SEC Form DEF 14A filed by Brixmor Property Group Inc.

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Preliminary Proxy Statement

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

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Definitive Proxy Statement

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Definitive Additional Materials

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Soliciting Material Pursuant to § 240.14a-12

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No fee required

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Fee paid previously with preliminary materials

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Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11

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March 14, 2024

Dear Fellow Stockholders:

Please join us for Brixmor Property Group Inc.’s Annual Meeting of Stockholders on Thursday, April 25, 2024, at 9:00 a.m. (EDT). To encourage higher levels of stockholder participation and help us reduce financial and environmental costs, this year’s Annual Meeting will again be held in a virtual meeting format only. You will be able to attend the virtual Annual Meeting, vote, and submit questions by first registering at https://www.viewproxy.com/brixmor/2024 and then following the instructions that will be emailed to you. Please note that you must register no later than 11:59 p.m. (EDT) on April 22, 2024.​

As in prior years, we are pleased to be furnishing our proxy materials to stockholders primarily over the Internet. We believe this process expedites the stockholders’ receipt of the materials, lowers the costs of the Annual Meeting, and conserves natural resources. A Notice of Internet Availability of Proxy Materials was sent to stockholders of record at the close of business on February 9, 2024. The notice contains instructions on how to access our proxy statement, 2023 annual report to stockholders, and Annual Report on Form 10-K for the year ended December 31, 2023, and how to vote online. If you would like to receive a printed copy of our proxy materials, please follow the instructions for requesting such materials included in the notice.

The matters to be acted upon at the Annual Meeting are described in detail in the accompanying notice of the Annual Meeting and the proxy statement. We may also report on other matters of current interest to our stockholders.

Please use this opportunity to contribute to our company by voting on the matters to come before this Annual Meeting. Stockholders who hold shares in their own name through our transfer agent, Computershare, can vote online or by telephone. To vote online or by telephone, follow the instructions contained on the following page. In addition, if you have requested or received a paper copy of the proxy materials, you can vote by completing, dating, signing, and returning the proxy card sent to you with the proxy materials. Voting online, by telephone, or by returning the proxy card does not deprive you of your right to attend the virtual Annual Meeting or to vote your shares at the virtual Annual Meeting. If you do attend the virtual Annual Meeting and wish to vote at that time, you may revoke your proxy at or prior to the virtual Annual Meeting.

Thank you for your continued support of Brixmor Property Group Inc.

Sincerely,

 

If at the close of business on February 9, 2024, you were a stockholder of record, you may authorize a proxy to vote in accordance with your instructions online, by telephone or, if you have requested or received a paper copy of the proxy materials by mail, or you may vote at the virtual Annual Meeting. For shares held through a broker, bank, or other nominee, you may authorize a proxy by submitting voting instructions to your broker, bank, or other nominee. To reduce our administrative and postage costs, we ask that you authorize a proxy online or by telephone, both of which are available 24 hours a day. You may revoke your proxies at the times and in the manners described on page 94 of the proxy statement.

If you hold your shares in street name, you may also submit voting instructions to your broker, bank, or other nominee. In most instances, you will be able to do this online, by telephone, or by mail. Please refer to information from your broker, bank, or other nominee on how to submit voting instructions.

 

 

 

This Notice of Annual Meeting and proxy statement are being distributed or made available, as the case may be, on or about March 14, 2024.

 

 

Our proxy statement, 2023 annual report to stockholders, and Annual Report on Form 10-K for the year ended December 31, 2023 will be available at https://www.viewproxy.com/brixmor/2024 beginning on or about March 14, 2024. As permitted by the Securities and Exchange Commission (the “SEC”), the Company is sending a Notice of Internet Availability of Proxy Materials (the “Notice”) to all stockholders of record. All stockholders will have the ability to access our proxy statement, 2023 annual report to stockholders, and Annual Report on Form 10-K for the year ended December 31, 2023 as filed with the SEC on February 12, 2024, on a website referred to in the Notice or to request a printed set of these materials at no charge. Instructions on how to access these materials online or to request a printed copy may be found in the Notice.

In addition, any stockholders may request to receive proxy materials in printed form by mail or electronically by email on an ongoing basis. Choosing to receive future proxy materials by email will save the Company the cost of printing and mailing documents to stockholders and will reduce the environmental impact of future annual meetings. A stockholder’s election to receive proxy materials by email will remain in effect until terminated by the stockholder.

 

 

 

 

The following table provides information about the nine candidates who have been nominated for election to our Board of Directors. Additional information regarding each nominee’s specific experience, qualifications, attributes, and skills can be found under Proposal No. 1. Upon election, these directors will hold office until our next annual meeting of stockholders and until their successors are duly elected and qualify. These directors hold committee memberships and chair responsibilities as follows:

 

 

During 2023, we again drove strong internal growth by capitalizing on the ongoing strength of the retail real estate environment and the momentum generated by our successful portfolio transformation initiatives, resulting in record leased occupancy for our high-quality, nationally diversified portfolio of community and neighborhood shopping centers.

We have also continued to execute on our accretive, value enhancing reinvestment program, repositioning assets to align with our vision of owning and operating the “centers of the communities we serve,” while harvesting the opportunities embedded in our portfolio of below-market leases. And while acquisitions were limited as we remained disciplined in navigating a dynamic capital markets environment, we continued to dispose of assets where value had been maximized.

As we have executed on our internal and external growth initiatives, we have maintained significant financial liquidity and flexibility to support the execution of our long-term balanced business plan. As always, our execution in 2023 was guided by our Corporate Responsibility (“CR”) strategy.

 

 

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We define our operating metrics in the glossary of our Supplemental Disclosure for the quarter ended December 31, 2023, which is available on our website.

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For more information on our CR strategy, goals, performance, and achievements, including our EEO-1 report, please visit the CR section of our website at
https://www.brixmor.com/corporate-responsibility.

For information on our Board of Directors and related governance documents, please visit the Leadership & Governance tab on the Investors section of our website at https://investors.brixmor.com/corporate-profile.

Information on our website is not incorporated by reference herein and is not a part of this proxy statement.

 

 

As a result of our CR efforts, we have been recognized by GRESB as a Green Star recipient for the seventh consecutive year. In addition, we received an “A” rating from GRESB for Public Disclosure for the fifth consecutive year. Additional recognition for our CR efforts includes:

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ISS: Awarded Prime status for Corporate ESG Performance, indicating the fulfillment of ambitious absolute performance requirements

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MSCI: Received a “BBB” rating, with year-over-year improvements in the governance pillar score

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U.S. Department of Energy Better Buildings Alliance / The Institute for Market Transformation: Awarded Green Lease Leader at the Gold Level recognition

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The success of our Company is highly dependent on the success of our tenants. As one of the largest open-air retail landlords in the United States, we support over 5,000 national and regional tenants and local entrepreneurs across the country, including many vibrant new retailers added over the past several years. By utilizing a combination of local leasing professionals and a dedicated National Accounts leasing team, we attract and retain a wide variety of relevant retailers to our shopping centers.

We strive to be a key partner in the success of our tenants by providing proactive property management, ongoing tenant coordination, and resources to help local tenants promote and operate their businesses. We work to ensure that our properties are safe and accessible and adhere to our high operational standards. Our commitment to maintaining best-in-class properties that serve the surrounding communities is evidenced by various initiatives and programs we have in place, including:

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Incubator Program: offers retail space to small business owners or retailers seeking to launch new concepts or brands, allowing them to test their concepts over a limited 90-day period

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Tenant coordination: supports new tenants during the store opening process by providing hyperlocal expertise to guide them through permitting and other local regulations

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Adapting our centers: engages the community and our consumers by adding dedicated curbside pick-up areas, outdoor dining options, and vibrant community spaces

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Sustainability best practices: offers cost-saving sustainability tips to help small business owners reduce their energy and water expenses, and their environmental footprint

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Brixmor seeks to partner with suppliers and vendors who share our passion for efficient, resilient properties built and maintained to meet our high operational standards. Our Supplier Code of Conduct, which outlines our expectations from suppliers and vendors related to working conditions / human rights, health and safety, environmental impact, and business integrity, is included in all new contracts. We maintain open dialogue with our suppliers through regular review meetings with key national partners and supplier engagement surveys.

The Supplier Code of Conduct is also available on our website at:
https://investors.brixmor.com/leadership-governance/governance-documents-policies.

We have established ambitious long-term sustainability goals, and in 2023 we continued to make meaningful progress towards achieving these goals. In addition to improving our resiliency and environmental efficiency, integrating sustainable practices and initiatives into our business operations has reduced utility-related operational expenses and added ancillary income to our properties. Examples of our environmental stewardship at our centers and communities include:

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Energy usage reduction projects such as LED lighting conversions and equipment upgrades, motion sensor technology for parking lot lighting, and reflective roofing and insulation to reduce air conditioning and heating requirements

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On-site renewable energy projects such as solar panel installations

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Water conservation projects such as smart irrigation and annual wet checks, xeriscaping and the use of native plant species, and smart water meters

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Electric vehicle charging stations for use by customers and visitors

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Reinvestment projects executed with a focus on resource efficiency and resiliency

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We released our Climate Change Policy in 2021 and committed to achieving net zero carbon emissions by 2045 for areas under our operational control. As a signatory of the Science Based Targets initiative (“SBTi”), aligned with the 1.5 degree Celsius pathway, we are also committed to reducing our Scope 1 and 2 emissions by 50% by 2030 for areas under our operational control, as compared to a 2018 baseline. As of December 31, 2022, improvements in energy efficiency and the addition of renewable energy sources to our properties have resulted in an approximately 40% reduction against this interim SBTi goal. We will continue to be transparent on our climate change progress through our external disclosures and we will collaborate with our key stakeholders to further address climate change.

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As of 12/31/2022.

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Compared to 2016 baseline.

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Compared to 2018 baseline.

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Reduction target applies to areas under our operational control (i.e. Scope 1 and 2 GHG emissions).

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We recognize that climate change could have an impact on our portfolio and the communities we serve. Our goal is to identify, understand, and minimize such risk. We manage day-to-day risk through the proactive implementation of resiliency measures, property insurance, and emergency response, business continuity, and life safety plans. Climate change and natural hazard risk assessments for our existing portfolio are conducted annually and climate-related risk assessments are part of our standard underwriting due diligence processes for potential acquisitions and major redevelopment projects. We utilize Moody’s Climate on Demand proprietary climate risk scoring data to support our climate-related risk assessments which identify key environmental risks including wildfires, flooding, hurricanes, heat and water stress, earthquakes, and sea level rise. We have also implemented several strategies and initiatives focused on resiliency measures for higher risk properties, including: hurricane / high wind upgrades, reflective roofs to reduce heat stress and utility use, native landscaping to reduce water stress, and stormwater infrastructure upgrades.

Disaster preparedness and response help minimize the disruption caused by unexpected weather events. Our Market Research team has developed an internal storm tracking tool to monitor severe weather conditions and initiate preparedness activities before an imminent event. Our team of Property Managers follows the Company’s crisis management plan and site-specific protocols to reduce potential damage, and after an event occurs, they and members of our all-volunteer Disaster Assistance Recovery Team mobilize to provide immediate and long-term assistance to restore our shopping centers and assist with rebuilding local communities.

Our properties serve an important role in their communities and, as such, we are deliberate and thoughtful in merchandising our properties with a robust mix of relevant non-discretionary and value-oriented retailers, as well as consumer-oriented service providers. We provide our tenants and their customers with inviting, safe, and attractive retail centers to gather, connect, and engage, both within stores and in public spaces at our centers throughout our portfolio. We further support our communities by hosting local events, volunteering, and providing aid in times of need. To promote connection within our communities, we host farmers markets, holiday events and activities, drive-in movies, fundraising, and other charity events. We also provide each employee with two paid Service Days each year to make an impact in their respective communities. Some examples of how we connected with our communities during 2023 include:

 

 

We believe that employees that are personally engaged in our vision to be the center of the communities we serve and are connected with similarly engaged colleagues will be more effective in their roles. Company-wide recognition of excellence is one way we show our team members how important they are to our communities, our Company, and each other. Our quarterly employee awards include the “Our Center is You” award, which recognizes employees for immersing themselves in and serving our communities, and the “Find A Better Way” award, which recognizes employees for using ingenuity to solve a business need or challenge. We foster connectivity through Company-wide enrichment events, such as our TED-Talk style “Big Brain Days,” where leading authors discuss topics to inspire individual and team growth, and our annual Company-wide community service projects, which have focused on important social issues such as food insecurity and implicit bias.

We measure employee engagement through biennial employee surveys and utilize the results from such surveys to continually improve our organization. Some examples of improvements we have made in response to employee feedback include:

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Enhancing our benefits platform with expanded physical, emotional, and financial health and wellness benefits

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Increasing leadership and management development training

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Offering a Company-wide mentorship program

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Our engagement and connectivity initiatives have contributed to:

We encourage our employees to grow and develop their interests, skills, and passions by providing a variety of professional and personal training opportunities. Our annual talent development process is intended to provide a well-rounded perspective on individual

 

 

performance by recognizing employee strengths, identifying opportunities for growth, and developing actionable plans for professional development. We foster employee growth by providing:

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Comprehensive training programs

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Innovative development programs, such as two-year intensive apprenticeship programs for entry level employees in leasing, property management, and construction

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Mentorship programs for early career professionals

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Predictive Index Behavioral Assessments to enhance self-awareness and effective collaboration

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Education assistance for tuition and professional licensure

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Personal Development Accounts, which provide time off and expense reimbursement for a personal or professional development activity chosen by the employee

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Access to ADP Workforce Now Essential Learning and BRX YOUniversity, Brixmor’s internally-developed learning management system

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We believe our performance is enhanced by an inclusive environment that reflects the diversity of the communities we serve. We believe a culture based on inclusion is critical to our ability to attract and retain talented employees and to deliver on our strategic goals and objectives. To celebrate and promote an inclusive work environment, we hold a variety of events to recognize the backgrounds and unique perspectives of our employees. Cultural tradition exchanges, round table events, and trainings allow employees to share meaningful aspects of their heritage and provide a forum for other employees to broaden their understanding of those around them. In addition, we assess fair pay periodically as it relates to race, ethnicity, and gender based on a role / similar-role basis and on average, in 2023, there was no such pay gap across the Company.

 

 

Our Board is committed to strong corporate governance practices and to conducting business according to the highest ethical standards. We believe we have structured our corporate governance in a manner that closely aligns our interests with those of our stakeholders. We have been recognized consistently for our outstanding corporate governance by Green Street, ranking third in the REIT sector for corporate governance, and ISS, receiving and maintaining the highest score of 1 in ISS’s Governance QualityScore category continuously in 2023.

Our focus on strong corporate governance expands to our commitment to transparent, high-quality disclosure and consistent investor engagement. We value the outlook and opinions offered by our investors and believe that ongoing dialogue is an important component of our governance practices. Through a strategic, proactive outreach program, we discuss business and industry trends and market conditions, our operational strategy and performance, our CR initiatives, and our governance practices. We share the feedback we receive with our Board of Directors, providing them with valuable insight into stakeholder views about Brixmor.

In general, we engage with our investors through a mix of in-person and telephonic meetings, conferences, and property tours. In 2023, we had over 500 equity and fixed income investor touchpoints and connected with the majority of our actively managed investors. We supplement traditional outreach methods with videos and social media, providing additional avenues to showcase our ongoing portfolio transformation.

 

Nine nominees will be proposed for election as directors at the Annual Meeting to hold office until our next annual meeting of stockholders and until their successors are duly elected and qualify. Our nominees were selected by the Board, based on the recommendation of the Nominating and Corporate Governance Committee. All nine nominees currently serve on our Board. All of the nominees are willing to serve as directors but if any of them should decline or be unable to act as a director then the individuals designated in the proxy cards as proxies will exercise the discretionary authority provided to vote for the election of a substitute nominee selected by our Board, unless the Board alternatively acts to reduce the size of the Board or maintain a vacancy on the Board in accordance with our bylaws.

We believe that each of our director nominees possesses the professional and personal qualifications necessary for effective service as a director and, that together, our directors have a complementary balance of knowledge, experience, and capabilities that will best serve the Company and its stakeholders. We also believe that each nominee has a reputation for integrity, adherence to the highest ethical standards, sound business judgment, and willingness to represent the long-term interests of our stakeholders. The following chart provides a summary of the director nominees’ skills and core competencies.

 

 

 

The biographical description below includes the specific experience, qualifications, attributes, and skills that led to the conclusion by the Board that each director nominee should serve as a director. Beneficial ownership of equity securities of the director nominees is shown under “Ownership of Securities” below.

 

 

 

 

 

 

 

 

 

 

The business and affairs of the Company are managed under the direction of our Board, as provided by Maryland law, and the Company conducts its business through meetings of the Board and its three standing committees: the Audit Committee, the Compensation Committee, and the Nominating and Corporate Governance Committee.

We have structured our corporate governance in a manner that we believe closely aligns our interests with those of our stockholders. Notable features of our corporate governance include:

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Our Board is not classified and each of our directors is subject to re-election annually, and we will not classify our Board in the future without the approval of our stockholders;

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Our directors may be removed by a vote of a majority of the votes entitled to be cast and our Board may not increase the vote required to remove a director without stockholder approval;

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We have opted out of the Maryland Unsolicited Takeover Act (known as MUTA) and the Maryland business combination and control share acquisition statutes, and in the future will not opt in without stockholder approval;

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We do not have a stockholder rights plan/poison pill, and we will not adopt a stockholder rights plan/poison pill in the future without stockholder approval;

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Our directors are elected by a vote of a majority of votes cast in uncontested elections, and in the event that an incumbent director fails to receive a majority of votes cast in an uncontested election, such incumbent director is required to submit his or her resignation to the Board, which will decide what action to take on the resignation, and the decision will be publicly disclosed;

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We have fully independent Audit, Compensation, and Nominating and Corporate Governance Committees, and our independent directors meet regularly in executive sessions without the presence of our corporate officers and/or non-independent directors;

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Our Board has an independent Chair and a Presiding Independent Director;

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Our Board has an “ad hoc” investment committee which approves any individual transaction with a value between $50 million and $100 million (with full Board approval required for transactions above $100 million);

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We maintain a program of continuing education for our directors, covering current topics such as cybersecurity and ESG, in order to optimize their service on the Board;

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All members of our Audit Committee are “financial experts” as defined by applicable SEC regulations;

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We restrict the number of other public company boards that our directors can serve on to four, including our Board, and also restrict the number of public company board audit committees that our directors can serve on to three, including the Audit Committee of our Board, to mitigate risks of director overcommitments;

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Our executive officers and members of our Board are prohibited from pledging or hedging our securities;

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We have adopted proxy access pursuant to which stockholders owning at least 3% of our common stock for at least three years may nominate the greater of up to 20% of the Board or two directors; and

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Stockholders holding a majority of outstanding shares have the right to amend, alter, or repeal our bylaws, or adopt new bylaws, at a duly called meeting of stockholders.

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We believe the quality, focus, and diversity of skills and experience on our Board have been a key driver of the Company’s success and that the strength of our Board is a competitive advantage. Our Nominating and Corporate Governance Committee believes that maintaining this advantage requires planning for Board refreshment and succession continually and strategically. To that end, in considering Board refreshment and succession planning, the Nominating and Corporate Governance Committee takes into account, among other things, its assessment of the skills the Board currently needs and will need in the future, its assessment of the degree to which the current directors satisfy these skills, feedback from annual Board, committee and director evaluations, and expectations of upcoming Board vacancies.

Our strategic approach to refreshment is reflected in our current Board composition and in our recent track record. The average Board member tenure is only seven years and three of our directors have served for five years or less. Our Nominating and Corporate Governance Committee’s effective approach to refreshment has resulted in the recent appointments of (i) Sandra A.J. Lawrence, a seasoned executive with senior leadership experience in the health care, real estate, and packaging industries, whose appointment addressed, among other things, the Board’s strategic goals of further building on the Board’s financial expertise and increasing public company board experience and (ii) JP Suarez, a global business leader with over 30 years of executive experience at Walmart International and Walmart, Inc., whose appointment addressed, among other things, the Board’s strategic goal of strengthening its retail expertise.

Our strategic approach to refreshment is also reflected in periodic changes we make to Board leadership positions. For example, last year, Ms. Crosland assumed the role of Chair of the Board and Ms. Lawrence assumed the role of Audit Committee chair.

In identifying Board candidates, the Nominating and Corporate Governance Committee solicits input from a variety of sources, including existing directors, senior management, and executive search firms, in order to identify candidates that will best contribute to the Board. In addition, in order to further advance its goals of racial, ethnic, gender, and sexual orientation diversity, the Nominating and Corporate Governance Committee requires that in connection with any director search at least one diverse candidate be interviewed.

Under our Corporate Governance Guidelines and New York Stock Exchange (“NYSE”) rules, a director is not independent unless the Board affirmatively determines that he or she does not have a direct or indirect material relationship with the Company or any of its subsidiaries.

Our Corporate Governance Guidelines define independence in accordance with the independence definition in the NYSE corporate governance rules for listed companies. Our Corporate Governance Guidelines require the Board to review the independence of all directors at least annually.

In the event a director has a relationship with the Company that is relevant to his or her independence and is not addressed by the objective tests set forth in the NYSE independence definition, the Board will determine, considering all relevant facts and circumstances, whether such relationship is material.

 

 

The Nominating and Corporate Governance Committee undertook its annual review of director independence and made a recommendation to our Board regarding director independence. As a result of this review, our Board affirmatively determined that each of Messrs. Berman, Dickson, Hurwitz, Rahm, and Suarez and Mses. Bowerman, Crosland, and Lawrence is independent for purposes of all applicable NYSE standards, including with respect to committee service. No independence determination for purposes of applicable NYSE standards was made with respect to Mr. Schreiber in light of his retirement in April 2023. Mr. Schreiber was affirmatively determined to be independent for purposes of applicable NYSE standards in the prior year. Our Board has also determined that each of Messrs. Berman and Suarez and Mses. Crosland and Lawrence is “independent” for purposes of Section 10A(m)(3) and each of Messrs. Dickson, Hurwitz and Rahm is “independent” for purposes of Section 10C(b) of the Exchange Act.

In making its independence determinations, the Board considered and reviewed all information known to it (including information identified through annual directors’ questionnaires).

Our Board is led by the Chair, which is purposely separate from the Chief Executive Officer position. Accordingly, Ms. Crosland, an independent director, serves as Chair, while Mr. Taylor serves as our Chief Executive Officer and President. Our Board believes that this structure is appropriate corporate governance for us at this time and best encourages the free and open dialogue of competing views while providing for strong checks and balances. Additionally, our independent Chair’s attention to Board and committee matters allows the Chief Executive Officer to focus more specifically on overseeing the Company’s day to day operations and long-term strategic planning. If in the future the Board, after considering relevant facts and circumstances at that time, appoints the Chief Executive Officer as Chair, we will promptly publicly disclose such appointment.

The Chair has the power to call meetings of the Board or Board committees, to preside over meetings of the Board, and to call special meetings of stockholders and approve certain administrative matters related to any such special meetings of stockholders. The Chair regularly engages with the Chief Executive Officer, chairs of Board committees, and other members of the Board regarding issues related to Board structure.

All directors are expected to make every effort to attend all meetings of the Board, meetings of the committees of which they are members, and the annual meeting of stockholders. During the year ended December 31, 2023, the Board held four meetings. All of our directors attended at least 75% of the aggregate of the meetings of the Board and the Committees on which they serve. All nine of our then-serving directors attended the 2023 virtual Annual Meeting of Stockholders.

Our bylaws provide for proxy access, thereby giving our stockholders an even greater voice in director elections. A stockholder, or a group of up to 20 stockholders, owning at least 3% of the Company’s outstanding common stock continuously for at least three years, may include in our proxy materials director nominees constituting up to the greater of 20% of the number of directors on the Board or two directors, provided that the stockholder(s) and the nominees satisfy the eligibility requirements in our bylaws. There are no qualifying stockholder nominations for inclusion in this proxy statement.

 

 

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Ms. Crosland’s qualification is based on, among other things, her education as a certified public accountant, her more than 30 years of experience in real estate investment management, and her experience serving on private real estate company audit committees

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Mr. Suarez’s qualification is based on, among other things, his long career at Walmart International and Walmart Inc., including his service as Regional Chief Executive Officer and Chief Administration Officer, in which role he oversaw the preparation of financial statements and the accounting function

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Carries out the responsibilities and duties delegated to it by the Board, including oversight of our financial reporting policies, our internal controls, and our compliance with legal and regulatory requirements applicable to financial statements and accounting and financial reporting processes

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Selects our independent registered public accounting firm and reviews and evaluates its qualifications, performance, and independence

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Reviews and pre-approves the audit and non-audit services and the payment of compensation to the independent registered public accounting firm

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Reviews reports and material written communications between management and the independent registered public accounting firm, including with respect to major issues regarding the Company’s internal controls

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Reviews and discusses with management and the independent registered public accounting firm our annual audited financial statements, including our critical audit matters, and quarterly financial statements prior to inclusion in our Annual Report on Form 10-K or other public dissemination in accordance with applicable rules and regulations of the SEC

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Reviews and oversees the Company’s risk management policies and procedures (see “Oversight of Risk Management” below) and reviews and discusses with management and the independent registered public accounting firm our guidelines and policies with respect to risk assessment and risk management

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Reviews and oversees the work of our internal audit function

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Reviews and oversees the Company’s information technology, cybersecurity and risk exposures, and provides oversight of management’s preparedness for and response to cyber-attacks

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Oversees the Company’s policies and practices with respect to publicly-disclosed non-GAAP measures

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Oversees the adequacy and effectiveness of the Company’s controls related to the reliability of the Company’s publicly-disclosed quantitative environmental and social measures

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Reviews and approves, or makes recommendations to the Board, on the annual salary, bonus, equity-based incentives, and other benefits, direct and indirect, of the other executive officers

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Reviews and approves, or makes recommendations to the Board with respect to, all incentive compensation and equity-based plans and awards granted thereunder, including

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those plans that are subject to the approval of the Board and any plans that are not otherwise subject to the approval of the Company’s stockholders

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Oversees the activities of the individuals responsible for administering all incentive compensation and equity-based compensation plans

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Reviews and monitors all employee retirement, profit sharing, and benefit plans of the Company

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Reviews the preparation of the Compensation Discussion and Analysis and determines whether or not to recommend to the Board that the Compensation Discussion and Analysis be included in our annual proxy statement or Annual Report on Form 10-K in accordance with applicable rules and regulations of the SEC

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Performs an annual risk review of the Company’s compensation policies and practices

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The charter of the Compensation Committee permits the committee to delegate any or all of its authority to one or more subcommittees and to delegate to one or more officers of the Company the authority to make awards to any non-Section 16 officer of the Company under the Company’s incentive-compensation or other equity-based plan, subject to compliance with the plan and the laws of the state of the Company’s jurisdiction.

The Compensation Committee has the authority under its charter to retain outside consultants or advisors, as it deems necessary or advisable.

In 2023, James M. Taylor Jr., our Chief Executive Officer and President, participated in discussions and deliberations with the Compensation Committee regarding determinations of annual cash and equity incentive awards for our executive officers. Specifically, he made recommendations to the Compensation Committee regarding executive salaries, equity awards, performance targets used under our annual bonus plan, and amounts of annual cash incentive awards. Mr. Taylor did not participate in deliberations regarding his own compensation.

 

 

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Oversees the Company’s activities relating to ESG matters, including sustainability, corporate social responsibility, and human capital matters, such as diversity and inclusion, employee engagement, and culture, and reviews and assists in developing the Company’s policies related to such matters

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The Board oversees risk management related to us and our business and regularly receives detailed financial and operational updates from management. Oversight for certain specific risks falls under the responsibilities of our Board committees.

The Board has delegated to the Audit Committee the responsibility to review and oversee: (i) the Company’s guidelines and policies to identify, assess, manage, mitigate, and monitor significant business risks of the Company, including financial, operational, information technology, cybersecurity, privacy, business continuity, legal, regulatory, and reputational risks; and (ii) management’s risk assessment, mitigation, and monitoring decisions, practices, and activities, including the steps management has taken to monitor and control the Company’s major financial risk exposures. The Audit Committee considers short-term, medium-term, and long-term risks in exercising its review and oversight responsibilities and considers the immediacy of the risk is assessing mitigation strategies.

The Audit Committee generally reassesses our risk profile annually or more frequently when circumstances warrant. The Audit Committee typically receives quarterly presentations that involve the participation of members of management from the finance, information technology,

 

 

internal audit, and legal functions, as well as external experts as appropriate. The Company’s General Counsel, who is the Company’s chief compliance officer and reports directly to the Chief Executive Officer, as well as other members of management with oversight of the Company’s public risk disclosures, participate in these presentations.

The Board has delegated to the Compensation Committee the responsibility to review and oversee risks related to our compensation program, including evaluating appropriate incentives relating to the compensation of our executives and employees. On an annual basis the Compensation Committee engages with senior management to evaluate potential risks related to compensation policies and practices applicable to all employees and the Company’s management of such risks.

The Nominating and Corporate Governance Committee focuses on risks associated with succession planning, corporate governance, Board effectiveness, and public policy matters, including political and charitable contributions. The Nominating and Corporate Governance Committee also supports the Board in identifying and overseeing risks associated with ESG matters, including sustainability, corporate social responsibility, and human capital matters.

Our Board and Board committees regularly receive presentations from management on risks to the business, including the risks described above. In addition, each of the Board committees regularly advise the full Board of their risk oversight activities.

We are committed to cybersecurity and vigilantly protecting all Company resources and information from unauthorized access. We employ dedicated cybersecurity personnel, led by our Chief Information Officer, to focus on preventing, identifying, and detecting cybersecurity risks. Our Chief Information Officer reports directly to our Executive Vice President, Chief Transformation Officer. The Audit Committee, which consists solely of independent directors, is responsible for overseeing cybersecurity risks, and management provides the Audit Committee with updates on current cybersecurity projects and industry trends on at least a quarterly basis.

Please see our Annual Report on Form 10-K for the year ended December 31, 2023 for more information on our processes and procedures for addressing and managing cybersecurity risks.

Our Nominating and Corporate Governance Committee oversees the Company’s political and charitable contributions. In order to facilitate informed decision-making and accountability with respect to the Company’s political and charitable contributions, the Nominating and Corporate Governance Committee has adopted Political and Charitable Contributions Guidelines that apply to contributions or expenditures of corporate funds to various political entities (including political candidates and parties and political action committees) and charitable organizations. Contributions exceeding certain thresholds set forth in these guidelines must be approved by the Nominating and Corporate Governance Committee and all contributions are required to be reported quarterly to the Nominating and Corporate Governance Committee. We did not make any contributions to political candidates or parties and political action committees in 2023.

We provide an orientation program to any new director, including briefings and materials on our strategy, business, industry, and governance policies and practices. We also provide

 

 

continuing education for all directors, including through Board and committee presentations by third parties and opportunities to participate in external board education programs.

Our commitment to good corporate governance is reflected in our Corporate Governance Guidelines. These Corporate Governance Guidelines are reviewed from time to time by the Board and, to the extent deemed appropriate in light of emerging practices, revised accordingly, upon recommendation to and approval by the Board.

Our Corporate Governance Guidelines, our Audit, Compensation, and Nominating and Corporate Governance Committee charters, and other corporate governance information are available on Leadership & Governance tab on the Investors section of our website at https://investors.brixmor.com/corporate-profile. Any stockholder may also request these documents in print, without charge, by contacting the Secretary at Brixmor Property Group Inc., 450 Lexington Avenue, New York, New York 10017.

Executive sessions, which are meetings of the non-management members of the Board, are regularly scheduled throughout the year. In addition, at least once a year, the independent directors meet in a private session that excludes management and any non-independent directors. In accordance with our Corporate Governance Guidelines, the independent directors have elected Mr. Rahm from among themselves to serve as the Presiding Independent Director to call and preside at executive sessions. The Audit and Compensation Committees also meet regularly in executive sessions.

The Board has implemented stock ownership guidelines, which are included in our Corporate Governance Guidelines referenced above. The Board may, in its sole discretion, grant exceptions to the guidelines outlined below.

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Our Chief Executive Officer and President, Chief Financial Officer, and each Executive Vice President are expected to own common stock or common stock equivalents equal in market value to a specified multiple of his or her annual base salary as outlined below:

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•

New officers that are subject to the ownership guidelines are expected to be in compliance by the fifth anniversary of their appointment to the position that results in application of the ownership guidelines

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•

Each of our named executive officers is currently in compliance with their respective ownership guideline, including Ms. Aman, who was in compliance through the date of her departure in January 2024

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•

Each independent director is expected to own common stock or common stock equivalents equal in market value to five times the cash portion of such independent director’s annual Board fee for the preceding year (exclusive of committee or chair fees) within five years of joining the Board

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•

Each independent director that has served on the Board for five years is currently in compliance with their ownership guideline

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For purposes of the stock ownership guidelines applicable to both senior officers and independent directors, (i) restricted stock and (ii) earned restricted stock units, which are only subject to a time vesting requirement, count towards such requirement.

We have a Code of Business Conduct and Ethics that applies to all directors, officers, and employees of the Company and a Code of Conduct for Senior Financial Officers that applies to our principal executive officer, principal financial officer, principal accounting officer or controller, and persons performing similar functions. Each of these codes is available on our website at
https://investors.brixmor.com/leadership-governance/governance-documents-policies/default.aspx.​

The Code of Business Conduct and Ethics sets forth our policies and expectations on a number of topics, including conflicts of interest, compliance with laws (including insider trading laws), use of our assets, business conduct, and fair dealing. The Code of Conduct for Senior Financial Officers satisfies the requirements for a code of ethics, as defined by Item 406 of Regulation S-K promulgated by the SEC. The Company will disclose within four business days any substantive changes in or any waivers of the Code of Business Conduct and Ethics or Code of Conduct for Senior Financial Officers granted to our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, by posting such information on our website.

As described in our Code of Business Conduct and Ethics, the Company’s directors, officers, and employees are provided with three avenues through which they can report violations or suspected violations with respect to accounting or auditing matters: a toll-free phone number, in writing, or through a website. The toll-free phone number for directors, officers, and employees is available 24 hours a day, seven days a week. Directors, officers, and employees may report any violation of the Code of Business Conduct and Ethics that does not concern accounting or auditing matters either in writing or in person. Violations or suspected violations of the Code of Conduct for Senior Financial Officers must be reported to the Company’s General Counsel or the Chair of the Audit Committee of the Board of Directors and may be made through a toll-free phone number, in writing, or through a website. Directors, officers, and employees can choose to remain anonymous in reporting violations or suspected violations. In addition, we maintain a formal non-retaliation policy that prohibits action or retaliation against any director, officer, or employee who makes a report in good faith even if the facts alleged are not confirmed by subsequent investigation.

The Nominating and Corporate Governance Committee weighs the characteristics, experience, independence, and skills of potential candidates and recommends nominees for election as directors to the Board. In considering candidates for the Board, the Nominating

 

 

and Corporate Governance Committee also assesses overall Board composition considerations, including the importance of diversified Board membership, in terms of both the individuals involved and their various skills and areas of expertise (including expertise that could qualify a director as an “audit committee financial expert” under SEC rules), compliance with NYSE and SEC Board and Committee independence requirements, as applicable, and the size of the Board. In evaluating Board candidates, the Nominating and Corporate Governance Committee also considers each candidate’s other commitments, including job responsibilities, service on other public company boards, and leadership positions on such boards, for the purpose of determining whether the candidate can satisfy the time commitments necessary and appropriate for service on the Board.

As the application of these factors involves the exercise of judgment, the Nominating and Corporate Governance Committee does not have a standard set of fixed qualifications that is applicable to all director candidates, although the Nominating and Corporate Governance Committee does at a minimum assess each candidate’s strength of character, mature judgment, familiarity with our business and industry, independence of thought, and his or her ability to work collegially with the other members of the Board. The Nominating and Corporate Governance Committee utilizes the same criteria for evaluating candidates regardless of the source of the candidate.

In identifying prospective director candidates, the Nominating and Corporate Governance Committee may seek referrals from other members of the Board, management, stockholders, and other sources. The Nominating and Corporate Governance Committee may also, but need not, retain a search firm in order to assist it in identifying candidates to serve as directors of the Company. In order to further advance its goals of Board racial, ethnic, gender, and sexual orientation diversity, the Nominating and Corporate Governance Committee requires that in connection with any director search at least one diverse candidate be interviewed.

Mr. Suarez is standing for re-election by stockholders for the first time at the Annual Meeting. Mr. Suarez was originally identified as a potential director appointee by certain of our Board members.

When considering director candidates, the Nominating and Corporate Governance Committee seeks individuals with backgrounds and qualities that, when combined with those of our incumbent directors, provide a blend of skills and experience to further enhance the Board’s effectiveness. In connection with its annual recommendation of a slate of nominees, the Nominating and Corporate Governance Committee may also assess the contributions of those directors recommended for re-election in the context of the Board evaluation process (discussed in more detail below) and other perceived needs of the Board.

When considering whether the directors and nominees have the experience, qualifications, attributes, and skills, taken as a whole, to enable the Board to satisfy its oversight responsibilities effectively in light of the Company’s business, the Board focused primarily on the information contained in each of the Board member’s biographical information set forth above.

 

 

Each of the Company’s directors:

In addition, most of the Company’s directors possess experience in either (i) owning and/or managing publicly traded or privately held enterprises and (ii) advising and managing companies in various segments of the real estate industry.

In 2024, the director nomination process resulted in the Nominating and Corporate Governance Committee’s recommendation to the Board, and the Board’s nomination of, the nine incumbent directors named in this proxy statement and proposed for election by you at the upcoming Annual Meeting.

The Nominating and Corporate Governance Committee will consider director candidates recommended by stockholders. Any recommendation submitted to the Corporate Secretary should be in writing and should include any supporting material the stockholder considers appropriate in support of that recommendation, but must include information that would be required under the rules of the SEC to be included in a proxy statement soliciting proxies for the election of such candidate and a written consent of the candidate to serve as one of our directors if elected. Stockholders wishing to propose a candidate for consideration may do so by submitting the above information to the attention of the Secretary, Brixmor Property Group Inc., 450 Lexington Avenue, New York, New York 10017. Stockholders must comply with the advance notification, timeliness, consent, information, and other requirements of our Bylaws regarding director nominations. All recommendations for nomination received by the Corporate Secretary will be presented to the Nominating and Corporate Governance Committee for its consideration. The foregoing requirements are also described under the caption “Stockholder Proposals for the 2025 Annual Meeting.” In addition, stockholders have proxy access rights pursuant to which stockholders owning at least 3% of our common stock for at least three years may nominate the greater of up to 20% of the number of directors on the Board or two directors. The deadline for submission of proxy access nominees is described under the caption “Proxy Access Nominees.”

Under the oversight of the Nominating and Corporate Governance Committee, we perform an annual evaluation of the Board, each of the standing Board committees, and individual directors. The evaluation process consists of a written questionnaire, an interview of each director by the Chair of the Nominating and Corporate Governance Committee, and a discussion of the issues raised through the questionnaire and interview process at the Board and committee levels. Feedback resulting from these evaluations is used to refine Board and Board committee practices and improve Board, Board committee, and individual director performance. The evaluation process is also considered as part of the director nomination process.

 

 

As described in the Corporate Governance Guidelines, stockholders and other interested parties who wish to communicate with a member or members of the Board, including the Chair, the Presiding Independent Director, the chair of the Audit, Compensation, or Nominating and Corporate Governance Committees, or to the non-management or independent directors as a group, may do so by addressing such communications or concerns to the Board of Directors or any such individual directors or group or committee of directors by either name or title and sending it by:

Such communications may be done confidentially or anonymously.

 

 

Set forth below is certain information regarding each of our current executive officers, other than Mr. Taylor, whose biographical information is presented under “Director Nominees.”

 

 

 

The Audit Committee has selected Deloitte & Touche LLP to serve as our independent registered public accounting firm for 2024. Deloitte & Touche LLP has served as our independent registered public accounting firm since May 2015.

Although ratification is not required by our Bylaws or otherwise, the Board is submitting the selection of Deloitte & Touche LLP to our stockholders for ratification because we value our stockholders’ views on the Company’s independent registered public accounting firm. If our stockholders fail to ratify the selection, it will be considered as notice to the Board and the Audit Committee to consider the selection of a different firm. Even if the selection is ratified, the Audit Committee, in its discretion, may select a different independent registered public accounting firm at any time during the year if it determines that such a change would be in the best interests of the Company.

Representatives of Deloitte & Touche LLP are expected to be present at the virtual Annual Meeting. They will also have the opportunity to make a statement if they desire to do so, and they are expected to be available to respond to appropriate questions.

The shares represented by your proxy will be voted for the ratification of the selection of Deloitte & Touche LLP unless you specify otherwise.

In connection with the audit of the 2023 financial statements, we entered into an agreement with Deloitte & Touche LLP that set forth the terms by which Deloitte & Touche LLP would perform audit services for the Company.

The following table presents fees billed for professional services rendered by Deloitte & Touche LLP for the audit of our financial statements for 2023 and 2022 and fees billed for other services rendered by Deloitte & Touche LLP for those periods:

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(1)

Includes the aggregate fees billed in each of the last two fiscal years for professional services rendered by Deloitte & Touche LLP for the audit of the Company’s annual financial statements included in Forms 10-K and the review of quarterly financial statements included in Forms 10-Q, including fees related to the issuance of comfort letters and consents. The fees are for services that are normally provided by Deloitte & Touche LLP in connection with statutory or regulatory filings or engagements.

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(2)

Includes the aggregate fees billed in each of the last two fiscal years for professional services rendered by Deloitte & Touche LLP for tax compliance, tax advice, and tax planning.

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The Audit Committee considered whether providing the non-audit services shown in this table was compatible with maintaining Deloitte & Touche LLP’s independence and concluded that it was.

Consistent with SEC policies regarding auditor independence and the Audit Committee’s charter, the Audit Committee has responsibility for engaging, setting compensation for, and reviewing the performance of the independent registered public accounting firm. In exercising this responsibility, the Audit Committee pre-approves all audit and permitted non-audit services provided by the independent registered public accounting firm prior to each engagement.

 

 

The Audit Committee operates pursuant to a charter that is reviewed annually by the Audit Committee. Additionally, a brief description of the primary responsibilities of the Audit Committee is included in this proxy statement under the caption “The Board of Directors and Certain Governance Matters—Committee Membership—Audit Committee.” Under the Audit Committee charter, our management is responsible for the preparation, presentation, and integrity of our financial statements, the application of accounting and financial reporting principles, and internal controls and procedures designed to assure compliance with accounting standards and applicable laws and regulations. The independent registered public accounting firm is responsible for auditing our financial statements and expressing an opinion as to their conformity with accounting principles generally accepted in the United States of America.

In the performance of its oversight function, the Audit Committee reviewed and discussed the audited financial statements of the Company, including the critical audit matters described therein, with management and with the independent registered public accounting firm. The Audit Committee also discussed with the independent registered public accounting firm the matters required to be discussed by the applicable requirements of the Public Company Accounting Oversight Board (the “PCAOB”) and the SEC. In addition, the Audit Committee received the written disclosures and the letter from the independent registered public accounting firm required by the PCAOB regarding the independent registered public accounting firm’s communications with the Audit Committee concerning independence, and discussed with the independent registered public accounting firm their independence.

Based upon the review and discussions described in the preceding paragraph, our Audit Committee recommended to the Board of Directors that the audited financial statements of the Company be included in the Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC.

Sandra A.J. Lawrence, Chair
Michael Berman
Sheryl M. Crosland
JP Suarez

 

 

In accordance with the requirements of Section 14A of the Exchange Act and the related rules of the SEC, we are including in these proxy materials a separate resolution, subject to stockholder vote, to approve, in a non-binding, advisory vote, the compensation paid to our named executive officers. While the results of the vote are non-binding and advisory in nature, the Board intends to carefully consider the results of this vote.

The text of the resolution in respect of Proposal No. 3 is as follows:

“RESOLVED, that the compensation paid to the Company’s named executive officers, as disclosed pursuant to Item 402 of Regulation S-K, including the Compensation Discussion and Analysis, compensation tables, and any related narrative discussion, is hereby APPROVED.”

In considering their vote, stockholders may wish to review with care the information on the Company’s compensation policies and decisions regarding the named executive officers presented in Compensation Discussion and Analysis on pages 47 to 63 as well as the discussion regarding the Compensation Committee on pages 31 to 32. We expect that we will conduct the next advisory vote on executive compensation at the 2025 annual meeting of stockholders.

 

 

The Compensation Committee has discussed and reviewed the following Compensation Discussion and Analysis with management. Based upon this review and discussion, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this proxy statement and incorporated by reference into the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC.

William D. Rahm, Chair
Thomas W. Dickson
Daniel B. Hurwitz

 

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James M. Taylor Jr., our Chief Executive Officer and President

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Brian T. Finnegan, our Senior Executive Vice President, Chief Operating Officer

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Mark T. Horgan, our Executive Vice President, Chief Investment Officer

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Steven F. Siegel, our Executive Vice President, General Counsel and Secretary

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Angela M. Aman, our former President, Chief Financial Officer and Treasurer

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Our executive compensation program is designed to attract, retain, and motivate executives who are capable of advancing our mission and strategy and ultimately maintain and grow our long-term equity value.

In 2023, stockholders showed support for our executive compensation program with 96.5% of the votes cast for the approval of the “say on pay” proposal at our 2023 Annual Meeting of Stockholders. This is consistent with the strong support we have received in recent years, with support levels in 2022, 2021, and 2020 at 97.3%, 97.6%, and 96.9%, respectively.

 

 

 

Our target pay is heavily weighted towards performance-based and/or equity-based compensation. Performance-based and equity-based compensation for all named executive officers averages 80% of total target compensation.

(1)

Calculated without giving effect to salary increases of  $50,000 for each of Ms. Aman and Mr. Finnegan, which were effective as of October 1, 2023 in connection with their promotions. In addition, excludes compensation included in the “All Other Compensation” column of the “Summary Compensation Table.” For more information about this additional compensation, see “—Executive Compensation Tables—Summary Compensation Table” below.

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Our annual bonus program features multiple metrics designed to reward performance. The financial metrics used are key indicators of the executive team’s effectiveness at leading the Company in the management of our properties (Same Property Net Operating Income or “SP NOI” or “Same Property NOI”) and our overall business (Nareit Funds From Operations or “Nareit FFO”).

The diagram below illustrates the achievement level of performance for our 2023 annual bonus plan (“Annual Bonus Plan”).

 

 

Our compensation philosophy is based on best governance practices and are designed to align executive compensation with long-term stockholder interests.
   

​	WHAT WE DO:				​
​		​	​	Structure our Board with experienced independent leadership including an independent Chair	​
​		​	​	Design our compensation program to reflect our culture of pay for performance, with more than three-quarters of named executive officer compensation being performance based	​
​		​	​	Undertake an annual review of compensation strategies and programs by the Compensation Committee, including our compensation risk profile	​
​		​	​	Utilize an independent compensation consultant to advise the Compensation Committee	​
​		​	​	Include achievement of individual ESG goals as part of each executive’s total bonus compensation	​
​		​	​	Subject cash and equity incentive compensation to clawback provisions more stringent than those required by the NYSE	​
​		​	​	Subject Named Executive Officers, other Executive Vice Presidents and directors to robust stock ownership guidelines	​

​	WHAT WE DO NOT DO:				​
​		​	​	Offer excessive perquisites or special health and welfare plans to executives	​
​		​	​	Guarantee salary / bonus increases	​
​		​	​	Allow hedging or pledging of Company stock	​
​		​	​	Have single trigger cash severance payments in the event of a change-in-control	​
​		​	​	Provide excise tax gross-ups	​
​		​	​	Encourage unreasonable risk-taking through compensation	​

 

 

Our primary executive compensation objectives are to:

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Attract, retain, and motivate executives who are capable of advancing our mission and strategy and ultimately maintain and grow our long-term equity value

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Reward executives in a manner aligned with our financial performance and individual goals; and

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Align executives’ interests with the long-term interests of our equity owners through equity participation and ownership

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To achieve our objectives, we deliver executive compensation through a combination of the following components: (1) base salary; (2) Bonus; (3) LTI; (4) other employee benefits and perquisites; and (5) severance benefits.

Each year, the Compensation Committee considers the outcome of the stockholder advisory vote on executive compensation when making future decisions relating to the compensation of our named executive officers and our executive compensation program and policies. In 2023, stockholders showed support for our executive compensation programs, with 96.5% of the votes cast for the approval of the “say-on-pay” proposal at our 2023 Annual Meeting of Stockholders. The Compensation Committee believes that this support is attributable to the Compensation Committee’s commitment to the alignment of our named executive officers’ compensation with the Company’s performance.

Our stockholders have historically shown strong support for our policies and practices regarding executive compensation, as illustrated by the annual say-on-pay vote.

SEC rules require the vote on the frequency of stockholder votes on executive compensation to be held at least once every six years. In light of the Board’s recommendation and the voting results with respect to the frequency of stockholder votes on executive compensation at the 2020 annual meeting of stockholders, the Company will continue to hold an advisory vote on the compensation of named executive officers at each annual meeting of stockholders until the next required vote on the frequency of stockholder votes on executive compensation. We currently expect the next stockholder vote on frequency to occur at the Company’s 2026 annual meeting.

 

 

In response to recently adopted NYSE and SEC rules, the Compensation Committee updated the Company clawback policy, pursuant to which the Company will seek repayment of cash and equity incentive compensation paid to executive officers under certain circumstances. As mandated by such rules, if the Company is required to prepare an accounting restatement of its GAAP financial statements, the Company will recover any incentive compensation received by any covered person during the fiscal years pertaining to the restatement that was in excess of the amount that otherwise would have been paid, giving effect to the restated results.

The Company clawback policy also applies to circumstances that are not required to be addressed by the newly adopted NYSE and SEC rules. The Company’s clawback policy continues to provide for discretionary recoupment of incentive compensation if the Compensation Committee determines that any covered person has committed fraud or intentional misconduct that either constitutes a violation of law or a material breach of specified Company policies or that could reasonably be expected to result in significant reputational or financial harm to the Company. In these cases, the Compensation Committee may recover up to 100% of any incentive compensation received by such covered person in the fiscal year during which such misconduct occurred.

In addition, if the Company restates or revises a non-GAAP financial measure, other than in connection with a restatement of its GAAP financial statements, due to material non-compliance with any financial reporting requirement under the federal securities laws or if such measure has been determined in the reasonable judgment of the Compensation Committee to have been materially misstated, the Company may recover any incentive compensation received by any covered person during the fiscal years pertaining to the restatement or revision that was in excess of the amount that otherwise would have been received after giving effect to the restated or revised results.

The Compensation Committee of our Board is responsible for determining the compensation of our Chief Executive Officer and our other named executive officers. At the beginning of each performance cycle, the Compensation Committee approves financial goals designed to align executive pay with company performance and stockholder interests, provide competitive pay opportunities dependent on company performance, retain talent, grow stockholder value, and mitigate material risk. The Compensation Committee has the authority to engage its own advisors to assist in carrying out its responsibilities and, as described below, utilized its compensation consultant to assist with decisions regarding 2023 compensation.

In 2023, Mr. Taylor, our Chief Executive Officer and President, worked with the Compensation Committee in managing our executive compensation program and he attended meetings of the Compensation Committee. He did not attend portions of meetings relating to his own compensation. Because of his daily involvement with the executive team, our Chief Executive Officer and President made recommendations to the Compensation Committee regarding 2023 compensation for the named executive officers other than himself.

 

 

Pay Governance serves as the Compensation Committee’s independent, third-party compensation consultant to provide advice on a range of compensation matters.

Pay Governance reports directly to the Compensation Committee and does not provide services to the Company’s management that are not under the Compensation Committee’s purview. Representatives of Pay Governance have attended meetings of the Compensation Committee and will continue to do so upon request. Prior to retaining Pay Governance, the Compensation Committee considered all factors relevant to Pay Governance’s independence from management, as required by the Compensation Committee’s charter.

The total potential compensation for each of our named executive officers is established based on the scope of his or her individual responsibilities and contributions to our performance, taking into account competitive market compensation paid for similar positions. Our Compensation Committee determines appropriate levels of total compensation for our named executive officers by applying their individual understanding, experiences, and judgments of the national marketplace of senior level real estate positions and related industry pay in both public and private companies that may compete for our executives, while also considering the relative importance of various positions at the Company given our business plan and organization compared with the business plans and organizations of our major competitors. The Compensation Committee also consults with its independent compensation consultant and considers compensation surveys prepared by FPL Associates for Nareit to confirm its assessment of appropriate market compensation for our named executive officers. The latest FPL Associates survey contains information reported for each position by 116 U.S. equity focused real estate investment trusts (“REITs”), including 21 retail-focused REITs. An individual compensation package is then created for each named executive officer using a combination of base salary, annual cash bonus, and long-term equity incentives to provide the appropriate level of potential total annual compensation and the right balance of fixed versus at-risk compensation.

Actual compensation of our named executive officers may be higher or lower than the compensation for executives in similar positions at comparable companies based on the performance, skills, experience, and the specific role of the named executive officer in the organization.

The Compensation Committee, in consultation with management, annually assesses the Company’s compensation policies and procedures with respect to risk and risk management. Based on this assessment, the Compensation Committee does not believe there are any risks from the Company’s compensation policies and practices that are reasonably likely to have a material adverse effect on the Company.

In setting 2023 compensation in February 2023, the Compensation Committee did not make any changes in base salaries, annual bonus payout percentages or LTI target grants for the named executive officers compared to 2022.

 

 

In September 2023, Ms. Aman was promoted to the additional position of President and Mr. Finnegan was promoted to the position of Senior Executive Vice President and Chief Operating Officer. In connection with these promotions, the Compensation Committee increased Ms. Aman’s and Mr. Finnegan’s (i) annual base salaries to $650,000 and $625,000, respectively, effective as of October 1, 2023 and (ii) LTI target grants to $1,800,000 and $1,750,000, respectively, effective in 2024.

Ms. Aman resigned as the Company’s President, Chief Financial Officer and Treasurer, effective January 19, 2024, concurrent with her appointment as chief executive officer of an office REIT. Mr. Gallagher assumed the role of the Company’s interim Chief Financial Officer effective January 19, 2024. Because Mr. Gallagher was not a named executive officer in fiscal 2023, his compensation is not presented in this proxy statement.

Base salary compensates our executives for performing the day-to-day requirements of their positions and provides them with cash income and stability with respect to a portion of their total compensation. We believe that the level of a named executive officer’s base salary should reflect that named executive officer’s performance, experience, breadth of responsibilities, salaries for similar positions within our industry, and any other factors relevant to that particular position. The minimum base salary payable to each named executive officer is set by the terms of an employment agreement entered into with each named executive officer, the material terms of which are summarized in the “Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table—Employment Agreements with Our Named Executive Officers” below. The compensation of each named executive officer is reviewed annually and is eligible for a discretionary annual merit increase. Base salaries may also be adjusted at other times to address competitive pressures or changes in job responsibilities. The following table reflects the base salaries of our named executive officers at the end of 2023.

In order to motivate our named executive officers to achieve near-term performance goals by linking a significant portion of their cash compensation to realized performance, each named executive officer is eligible for annual cash incentive awards under the Annual Bonus Plan based on the achievement of corporate metric targets (75% of the bonus) and individual qualitative goals (25% of the bonus, 20% of which are individual ESG goals), each set at the beginning of the fiscal year, with the threshold, target, and maximum payout amounts based on a percentage of the named executive officer’s base salary. The named executive officers’ threshold, target, and maximum payout amounts were as follows:

 

 

In February 2023, the Compensation Committee determined that the two corporate metrics under the 2023 Annual Bonus Plan (75% of the bonus) would be SP NOI growth and Nareit FFO per share. SP NOI growth is calculated (using properties owned for the entirety of both periods and excluding properties under development and completed new development properties that have been stabilized for less than one year) as total property revenues (base rent, expense reimbursements, adjustments for revenues deemed uncollectible, ancillary and other rental income, percentage rents, and other revenues) less direct property operating expenses (operating costs and real estate taxes). SP NOI excludes lease termination fees, straight-line rental income, net, accretion of below-market leases, net of amortization of above-market leases and tenant inducements, straight-line ground rent expense, net, income or expense associated with the captive insurance company, depreciation and amortization, impairment of real estate assets, general and administrative expense, and other income and expense (including interest expense and gain on sale of real estate assets). Nareit FFO per share is defined as net income (loss), calculated in accordance with GAAP, excluding (i) depreciation and amortization related to real estate, (ii) gains and losses from the sale of certain real estate assets, (iii) gains and losses from change in control, (iv) impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity and (v) after adjustments for unconsolidated joint ventures calculated to reflect Nareit FFO on the same basis. In addition, when setting the metrics for Nareit FFO per share achievement under the 2023 Annual Bonus Plan, the Compensation Committee provided that maximum, target, and threshold performance levels approved in 2023 for Nareit FFO were to be adjusted to exclude litigation and other non-routine legal expenses, and loss on debt extinguishment of debt, net. For 2023, no adjustments to Nareit FFO were made for these expenses, as maximum performance was achieved notwithstanding these items.

The following table shows the weighting assigned to each of the named executive officers for each fiscal 2023 Annual Bonus Plan performance metric.

* 20% of Individual goals are comprised of individual ESG goals.

 

 

The table below sets forth the original threshold, target, and maximum corporate metrics established by the Compensation Committee in February 2023 for the 2023 Annual Bonus Plan:

Mr. Taylor’s accomplishments included:

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Delivering strong operating metrics, including robust leasing spreads and contractual adjustments on rental rates, as well as record total and small shop occupancy and annualized base rent (“ABR”) per square foot

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Stabilizing $157 million of value enhancing reinvestment projects, with $429 million of projects in the in process reinvestment pipeline

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Harvesting $190 million of capital through non-core asset dispositions

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Overseeing ongoing enhancements in the employee experience, resulting in strong employee retention

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Ensuring ample financial capacity and flexibility and reducing interest rate risk, while decreasing debt to EBITDA to 6.0x and receiving a ratings upgrade from S&P Global Ratings

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Communicating and reinforcing the success of the Company’s reinvestment strategy and portfolio and platform transformation with a broad group of stakeholders

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Continuing property level sustainability improvements, execution of renewable energy projects, and enhancing related reporting functionality and disclosures

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Promoting an inclusive work environment that reflects the diversity of the communities served, including holding events such as unconscious bias training, heritage spotlights, and cultural tradition exchanges

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Mr. Finnegan’s accomplishments included:

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Leading the execution of 6.3 million square feet of new and renewal leases with robust leasing spreads and net effective rents, while continuing to add strong new to portfolio tenants

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Driving total occupancy to a record 94.7% and small shop occupancy to a record 90.3%

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Achieving rent spreads on new and renewal leases of 19.3%

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Achieving a record high new lease ABR of  $21.92 per square foot, a 15% increase year over year

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Executing key strategic leases in order to launch significant value enhancing reinvestment projects

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Efficiently addressing space recaptured in bankruptcy at strong increases in base rent

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Increasing brand awareness through social media video campaigns

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Including green lease provisions in the majority of the Company’s new leases

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Mr. Horgan’s accomplishments included:

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Monitoring and evaluating the transactions market in order to quickly identify opportunities

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Closing $190 million of dispositions, exiting non-core markets and low growth / high risk assets

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Leading the Company’s Investment Committee and ensuring the appropriateness of the Company’s broader capital allocation decisions, including reviewing redevelopments and property transactions

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Incorporating climate and natural hazard risk considerations in targeted acquisitions and dispositions

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Mr. Siegel’s accomplishments included:

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Directing the execution of 1,400 new and renewal lease agreements representing 6.3 million square feet

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Increasing adoption of short-form leases for small shop tenants to over 90%

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Reducing execution time frame for anchor leases by almost 10%

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Overseeing diligence and documentation of capital recycling efforts, as well as monitoring legal aspects of reinvestment projects and capital markets transactions

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Implementing new processes and procedures to measure and ensure adoption of green lease provisions

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Maintaining the Company’s corporate governance practices, resulting in continuing third-party recognition

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Ms. Aman’s accomplishments included:

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Ensuring ample financial capacity and flexibility and reducing interest rate risk, while decreasing debt to EBITDA to 6.0x and receiving a ratings upgrade from S&P Global Ratings

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Tendering for $200 million of bonds funded with a $200 million delayed draw term loan

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Executing interest rate and forward-starting swaps

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Further improving the Company’s data governance, warehousing and automation capabilities, and increasing integration between accounting and forecasting platforms

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Remaining vigilant in protecting Company assets by implementing cybersecurity products and following best practices

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Broadening the investor base with over 500 investor touchpoints, including communicating the Company’s reinvestment strategy and portfolio and platform transformation

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Enhancing CR related reporting functionality and disclosures, ensuring alignment with applicable frameworks

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Automating Scope 1 and 2 GHG emissions calculations

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Based on this assessment the Compensation Committee determined that each of Messrs. Taylor, Finnegan, Horgan and Siegel and Ms. Aman achieved between target and maximum performance with respect to their individual goals.

Based on the assessments of the corporate metrics and the individual performance goals, the Compensation Committee approved the 2023 Annual Bonus Plan awards detailed in the following table:

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(1)

Combined Achievement Factor as a Percentage of Target is calculated by dividing the Actual 2023 Annual Bonus by the Target Bonus Potential. With respect to each of Ms. Aman and Mr. Finnegan, 2023 Base Salary and Target Bonus Potential are presented without giving effect to salary increases that occurred in October 2023 in connection with their respective promotions; however, their Actual 2023 Annual Bonus was pro-rated based on the effective date of their salary increases, and, accordingly, Combined Achievement Factor as a Percentage of Target reflects Actual 2023 Annual Bonus paid in relation to Target Bonus Potential without giving effect to said salary increases.

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The Company grants long-term incentive awards to align the Company’s executives with stockholder interests, support long-term value creation, and promote the retention and stability of our executive management team.

Under the current executive long-term incentive program, 60% of total equity awards received by the named executive officers are in the form of PRSUs with a three-year performance measurement period commencing at the beginning of the calendar year of grant (the “Performance Period”), based on relative total stockholder return (“TSR”) over such period. Performance over the Performance Period will be measured by the Compensation Committee after the completion of the Performance Period (the “Measurement Date”). Of the PRSUs that are earned, 50% will vest on the Measurement Date and 25% will vest on January 1 of each of the next two succeeding years.

The total number of PRSUs that can be earned is between 0% (for below threshold performance) and 200% (for maximum performance) of the target level, based on the Company’s TSR performance compared to the constituent companies in the FTSE Nareit Equity Shopping Centers Index. If the Company’s TSR during the measurement period is negative, the maximum

 

 

number of PRSUs that may be earned (notwithstanding relative TSR achievement above the target level) is limited to the target level.

The threshold, target, above target, and maximum performance levels of relative TSR (measured on a compounded annual basis over the measurement period) are as follows:

To encourage retention, the remaining 40% of total equity awards received by the named executive officers are granted in the form of service-based restricted stock units (“Service RSUs”) that vest in three equal annual installments beginning on January 1 of the succeeding year. In order to incentivize and reward superior performance, the Service RSUs have an attached outperformance modifier, referred to as Outperformance RSUs that can increase the original Service RSU award based on the Company’s financial and operational outperformance over a specified measurement period. The number of Outperformance RSUs that may be earned is between 0.00 and 2.00 times the number of Service RSUs initially granted, based on the achievement of specified SP NOI and Nareit FFO per share growth hurdles; provided, however, commencing with the awards granted in 2024, in no event shall the number of Outperformance RSUs earned exceed 1.00 times the number of Service RSUs if the number of PRSUs earned during the measurement period did not equal or exceed target level. The Outperformance RSUs are assessed based on a three-year performance measurement period commencing in the calendar year of grant (i.e., the same measurement period as the PRSUs granted in that year). To the extent earned and granted, 50% of the Outperformance RSUs will vest on the Measurement Date and 25% will vest on January 1 of each of the next two succeeding years.

In 2023, the Compensation Committee determined to grant the named executive officers the number of PRSUs and Service RSUs detailed below.

Any Outperformance RSUs earned with respect to the 2023 Service RSUs will be earned and granted following the end of the measurement period on December 31, 2025, as described above.

In general, PRSUs are forfeited and Outperformance RSUs are not granted to the extent the applicable performance criteria are not achieved as of the end of the Performance Period or

 

 

as of any termination of employment. Upon a qualifying termination (as defined in the award agreements), a portion of the PRSUs and Outperformance RSUs will be eligible to become earned in the case of PRSUs or earned and granted in the case of Outperformance RSUs, and vested, based on actual performance through the date of termination or good reason resignation and subject to proration based on the number of days during the applicable Performance Period that the executive was employed. The foregoing will also be applicable with respect to the PRSUs upon the executive’s retirement (as defined in the award agreements). Upon a change in control during any Performance Period, a portion of the PRSUs will become earned or Outperformance RSUs will be earned and granted based on actual performance through the date of the change in control. In addition, unvested Service RSUs are forfeited upon a voluntary termination of employment; however, upon a qualifying termination, all unvested Service RSUs will automatically and immediately vest as of the date of such qualifying termination.

Dividend equivalents will be paid currently on unvested Service RSUs. Dividend equivalents will accrue and be paid only on fully vested PRSUs at the time of vesting. Dividend equivalents will only be paid on Outperformance RSUs from and after the date they are fully vested.

The performance criteria for the 2021 PRSU awards, which Performance Period began on January 1, 2021 and ended on December 31, 2023, was the percentile ranking of the Company’s TSR over the Performance Period relative to the TSR of the REITs included in the FTSE Nareit Equity Shopping Centers Index over the entirety of the Performance Period (the “Percentile Ranking”). The threshold, target, above target, and maximum performance levels of relative TSR (measured on a compounded annual basis over the Performance Period) for the 2021 PRSU awards are described in the second table above. For the three year period ended December 31, 2023, the Company’s absolute TSR was positive and the Company’s Percentile Ranking was 55.9%, which resulted in an award payout of 123.8% of target. Of the PRSUs that were earned, 50% vested on January 31, 2024, 25% will vest on January 1, 2025 and 25% will vest on January 1, 2026.

The Performance Period for the 2021 Outperformance RSU awards began on January 1, 2021 and ended on December 31, 2023. The performance criteria was based on the achievement of specified SP NOI and Nareit FFO per share growth hurdles, which were considered at the time of grant not probable of being achieved. With respect to the SP NOI growth rate metric, for the three year period ended December 31, 2023, the Company achieved a compounded growth rate of 6.3%, which was above the maximum level of 4%, and thus awards were earned at the maximum level. With respect to the Nareit FFO per share growth metric, for the three year period ended December 31, 2023, the Company achieved a compounded growth rate of 6.9%, which was above the maximum level of 6%, and thus awards were earned at the maximum level. Of the OPRSUs that were earned, 50% vested on January 31, 2024, 25% will vest on January 1, 2025 and 25% will vest on January 1, 2026.

We provide our employees, including our named executive officers, with broad-based benefits that are intended to attract and retain employees while providing them with retirement and health and welfare security. These benefits include life and health benefits and vacation,