Exhibit 97.1
ACRES COMMERCIAL REALTY CORP.
POLICY FOR THE
RECOVERY OF ERRONEOUSLY AWARED COMPENSATION
Overview
In accordance with Section 10D of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), Rule 10D-1 promulgated under the Exchange Act (“Rule 10D-1”) and Section 303A.14 of the New York Stock Exchange Listed Company Manual (the “NYSE Rules”), the Board of Directors (the “Board”) of ACRES Commercial Realty Corp. (the “Company”) has adopted this Policy for the Recovery of Erroneously Awarded Compensation (the “Policy”) to provide for the recovery of erroneously awarded Incentive-based Compensation from Executive Officers and the Manager under the Management Agreement. All capitalized terms used and not otherwise defined herein shall have the meanings set forth in Section 2 below.
Except as specifically set forth herein, this Policy shall be administered by the Compensation Committee of the Board (the “Committee”). The Committee is authorized to interpret and construe this Policy and to make all determinations necessary, appropriate or advisable for the administration of this Policy and for the Company’s compliance with NYSE Rules, Section 10D, Rule 10D-1 and any other applicable law, regulation, rule or interpretation of the Securities Exchange Commission (“SEC”) or NYSE promulgated or issued in connection therewith. Any determinations made by the Committee shall be final and binding on all affected individuals and need not be uniform with respect to each individual covered by the Policy. In the administration of this Policy, the Committee is authorized and directed to consult with the full Board or such other committees of the Board, such as the Audit Committee, as may be necessary or appropriate as to matters within the scope of such other committee’s responsibility and authority. Subject to any limitation at applicable law, the Committee may authorize and empower any officer or employee of the Company to take any and all actions necessary or appropriate to carry out the purpose and intent of this Policy (other than with respect to any recovery under this Policy involving such officer or employee).
As used in this Policy, the following definitions apply:
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This Policy applies to Incentive-Based Compensation received by a Covered Executive (a) after beginning services as a Covered Executive; (b) if that person served as a Covered Executive at any time during the performance period for such Incentive-Based Compensation; (c) while the Company had a listed class of securities on a national securities exchange and (d) during the applicable Clawback Period. This Policy also applies to Incentive Compensation (as defined in the Company’s Fourth Amended and Restated Management Agreement, dated July 31, 2020, as amended, by and among the Company, ACRES Capital, LLC (the Company’s “Manager”), and ACRES Capital, Corp. (the “Management Agreement”)) received the Manager under the terms of the Management Agreement.
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Notwithstanding the terms of any indemnification or insurance policy or any contractual arrangement with any Covered Executive or the Manager that may be interpreted to the contrary, the Company shall not indemnify any Covered Executives or the Manager against the loss of any Erroneously Awarded Compensation, including any payment or reimbursement for the cost of third-party insurance purchased by any Covered Executives or the Manager to fund potential clawback obligations under this Policy.
Any members of the Committee, and any other members of the Board who assist in the administration of this Policy, shall not be personally liable for any action, determination or interpretation made with respect to this Policy and shall be fully indemnified by the Company to the fullest extent under applicable law and Company policy with respect to any such action, determination or interpretation. The foregoing sentence shall not limit
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any other rights to indemnification of the members of the Board under applicable law or Company policy.
This Policy shall be effective as of December 1, 2023 (the “Effective Date”). The terms of this Policy shall apply to any Incentive-Based Compensation that is received by Covered Executives or the Manager on or after the Effective Date, even if such Incentive-Based Compensation was approved, awarded, granted or paid to Covered Executives or the Manager prior to the Effective Date.
The Board may amend, modify, supplement, rescind or replace all or any portion of this Policy at any time and from time to time in its discretion, and shall amend this Policy as it deems necessary to comply with applicable law or any rules or standards adopted by a national securities exchange on which the Company’s securities are listed.
The Board intends that this Policy shall be applied to the fullest extent of the law. Any right of recoupment under this Policy is in addition to, and not in lieu of, any other remedies or rights of recoupment that may be available to the Company under applicable law or pursuant to the terms of any similar policy in any employment agreement, equity award agreement, or similar agreement and any other legal remedies available to the Company.
Nothing contained in this Policy, and no recoupment or recovery as contemplated by this Policy, shall limit any claims, damages or other legal remedies the Company or any of its affiliates may have against a Covered Executive or the Manager arising out of or resulting from any actions or omissions by the Covered Executive or the Manager.
This policy shall be enforceable against all Covered Executives and the Manager and their beneficiaries, heirs, executors, administrators or other legal representatives.
The Company shall file all disclosures with respect to this Policy required by applicable SEC filings and rules.
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