity Incentive Awards” and “Executive Compensation – Outstanding Equity Awards at Fiscal Year End.” There are 140,605 shares available to be awarded pursuant to our 2018 Incentive Plan, which we refer to as the 2018 Plan, and we propose the adoption of the Plan pursuant to which up to 1,000,000 shares may be awarded. If stockholders adopt the Plan, no further awards will be made under the 2018 Plan. Generally, the awards granted each year have represented approximately 1% of our outstanding shares at the time of grant. The closing price of a share of our common stock on the New York Stock Exchange on May 15, 2020 was $8.91.
The following summary of major features of the Plan is qualified in its entirety by reference to the actual text of the Plan, set forth as Annex A.
Shares Subject to the Plan
The total number of shares available for grant under the Plan will not exceed 1,000,000 shares. The Plan authorizes the discretionary grant of (i) incentive stock options intended to qualify under Section 422 of the Internal Revenue Code of 1986, as amended, which we refer to as the “Code”, (ii) non-qualified stock options, (iii) restricted stock, (iv) restricted stock units, (v) dividend equivalent rights and (vi) performance-based awards. The shares available for issuance under the Plan will be authorized but unissued common shares. Shares related to awards that are forfeited, cancelled, terminated or expire unexercised will be available for grant under the Plan. Neither shares tendered by a participant to pay the exercise price of an award, nor any shares withheld by us for taxes, will be available for future grants under the Plan. In the event of a stock dividend or stock split affecting our shares, the number of shares issuable and issued under the Plan and the number of shares covered by and the exercise price and other terms of outstanding awards will be adjusted to reflect such event to prevent dilution or diminution of awards.
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Administration of the Plan
The Plan will be administered by our compensation committee which, to the extent deemed necessary by the Board, will consist of two or more persons who satisfy the requirements for a “non-employee director” under Rule 16(b) under the Exchange Act. The compensation committee has authority to administer and construe the Plan in accordance with its provisions, including the power to (a) determine persons eligible for awards, (b) prescribe the terms and conditions of awards granted under the Plan, (c) adopt rules for the administration, interpretation and application of the Plan which are consistent with the Plan and (d) establish, interpret, amend or revoke any such rules. A non-management director may not be granted awards with respect to more than 10,000 shares in any calendar year.
Options
Stock options entitle the holder to purchase a specified number of shares at a specified exercise price subject to the terms and conditions of the option grant. The purchase price per share for each stock option is determined by the compensation committee, but must be at least 100% of the fair market value per share on the date of grant. The aggregate fair market value of shares with respect to which incentive stock options are exercisable for the first time by an individual during any calendar year cannot exceed $100,000. To the extent that the fair market value of shares with respect to which incentive stock options become exercisable for the first time during any calendar year exceeds $100,000, the portion in excess of $100,000 will be treated as a non-qualified option. Options granted under the Plan may be exercisable for a term up to ten years. If a participant owns more than 10% of the total voting power of all classes of our shares at the time the participant is granted an incentive stock option, the purchase price per share for such option cannot be less than 110% of the fair market value per share on the date of grant and the term of such option cannot exceed five years.
Restricted Stock and RSUs
Restricted stock are shares that may not be sold, transferred, gifted, bequeathed, pledged, assigned or otherwise disposed of until the end of a specified restriction period. Restricted stock units, or RSUs, represent the right, upon satisfaction of specified conditions, to receive shares and are subject to the same restrictions on transferability applicable to restricted stock. RSUs and shares of restricted stock will be issued at the beginning of the restriction period and the compensation committee shall set restrictions and other conditions applicable to the vesting of such award, including restrictions based on the achievement of specific performance goals, time based restrictions or any other basis determined by the compensation committee.
Generally, recipients of restricted stock have the right to vote such shares and to receive and retain cash dividends and other distributions, if any, paid thereon, even if such restricted stock is later forfeited. Recipients of RSUs are not entitled to dividends (except to the extent a dividend equivalent right is granted in tandem with an RSU) or vote with respect to the underlying shares until such units vest. Recipients of these awards will not be entitled to delivery of the stock certificate (or its equivalent) representing the shares until the applicable restrictions have been satisfied. The Plan provides that except as otherwise determined by the compensation committee, RSUs and shares of restricted stock for which the vesting and other applicable conditions have not been met will be forfeited upon the death, disability or retirement of such participant; it is anticipated that to the extent permitted by law, the compensation committee will, as it has in the past, provide that (i) shares of restricted stock vest upon such occurrence and (ii) with respect to RSUs, subject to the satisfaction of the applicable market and/or performance conditions, a pro-rata portion (based on the time elapsed between the grant and the triggering event) of the RSUs will vest. See “Executive Compensation –Components of Executive Compensation – Employment and Severance Agreements; Post-Employment Benefits; Change of Control.”
Generally, restricted stock or RSUs that do not vest as provided in the applicable award agreement will be forfeited and the recipient of such award will not have any rights after such forfeiture with respect to such award other than to retain dividends paid prior thereto.
Dividend Equivalent Rights
The Plan allows the compensation committee to grant dividend equivalents rights in tandem with the grant of RSUs and performance based awards (other than restricted stock and options). These rights entitle the holder to receive an amount of cash equal to the cash distributions that would have been paid on shares underlying the award to which such right relates, as if such shares were outstanding during the period beginning with the grant
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date (or if otherwise determined by the compensation committee, the beginningDELINQUENT SECTION 16(a) REPORTS
Each of the performance cycle) of the award to which such dividend equivalent right relates through the vesting date (or if otherwise determined by the compensation committee, the conclusion of the performance cycle) of such award. Dividend equivalents rights will only vest to the extent the related award vests.
Performance Based Awards
Performance based awards will be made by the issuance of restricted stock units or other awards, or a combination thereof, contingent upon the attainment, as established by the compensation committee, of one or more performance goals (described below) over a specified period. The maximum number of sharesGould Investors, Jeffrey A. Gould and Matthew J. Gould filed two reports late with respect to which a participant may be granted performance based awards in any calendar year is 100,000 shares.
The terms and conditions of a performance based award will provide for the vesting of the award to be contingent upon the achievement of one or more specified performance goals that the compensation committee establishes. For this purpose, “performance goals” means for a performance cycle, the specific goals that the compensation committee establishes that may be based on one or more of the following performance criteria:
pre-tax income,
after-tax income,
net income (meaning net income as reflected in our financial reports for the applicable period),
operating income (including net operating income),
any one or more of cash flow, cash flow from operations, and free cash flow,
return on any one or more of equity, capital, invested capital and assets,
funds available for distribution,
occupancy rate at any one or more of our properties,
total stockholder return,
funds from operations (“FFO”), as computed in accordance with standards established by the National Association of Real Estate Investment Trusts Inc.,
adjusted FFO (i.e., adjusting FFO to give effect to any one or more of the following: straight-line rent, amortization of lease tangibles, lease termination fee income, amortization of restricted stock or other non-cash compensation expense, amortization and/or write-off of deferred financing costs, deferred mortgage and debt prepayment costs),
stock appreciation (meaning an increase in the price or value of the Shares after the date of grant of an award and during the applicable period),
revenues,
assets,
earnings before any one or more of the following items: interest, taxes, impairment charges, depreciation or amortization for the applicable period, as reflected in our financial reports for the applicable period,
reduction in expense levels,
operating cost management and employee productivity,
strategic business criteria consisting of one or more objectives based on meeting specified revenue, market share, market penetration, geographic business expansion goals, objectively identified project milestones, cost targets and goals relating to acquisition or divestitures,
achievement of business or operational goals such as market share and/or business development; and
such other metrics or criteria as the Committee may establish or select.
The performance goals need not be the same with respect to all participants and may be established for the Company in the aggregate or on a per share basis (whether diluted or undiluted), may be based on an absolute ortwo transactions.
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relative basis, may be based on our performance compared to the performance of businesses or indices specified by the compensation committee, may be compared to any prior period, may be based on a company-wide basis or in respect of any one or more business units, may be adjusted for non-controlling interests, and any one or more of the foregoing.
Amendment and Termination of the Plan
No awards may be made under the Plan on or after the tenth anniversary of the Plan’s effective date. Our Board may amend, suspend or terminate the Plan at any time for any reason provided that no amendment, suspension or termination may impair rights or obligations under any outstanding award without the participant’s consent or violate the Plan’s prohibition on repricing (i.e., the replacing or regranting of an option in connection with the cancellation of the option or by amending an award agreement to lower the exercise price of an option or the cancellation of any award in exchange for cash). The stockholders must approve any amendment: (i) if such approval is required under applicable law or stock exchange requirements; or (ii) that changes the no-repricing provisions of the Plan.
Clawbacks; Compliance with Laws; Compliance with REIT Requirements
The grant of awards and the issuance of shares under the Plan is subject to all applicable laws, rules and regulations, approvals by governmental and quasi-governmental authorities and the applicable provisions of any claw-back policy implemented by us, whether implemented prior to or after the grant of such award.
If a recipient’s relationship with us is terminated for cause (e.g., insubordination, dishonesty, incompetence, moral turpitude, the refusal to perform such person’s duties and responsibilities and other misconduct, as determined by the compensation committee), then (i) all options (except to the extent exercised) immediately terminate and (ii) the recipient’s rights to all restricted stock, RSUs and performance share awards (except to the extent such awards have vested) are forfeited immediately.
Awards are not exercisable if such award or its exercise could cause the participant to be in violation of any restrictions on ownership and transfer of our securities, or if, in the discretion of the Committee, such award could otherwise impair our status as a real estate investment trust under the Code.
Change in Control
Awards granted under the Plan that are outstanding and not then exercisable or subject to restrictions at the time of a change in control (as described below and in the Plan) become immediately exercisable and all restrictions are removed effective as of such change in control, except as otherwise provided in the award agreement. Our RSUs limit the vesting of such awards upon a change of control. See “Executive Compensation – Employment and Severance Agreements; Post-Employment Benefits; Change of Control.” The Plan defines a change in control as follows:
(a)
the acquisition (other than from us) in one or more transactions by any person (as defined in Section 13(d) of the Exchange Act) of the beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act) of 25% or more of the outstanding shares or the combined voting power of the then outstanding securities entitled to vote in the election of directors (provided that this provision is not applicable to acquisitions made individually, or as a group, by Fredric H. Gould, Matthew J. Gould and Jeffrey A. Gould and their respective spouses, lineal descendants and affiliates);
(b)
individuals who, at the date of the award, constitute our board (the “Incumbent Board”), cease for any reason to constitute at least a majority of the board; provided, however, that an individual becoming a director subsequent to the date of an award whose election or nomination for election was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individuals were a member of the Incumbent Board, but excluding any individual whose initial assumption of office occurs as a result either of an actual or threatened election contest or other actual or threatened solicitation of proxies or consent by and behalf of a person other than the Incumbent Board;
(c)
the closing of a sale or other conveyance of all or substantially all of our assets;
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(d)
the effective time of any merger or other business combination involving us if immediately after such transactions persons who hold a majority of outstanding voting securities entitled to vote generally in the election of the directors of the surviving entity are not persons who, immediately prior to such transaction, held our voting stock.
Federal Income Tax Consequences
The federal tax rules applicable to awards under the Plan under the Code are summarized below. This summary omits the tax laws of any municipality, state, or foreign country in which a participant resides.
Stock option grants under the Plan may be intended to qualify as incentive stock options under Section 422 of the Code or may be non-qualified stock options governed by Section 83 of the Code. Generally, federal income tax is not due from a participant upon the grant of a stock option, and a deduction is not taken by us. Under current tax laws, if a participant exercises a non-qualified stock option, he or she will have taxable income equal to the difference between the market price of the common shares on the exercise date and the stock option grant price. We are entitled to a corresponding deduction on our income tax return.
A participant will not have any taxable income upon exercising an incentive stock option after the applicable holding periods have been satisfied (except that the alternative minimum tax may apply), and we will not receive a deduction when an incentive stock option is exercised. The treatment of a disposition of shares acquired through the exercise of a stock option depends on how long the shares were held and whether the shares were acquired by exercising an incentive stock option or a non-qualified stock option. We may be entitled to a deduction in the case of a disposition of shares acquired under an incentive stock option before the applicable holding periods have been satisfied.
Generally, taxes are not due from the participant or owed by us when a grant of restricted stock, RSUs or performance based awards is initially made (unless the recipient of a restricted stock award makes an election under Section 83(b) of the Code in which case it is taxed at the time of grant), but the award becomes taxable when it is no longer subject to a “substantial risk of forfeiture” (i.e., it becomes vested or transferable), in the case of restricted stock, or when shares are issuable in connection with vesting, in the case of an RSU or performance based award. Except with respect to awards for which a Section 83(b) election is made, income tax is paid on the value of the stock units or awards at ordinary rates when the restrictions lapse, and then at capital gain rates when the shares are sold. Generally, we will be entitled to a deduction equal to the amount of ordinary income recognized by the participant at the time the participant recognizes such income for tax purposes.
The grant of dividend equivalents rights generally will have no federal income tax consequences for the participant. Generally, the participant will recognize ordinary income and/or capital gain, depending on the characterization of such distribution as ordinary income and/or capital gain, on the amount distributed to the participant pursuant to such dividend equivalent rights. Generally, we will be entitled to a dividend paid deduction equal to the amount of ordinary income and/or capital gain recognized by the participant at the time the participant recognizes such income for tax purposes.
Section 409A of the Code affects taxation of awards to employees but does not affect our ability to deduct deferred compensation. Section 409A applies to RSUs, performance units, and performance shares. Such grants are taxed at vesting but will be subject to new limits on plan terms governing when vesting may occur. If grants under such plans do not allow employees to elect further deferral on vesting or on distribution, under the regulations, a negative impact should not attach to the grants.
Section 409A of the Code does not apply to incentive stock options, non-qualified stock options (that are not discounted), and restricted stock, provided that there is no deferral of income beyond the vesting date.
See “Executive Compensation – Deductibility of Executive Compensation” for information regarding Section 162(m) of the Code.
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New Plan Benefits Table
We have not determined the type, amount or recipients of awards under the 2020 Plan. Accordingly, we provide the following table which reflects the awards granted in 2019 pursuant to the 2018 Plan to the persons and groups indicated as if such grants were made pursuant to the 2020 Plan. These awards were in the form of restricted stock that vest on a “cliff-vesting” basis five years after grant. See “Executive Compensation –Grant of Plan Based Awards During 2019” for additional information regarding the equity awards granted in 2019.
Name and Position
Dollar
Value(1)
Number of
Units
Jeffrey A. Gould
 
 
President and Chief Executive Officer
243,927
14,374
Mitchell Gould
 
 
Executive Vice President
183,276
10,800
David W. Kalish
 
 
Senior Vice President
118,790
7,000
George Zweier
 
 
Vice President and Chief Financial Officer
123,881
7,300
Steven Rosenzweig
 
 
Senior Vice President - Legal
56,120
3,307
Executive group (8 individuals)
1,347,537
79,407
Non-executive director group (6 individuals)
397,098
23,400
Non-executive officer and employee group (38 individuals)
726,061
42,785
(1)
Reflects the number of units multiplied by $16.97, the closing price of our common stock on December 31, 2019.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE IN FAVOR OF THE PROPOSAL TO ADOPT THE BRT APARTMENTS CORP. 2020 INCENTIVE PLAN.
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ADDITIONAL INFORMATION AND NOTICE OF INTERNET AVAILABILITY OF
PROXY MATERIALS
As of the date of this proxy statement, we do not know of any business that will be presented for consideration at the meeting other than the items referred to in the Notice of the Meeting. Subject to applicable law, if any other matter is properly brought before the meeting for action by stockholders, the holders of the proxies will vote and act with respect to the business in accordance with their best judgment and discretionary authority to do so is conferred by the enclosed proxy. Our Conduct Code, corporate governance guidelines and the charters for our audit, compensation and nominating committees are available under the “Corporate Governance’’Governance” tab at www.brtapartments.com.
This proxy statement (including the notice of meeting), the proxy card and our Annual Report are available at www.brtapartments.com/annualmeetingmaterials.pdf.
By order of the Board of Directors


 
S. Asher Gaffney,
S. Asher Gaffney, Secretary
Corporate Secretary

April 21, 2023
 
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ANNEX A
BRT APARTMENTS CORP.
2020 INCENTIVE PLAN
SECTION 1
EFFECTIVE DATE AND PURPOSE
1.1 Effective Date. This Plan (as defined) shall become effective upon approval by the stockholders of the Company (as defined), as and to the extent required by the listing requirements of the New York Stock Exchange.
1.2 Purpose of the Plan. The Plan is designed to motivate, retain and attract Participants (as defined) of experience and ability and to further the financial success of the Company by aligning the interests of Participants through the ownership of Shares (as defined) with the interests of the Company’s stockholders.
SECTION 2
DEFINITIONS
The following terms shall have the following meanings (whether used in the singular or plural) unless a different meaning is plainly required by the context:
1934 Act” means the Securities Exchange Act of 1934, as amended. Reference to a specific section of the 1934 Act or a regulation thereunder shall include any regulation promulgated under such section, and any comparable provision of any future legislation or regulation amending, supplementing or superseding such section or regulation.
Affiliate” or “Affiliates” has the meaning ascribed to such term by Rule 501 promulgated under the Securities Act of 1933, as amended.
Award” means, individually or collectively, a grant under the Plan of Nonqualified Stock Options, Incentive Stock Options, Restricted Stock, Restricted Stock Units, Dividend Equivalent Rights and Performance Share Awards.
Award Agreement” means either (1) the written agreement setting forth the terms and provisions applicable to each Award granted under the Plan or (2) a statement (including an electronic communication) issued by the Company to a Participant describing the terms and provisions of such Award.
Board” or “Board of Directors” means the Board of Directors of the Company, or any analogous governing body of any successor to the Company.
Code” means the Internal Revenue Code of 1986, as amended from time to time, and the regulations thereunder.
Committee” means the Compensation Committee of the Board or the committee of the Board appointed to administer the Plan.
Company” means BRT Apartments Corp., a Maryland corporation.
Company Voting Stock” has the meaning ascribed to such terms by Section 12.1(a).
Dividend Equivalent Right” means an Award granted pursuant to Section 9, entitling the Participant to receive an amount of cash equal to the cash distributions that would have been paid on the Shares specified in the Award to which such Dividend Equivalent Right relates, as if such Shares had been issued to and held by the Participant holding such Dividend Equivalent Right during the period beginning with the grant date (or if otherwise determined by the Committee, the beginning of the Performance Cycle) of the Award to which the Dividend Equivalent Right relates through the vesting date of such award (or if otherwise determined by the Committee, the conclusion of such Performance Cycle).
Disability” or “Disabled” means the inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than 12 months.
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Exercise Price” means the price at which a Share may be purchased by a Participant pursuant to the exercise of an Option.
Fair Market Value” means, as of any given date: (i) the closing sales price of the Shares on any national securities exchange on which the Shares are listed; (ii) the closing sales price if the Shares are listed on the OTCBB or other over the counter market; or (iii) if there is no regular public trading market for such Shares, the fair market value of the Shares as determined by the Committee.
Grant Date” means, with respect to an Award, the effective date that such Award is granted to a Participant.
Incentive Stock Option” means an Option to purchase Shares which is designated as an Incentive Stock Option and is intended to meet the requirements of Section 422 of the Code.
Incumbent Board” has the meaning ascribed to such term by Section 12.1(b).
Non-management director” means a director who, in the applicable calendar year, was not compensated, directly or indirectly, by the Company, any Subsidiary or any of their Affiliates, other than compensation for service as a director or as a member of any committee of the Board.
Non-qualified Stock Option” means an Option to purchase Shares which is not an Incentive Stock Option.
Option” means an Incentive Stock Option or a Nonqualified Stock Option.
Participant” means an officer, employee, director or consultant of the Company or any of its Subsidiaries.
Performance Criteria” shall mean any, a combination of, or all of the following: (i) pre-tax income, (ii) after-tax income, (iii) net income (meaning net income as reflected in the Company’s financial reports for the applicable period), (iv) operating income (including net operating income), (v) cash flow, cash flow from operations, free cash flow and any one or more of the foregoing, (vi) return on any one or more of equity, capital, invested capital and assets, (vii) funds available for distribution, (viii) occupancy rate at any one or more of the Company’s or its Subsidiaries’ properties, (ix) total stockholder return, (x) funds from operations (“FFO”), as computed in accordance with standards established by the National Association of Real Estate Investment Trusts, Inc. (“NAREIT”), (xi) adjusted FFO (i.e., adjusting FFO to give effect to any one or more of the following: straight-line rent, amortization of lease intangibles, lease termination fee income, amortization of restricted stock or other non-cash compensation expense, amortization and/or write-off of deferred financing costs, deferred mortgage costs and debt prepayment costs), (xii) stock appreciation (meaning an increase in the price or value of the Shares after the date of grant of an award and during the applicable period), (xiii) revenues, (xiv) assets, (xv) earnings before any one or more of the following items: interest, taxes, impairment charges, depreciation or amortization for the applicable period, as reflected in the Company’s financial reports for the applicable period, (xvi) reduction in expense levels, (xvii) operating cost management and employee productivity, (xviii) strategic business criteria consisting of one or more objectives based on meeting specified revenue, market share, market penetration, geographic business expansion goals, objectively identified project milestones, cost targets and goals relating to acquisition or divestitures; (xix) achievement of business or operational goals such as market share and/or business development, and (xx) such other metrics or criteria as the Committee may establish or select. Performance Criteria need not be the same with respect to all Participants and may be established on an aggregate or per share basis (diluted or undiluted), may be based on performance compared to performance by businesses or indices specified by the Committee, may be compared to any prior period, may be based on a company-wide basis or in respect of any one or more business units, may be measured on an absolute or relative basis, may be adjusted for non-controlling interests, and any one or more of the foregoing. All calculations and financial accounting matters relevant to this Plan shall be determined in accordance with GAAP, except as otherwise directed by the Committee.
Performance-Based Award” means an Award granted pursuant to Section 8 of the Plan.
Performance Cycle” means one or more periods of time which may be of varying and overlapping durations, as the Committee may select, over which the attainment of one or more Performance Goals will be measured for the purpose of determining a Participants right to and the payment of a Restricted Stock Award, Restricted Stock Unit, Option or Performance Share Award.
Performance Goals” means for a Performance Cycle, the applicable Performance Criteria.
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Period of Restriction” means the period during which an Award granted hereunder is subject to a substantial risk of forfeiture. Such restrictions may be based on the passage of time, the achievement of Performance Goals or the occurrence of other events as determined by the Committee.
Plan” means the BRT Apartments Corp. 2020 Incentive Plan, as set forth in this instrument, and as hereafter amended from time to time.
Restricted Stock” means an Award of Shares, the grant, issuance, retention and/or vesting of which is subject to such conditions as are expressed in the Award Agreement and as contemplated herein.
Restricted Stock Unit” or “RSU” means an Award of a right to receive one Share, the grant, issuance, retention and/or vesting of which is subject to such conditions as are expressed in the Award Agreement and as contemplated herein.
Retirement” means (i) a director who has attained the age of 65 years who resigns or retires from the Board or does not stand for re-election to the Board and has served continuously as a director of the Company for not less than six consecutive years, and (ii) an officer or employee of, or consultant to, the Company or one of its Subsidiaries who has attained the age of 65 years who resigns or retires from the Company or one of its Subsidiaries and has served in any such capacity with the Company or one of its Subsidiaries for not less than ten consecutive years at the time of retirement or resignation.
Shares” means the shares of common stock, $0.01 par value, of the Company, or any other security of the Company determined by the Committee pursuant to Section 5.3.
Subsidiary” means (i) a corporation, association or other business entity of which 50% or more of the total combined voting power of all classes of capital stock is owned, directly or indirectly, by the Company or by one or more Subsidiaries of the Company or by the Company and one or more Subsidiaries of the Company, (ii) any partnership or limited liability company of which 50% or more of the capital and profit interests is owned, directly or indirectly, by the Company or by one or more Subsidiaries of the Company or by the Company and one or more Subsidiaries of the Company, or (iii) any other entity not described in clauses (i) or (ii) above of which 50% or more of the ownership and the power, pursuant to a written contract or agreement, to direct the policies and management or the financial and the other affairs thereof, are owned or controlled by the Company or by one or more Subsidiaries of the Company or by the Company and one or more Subsidiaries of the Company.
SECTION 3
ELIGIBILITY
3.1 Participants. Awards may be granted in the discretion of the Committee to officers, employees, directors of, or consultants to the Company or its Subsidiaries.
3.2 Non-Uniformity. Awards granted hereunder need not be uniform among eligible Participants and may reflect distinctions based on title, compensation, responsibility or any other factor the Committee deems appropriate.
SECTION 4
ADMINISTRATION
4.1 The Committee. The Plan will be administered by the Committee, which, to the extent deemed necessary by the Board, will consist of two or more persons who satisfy the requirements for a “non-employee director” under Rule 16b-3 promulgated under the 1934 Act. The members of the Committee shall be appointed from time to time by, and shall serve at the pleasure of, the Board of Directors. In the absence of such appointment, the Board of Directors shall serve as the Committee and shall have all of the responsibilities, duties, and authority of the Committee set forth herein.
4.2 Authority of the Committee. Subject to applicable law, the Committee shall have the exclusive authority to administer and construe the Plan in accordance with its provisions. The Committee’s authority shall include, without limitation, the power to (a) determine persons eligible for Awards, (b) prescribe the terms and conditions of the Awards, (c) construe and interpret the Plan, the Awards and any Award Agreement, (d) adopt rules for the
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administration, interpretation and application of the Plan as are consistent therewith and (e) establish, interpret, amend or revoke any such rules. The Committee, in its sole discretion and on such terms and conditions as it may provide, may delegate all or any part of its authority and powers under the Plan to one or more officers of the Company to the extent permitted by law.
4.3 Decisions Binding. All determinations and decisions made by the Committee and any of its delegatees pursuant to Section 4.2 shall be final, conclusive and binding on all persons, and shall be given the maximum deference permitted by law.
4.4 Limitation on Awards Granted to Non-management directors. The maximum number of Shares issuable pursuant to Awards that may be granted to a Non-management director in any calendar year shall not exceed 10,000 Shares.
SECTION 5
SHARES SUBJECT TO THE PLAN
5.1 Number of Shares. Subject to adjustment as provided in Section 5.3, the total number of Shares available for grant under the Plan shall not exceed 1,000,000 Shares. The Shares available for issuance under the Plan shall be authorized but unissued Shares of the Company.
5.2 Lapsed Awards. Unless determined otherwise by the Committee, Shares related to Awards that are forfeited, cancelled, terminated or expire unexercised, shall be available for grant under the Plan. Shares that are tendered by a Participant to the Company in connection with the exercise of an Award, withheld from issuance in connection with a Participant’s payment of tax withholding liability, or settled in such other manner so that a portion or all of the Shares included in an Award are not issued to a Participant shall not be available for grant under the Plan.
5.3 Adjustments in Awards and Authorized Shares. In the event of a stock dividend or stock split, the number of Shares subject to the Plan, outstanding Awards and the numerical amounts set forth in Sections 5, 6, 7 and 8 shall automatically be adjusted proportionally to prevent the dilution or diminution of such Awards, except to the extent directed otherwise by the Committee. In the event of a merger, reorganization, consolidation, recapitalization, separation, liquidation, combination or other similar change in the structure of the Company affecting the Shares, the Committee shall adjust the number and class of Shares which may be delivered under the Plan, the number, class and price of Shares subject to outstanding Awards, and the numerical limits of Sections 5, 6, 7 and 8 in such manner as the Committee shall determine to be advisable or appropriate to prevent the dilution or diminution of such Awards. Any such numerical limitations shall be subject to adjustment under this Section only to the extent such adjustment will not affect the ability to grant or the qualification of Incentive Stock Options under the Plan or subject the Participant to taxes, penalties and interest imposed under section 409A(a)(1) of the Code.
5.4 Restrictions on Transferability. The Committee may impose such restrictions on any Award, Award of Shares or Shares acquired pursuant to an Award as it deems advisable or appropriate, including, but not limited to, restrictions related to applicable Federal securities laws, the requirements of any national securities exchange or system upon which Shares are then listed or traded, and any blue sky or state securities laws.
SECTION 6
STOCK OPTIONS
6.1 Grant of Options. Subject to the terms and provisions of the Plan, Options may be granted to Participants at any time and from time to time as determined by the Committee. The Committee shall determine the number of Shares subject to each Option. The Committee may grant Incentive Stock Options, Nonqualified Stock Options, or any combination thereof. The maximum aggregate number of Shares underlying Options granted in any one calendar year to an individual Participant is 50,000.
6.2 Award Agreement. Each Option shall be evidenced by an Award Agreement that shall specify the Exercise Price, the expiration date of the Option, the number of Shares to which the Option pertains, whether the Option is intended to be an Incentive Stock Option or a Nonqualified Stock Option, any conditions on exercise of the Option and such other terms and conditions as the Committee shall determine, including terms regarding forfeiture of Awards or continued exercisability of Awards in the event of termination of employment by the Participant.
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6.3 Exercise Price. The Exercise Price for each Option shall be determined by the Committee and shall be provided in each Award Agreement; provided, however, the Exercise Price for each Option may not be less than one hundred percent (100%) of the Fair Market Value of a Share on the Grant Date. In the case of an Incentive Stock Option, the Exercise Price shall be not less than one hundred ten percent (110%) of the Fair Market Value of a Share if the Participant (together with persons whose stock ownership is attributed to the Participant pursuant to section 424(d) of the Code) owns on the Grant Date stock possessing more than 10% of the total combined voting power of all classes of stock of the Company or any of its Subsidiaries.
6.4 Expiration of Options. Except as provided in Section 6.7(c) regarding Incentive Stock Options, each Option shall terminate upon the earliest to occur of (i) the date(s) for termination of the Option set forth in the Award Agreement or (ii) the expiration of ten (10) years from the Grant Date. Subject to such limits, the Committee shall provide in each Award Agreement when each Option expires and becomes un-exercisable. Except as set forth in an Award Agreement or as provided by the Committee, upon Retirement of a Participant, an Option may be exercised by such Participant to the extent it was exercisable on the effective date of the Retirement and shall be exercisable for a period of six months from the effective date of such Retirement, but not later than the expiration of the maximum term such Option. The Committee may not, after an Option is granted, extend the maximum term of the Option.
6.5 Exercisability of Options. Options granted under the Plan shall be exercisable, in whole or in part, at such times and be subject to such restrictions and conditions as the Committee shall determine. After an Option is granted, the Committee may accelerate or waive any condition constituting a substantial risk of forfeiture applicable to the Option.
6.6 Payment. Options shall be exercised by a Participant’s delivery of a written notice of exercise to the Secretary of the Company (or his or her designee), setting forth the number of Shares with respect to which the Option is to be exercised, accompanied by full payment for the Shares. Upon the exercise of an Option, the Exercise Price shall be payable to the Company in full in cash or its equivalent. The Committee may permit exercise (a) by the Participant tendering previously acquired Shares having an aggregate Fair Market Value at the time of exercise equal to the total Exercise Price, (b) the Participant tendering a combination of cash and previously acquired Shares equal to total Exercise Price (the Shares tendered being valued at Fair Market Value at the time of exercise), or (c) by any other means which the Committee determines to provide legal consideration for the Shares, and to be consistent with the purposes of the Plan. As soon as practicable after receipt of a written notification of exercise and full payment for the Shares purchased, the Company shall deliver, or cause to be delivered, to the Participant, evidence of such Participant’s ownership of such Shares. No right to vote or receive dividends or any other rights as a shareholder shall exist with respect to the Shares as to which the Option has been exercised until the records of the Company or its transfer agent reflect the issuance of such Shares. No adjustment will be made for a dividend or other rights for which a record date is established prior to the date the records of the Company or its transfer agent reflect the issuance of the Shares upon exercise of the Options.
6.7 Certain Additional Provisions for Incentive Stock Options.
(a) Exercisability. The aggregate Fair Market Value (determined on the Grant Date(s)) of the Shares with respect to which Incentive Stock Options are exercisable for the first time by any Participant during any calendar year (under all plans of the Company, any parent and its Subsidiaries) shall not exceed $100,000. The portion of the Option which is in excess of the $100,000 limitation shall be treated as a Non-Qualified Option pursuant to Section 422(d)(1) of the Code.
(b) Company and Subsidiaries Only. Incentive Stock Options may be granted only to Participants who are officers or employees of the Company or a Subsidiary on the Grant Date.
(c) Expiration. No Incentive Stock Option may be exercised after the expiration of ten (10) years from the Grant Date. In the case of an Incentive Stock Option that is granted to a Participant who (together with persons whose stock ownership is attributed to the Participant pursuant to Section 424(d) of the Code) owns on the Grant Date stock possessing more than 10% of the total combined voting power of all classes of stock of the Company or any of its Subsidiaries, the term of such Incentive Stock Option shall be no more than five years from the Grant Date.
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6.8 Restriction on Transfer. Except as otherwise determined by the Committee or as set forth in the Award Agreement, no Option may be transferred, gifted, pledged, assigned, or otherwise alienated or hypothecated, voluntarily or involuntarily. Upon the death or Disability of a Participant, an Option may be exercised by the duly appointed personal representative of the deceased Participant or in the event of a Disability by the Participant or the duly appointed attorney-in-fact, guardian or custodian of the Disabled Participant to the extent the Option was exercisable on the date of death or the date of Disability and shall be exercisable for a period of six months from the date of death or the date of Disability.
6.9 Repricing of Options. Without stockholder approval, (i) the Company will not reprice, replace or regrant an outstanding Option either in connection with the cancellation of such Option or by amending an Award Agreement to lower the exercise price of such Option, and (ii) the Company will not cancel outstanding Options in exchange for cash or other Awards.
6.10 Voting Rights. A Participant shall have no voting rights with respect to any Options granted hereunder.
SECTION 7
RESTRICTED STOCK AND RESTRICTED STOCK UNITS
7.1 Grant of Restricted Stock and Restricted Stock Units. Subject to the terms and provisions of the Plan, the Committee, at any time and from time to time, may grant Shares of Restricted Stock and/or RSUs to Participants in such amounts as the Committee shall determine. The Committee shall determine the number of Shares of Restricted Stock and/or RSUs to be granted to each Participant and the time when each Award shall be granted. No more than 100,000 Shares of each of Restricted Stock and Shares underlying RSUs may be granted to any individual Participant in any one calendar year.
7.2 Restricted Stock and RSU Agreements. Each Award of Restricted Stock and RSUs shall be evidenced by an Award Agreement that shall specify the Period of Restriction, the number of Shares of Restricted Stock granted, the number of Shares subject to an RSU, any applicable Performance Goals and Performance Cycle, and such other terms and conditions as the Committee shall determine, including terms regarding forfeiture of Awards in the event of termination of employment by the Participant or termination of the Participant’s relationship with the Company as a director, officer or consultant.
7.3 Transferability. Except as otherwise determined by the Committee or as set forth in the Award Agreement, Shares of Restricted Stock and RSUs (including Shares underlying RSUs) may not be sold, transferred, gifted, bequeathed, pledged, assigned, or otherwise alienated or hypothecated, voluntarily or involuntarily, until the end of the applicable Period of Restriction and the satisfaction, in whole or in part, of any applicable Performance Goals within the applicable Performance Cycle. Except as otherwise determined by the Committee or as set forth in the Award Agreement, in the event of the death, Disability or Retirement of a Participant, all unvested Restricted Stock and unvested RSUs will not vest on the date of death or Disability or the effective date of Retirement. Without stockholder approval, the Company will not, except as otherwise provided for in the Plan, repurchase outstanding unvested Restricted Stock or unvested RSUs in exchange for cash.
7.4 Other Restrictions. The Committee may impose such other restrictions on Shares of Restricted Stock and RSUs (including Shares underlying RSUs) as it may deem advisable or appropriate in accordance with this Section 7.4.
(a) General Restrictions. The Committee may set one or more restrictions based upon (a) the achievement of specific Performance Goals, (b) applicable Federal or state securities laws, (c) time-based restrictions, or (d) any other restrictions determined by the Committee.
(b) Methods of Implementing Restrictions. The Committee may take such action as it, in its sole discretion, deems appropriate to give notice to the Participant of, and implement, the restrictions imposed pursuant to Section 7.
7.5 Removal of Restrictions. After the end of the Period of Restriction, the Shares (including the Shares underlying the RSUs) shall be freely transferable by the Participant, subject to any other restrictions on transfer (including without limitation, limitations imposed pursuant to the Company’s organizational documents) which may apply to such Shares.
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7.6 Voting Rights. Except as otherwise determined by the Committee and set forth in the Award Agreement, Participants holding (a) Shares of Restricted Stock shall have voting rights during the Period of Restriction and (b) RSUs shall not have voting rights during the Period of Restriction.
7.7 Dividends and Other Distributions. Except as otherwise determined by the Committee and set forth in the Award Agreement, Participants holding (a) Shares of Restricted Stock shall be entitled to receive all dividends and other distributions paid with respect to the Shares during the Period of Restriction and (b) except to the extent a Dividend Equivalent Right is granted in tandem with an RSU, RSUs shall not be entitled to receive any dividends or other distributions paid with respect to the underlying Shares during the Period of Restriction.
SECTION 8
PERFORMANCE-BASED AWARDS
8.1 Performance-Based Awards. Participants selected by the Committee may be granted one or more Performance Awards in the form of Options, Restricted Stock, Restricted Stock Units, Dividend Equivalent Rights or Performance Share Awards payable upon the attainment of Performance Goals that are established by the Committee and related to one or more of the Performance Criteria, in each case on a specified date or dates or over a Performance Cycle as determined by the Committee. The Committee shall define the manner of calculating the Performance Criteria it selects to use for any Performance Cycle. Depending on the Performance Criteria used to establish such Performance Goals, the Performance Goals may be expressed in terms of overall Company performance or the performance of an individual. The Committee, in its discretion, may adjust or modify the calculation of Performance Goals for such Performance Cycle in order to prevent the dilution or enlargement of the rights of an individual (i) in the event of, or in anticipation of, any unusual or extraordinary corporate item, transaction, event or development, (ii) in recognition of, or in anticipation of, any other unusual or nonrecurring events affecting the Company, or the financial statements of the Company, or (iii) in response to, or in anticipation of, changes in applicable laws, regulations, accounting principles, or business conditions; provided, however, that the Committee may not exercise such discretion in a manner that would increase the Performance-Based Award granted to a Participant. Performance Awards, other than Dividend Equivalent Rights, shall be paid in Shares.
8.2 Grant of Performance-Based Awards. With respect to each Performance-Based Award granted to a Participant, the Committee shall select, within the first 180 days of the beginning of a Performance Cycle, the Performance Criteria for such grant, and the Performance Goals with respect to each Performance Criterion (including, if applicable, a threshold level of performance below which no amount will become payable with respect to such Award). Each Performance-Based Award will specify the amount payable, or the formula for determining the amount payable, upon achievement of the various applicable performance targets. The Performance Criteria established by the Committee may be (but need not be) different for each Performance Cycle and different Performance Goals may be applicable to Performance-Based Awards to different Participants.
8.3 Payment of Performance-Based Awards. Following the completion of a Performance Cycle, the Committee shall meet to review and certify in writing whether, and to what extent, the Performance Goals for the Performance Cycle have been achieved and, if so, to calculate and certify in writing the amount of the Performance-Based Awards earned for the Performance Cycle.
8.4 Maximum Award Payable. The maximum Performance-Based Award payable to any one Participant under the Plan for a Performance Cycle is 100,000 Shares (subject to adjustment as provided in Section 5.3 hereof).
SECTION 9
DIVIDEND EQUIVALENT RIGHTS
9.1 Dividend Equivalent-Rights. A Dividend Equivalent Right may be granted hereunder to any Participant only in tandem with an Award of RSUs or a Performance Based Award (other than an Award of Restricted Stock or Options). The terms and conditions of Dividend Equivalent Rights shall be specified in the Award Agreement which shall provide that such Dividend Equivalent Right, except to the extent otherwise provided in the related Award Agreement, shall (i) not be sold, transferred, gifted, bequeathed, pledged, assigned, or otherwise alienated or hypothecated, voluntarily or involuntarily, until the end of the applicable Period of Restriction and the satisfaction, in whole or in part, of any applicable Performance Goals within the applicable Performance Cycle,
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and (ii) be settled upon settlement or payment of, or lapse of restrictions on, the Award to which it relates, and such Dividend Equivalent Right shall expire or be forfeited or annulled under the same conditions as such Award.
SECTION 10
AMENDMENT, TERMINATION, AND DURATION
10.1 Amendment, Suspension, or Termination. The Board, in its sole discretion, may amend, suspend or terminate the Plan, or any part thereof, at any time and for any reason; provided, however, that if and to the extent required by law or to maintain the Plan’s compliance with the Code, the rules of any national securities exchange (if applicable), or any other applicable law, any such amendment shall be subject to stockholder approval. The amendment, suspension or termination of the Plan shall not, without the consent of the Participant, alter or impair any rights or obligations under any Award theretofore granted to such Participant. No Award may be granted during any period of suspension or after termination of the Plan.
10.2 Duration of the Plan. The Plan shall become effective in accordance with Section 1.1, and subject to Section 10.1, shall remain in effect until the tenth anniversary of the effective date of the Plan.
SECTION 11
TAX WITHHOLDING
11.1 Withholding Requirements. Prior to the delivery of any Shares pursuant to an Award (or the exercise thereof), the Company shall have the power and the right to deduct or withhold from any amounts due to the Participant from the Company, or require a Participant to remit to the Company, an amount sufficient to satisfy Federal, state and local taxes (including the Participant’s FICA obligation) required or appropriate to be withheld with respect to such Award (or the exercise or vesting thereof).
11.2 Withholding Arrangements. The Company, pursuant to such procedures as it may specify from time to time, may permit a Participant to satisfy such tax withholding obligation, in whole or in part, by (a) electing to have the Company withhold otherwise deliverable Shares, or (b) delivering to the Company, Shares then owned by the Participant. The amount of the withholding requirement shall be deemed to include any amount that the Company agrees may be withheld at the time any such election is made, not to exceed the amount determined by using the maximum federal, state and local marginal income tax rates applicable to the Participant with respect to the Award on the date that the amount of tax to be withheld is to be determined. The Fair Market Value of the Shares to be withheld or delivered shall be determined as of the date that the taxes are required to be withheld.
SECTION 12
CHANGE IN CONTROL
12.1 Change in Control. For purposes of the Plan, a Change in Control means any of the following:
(a) the acquisition (other than from the Company) in one or more transactions by any person (as such term is used in Section 13(d) of the 1934 Act) of the beneficial ownership (within the meaning of Rule 13d-3 under the 1934 Act) of 25% or more of (i) the then outstanding Shares or (ii) the combined voting power of the then outstanding securities of the Company entitled to vote generally in the election of directors (the “Company Voting Stock”); provided, however, the provision of this Section 12.1(a) is not applicable to acquisitions made individually, or as a group, by Fredric H. Gould, Matthew J. Gould and Jeffrey A. Gould, and their respective spouses, lineal descendants and Affiliates;
(b) individuals who, as of the date of the Award, constitute the Board of Directors (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the date of such Award whose election, or nomination for election by the Company’s stockholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of either an actual or threatened election contest (as such terms are used in Regulation 14A promulgated under the 1934 Act) or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Incumbent Board;
(c) the closing of a sale or other conveyance of all or substantially all of the assets of the Company; or
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(d) the effective time of any merger, share exchange, consolidation, or other business combination involving the Company if immediately after such transaction persons who hold a majority of the outstanding voting securities entitled to vote generally in the election of directors of the surviving entity (or the entity owning 100% of such surviving entity) are not persons who, immediately prior to such transaction, held the Company’s voting Shares.
12.2 Effect of Change of Control. On the effective date of any Change in Control, unless the applicable Award Agreement provides otherwise: (i) in the case of an Option, each such outstanding Option shall become exercisable in full in respect of the aggregate number of Shares covered thereby; and (ii) in the case of Restricted Stock, Restricted Stock Units, Dividend Equivalent Rights and Performance Share Awards, the Period of Restriction applicable to each such Award shall be deemed to have expired. Notwithstanding the foregoing, unless otherwise provided in the applicable Award Agreement, the Committee may, in its discretion, determine that any or all outstanding Awards of any or all types granted pursuant to the Plan will not become exercisable on an accelerated basis nor will the Restriction Period expire in connection with a Change of Control if effective provision has been made for the taking of such action which, in the opinion of the Committee, is equitable and appropriate to substitute a new Award for such Award or for the assumption of such Award and to make such new or assumed Award, as nearly as may be practicable, equivalent to the old Award (before giving effect to any acceleration of the exercisability or the expiration of the Restriction Period), taking into account, to the extent applicable, the kind and amount of securities, cash, or other assets into or for which the Shares may be changed, converted, or exchanged in connection with such Change of Control.
SECTION 13
MISCELLANEOUS
13.1 Deferrals. To the extent consistent with the requirements of section 409A of the Code, the Committee may provide in an Award Agreement or another document that a Participant is permitted or required to defer receipt of the delivery of Shares that would otherwise be due to such Participant under an Award, other than an Option, any such deferral shall be subject to such rules and procedures as shall be determined by the Committee.
13.2 Termination for Cause. If a Participant’s employment or relationship with the Company or a Subsidiary shall be terminated for cause by the Company or such Subsidiary during the Restriction Period or prior to the exercise of any Option (for these purposes, cause shall have the meaning ascribed thereto in any employment agreement or Award Agreement to which such Participant is a party or, in the absence thereof, shall include, but not be limited to, insubordination, dishonesty, incompetence, moral turpitude, the refusal to perform his duties and responsibilities for any reason (other than illness or incapacity) and other misconduct of any kind, as determined by the Committee), then, (i) all Options (whether or not then vested and exercisable) shall immediately terminate and (ii) such Participant’s rights to all Restricted Stock, RSUs, Dividend Equivalent Rights and Performance Share Awards shall be forfeited immediately.
13.3 No Effect on Employment or Service. Nothing in the Plan, any Award or any Award Agreement, and no action of the Committee, shall confer or be construed to confer on any Participant any right to continue in the employ or service of the Company or any Subsidiary or shall interfere with or limit in any way the right of the Company or any Subsidiary to terminate any Participant’s employment or service at any time, with or without cause. Employment with the Company or any Subsidiary is on an at-will basis only, unless otherwise provided by an applicable employment or service agreement between the Participant and the Company or any Subsidiary, as the case may be.
13.4 Successors. All obligations of the Company under the Plan, with respect to Awards granted hereunder, shall be binding on any successor to the Company, whether the existence of such successor is the result of a direct or indirect merger, consolidation or otherwise, or the purchase of all or substantially all of the business or assets of the Company.
13.5 No Rights as Stockholder. Except to the limited extent provided in Sections 7.6 and 7.7, no Participant (nor any beneficiary thereof) shall have any of the rights or privileges of a stockholder of the Company with respect to any Shares issuable pursuant to an Award (or the exercise or vesting thereof), unless and until the issuance of such Shares shall have been recorded on the records of the Company or its transfer agents or registrars.
13.6 Uncertificated Shares. Notwithstanding any provision of the Plan to the contrary, the ownership of Shares issued under the Plan may be evidenced in such a manner as the Committee, in its sole discretion, deems
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appropriate, including by book-entry or direct registration (including transaction advices) or the issuance of one or more share certificates, and to the extent that the Plan, applicable law or the Company’s organizational documents, require or contemplate the imposition of a legend or other notation on one or more certificates evidencing Shares or an Award, the Committee shall have the sole discretion to determine the manner in which such legend or notation is implemented.
13.7 Fractional Shares. No fractional Shares shall be issued or delivered pursuant to the Plan or any Award. The Committee shall determine whether cash, or Awards, or other property shall be issued or paid in lieu of fractional Shares or whether such fractional Shares or any rights thereto shall be forfeited or otherwise eliminated.
13.8 Severability. In the event any provision of the Plan shall be held illegal or invalid for any reason, the illegality or invalidity shall not affect the remaining parts of the Plan, and the Plan shall be construed and enforced as if the illegal or invalid provision had not been included.
13.9 Requirements of Law; Claw-Back Policies. The grant of Awards and the issuance of Shares under the Plan shall be subject to all applicable laws, rules and regulations, and to such approvals by any governmental agencies or national securities exchanges as may be required from time to time, and shall be subject to the applicable provisions of any claw-back policy implemented by the Company, whether implemented prior to or after the grant of such Award, including without limitation, any claw-back policy adopted to comply with the requirements of applicable law (including the requirements of a national securities exchange).
13.10 Securities Law Compliance. To the extent any provision of the Plan, Award Agreement or action by the Committee fails to comply with any applicable federal or state securities law, it shall be deemed null and void, to the extent permitted by law and deemed advisable or appropriate by the Committee.
13.11 Real Estate Investment Trust. No Award shall be granted or awarded and, with respect to any Award granted under the Plan, such Award shall not vest, be exercisable or be settled, to the extent that the grant, vesting, exercise or settlement of such Award could cause the Participant or any other person to be in violation of any restrictions on ownership and transfer of the Company’s securities set forth in its articles of incorporation or other governing instrument or organizational documents, as amended, and in effect from time to time, or if, in the discretion of the Committee, the grant, vesting, exercise or settlement of such award could otherwise impair the Company’s status as a real estate investment trust under the Code.
13.12 Governing Law. The Plan and all Award Agreements shall be construed in accordance with and governed by the laws of the State of Maryland.
13.13 Captions. Captions are provided herein for convenience of reference only, and shall not serve as a basis for interpretation or construction of the Plan.
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