DEF 14A 1 nc10022411x3_def14a.htm DEF 14A

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
SCHEDULE 14A
(RULE 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the Registrant ☒
Filed by a Party other than the Registrant
Check the appropriate box:
Preliminary Proxy Statement
Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
Definitive Proxy Statement
Definitive Additional Materials
Soliciting Material Pursuant to Rule 14a-12
EASTGROUP PROPERTIES, INC.
(Name of Registrant as Specified in Its Charter)
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
No fee required:
 
 
 
Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
 
 
 
 
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Fee paid previously with preliminary materials.
 
 
 
Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the form or schedule and the date of its filing.
 
 
 
 
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400 W. Parkway Place, Suite 100
Ridgeland, Mississippi 39157
NOTICE OF 2021 ANNUAL MEETING OF SHAREHOLDERS
To the Shareholders:
The 2021 Annual Meeting of Shareholders (the “Meeting”) of EastGroup Properties, Inc. (the “Company”) will be held on Thursday, May 27, 2021 at 9:00 a.m., Central Daylight Time, in a virtual meeting format. To log on to the Meeting, visit www.virtualshareholdermeeting.com/EGP2021 and enter the unique 16-digit control number included on your Notice of Internet Availability of Proxy Materials, voting instruction form, or proxy card (if you received a printed copy of the proxy materials). Shareholders will be able to vote electronically and submit questions electronically during the Meeting. At the Meeting, shareholders will be asked to:
1.
Elect the eight director nominees named in this proxy statement for a one-year term to serve until the next annual meeting of shareholders and until their successors are duly elected and qualified;
2.
Ratify the appointment of KPMG LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2021;
3.
Approve by a non-binding, advisory vote the compensation of our Named Executive Officers as described in this proxy statement;
4.
Approve the amendment and restatement of our charter and our bylaws to allow our bylaws to be amended by a majority of stockholder votes; and
5.
Transact such other business as may properly come before the Meeting or any adjournment or postponement thereof.
All shareholders of record at the close of business on March 26, 2021 are entitled to notice of and to vote at the Meeting or any adjournment thereof.
We are pleased to take advantage of the Securities and Exchange Commission rules that allow issuers to furnish proxy materials to their shareholders electronically. We believe these rules allow us to provide our shareholders with the information they need, while lowering the costs of delivery and reducing the environmental impact of the Meeting.
 
By Order of the Board of Directors
 

 
Brent W. Wood
Executive Vice President, Chief
Financial Officer and Treasurer
DATED: April 12, 2021

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Important Notice Regarding the Availability of Proxy Materials for the
Shareholder Meeting to be Held on May 27, 2021.
This proxy statement and our 2020 Annual Report to Shareholders are
available at www.proxyvote.com
Whether or not you plan to attend the 2021 Annual Meeting of Shareholders, please carefully read the proxy statement and other proxy materials and complete a proxy for your shares as soon as possible. You may authorize your proxy via the Internet or by telephone by following the instructions on the website indicated in the materials you received in the mail. If you received a Notice of Availability of Proxy Materials, you may also request a paper or an e-mail copy of our proxy materials and a paper proxy card at any time. If you receive a copy of the proxy card by mail, you may sign, date and mail the proxy card in the postage-paid envelope provided. If you attend the Meeting, you may vote via the virtual platform during the Meeting if you wish, even if you previously have submitted your proxy. However, please note that if your shares are held of record by a bank, broker or similar organization and you wish to vote via the virtual platform during the Meeting, you must obtain a “legal proxy” issued in your name from such bank, broker or similar organization.

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APPENDICES
 
Every shareholder’s vote is important. Please complete, sign, date, and return your proxy card,
or authorize your proxy by phone or via the Internet.
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PROXY STATEMENT
The following information is furnished in connection with the 2021 Annual Meeting of Shareholders (the “Meeting”) of EastGroup Properties, Inc. (the “Company”), to be held on May 27, 2021 at 9:00 a.m., Central Daylight Time, in a virtual meeting format. This proxy statement and 2020 Annual Report to shareholders are first being made available, and a Notice Regarding the Availability of Proxy Materials is first being mailed, to shareholders on or about April 12, 2021.
ABOUT THE 2021 ANNUAL MEETING
What is the purpose of the Meeting?
At the Meeting, shareholders will be asked to elect the eight director nominees named in this proxy statement for a one-year term, ratify the appointment of KPMG LLP (“KPMG”) as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2021, approve by a non-binding, advisory vote the compensation of our Named Executive Officers (as defined below) and approve the amendment and restatement of our articles of incorporation, as amended (our “Charter”) and our amended and restated bylaws (our “Bylaws”) to allow our Bylaws to be amended by a majority of stockholder votes. In addition, management will report on the performance of the Company and respond to questions from shareholders at management’s discretion.
Who is entitled to vote?
All shareholders of record as of the close of business on Friday, March 26, 2021 (the “Record Date”) are entitled to vote at the Meeting. As of the Record Date, 40,021,537 shares of the Company’s common stock, par value $0.0001 per share (“Common Stock”), were issued and outstanding. Each share of Common Stock outstanding on the Record Date is entitled to one vote on each item submitted to shareholders for consideration.
Why didn’t I automatically receive a paper copy of the proxy statement, proxy card and Annual Report?
The Securities and Exchange Commission (“SEC”) rules allow us to furnish proxy materials to our shareholders electronically. In an effort to lower the costs of delivery of proxy materials, as well as to reduce our use of paper, we have elected to take advantage of these rules by only mailing materials to those shareholders who specifically request a paper copy. On or around April 12, 2021, all shareholders were mailed a Notice Regarding the Availability of Proxy Materials that contains an overview of the proxy materials and explains several methods by which shareholders can view the proxy materials online or request to receive a copy of proxy materials via regular mail or email. There is NO charge for requesting a copy of the proxy materials.
How can I get electronic access to the proxy materials?
The Notice Regarding the Availability of Proxy Materials includes a website address that will:
Provide you with instructions on how to view our proxy materials on the Internet; and
Enable you to notify us to send future proxy materials to you by email.
Choosing to receive future proxy materials by email will save us the cost of printing and mailing documents to you and will reduce the impact of our annual meetings on the environment. If you choose to receive future proxy materials by email, you will receive an email next year with instructions containing a link to those materials and a link to the proxy voting site. Your election to receive proxy materials by email will remain in effect until you terminate it.
Can I find additional information on the Company’s website?
Yes. Our website is located at www.eastgroup.net. Although the information contained on our website is not part of this proxy statement, you can view additional information on the website, such as our Code of Ethics and Business Conduct, Corporate Governance Guidelines, charters of committees of our Board of Directors (the “Board”) and
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reports that we file with the SEC. A copy of our Code of Ethics and Business Conduct, Corporate Governance Guidelines and each of the charters of our Board committees may be obtained free of charge by writing to EastGroup Properties, Inc., 400 W. Parkway Place, Suite 100, Ridgeland, Mississippi 39157, Attention: Investor Relations.
How do I vote?
Voting During the Virtual Meeting. If you are a “registered owner” or “record holder” (i.e., you hold your shares in your own name as a holder of record with our transfer agent, EQ Shareowner Services), you may attend the Meeting virtually and vote your shares during the Meeting. If you are a “beneficial owner” because your bank, broker or similar organization is the holder of your shares (i.e., your shares are held in “street name”) and you wish to vote during the Meeting, you will need to obtain a “legal proxy” from the bank, broker or similar organization that holds your shares of Common Stock of record. If you attend the Meeting and you submit your vote during the Meeting, any previous votes that you submitted by mail or authorized via the Internet or by telephone will be superseded by the vote that you cast during the Meeting. Further instructions for voting during the Meeting can be obtained by calling us at (601) 354-3555.
Voting by Proxy for Shares Registered Directly in the Name of the Shareholder. If you hold your shares of Common Stock in your own name as a holder of record with our transfer agent, EQ Shareowner Services, you may also instruct the proxy holders named in the proxy card how to vote your shares of Common Stock in one of the following ways:
Vote online. You can access proxy materials and vote at www.proxyvote.com. To vote online, you must have a shareholder identification number, which is provided in the Notice Regarding the Availability of Proxy Materials.
Vote by telephone. If you received printed materials, you also have the option to vote by telephone by following the “Vote by Phone” instructions on the proxy card.
Vote by regular mail. If you received printed materials and would like to vote by mail, then please mark, sign and date your proxy card and return it promptly in the postage-paid envelope provided.
Voting by Proxy for Shares Registered in Street Name. If your shares of Common Stock are held in street name, you will receive instructions from your bank, broker or similar organization that you must follow in order to have your shares voted.
Regardless of how you choose to vote, your vote is important to us and we encourage you to vote promptly.
What happens if I return my proxy card without voting on all proposals?
When you return a properly executed proxy card, the proxy holders named in the proxy card, Marshall A. Loeb and Brent W. Wood, will vote the shares that the proxy card represents in accordance with your directions. If you return the signed proxy card with no direction on a proposal, the proxy holders will vote your proxy FOR each of the Board’s eight director nominees named in this proxy statement, FOR the ratification of the independent registered public accounting firm for the fiscal year ending December 31, 2021, FOR the approval, on an advisory basis, of the compensation of our Named Executive Officers as disclosed in this proxy statement, and FOR the approval of the amendment and restatement of our Charter and our Bylaws to allow our Bylaws to be amended by a majority of stockholder votes.
Will there be any other items of business on the agenda?
Pursuant to the Company’s Bylaws and SEC rules, shareholder proposals must have been received by February 20, 2021 to be considered at the Meeting. To date, we have received no shareholder proposals and we do not expect any other items of business. Nonetheless, in case there is an unforeseen need, your proxy gives discretionary authority to Marshall A. Loeb and Brent W. Wood with respect to any other matters that might be properly brought before the Meeting. Those persons intend to vote that proxy in accordance with their best judgment.
How many votes are needed to hold the Meeting?
In order to conduct the Meeting, the presence, in person at the virtual Meeting or by properly executed proxy, of the holders of shares of Common Stock entitled to cast a majority (i.e., greater than 50%) of all the votes entitled to be cast at the Meeting, is necessary to constitute a quorum. Shares of Common Stock represented by a properly signed, dated and returned proxy card, or proxies submitted by telephone or online, including abstentions and broker non-votes, will be treated as present at the Meeting for purposes of determining a quorum.
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How many votes are needed to approve each proposal?
Proposal 1 concerns the election of the eight director nominees named in this proxy statement for a one-year term. The votes cast “For” a nominee must exceed the votes cast “Against” the nominee for the nominee to be elected. Neither abstentions nor broker non-votes will have any legal effect on whether this proposal is approved as they do not count as votes cast for such matter. If a nominee fails to receive more “For” votes than votes cast “Against” and is an incumbent director, the nominee is required to tender a resignation to the Nominating and Corporate Governance Committee of the Board for consideration. If the resignation is not accepted, the nominee will continue to serve as director until the next annual meeting and until the director’s successor is duly elected and qualified or until the director’s earlier resignation or removal.
Proposal 2 concerns ratification of the appointment of KPMG as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2021. This proposal will be approved if the votes cast “For” the proposal exceed the votes cast “Against” the proposal. Neither abstentions nor broker non-votes will have any legal effect on whether this proposal is approved. Even though the vote is advisory and non-binding, the Audit Committee of the Board will consider a vote against the firm by the shareholders in selecting the Company’s independent registered public accounting firm in the future.
Proposal 3 concerns approval by a non-binding, advisory vote of the compensation of the Named Executive Officers disclosed in the section of this proxy statement entitled “Compensation of Executive Officers.” For the non-binding, advisory vote to be approved, the votes cast “For” the proposal must exceed the votes cast “Against” this proposal. Neither abstentions nor broker non-votes will have any legal effect on whether this proposal is approved.
Proposal 4 concerns approval of the amendment and restatement of the Company’s Charter and Bylaws to allow the Bylaws to be amended by the stockholders representing a majority of all votes entitled to be cast on the matter. This proposal will be approved if the holders of not less than eighty percent (80%) of all the votes entitled to be cast on this proposal vote “For” the proposal. Neither abstentions nor broker non-votes will have any legal effect on whether this proposal is approved.
Can I change my vote after I have voted?
Yes. You can revoke your proxy and change your vote at any time before the polls close at the Meeting. You can do this by:
filing with the Secretary of the Company a written revocation;
signing and submitting another proxy with a later date; or
attending the Meeting, withdrawing the proxy and voting during the Meeting.
How do I submit a proposal for the 2022 Annual Meeting?
If a shareholder wishes to have a proposal considered for inclusion in the Company’s proxy statement for the 2022 Annual Meeting of Shareholders, the shareholder must submit the proposal in writing to the Secretary of the Company at 400 W. Parkway Place, Suite 100, Ridgeland, Mississippi 39157 so that the Company receives the proposal by December 13, 2021.
If the proposal is not intended to be included in the Company’s proxy statement, a qualified shareholder intending to introduce a proposal or nominate a director at the 2022 Annual Meeting of Shareholders should give written notice to the Company’s Secretary not later than February 26, 2022 and not earlier than January 27, 2022 (although these dates may be adjusted in the event that the date of the 2022 Annual Meeting of Shareholders is more than 30 days before or more than 60 days after the anniversary date of the Meeting).
Shareholders also are advised to review the Company’s Bylaws, which contain additional advance notice requirements, including requirements with respect to advance notice of shareholder proposals and director nominations.
Will anyone contact me regarding this vote?
No arrangements or contracts have been made with any solicitors as of the date of this proxy statement, although we reserve the right to engage solicitors if we deem them necessary. Such solicitations may be made by mail, telephone, facsimile, email or other electronic means or personal interviews. In addition, we reserve the right to solicit
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proxies through our directors, officers and employees (who will receive no additional compensation for those services). We anticipate that banks, brokerage houses and other institutions, nominees or fiduciaries will be requested to forward the soliciting material to their principals and to obtain authorization for the execution of proxies. The Company may, upon request, reimburse banks, brokerage houses and other institutions, nominees and fiduciaries for their expenses in forwarding proxy material to their principals.
Who has paid for this proxy solicitation?
The Company has paid the entire expense of this proxy statement and any additional materials furnished to shareholders.
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CORPORATE GOVERNANCE AND BOARD MATTERS
Director Nominees Qualifications and Biographical Information

(1)
Excludes Marshall A. Loeb, our CEO
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The biography of each director nominee below contains information regarding that person’s principal occupation, tenure with the Company, business experience, other director positions currently held or held at any time during the past five years, and the specific experience, qualifications, attributes or skills that led to the conclusion by the Board that such person should serve as a director of the Company.
D. Pike Aloian
Age: 66
Gender: Male
Independent
Director Since: 1999
Committees:
Audit,
Nominating and
Corporate Governance
 
Select Business Experience:
 
Managing Director of Neuberger Berman, a New York-based investment management firm
 
Partner of Almanac Realty Investors, LLC (“Almanac”) and its predecessor entities through January 31, 2020, when the firm was acquired by Neuberger Berman
 
Serves as a member of the Almanac Investment Committee
 
 
 
Key Experience/Director Qualifications:
 
Financial and investment experience, knowledge of capital markets and experience on other public and private company boards
 
Plays senior role in the on-going management of the Almanac business, including the origination, structuring and management of Almanac’s capital investments to public and private real estate companies
 
Graduated from Harvard College and received an MBA from Columbia University Graduate School of Business, where he also served as an adjunct professor
H. Eric Bolton, Jr.
Age: 64
Gender: Male
Independent
Lead Director Since: 2017
Director Since: 2013
Committees:
Audit,
Compensation
 
Select Business Experience:
 
Chief Executive Officer of Mid-America Apartment Communities, Inc. (“MAA”) (NYSE: MAA), a real estate investment trust (“REIT”) that owns and operates apartment communities, since October 2001 and Chairman of the Board of Directors of MAA since September 2002
 
Joined MAA in 1994 as Vice President of Development and was named Chief Operating Officer in February 1996 and promoted to President in December 1996; prior to that time, he was Executive Vice President and Chief Financial Officer of Trammell Crow Realty Advisors
 
Served on the Board of Directors of Interstate Hotels and Resorts, Inc. from 2008 to 2010
 
 
 
Key Experience/Director Qualifications:
 
Brings extensive business and real estate operating experience to the Board
 
Serves on the National Association of Real Estate Investment Trusts (“Nareit”) Advisory Board of Governors
 
 
Received a BBA in Accounting from the University of Memphis and an MBA with a concentration in Finance and Real Estate from the University of North Texas
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Donald F. Colleran
Age: 65
Gender: Male
Independent
Director Since: 2017
Committees:
Compensation,
Nominating and
Corporate Governance
 
Select Business Experience:
 
President and Chief Executive Officer of FedEx Express and also serves on the Strategic Management Committee of FedEx Corporation (“FedEx”), which sets the strategic direction for FedEx
 
Joined FedEx in 1989, where he has served in a variety of leadership roles including Executive Vice President, Chief Sales Officer of FedEx from 2016 to 2019 and Executive Vice President, Global Sales of FedEx Services from 2006 to 2016
 
 
 
Key Experience/Director Qualifications:
 
Leadership positions provide broad experience and allow him to provide valuable insight to the Company and the Board regarding operational and strategic issues
 
Serves on the Board of Directors of ABM Industries, since 2018
 
Received a BBA from the University of New Hampshire
Hayden C. Eaves III
Age: 75
Gender: Male
Independent
Director Since: 2002
Committees:
Compensation,
Nominating and
Corporate Governance
 
Select Business Experience:
 
President of Hayden Holdings, Inc., a family investment management company, and an advisor to IDS Real Estate Group, where he served as a Managing Director until 2006
 
President and Chief Executive Officer of the Western Region of Trammell Crow Company until 1995, where he was responsible for 52 million square feet of industrial, office and retail space in California, Oregon, Washington, Arizona and Nevada
 
 
 
Key Experience/Director Qualifications:
 
Leadership and extensive experience in the real estate, real estate development and real estate operations business, particularly in the California and Arizona real estate markets, are valuable to the Board
 
Serves on the Board of Directors of Watson Land Company, a private developer, owner, and manager of industrial properties located in Southern California and Lehigh Valley, Pennsylvania
 
Received a BS in Accounting from California State University of Los Angeles
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David H. Hoster II
Age: 75
Gender: Male
Director Since: 1993
Chairman of the
Board Since: 2016
 
Select Business Experience:
 
Chief Executive Officer of the Company from 1997 to December 2015 and President of the Company from 1993 to March 2015
 
Leadership experience and knowledge of the Company and the industry in which we operate, including over 40 years’ involvement with publicly held REITs
 
 
 
Key Experience/Director Qualifications:
 
Extensive experience with industrial real estate provides valuable insight to the Board in formulating and executing the Company’s strategy
 
Served on the Board of Directors of Trustmark National Bank and Trustmark Corporation until April 2016 and on the Nareit Board of Governors
 
Received a BA degree with honors from Princeton University and a MBA from Stanford University Graduate School of Business
Marshall A. Loeb
Age: 58
Gender: Male
Director Since: 2016
 
Select Business Experience:
 
President of the Company since March 2015 and Chief Executive Officer and a director of the Company since January 2016
 
Rejoined the Company as President and Chief Operating Officer in March 2015 from Glimcher Realty Trust (“Glimcher”), a retail REIT that owns, develops and manages shopping centers in the United States
 
He served as President and Chief Operating Officer of Glimcher from 2005 to 2015 until it was acquired by Washington Prime Group Inc.
 
Chief Financial Officer of Parkway Properties, Inc. from 2000 to 2005
 
Previously employed by the Company from 1991 to 2000, beginning as an asset manager and rising to senior vice president after having a variety of responsibilities with the Company
 
 
 
Key Experience/Director Qualifications:
 
30 years of experience with publicly held REITs and brings real estate industry, finance, operations, development, and executive leadership expertise to the Board
 
Serves on the Board of Directors of Lamar Advertising Company (Nasdaq: LAMR), one of the largest outdoor advertising companies in the world specializing in billboard, interstate logo, transit and airport advertising formats
 
Received a BS in Accounting and a Master of Tax Accounting degree from the University of Alabama, then earned a MBA from the Harvard Graduate School of Business
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Mary E. McCormick
Age: 63
Gender: Female
Independent
Director Since: 2005
Committees:
Audit,
Nominating and
Corporate Governance
 
Select Business Experience:
 
Executive Director of the Center for Real Estate at The Ohio State University where she is also a Senior Lecturer at the Fisher College of Business
 
Served the Ohio Public Employees Retirement System from 1989 through 2005, where she was responsible for directing real estate investments and overseeing an internally managed REIT portfolio
 
Served on the boards of multiple public and private real estate companies and as a Senior Advisor for Almanac Realty Partners from 2010 to 2016
 
 
 
Key Experience/Director Qualifications:
 
Extensive experience in real estate, capital markets, and corporate governance and brings that expertise to Board discussions
 
Held a number of leadership positions for a variety of national and regional real estate associations, including Chair of the Pension Real Estate Association
 
Serves on the Board of Directors of Xenia Hotels and Resorts, Inc. (NYSE: XHR), a lodging REIT, since 2015, and previously served on the Board of Directors of MAA from 2006 to 2010
 
Member of the Urban Land Institute, NAIOP, Inc., Commercial Real Estate Development Association, and the Pension Real Estate Association
 
 
Received a Bachelor’s degree and an MBA from The Ohio State University
Katherine M. Sandstrom
Age: 52
Gender: Female
Independent
Director Since: 2020
Committees:
Audit
Select Business Experience:
 
Served as Senior Managing Director at Heitman LLC (“Heitman”), a real estate investment management firm, as an Advisor from July 2018 to March 2019 and Senior Managing Director and global head of Heitman’s Public Real Estate Securities business from 2013 to 2018
 
Joined Heitman in 1996 and held several senior leadership positions across multiple facets of the institutional real estate investment industry. Additionally, Ms. Sandstrom previously served on Heitman’s Global Management Committee, the Board of Managers and the Allocation Committee
 
Key Experience/Director Qualifications:
 
Brings valuable business, financial and investment expertise to the Board
 
Serves on the Board of Directors of Healthpeak Properties, Inc. (NYSE: PEAK), a REIT serving the healthcare industry, since 2018
 
 
Received a Bachelor of Arts in Accounting from the University of West Florida, and she is a certified public accountant
Board Size
Our Bylaws provide that the number of directors will be initially as provided in our Charter, and subsequently as determined by the Board. H.C. Bailey, Jr.'s term expires at the Meeting, and he has not been nominated by the Board to stand for reelection, and Leland R. Speed, the Chairman Emeritus of the Board and a director of the Company, passed away in January 2021. Accordingly, the Board has adopted resolutions reducing the size of the Board from ten (10) to eight (8) members, effective at the conclusion of the Meeting and the expiration of Mr. Bailey's term as a director.
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Independent Directors
Under the New York Stock Exchange (“NYSE”) listing standards, at least a majority of the Company’s directors and all of the members of the Company’s Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee must meet the test of “independence” as defined by the NYSE. The NYSE standards provide that, to qualify as an “independent” director, in addition to satisfying certain bright-line criteria, the Board must affirmatively determine that a director has no material relationship with the Company (either directly or as a partner, shareholder or officer of an organization that has a relationship with the Company) that would interfere with such person’s ability to exercise independent judgment as a member of the Company’s Board.
Our Board currently has nine members: D. Pike Aloian, H.C. Bailey, Jr., H. Eric Bolton, Jr., Donald F. Colleran, Hayden C. Eaves III, David H. Hoster II, Marshall A. Loeb, Mary E. McCormick and Katherine M. Sandstrom. The Board has determined that each director who served during the fiscal year ended December 31, 2020 was, and each current director continues to be, independent other than Mr. Loeb, the Company’s Chief Executive Officer; Mr. Hoster, the Company’s Chairman of the Board; and Mr. Speed, who served as the Company’s Chairman Emeritus.
One of our directors serves as an executive officer at a company with whom we may directly or indirectly do business. The Board determined that the commercial relationships involving routine, arms-length transactions between the Company and the other party were not considered a material relationship that would impair the director’s independence. We provide additional details about the relationship in the following table.
Director
Name of Employer
(including affiliated
companies)
Business Relationship
Dollar Amount of
Transactions (approximate)
Donald F. Colleran
FedEx Corporation
Routine leasing of space by the Company to FedEx
$3,000,000, representing less than 0.9% of the Company’s gross revenues in 2020
Routine purchases of package delivery services by the Company from FedEx
The amount paid by the Company represents a de minimis percentage of FedEx’s gross revenue in fiscal 2020
Shareholder Communication with the Board
The Board has created the position of Lead Independent Director to facilitate and strengthen the Board’s independent oversight of our performance, strategy and succession planning and to promote effective governance standards. The Lead Independent Director presides over the meetings of the non-management directors of the Company. Our current Lead Independent Director is Mr. Bolton. Shareholders and other parties interested in communicating directly with the Lead Independent Director or with the directors as a group may do so by writing to Lead Independent Director, EastGroup Properties, Inc., 400 W. Parkway Place, Suite 100, Ridgeland, Mississippi 39157. Correspondence so addressed will be forwarded directly to the Lead Independent Director, who will forward any such communication to the director(s) to whom the communication is addressed. Shareholders and other parties interested in communicating with the directors as a group may also do so via the Contact Us page of EastGroup’s website at www.eastgroup.net.
Code of Ethics and Business Conduct and Other Policies
Code of Ethics and Business Conduct
Our Board adopted a Code of Ethics and Business Conduct (the “Code of Ethics”), which governs business decisions made and actions taken by our directors, officers and employees. A copy of this Code of Ethics is available on our website at http://investor.eastgroup.net/govdocs. We intend to disclose on this website any amendment to, or waiver of, any provision of this Code of Ethics applicable to our directors and executive officers that would otherwise be required to be disclosed under the rules of the SEC or the NYSE.
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Corporate Governance Guidelines
Our Board adopted Corporate Governance Guidelines, a copy of which is available on our website at http://investor.eastgroup.net/govdocs.
Copies of our Code of Ethics and Corporate Governance Guidelines may also be obtained free of charge by writing to EastGroup Properties, Inc., 400 W. Parkway Place, Suite 100, Ridgeland, Mississippi 39157, Attention: Investor Relations.
Leadership Structure
Our current leadership structure is comprised of the Chairman of the Board, a separate Chief Executive Officer, an independent director serving as Lead Independent Director who presides over the non-management directors, and strong, active independent directors. As Chief Executive Officer, Mr. Loeb is responsible for setting the strategic direction of the Company and for the day to day leadership and management of the Company, while Mr. Hoster, Chairman of the Board, provides oversight, direction and leadership to the Board.
Another component of our leadership structure is the active role played by our independent directors in overseeing the Company’s business, both at the Board and committee level. Seven of the current nine directors and six of the eight director nominees are considered independent under the NYSE listing standards. All of our directors are free to suggest the inclusion of items on the agenda for meetings of our Board or raise subjects that are not on the agenda for that meeting. In addition, our Board and each committee have complete and open access to any member of management and the authority to retain independent legal, financial and other advisors as they deem appropriate without consulting or obtaining the approval of any member of management. Our Board also holds regularly scheduled executive sessions of only non-management directors, led by the Lead Independent Director, in order to promote discussion among the non-management directors and assure independent oversight of management. Moreover, our Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee, all of which are comprised entirely of independent directors, also perform oversight functions independent of management.
Board Oversight of Risk Management
The Company believes that its leadership structure allows the Board to provide effective oversight of the Company’s risk management function by receiving and discussing regular reports prepared by the Company’s senior management on areas of material risk to the Company, including market conditions; tenant concentrations and credit worthiness; leasing activity and expirations; compliance with debt covenants; management of our balance sheet and debt maturities; access to debt and equity capital markets; existing and potential legal claims against the Company; cyber-security including cyber-attacks and computer viruses; environmental, social and governance (“ESG”) initiatives; enterprise risk management; and various other matters relating to the Company’s business. Additionally, the Board administers its risk oversight function through (i) the required approval by the Board (or a committee thereof) of significant transactions and other decisions, including, among others, development and acquisitions of properties, new borrowings and the appointment and retention of the Company’s senior management, (ii) the coordination of the direct oversight of specific areas of the Company’s business by the Compensation, Audit and Nominating and Corporate Governance Committees, and (iii) periodic reports from the Company’s auditors and other outside consultants regarding various areas of potential risk, including, among others, those relating to the qualification of the Company as a REIT for tax purposes, the Company’s internal control over financial reporting, and the security of the electronic systems which the Company relies upon to conduct its business.
See the discussion under the heading “Leadership Structure” above for a discussion of why the Board has determined that its current leadership structure is appropriate.
Committees and Meeting Data
The Board has a standing Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee; membership of these committees is outlined in the table below. Each member of each of these committees is “independent” as that term is defined in the NYSE listing standards. The Board has adopted written charters for each of these committees, which are available on our website at http://investor.eastgroup.net/govdocs.
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Director
Audit Committee
Compensation
Committee
Nominating and
Corporate
Governance
Committee
D. Pike Aloian
Member
 
Chair
H.C. Bailey, Jr.
 
Member
 
H. Eric Bolton, Jr
Member
Chair
 
Donald F. Colleran
 
Member
Member
Hayden C. Eaves III
 
Member
Member
David H. Hoster II
 
 
 
Mary E. McCormick
Chair
 
Member
Katherine M. Sandstrom
Member
 
 
Number of meetings in fiscal year 2020
7
4
5
The Audit Committee oversees the financial reporting of the Company, including the audit by the Company’s independent registered public accounting firm and the internal audit department. Mmes. McCormick and Sandstrom and Messrs. Aloian and Bolton have each been designated as an “Audit Committee financial expert” in accordance with the SEC rules and regulations, and the Board has determined that they have accounting and related financial management expertise within the meaning of the listing standards of the NYSE. See “Report of the Audit Committee” later in this proxy statement.
The Compensation Committee’s function is to review and recommend to the Board appropriate executive compensation policy, approve compensation of the Company’s executive officers and to review and recommend to the Board appropriate compensation of the Company’s directors. The Compensation Committee also reviews and makes recommendations with respect to executive and employee benefit plans and programs. Mr. Bailey’s term expires at the Meeting, and he has not been nominated by the Board to stand for reelection.
The responsibilities of the Nominating and Corporate Governance Committee include assessing Board membership needs and identifying, screening, recruiting and presenting director candidates to the Board, implementing policies regarding corporate governance matters, making recommendations regarding committee memberships and sponsoring and overseeing performance evaluations for the Board as a whole and the directors.
Nominating Procedures
In identifying suitable candidates for nomination as a director, the Nominating and Corporate Governance Committee considers the needs of the Board and the range of skills and characteristics required for effective functioning of the Board. Although the Company does not have a formal policy or guidelines regarding diversity, the Company’s Corporate Governance Guidelines recognize the value of having a Board that encompasses a broad range of skills, expertise, contacts, background, industry knowledge and diversity of opinion. In evaluating such skills and characteristics, the Committee may take into consideration such factors as it deems appropriate, including those included in the Corporate Governance Guidelines. Current members of the Board with skills and experience that are relevant to the Company’s business and who are willing to continue in service are considered for re-nomination. In addition, the Nominating and Corporate Governance Committee will consider nominees suggested by incumbent Board members, management, shareholders and, in certain circumstances, outside search firms; as such, shareholders may influence the composition of the Board. Under this principle, the Nominating and Corporate Governance Committee will consider written recommendations for potential nominees suggested by shareholders. Any such person will be evaluated in the same manner as any other potential nominee for director. Any suggestion for a nominee for director by a shareholder should be sent to the Company’s Secretary at 400 W. Parkway Place, Suite 100, Ridgeland, Mississippi 39157, within the time periods set forth under the heading “About the Meeting – How do I submit a proposal for the 2022 Annual Meeting?”
Board Attendance at Meetings
The Company’s Corporate Governance Guidelines provide that all directors are expected to regularly attend all meetings of the Board and the Board committees on which he or she serves. The Board held five meetings during the Company’s 2020 fiscal year, and all directors attended 75% or more of the Board meetings and meetings held by all committees of the Board on which he or she served. Each director nominee also is expected to attend the Meeting. All of our board members who were directors at the time of the 2020 Annual Meeting of Shareholders attended that meeting.
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Compensation Committee Interlocks and Insider Participation
As noted above, the Compensation Committee is comprised of four independent directors: Messrs. Bailey, Bolton, Colleran and Eaves. No member of the Compensation Committee is or was formerly an officer or an employee of the Company or had any other relationships with us requiring disclosure herein. No executive officer of the Company serves as a member of the board of directors or compensation committee of any entity that has one or more executive officers serving as a member of the Company’s Board, nor has such interlocking relationship existed in the past.
Compensation of Directors
We believe that a combination of cash and equity compensation is appropriate to attract and retain the individuals we desire to serve on our Board and that this approach is comparable to the policies of our peers. We feel that it is appropriate to provide cash compensation to our non-employee directors to compensate them for their time and effort and to provide equity compensation to our non-employee directors to align their long-term interests with those of the Company and our shareholders.
Under the Company’s director compensation program as set forth in the Independent Director Compensation Policy, non-employee directors are paid annual cash retainers for their service as shown below.
Position
Annual Cash Retainer ($)
Non-employee Director
56,000
Lead Independent Director
25,000
Audit Committee chairperson
20,000
Audit Committee member
10,000
Compensation Committee chairperson
15,000
Compensation Committee member
7,500
Nominating and Corporate Governance Committee chairperson
12,000
Nominating and Corporate Governance Committee member
6,000
Investment Committee member
6,000
In addition, each non-employee director is reimbursed for his or her expenses in connection with attendance of meetings.
A non-employee director who is appointed to the Board outside of an annual meeting of shareholders will receive a prorated amount of the applicable annual cash retainer, based on the time between his or her appointment and our next annual meeting of shareholders.
Pursuant to the Independent Director Compensation Policy, non-employee directors receive an annual award under the Company’s 2013 Equity Incentive Plan, in connection with their election to the Board at the annual meeting of shareholders. The annual award consists of shares of the Company’s Common Stock determined by dividing $100,000 by the fair market value of a share of the Company’s Common Stock on the date of grant. If a fraction results, the number of shares shall be rounded up to the next whole number. A non-employee director who is appointed to the Board outside of the annual meeting of shareholders will receive a prorated amount of the annual award, based on the time between his or her appointment and our next annual meeting of shareholders.
The Independent Director Compensation Policy also provides that each new non-employee director appointed or elected will receive an automatic award of restricted shares of Common Stock, under the Company’s 2013 Equity Incentive Plan, on the effective date of election or appointment, the number of which equals $25,000 divided by the fair market value of a share of the Company’s Common Stock on such date. If a fraction results, the number of shares shall be rounded up to the next whole number. These restricted shares will vest over a four-year period, subject to the director’s continuous service on our Board on each applicable vesting date.
As an employee of the Company, Mr. Loeb did not receive any compensation for his service as a director during the fiscal year ended December 31, 2020. The compensation received by Mr. Loeb, as a Named Executive Officer of the Company, is presented in “Compensation of Executive Officers – Summary Compensation Table” below. The Company’s non-employee directors received the following aggregate amounts of compensation for the fiscal year ended December 31, 2020:
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Name
Fees Earned
or Paid in
Cash ($)
Stock Awards
($)(1)
Total ($)
D. Pike Aloian
84,504
100,050
184,554
H.C. Bailey, Jr.
70,129
100,050
170,179
H. Eric Bolton, Jr.
110,504
100,050
210,554
Donald F. Colleran(2)
73,129
100,050
173,179
Hayden C. Eaves III
73,129
100,050
173,179
David H. Hoster II(3)
112,508
100,050
212,558
Mary E. McCormick
89,504
100,050
189,554
Katherine M. Sandstrom(2)(4)
33,798
112,444
146,242
Leland R. Speed
62,504
100,050
162,554
(1)
Represents the aggregate grant date fair values of the shares and restricted shares of Common Stock awarded to the non-employee directors during the fiscal year ended December 31, 2020, determined in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718. Such aggregate grant date fair values do not take into account any estimated forfeitures related to service-based vesting conditions. The valuation assumptions used in determining such amounts are described in the Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2020, filed with the SEC on February 17, 2021.
(2)
As of December 31, 2020, Mr. Colleran held 70 shares of restricted stock and Ms. Sandstrom held 208 shares of restricted stock; no other directors held any outstanding equity awards as of that date.
(3)
In addition to the standard payments to non-employee directors under the Company’s Independent Director Compensation Policy, the Board approved a cash stipend equal to $50,000 for Mr. Hoster, in connection with his additional service as Chairman of the Board in 2020.
(4)
Ms. Sandstrom was appointed to the Board in July 2020. In accordance with the Company’s Independent Director Compensation Policy, she received (i) a prorated portion of the annual cash retainers for service on the Board and the Audit Committee, (ii) a prorated annual award of shares of Common Stock and (iii) a grant of restricted shares for her initial election to the Board.
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PROPOSALS TO BE VOTED ON
Proposal 1 – Election of Directors
In accordance with our Bylaws, the Board has by resolution fixed the number of directors to be elected at the Meeting at eight. Each person so elected shall serve until the next Annual Meeting of Shareholders and until his or her successor is duly elected and qualified or until his or her earlier death, resignation or removal.
The nominees for director are: D. Pike Aloian, H. Eric Bolton, Jr., Donald F. Colleran, Hayden C. Eaves III, David H. Hoster II, Marshall A. Loeb, Mary E. McCormick and Katherine M. Sandstrom. All nominees are currently serving as directors of the Company and were elected at the 2020 Annual Meeting of Shareholders, with the exception of Ms. Sandstrom, who was appointed to the Board on July 6, 2020.
Unless instructed otherwise, proxies will be voted “FOR” the nominees listed above. Although the directors do not contemplate that any of the nominees will be unable to serve prior to the Meeting, if such a situation arises, your proxy will be voted in accordance with the best judgment of the person or persons voting the proxy.
Information regarding the director nominees can be found under “Corporate Governance and Board Matters – Director Nominees Qualifications and Biographical Information.”
Nominees receiving more “For” votes than votes cast “Against” will be elected. Neither abstentions nor broker non-votes will have any legal effect on whether this proposal is approved.
THE BOARD UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE “FOR” THE ELECTION OF EACH OF MMES. MCCORMICK AND SANDSTROM AND MESSRS. ALOIAN, BOLTON, COLLERAN, EAVES, HOSTER AND LOEB TO SERVE ON THE BOARD UNTIL THE 2022 ANNUAL SHAREHOLDER MEETING AND UNTIL A SUCCESSOR FOR EACH IS DULY ELECTED AND QUALIFIED.
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Proposal 2 – Ratification of Independent Registered Public Accounting Firm
The Audit Committee is responsible for the appointment of the independent registered public accounting firm engaged by the Company. The Audit Committee has appointed KPMG as independent auditors for the fiscal year ending December 31, 2021. KPMG was first appointed as our independent registered public accounting firm effective in 1970 to audit the consolidated financial statements of the Company for the fiscal year ended December 31, 1970. During 2020, the Audit Committee conducted an audit proposal process and selected KPMG to continue serving as the Company’s independent registered public accounting firm. The Board is asking shareholders to approve this appointment. KPMG audited the Company’s financial statements and internal controls over financial reporting for the fiscal year ended December 31, 2020. A representative of KPMG will be present at the Meeting and will have an opportunity to make a statement and answer appropriate questions.
The “Audit Committee Matters” section of this Proxy Statement contains additional information regarding the independent auditors, including a description of the Audit Committee’s Policy for Pre-Approval of Audit and Permitted Non-Audit Services and a summary of Auditor Fees and Services.
The Board recommends that you vote “FOR” the appointment of KPMG, an independent registered public accounting firm, to serve as the Company’s independent auditors for the 2021 fiscal year.
Shareholder ratification of the appointment of KPMG as the Company’s independent registered public accounting firm is not required by the Company’s Bylaws or otherwise. However, the Board is submitting the appointment of KPMG to the shareholders for ratification as a matter of good corporate practice. If the shareholders fail to ratify the appointment, the Audit Committee may reconsider whether or not to retain KPMG in the future. Even if the appointment is ratified, the Audit Committee in its discretion may direct the appointment of a different independent registered public accounting firm at any time during the year if the Audit Committee determines that such a change would be in the best interests of the Company. This proposal will be approved if the votes cast “For” the proposal exceed the votes cast “Against” the proposal. Neither abstentions nor broker non-votes will have any legal effect on whether this proposal is approved.
THE BOARD UNANIMOUSLY RECOMMENDS THAT THE SHAREHOLDERS VOTE “FOR” THE RATIFICATION OF THE APPOINTMENT OF KPMG AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE FISCAL YEAR ENDING DECEMBER 31, 2021.
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Proposal 3 – Non-Binding, Advisory Vote on Executive Compensation
Pursuant to Section 14A of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), we are asking our shareholders to vote on a non-binding, advisory basis to approve the compensation awarded to our Named Executive Officers, as we have described it in the “Compensation of Executive Officers” section of this Proxy Statement.
As described in greater detail under the heading “Compensation Discussion and Analysis,” we seek to closely align the interests of our Named Executive Officers with the interests of our shareholders. Our compensation programs are designed to reward our Named Executive Officers for the achievement of short-term and long-term strategic and operational goals and the achievement of increased total shareholder return, while at the same time avoiding the encouragement of unnecessary or excessive risk-taking.
This vote is not intended to address any specific item of compensation, but rather the overall compensation of our Named Executive Officers and the philosophy, policies and procedures described in this proxy statement, pursuant to Item 402 of Regulation S-K. In accordance with Section 14A of the Exchange Act, and as a matter of good corporate governance, we are asking shareholders to approve, on a non-binding, advisory basis, the following resolution at the Meeting:
“RESOLVED, that the compensation paid to the Company’s named executive officers, as disclosed in this proxy statement pursuant to Item 402 of Regulation S-K, including the Compensation Discussion and Analysis, compensation tables and narrative discussion, is hereby APPROVED.”
You may vote for or against the resolution, or you may abstain. For the advisory vote on the compensation of our Named Executive Officers to be approved, the votes cast “For” the proposal must exceed the votes cast “Against” this proposal. Neither abstentions nor broker non-votes will have any legal effect on whether this proposal is approved.
While the say-on-pay vote is advisory and will be non-binding, the Compensation Committee does value the opinions of our shareholders and intends to take the results of the vote on this proposal into account in its future decisions regarding the compensation of our Named Executive Officers. Unless the Board modifies its policy on the frequency of future say-on-pay advisory votes, the next say-on-pay advisory vote will be held at the 2022 annual meeting of shareholders, and the next advisory vote on the frequency of holding a say-on-pay vote will occur no later than the 2023 annual meeting of shareholders.
THE BOARD UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR” THIS RESOLUTION.
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Proposal 4 – Approval of Articles of Amendment and Restatement of the Charter and Amendment and Restatement of the Bylaws to Allow the Bylaws to be Amended by a Majority of Stockholder Votes
We are asking our stockholders to approve an amendment and restatement of the Company’s Charter and Bylaws to allow the Bylaws to be amended by the stockholders representing a majority of all votes entitled to be cast on the matter.
Background
As permitted by the Maryland General Corporation Law, Section 7 of Article VI of the Company’s Charter currently provides that the stockholders may adopt, alter and repeal our Bylaws only by the affirmative vote of 80% of the aggregate votes entitled to be cast with respect thereto, and Article IX of the Company’s Charter requires that this provision of Article VI relating to amendment of the Bylaws may in turn only be amended by the affirmative vote of the holders of not less than 80% of all the votes entitled to be cast on the matter. In addition, Article XV of the Company’s Bylaws currently provides that the Bylaws may be repealed, altered, amended or rescinded by the stockholders of the Company (considered for this purpose as one class) by the affirmative vote of not less than 80% of all of the votes entitled to be cast at any meeting of stockholders called for that purpose (provided that notice of such proposed repeal, alteration, amendment or rescission is included in the notice of such meeting). Consequently, for stockholders to have the right to amend the Bylaws by the affirmative vote of a majority of all votes entitled to be cast on the matter, the Company’s stockholders are required to approve amendments to both the Charter and the Bylaws.
The Board has adopted an amendment and restatement of the Charter (the “Articles of Amendment and Restatement”) and has recommended that our shareholders approve the Articles of Amendment and Restatement at the Meeting. The Articles of Amendment and Restatement (i) amend Section 7 of Article VI so that our stockholders can amend the Bylaws by the affirmative vote of a majority of all votes entitled to be cast on the matter and (ii) amend Article IX(b)(ii) so that the future amendment or repeal of the Bylaw amendment provision in Article IV does not require the affirmative vote of the holders of not less than 80% of all the votes entitled to be cast on the matter. The Articles of Amendment and Restatement also contain certain other conforming changes and minor updates that do not require the approval of our stockholders. The full text of the proposed Articles of Amendment and Restatement appears as Appendix A to this proxy statement.
The Board has also adopted an amendment and restatement of the Bylaws (the “Amended and Restated Bylaws”), and has recommended that our stockholders approve the Amended and Restated Bylaws at the Meeting. The Amended and Restated Bylaws would permit the stockholders of the Company, to the extent permitted by law, to amend the Amended and Restated Bylaws by the affirmative vote of a majority of all the votes entitled to be cast on the matter pursuant to a binding proposal submitted by a stockholder that (i) owned shares of the Company’s common stock in the amount and for the duration of time specified in Rule 14a-8 under the Exchange Act on the date the bylaw proposal is delivered or mailed to and received by the Company’s Secretary in accordance with the Amended and Restated Bylaws and (ii) continuously owns such shares through the date of the annual or special meeting of stockholders where such proposal will be considered. The foregoing right to amend the Amended and Restated Bylaws would be subject to additional eligibility, procedural and disclosure requirements set forth in Article XV of the Amended and Restated Bylaws. The Amended and Restated Bylaws also contain certain other conforming changes and minor updates that do not require the approval of our stockholders. The full text of the proposed Amended and Restated Bylaws appears as Appendix B to this proxy statement.
Text of Proposed Amendments
The proposed Articles of Amendment and Restatement, among other things, amend Section 7 of Article VI of the Charter and Article IX(b) of the Charter to read as follows (text that will be deleted is shown as struck through):
SECTION 7. AMENDMENTS TO THE BYLAWS.
In furtherance and not in limitation of the power conferred by statute, the Board of Directors is expressly authorized to adopt, alter or repeal Bylaws of the Corporation by vote of two-thirds of the Board of Directors. The stockholders may adopt, alter and repeal Bylaws of the Corporation only by the affirmative vote of 80% of the aggregate votes entitled to be cast with respect thereto.
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ARTICLE IX
AMENDMENTS
(b) Certain Amendments Requiring Special Stockholder Vote. Any provision of the Charter of the Corporation to the contrary notwithstanding:
(i) no term or provision of the Charter of the Corporation may be added, amended or repealed in any respect that would, in the determination of the Board of Directors, cause the Corporation not to qualify as a REIT under the Code;
(ii) Article VI, Section 3 (removal of directors) and Section 6 (amendments of Bylaws); Article VIII (indemnification of agents and limitation of liability of officers and directors); and this Article IX shall not be amended or repealed; and
(iii) no provision imposing cumulative voting in the election of directors may be added to the Charter of the Corporation;
unless in each such case, in addition to any vote required by the terms of then outstanding preferred stock, such action is approved by the affirmative vote of the holders of not less than eighty percent (80%) of all of the votes entitled to be cast on the matter.
The proposed Amended and Restated Bylaws, among other things, amends Article XV of the Bylaws to read as follows (additions of text are indicated by underlining, and text that will be deleted is shown as struck through):
ARTICLE IX
AMENDMENTS
In accordance with the Charter, these These Bylaws may be repealed, altered, amended or rescinded (a) by the stockholders of the Corporation (considered for this purpose as one class) by the affirmative vote of not less than 80% of all of the votes entitled to be cast at any meeting of stockholders called for that purpose (provided that notice of such proposed repeal, alteration, amendment or rescission is included in the notice of such meeting), or (b) by vote of two-thirds of the Board of Directors at a meeting held in accordance with the provisions of these Bylaws; provided that Sections 8 and 9 of Article VII of these Bylaws and this sentence may not be altered, amended or repealed by the Board of Directors unless it shall also obtain the affirmative vote of a majority of the votes cast on the matter by the holders of the issued and outstanding shares of common stock of the Corporation at a meeting of stockholders duly called and at which a quorum is present. In addition, to the extent permitted by law, these Bylaws may be repealed, altered, amended or rescinded by the stockholders of the Corporation by the affirmative vote of a majority of all the votes entitled to be cast on the matter, pursuant to a binding proposal that is submitted to the stockholders for approval at a duly called annual meeting or special meeting of stockholders by a stockholder (that provides a timely notice of such proposal which satisfies the notice procedures and all other relevant provisions of Section 12 of Article II of these Bylaws (the “Notice of Bylaw Amendment Proposal”)) (i) that owned shares of common stock of the Corporation in the amount and for the duration of time specified in Rule 14a-8 under the Exchange Act on the date the Notice of Bylaw Amendment Proposal is delivered or mailed to and received by the Secretary of the Corporation in accordance with Section 12 of Article II of these Bylaws and (ii) that continuously owns such shares of common stock of the Corporation through the date of such annual meeting or special meeting of stockholders (and any postponement or adjournment thereof).
The summary of the proposed Articles of Amendment and Restatement and Amended and Restated Bylaws set forth herein is qualified in its entirety by the text of the proposed Articles of Amendment and Restatement and Amended and Restated Bylaws, attached as Appendix A and Appendix B to this proxy statement, respectively.
Effectiveness of Proposed Amendments
Assuming stockholder approval, we anticipate filing the Articles of Amendment and Restatement with the State Department of Assessments and Taxation of Maryland on the day following the Meeting, and the Amended and Restated Bylaws shall be effective concurrently with the acceptance for record of the Articles of Amendment and Restatement. If our stockholders do not approve the proposed amendments, the Charter will continue in effect as currently stated, the Bylaws will not be amended and, subject to the limited restrictions set forth therein, stockholders would be permitted to alter and repeal our Bylaws only by the affirmative vote of 80% of the aggregate votes entitled to be cast with respect thereto.
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Vote Required
Approval of the proposed Articles of Amendment and Restatement and Amended and Restated Bylaws requires the affirmative vote of the holders of not less than eighty percent (80%) of all the votes entitled to be cast on this Proposal 4.
THE BOARD UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR” PROPOSAL 4 TO AMEND
AND RESTATE THE COMPANY’S CHARTER AND BYLAWS.
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ENVIRONMENTAL, SOCIAL AND GOVERNANCE (“ESG”) MATTERS
EastGroup’s commitment to ESG initiatives is evidenced by its building standards, corporate policies and procedures and positive company culture. The Board oversees our ESG-related efforts and, in such capacity, receives periodic updates from, and provides high-level guidance to, our management on ESG-related topics. In 2019, we formed an ESG Committee currently comprised of our Chief Financial Officer, Chief Accounting Officer and a senior accountant from our corporate accounting team. The ESG Committee meets regularly with the Board to discuss best practices in the areas of sustainability, environmental impact, social initiatives, enterprise risk management and corporate governance matters.
ESG Highlights
Shareholder Power to Amend Bylaws: The Board has approved, and recommended for shareholder approval at the 2021 annual meeting, amendments and restatements to EastGroup’s current charter and bylaws to allow EastGroup’s bylaws to be amended by a majority of stockholder votes.
ESG Executive Officer Individual Goals: For 2021, individual compensation goals (which will account for 20% of performance in connection with our annual incentive plan) will include ESG-related goals for our Chief Executive Officer, Chief Financial Officer and Chief Accounting Officer.
Board Diversity: The Board added a second female Board member in July 2020.
Committee Chair Rotations: In May 2020, Mary E. McCormick replaced the previous chair of the Audit Committee; H. Eric Bolton, Jr. replaced the previous chair of the Compensation Committee; and D. Pike Aloian replaced the previous chair of the Nominating and Corporate Governance Committee.
Director Meeting Fees: In 2020, the Board eliminated director meeting fees by adopting a retainer compensation program for directors.
Flexible Work Environment: EastGroup continues to offer its employees a flexible work environment during the COVID-19 pandemic.
ESG Reports: In 2020, EastGroup published its second annual Environmental, Social & Governance Report.
Environmental Matters
Protecting the environment is important to us and our employees, families, customers and communities. We strive for efficiency in operating our properties with innovative solutions that lower operational costs and reduce our environmental footprint. Our continued commitment to sustainability best practices creates long-term value for the environment, us and our shareholders. Through our environmental stewardship efforts, we have obtained 25 Leadership in Energy and Environmental Design (“LEED”) certifications, including one LEED Silver certification, and various ENERGY STAR certifications. Regardless of whether we pursue the actual certification, all of our development projects are constructed to LEED standards, reflecting the Company’s commitment to pursue environmentally conscious performance. This development program has produced tremendous value for our shareholders; we have developed approximately 47% of our properties.
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We continue to incorporate a variety of energy efficient, sustainable features into our properties, including:
skylights
irrigation with smart sensors
white reflective roofing
wildlife mitigation
LED lighting
fans in warehouse
motion sensor lighting
preferred parking spaces for green vehicles
locally sourced materials
interior windows for natural light
locally sourced trash disposal
Energy Star rated heating and cooling units
recycled materials
Low E insulated glass
electric car charging stations
water efficient plumbing fixtures
access to public transportation
drip irrigation systems in drought-tolerant markets
bike storage
reclaim water for irrigation where applicable

Social Matters
We and our employees are committed to social responsibility and are active participants in the communities where they live and work. EastGroup’s employees volunteer for numerous charities, and we coordinate volunteer opportunities for our employees and provide paid time off for volunteering in order to encourage participation and increase social engagement in all of the communities in which we operate. We prioritize charitable contributions that employees are directly involved with such as the Epilepsy Foundation of Mississippi, Goodwill Industries and the Make-A-Wish Foundation.
Additionally, we are focused on human capital. We believe our employees are a critical component of the success and sustainability of the Company, and we are committed to providing a diverse and inclusive work environment that encourages collaboration and teamwork. We are an equal opportunity employer, and we strive to attract, develop and advance a qualified and diverse workforce that will strengthen our company and our culture. Our commitment to our employees and our communities is evident in the social policies and practices we have in place, including:
Workforce Diversity: As of March 26, 2021, we employed 80 team members located in 12 offices in Arizona, California, Florida, Georgia, Mississippi, North Carolina and Texas. Our team is comprised of asset, construction and property management personnel; accounting, administrative, human resources and information technology personnel; and our corporate leadership team. Our current employee base is 75% comprised of women. The officer group is comprised of 40% women and 60% men, and 18% of our employees identify as racial or ethnic minorities. Our Board of Director nominees include two women and six men. With 80 employees and eight director nominees, each team member plays a vital role in the success of the company.


Employee Tenure: We believe our culture supports our employees and creates a positive, professional environment that encourages longevity for our team members. The average tenure of our workforce is 10 years, and 12 years for our officers.
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Compensation, Benefits, Health and Safety: EastGroup offers a comprehensive employee benefits program and what we believe are socially-responsible policies and practices in order to support the overall well-being of our employees and create a safe, professional and inclusive work environment. Some of the benefits we offer include a robust 401(k) matching program, a generous personal leave policy, flexible work schedules, paid time off for volunteering, annual health and wellness checkups, employer-paid health insurance for all full-time employees, a tobacco cessation program, athletic club and tuition reimbursement programs, and a competitive compensation structure.
Training and Development: We have a formal, certificate-based learning program for all employees; learning objectives include topics such as diversity and inclusion, unconscious bias and anti-harassment. Our employees are provided with training, education and peer mentoring programs to further develop their professional skill set, enhancing the level of customer service provided to our customers.
Policies: We have various policies and practices in place, including a Code of Ethics and Business Conduct and a formal Whistleblower Program, Equal Opportunity and Commitment to Diversity, ADA & Reasonable Accommodation, Commitment to Safety, Community Service, Family Medical Leave, Standards of Conduct, Workplace Violence Prevention, Healthy, Wealthy, Wise Benefits Summary, and Cybersecurity policies.
Company and Board Engagement: We value our employees, and our focus on human capital management and other socially-responsible initiatives is at the forefront of discussions and decisions with both management and the Board of Directors.
On March 11, 2020, the World Health Organization characterized COVID-19 as a pandemic. EastGroup promptly took action to promote the health, safety and well-being of our customers, employees, directors and other stakeholders. We formed a strategic planning committee to discuss the risks and guide the Company through these unprecedented times. Our customers, many of which were characterized as “essential businesses” during the early days of the pandemic, were able to continue operating. By nature of our multi-tenant business distribution building design, our customers each have their own entrances with no common lobbies, minimizing contact between customers. Our employees shifted to remote working arrangements seamlessly. All employees already had or were issued the technology needed to perform their duties remotely. This fostered a better work-life balance where employees could focus on their families and work duties while promoting health and safety for our EastGroup families and communities. Virtual town hall meetings were held with all employees, and virtual meetings continue to be conducted on a regular basis.
Governance Matters
We believe our corporate governance policies are well aligned with the interests of our shareholders. The Company’s Board has long upheld their mission to foster the long-term success of the Company while maintaining the highest regard for our fiduciary responsibility to our shareholders and employees. The Company’s leadership is committed to maintaining the highest standards for policies and practices in place across our company. Highlights of our Corporate Governance program include:
All Board members are elected annually by shareholders (non-staggered board).
Six of the eight Board members standing for re-election are independent.
Two of the eight Board members standing for re-election are women.
The positions of Chairman and CEO are separated.
All stock-based incentive plans have been approved by shareholders.
The Audit Committee, Compensation Committee, and Nominating and Corporate Governance Committee are all comprised entirely of independent directors.
During 2020, the Board rotated the Chairpersons of the Audit Committee, Compensation Committee, and Nominating and Corporate Governance Committee.
The Audit Committee meets with independent and internal auditors at least quarterly.
Formal ESG discussions are held with the Board and management at least annually.
Interested parties may communicate directly with the Board through a link on the Company’s website.
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During 2020, the Board eliminated director meeting fees by adopting a retainer compensation program for directors.
Over the past three years, the shares granted to employees and directors have been less than 1% of the shares outstanding.
Compensation is strongly tied to performance, and we do not have employment agreements, automatic salary increases or guaranteed bonuses.
General and administrative expense as a percentage of revenue was less than 5% for the years ended December 31, 2020 and 2019.
The Board has adopted a clawback policy that applies to both cash and equity incentive compensation.
The Board has adopted robust stock ownership guidelines for directors and executive officers.
No collective bargaining agreements.
No tax gross-ups and generally no single-trigger provisions.
Full Board oversight of risk management.
Strong Code of Ethics and Business Conduct, which is published on the Company’s website.
Our Code of Ethics and Business Conduct governs business decisions made and actions taken by our directors, officers and employees and provides guidance for recognizing potential issues encountered in conducting Company business and for making decisions that conform to our legal and ethical standards. All directors, officers, and employees are expected to be familiar with the Code of Ethics and Business Conduct and adhere to those principals and procedures. The Company has a Whistleblower Policy whereby customers, suppliers, employees and other stakeholders may report, in good faith, details of any instances of illegal and/or unethical conduct.
The Company believes its leadership structure allows the Board to provide effective oversight of the Company’s risk management function by receiving and discussing regular reports prepared by the Company’s senior management on areas of material risk to the Company, including market conditions; tenant concentrations and credit worthiness; leasing activity and expirations; compliance with debt covenants; management of our balance sheet and debt maturities; access to debt and equity capital markets; existing and potential legal claims against the Company; cyber-security including cyber-attacks and computer viruses; ESG initiatives; enterprise risk management; and various other matters relating to the Company’s business.
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EXECUTIVE OFFICERS
The following provides certain information regarding our executive officers. Each individual’s name and position with the Company is indicated. In addition, the principal occupation and business experience for the past five years is provided for each officer and, unless otherwise stated, each person has held the position indicated for at least the past five years. There are no family relationships between any of the directors or executive officers of the Company.
Marshall A. Loeb, age 58 − Mr. Loeb has served as the President of the Company since March 2015 and Chief Executive Officer of the Company since January 2016. He rejoined the Company as President and Chief Operating Officer in March 2015 from Glimcher Realty Trust, where he served as President and Chief Operating Officer from 2005 to 2015. From 2000 to 2005, he served as Chief Financial Officer of Parkway Properties, Inc. Mr. Loeb, who was with the Company from 1991 to 2000, began with the Company as an asset manager and rose to senior vice president after having a variety of responsibilities with the Company. Since 2018, Mr. Loeb has served on the board of directors of Lamar Advertising Company (Nasdaq: LAMR), one of the largest outdoor advertising companies in the world specializing in billboard, interstate logo, transit and airport advertising formats.
Brent W. Wood, age 51 − Mr. Wood has served as an Executive Vice President since May 2017 and Chief Financial Officer and Treasurer of the Company since August 2017. He was a Senior Vice President of the Company from 2003 to 2017, a Vice President of the Company from 2000 to 2003, a Senior Asset Manager of the Company from 1997 to 1999 and Assistant Controller of the Company from 1996 to 1997.
John F. Coleman, age 61 − Mr. Coleman has served as an Executive Vice President of the Company since May 2017. He was a Senior Vice President of the Company from 2001 to 2017. From 1994 until 2001, he was a Senior Vice President of Weeks Corporation and its successor Duke Realty Corporation (an industrial/office REIT).
Ryan M. Collins, age 40 − Mr. Collins has served as a Senior Vice President of the Company since May 2017. From 2005 to May 2017, Mr. Collins served as Vice President and Asset Manager for Clarion Partners (a diversified real estate investment firm).
R. Reid Dunbar, age 45 − Mr. Dunbar has served as a Senior Vice President of the Company since May 2017. From 2005 through May 2017, Mr. Dunbar held various positions with Prologis (an industrial REIT) and was most recently a Senior Vice President.
Staci H. Tyler, age 40 − Ms. Tyler has served as Senior Vice President, Chief Accounting Officer and Secretary since June 1, 2020. Ms. Tyler served as the Company’s Controller from 2017 through May 31, 2020 and Vice President from 2010 through May 31, 2020. She joined the Company in 2007 as Assistant Controller.
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COMPENSATION OF EXECUTIVE OFFICERS
Compensation Discussion and Analysis
This Compensation Discussion and Analysis (“CD&A”) reports on the Company’s performance in 2020, the executive compensation earned in light of that performance, and the performance metrics and other relevant factors the Compensation Committee used in making its compensation decisions with respect to our Chief Executive Officer and President, Chief Financial Officer and the three other most highly compensated executive officers who were serving as executive officers on December 31, 2020 (collectively, the “Named Executive Officers”). Our Named Executive Officers for the fiscal year ended December 31, 2020 are:
Marshall A. Loeb
Chief Executive Officer and President
Brent W. Wood
Executive Vice President and Chief Financial Officer
John F. Coleman
Executive Vice President
R. Reid Dunbar
Senior Vice President
Ryan M. Collins
Senior Vice President
Executive Summary
2020 Compensation Program Overview. Our executive compensation program is developed and monitored by our Compensation Committee. We provide a mix of fixed and at-risk pay incentives that are intended to motivate our executives to execute to achieve short-term and long-term objectives that build sustainable long-term value for our Company. In 2020, our compensation program consisted of the following primary elements:
Base Salary
Annual Cash and Equity Incentives
Long-Term Equity Opportunities
• We pay a base level of
  competitive cash salary to
  attract and retain executive
  talent.
• We determine base salary based
  on experience, job scope,
  market data and individual
  performance.
• We annually review our Named
  Executive Officers’ base salaries
  against our peers to maintain
  competitive levels.
• Our annual cash and equity
  incentives are based on the
  achievement of objective at-risk
  Company performance metrics
  to align compensation with
  strategic goals.
• Our performance metrics (FFO
  (as defined below) per share,
  Same PNOI (as defined below)
  change, debt to EBITDAre ratio
  and fixed charge coverage) are
  commonly used measures of
  REIT performance.
• A portion of the annual
  incentive is based on the
  achievement of individual
  performance goals to reward
  individual initiative,
  achievements and contributions.
• We grant performance-based
  and service-based restricted
  shares to our executives.
• Performance-based awards are
  only earned by achieving the
  Company’s three-year TSR (as   defined below) performance
  hurdles relative to the Nareit
  Equity Index and member
  companies of the Nareit
  Industrial Index. This is
  a critical component of aligning
  executive compensation with
  shareholders’ interests.
• Service-based awards encourage
  executive retention by vesting
  ratably over four years.
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At-Risk Compensation Mix. The graphics below illustrate the mix of 2020 fixed pay (base salary) and at-risk pay incentives (cash incentive compensation and equity awards), presented at target levels, for our Chief Executive Officer and our other Named Executive Officers. At-risk pay incentives constitute the majority of the total compensation package for our executive officers, consistent with our pay-for-performance compensation philosophy and objective, as discussed below. We believe that linking a substantial portion of our executive officers’, including our Named Executive Officers’, total compensation to at-risk pay rewards the achievement of key short-term and long-term performance goals and strongly aligns the interests of our executive officers, including our Named Executive Officers, with those of our shareholders. A larger portion of our Chief Executive Officer’s total compensation was linked to at-risk pay as compared to the other Named Executive Officers, in recognition of our Chief Executive Officer’s overall responsibility for our corporate performance.

Company Highlights. Below are operational and financial highlights for 2020. Funds from operations (“FFO”) and same property net operating income (“Same PNOI”) are not computed in accordance with U.S. generally accepted accounting principles (“GAAP”). Reconciliations of these non-GAAP measures and other required disclosure can be found on pages 22 and 23 of our Annual Report on Form 10-K for the year ended December 31, 2020, which we filed with the SEC on February 17, 2021.
Metric
Result
Total shareholder return (“TSR”)
Our TSR for 2020 was 6.7%. The Nareit Industrial REIT Total Return was 12.2% and the Nareit Equity REIT Total Return was -8.0%.
 
 
Earnings performance
Our 2020 FFO was $5.38 per share, which exceeded the high end of our goal range and was an increase of 8.0% over 2019.
 
 
Same PNOI growth
We experienced 2.1% growth in Same PNOI year over year on a GAAP basis which was between the threshold and target end of our goal range. The Compensation Committee approved an adjustment to Same PNOI growth for a non-cash, tenant-specific charge. After the adjustment, the Same PNOI growth was 2.4%, which resulted in 120% of the Target award.
 
 
Leasing
We renewed or re-leased 80% of expiring square feet during 2020 and rental rates on new and renewal leases increased an average of 21.7% for the year. Occupancy at the end of 2020 stood at 97.3% while average occupancy for 2020 was 96.7%.
 
 
Acquisitions
We completed acquisitions of operating properties (347,000 square feet), value-add properties (162,000 square feet) and land (233 acres) for $122 million during 2020.
 
 
Development and value-add program
We started five new development projects (851,000 square feet) with a projected total investment of $91 million in 2020. Our development and value-add program consisted of 16 projects (2.7 million square feet) at December 31, 2020 with a projected total investment of $292 million.
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Metric
Result
 
 
Dispositions
We sold 126,000 square feet of operating properties for $21 million and realized gains of $13 million.
 
 
Dividends
We raised the quarterly cash dividend by 5.3% in September 2020 and declared annual cash dividends of $3.08 per share during the year. We have paid 164 consecutive quarterly dividends and increased or maintained the dividend for 28 consecutive years. The Company has increased the dividend 25 times over that period, including increases in each of the last nine years.
 
 
Management of the balance sheet
We closed on new debt financing to lengthen our debt maturity schedule and fund acquisitions and development, while also maintaining and improving satisfactory liquidity and leverage ratios. We also issued 709,924 shares under our continuous common equity program in 2020 with gross proceeds of $94 million.
Compensation Philosophy and Objectives
We believe the most effective compensation program is one that promotes our ability to attract and retain highly qualified and motivated individuals whose interests are aligned with those of our shareholders. Our Compensation Committee seeks to develop a well-balanced compensation program that not only contains a competitive fixed pay element through annual base salary, but that is weighted more towards variable at-risk pay elements through the use of our short-term cash incentive and equity-based compensation, as well as our long-term equity-based compensation. We foster a culture where our Named Executive Officers may increase their cash compensation by contributing to measurable financial performance metrics of the Company; however, we also require meaningful value creation in the form of total return to our shareholders in order for our Named Executive Officers to earn a significant portion of their equity compensation. Each element of our compensation program is discussed in more detail below.
To further these objectives, we adhere to the following compensation and corporate governance practices:
What We Do:
What We Don’t Do:
We Pay for Performance: A substantial portion of our compensation is not guaranteed but rather linked to the achievement of key financial metrics that are disclosed to our shareholders.
No Employment Agreements, Automatic Salary Increases or Guaranteed Bonuses: We do not have employment agreements with any of our executive officers, and we do not guarantee annual salary increases or bonuses.
 
 
 
 
We Balance Short-Term and Long-Term Incentives: Our incentive programs provide a balance of annual and longer-term incentives, including a variety of performance metrics that measure both absolute performance (for short-term incentives) and relative performance (for long-term incentives); our existing long-term incentive program exclusively uses TSR to measure performance.
We Do Not Pay Dividends or Dividend Equivalents on Unvested Restricted Shares: Restricted shares do not receive dividends or dividend equivalents during the restricted period; accrued dividends are paid only to the extent the restricted shares vest.
 
 
 
 
We Limit the Maximum Payout Opportunity: We establish maximum amounts that may be earned under any award of performance-based compensation for our executives.
We Do Not Have Tax Gross-Ups and Generally Do Not Have “Single-Trigger” Provisions: We do not provide tax gross-ups on any severance, change in control or other payments. Change in control agreements generally require a “double-trigger”.
 
 
 
 
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What We Do:
What We Don’t Do:
We Recoup Compensation Under Certain Circumstances: We have a policy that requires the reimbursement of cash and equity incentive compensation in the event of a substantial restatement of our financial results caused by intentional misconduct by senior officers of the Company.
We Do Not Allow Hedging or Pledging: Our executive officers and directors are expressly prohibited from pledging and hedging Company securities.
 
 
 
 
We Maintain Robust Stock Ownership Guidelines: Our executive officers and directors are subject to robust stock ownership guidelines.
No Accelerated Vesting of Performance Awards: Our performance shares under long-term incentives do not provide for accelerated vesting in the event of a termination of employment.
 
 
 
 
We Retain an Independent Compensation Consultant: Our Compensation Committee engages an independent consultant to conduct an annual compensation review and to provide guidance on a variety of compensation matters.
We Do Not Provide Excessive Perquisites: Our executive officers are provided with limited perquisites and benefits.
 
 
 
 
We Have an Independent Compensation Committee: Our Compensation Committee is comprised solely of independent directors.
We Do Not Provide Pension Arrangements or Non-Qualified Deferred Compensation Arrangements: We do not provide a pension program or non-qualified deferred compensation program for any employees.
2020 Compensation Program Design and “Say-on-Pay” Advisory Vote
We provide shareholders with a “say-on-pay” advisory vote on the Company’s compensation program for its Named Executive Officers on an annual basis, in accordance with the preference expressed by shareholders concerning the frequency of such votes at our 2017 annual meeting. Our Compensation Committee considered the results of the “say-on-pay” advisory vote conducted at our 2020 annual meeting. As reported in our current report on Form 8-K, filed with the SEC on May 27, 2020, approximately 98.4% of the votes cast on the proposal expressed support for the compensation program offered to our Named Executive Officers as disclosed in last year’s proxy statement, which represents the fourth consecutive year that our “say-on-pay” proposal was supported by over 97% of votes cast. Accordingly, our Compensation Committee made no changes to our executive compensation program as a result of the say-on-pay advisory vote. We will be conducting our annual say-on-pay advisory vote as described in Proposal No. 3 of this proxy statement at our 2021 annual meeting. Our Board and our Compensation Committee will consider the outcome of the say-on-pay advisory vote, as well as shareholder feedback received throughout the year, when making compensation decisions for our Named Executive Officers in the future.
Say-on-Pay Shareholder Support

Our shareholders have largely supported the general framework of our compensation program with respect to the types of performance metrics by which we have measured our short-term and long-term performance.
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Accordingly, we continue to use a diverse group of performance metrics in connection with our annual incentive plan (“AIP”), including FFO, Same PNOI change, debt to EBITDAre ratio and fixed charge coverage as well as individual performance goals. The performance metrics used in 2020 remain largely unchanged from the previous year’s metrics. Performance goals and the corresponding payout levels were established across a three-tier construct (i.e. threshold, target and maximum).
Since 2017, we have utilized a long-term incentive plan (“LTIP”) based on forward-looking performance. Under the LTIP, the Compensation Committee issues equity grants that are earned based on three-year relative TSR (2020-2022 for awards granted in 2020) compared to TSR of the members of the Nareit Industrial Index and to the broader Nareit Equity Index. Performance goals and the corresponding payout levels were established across a three-tier construct (i.e. threshold, target and maximum). A portion of the LTIP is based on continued service and serves to foster retention.
Oversight of Compensation
The Compensation Committee is responsible for implementing our executive pay philosophy, evaluating compensation against the market, and approving the material terms of executive compensation arrangements, such as incentive plan participants, award opportunities, performance goals, and compensation earned under incentive plans.
The Compensation Committee relies upon outside advisors to assist in determining competitive pay levels and evaluating pay program design. In 2020, the Compensation Committee again retained FPL Associates, L.P. (“FPL”), which was first engaged by the Compensation Committee in 2003. The Compensation Committee directed FPL to, among other things:
assist the Compensation Committee in applying our compensation philosophy toward designing a compensation program for our executive officers, including the determination of the portion of total compensation awarded in the form of salary, annual cash incentive and equity-based compensation, as well as selecting the appropriate performance metrics and levels of performance (e.g., threshold, target, maximum);
analyze current compensation conditions among the Company’s peers, and assess the competitiveness and appropriateness of compensation levels for our executive officers;
recommend to the Compensation Committee any modifications or additions to the Company’s existing compensation programs that it deemed advisable; and
make specific recommendations to the Compensation Committee for base salary, annual cash incentive and equity-based awards for our executive officers.
A representative from FPL frequently attends meetings of the Compensation Committee and is available to participate in executive sessions and to communicate directly with the Compensation Committee chair or its members outside of meetings. We paid FPL approximately $40,000 in 2020 for their services as a compensation consultant.
In addition, in 2019, we engaged Ferguson Partners, an executive search firm and an affiliate of FPL, to assist us in the search for a new director. Ferguson Partners was paid approximately $30,000 in 2020 for its services. The decision to engage Ferguson Partners for director search services was made by the Nominating and Corporate Governance Committee. While the Compensation Committee does not pre-approve these non-executive compensation services, it does annually consider all factors relevant to FPL’s independence from management, including those identified by the NYSE. The Compensation Committee believes that the services provided by Ferguson Partners did not impact the advice and services that FPL provided to the Compensation Committee on executive compensation matters and has determined that FPL has no conflict of interest and is independent.
While Mr. Loeb, our CEO, did participate in general meetings of the Compensation Committee in 2020, he did not participate in executive sessions nor did he participate in any discussions determining his own compensation. Annually, upon request from the Compensation Committee, our CEO provides the Compensation Committee with data pertinent to his and the other executive officers’ performance, particularly in regards to the individual objectives of each executive.
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Peer Group Analysis
The Compensation Committee relies on the peer group analysis prepared by FPL to evaluate pay levels for our executive officers. The peer groups recommended by FPL and approved by the Compensation Committee are all public real estate companies and are divided into two groups based on (i) industry sector (the asset-based peer group) and (ii) equity market capitalization, geographic location and historical performance (the size-geographic-performance peer group, or what we refer to as the SGP peer group). FPL analyzes competitive total direct compensation at the peer REITs listed below, as disclosed in their proxy statements for prior years, as well as information contained in FPL’s proprietary database. The Compensation Committee evaluates the appropriateness of the peer groups annually (based on merger and acquisition activity, growth, property focus, etc.) and makes adjustments accordingly.
The asset-based peer group used for setting 2020 compensation was unchanged from 2019 other than by the removal of Liberty Property Trust, which was acquired by Prologis, Inc. on February 4, 2020, and the addition of Lexington Realty Trust; the asset-based peer group consisted of the following six exchange-listed REITs that invest in industrial properties.
Duke Realty Corporation
PS Business Parks, Inc.
First Industrial Realty Trust, Inc.
Rexford Industrial Realty, Inc.
Lexington Realty Trust
STAG Industrial, Inc.
The SGP peer group used for setting 2020 compensation consisted of the following 13 exchange-listed REITs, which (i) operate across multiple asset classes and are similar in size to the Company in terms of market capitalization, (ii) are similar in performance to the Company in terms of 3-year annualized TSR and/or (iii) are headquartered in the Sunbelt region of the United States. Eleven of the thirteen SGP peer group were unchanged from 2019. Columbia Property Trust, Inc. and Washington Real Estate Investment Trust were removed from the peer group and were replaced with Healthcare Realty Trust Incorporated and Life Storage, Inc. for a more appropriate size comparison. The SGP peer group companies are as follows:
Acadia Realty Trust
PS Business Parks, Inc.
CoreSite Realty Corporation
Rexford Industrial Realty, Inc.
Cousins Properties Incorporated
Sabra Health Care REIT, Inc.
First Industrial Realty Trust, Inc.
STAG Industrial, Inc.
Healthcare Realty Trust Incorporated
Sunstone Hotel Investors, Inc.
Life Storage, Inc.
Weingarten Realty Investors
Physicians Realty Trust
 
 
FPL conducted a study that compared the Company’s actual 2019 compensation for the executive officers (including the equity awards made in 2020 with respect to 2019 performance) with the actual 2019 total compensation of the top five executives of each of the companies included in the peer groups. In addition, FPL analyzed target compensation. The study showed that the target total pay, on a weighted average basis for all executive officers, was between the 25th percentile and median of both the asset-based peer group and the SGP peer group. The Compensation Committee then used the peer group data, survey information and other relevant factors to establish the 2020 compensation program for our executive officers. These factors provided the framework for compensation decision making and final decisions regarding the compensation opportunity for each executive officer. The Company did not target a specific percentile of the peer group to set compensation and no single factor was determinative in setting pay levels, nor was the impact of any factor on the determination of pay levels quantifiable.
Components of Compensation
The total compensation opportunity for our Named Executive Officers in 2020 incorporated three primary components: base salary, an annual cash and equity incentive award and a long-term equity incentive award (that is earned over a three-year performance period).
Base Salary. The Compensation Committee seeks to provide our executive officers with a level of assured cash compensation in the form of base salaries that are commensurate with their professional status, accomplishments and geographic location. The base salaries are reviewed annually by the Compensation Committee and are adjusted from time to time to recognize competitive market data based on our peer groups, the officer’s level of responsibility,
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outstanding individual performance, promotions and internal equity considerations. Based on a consideration of these factors, the base salaries of our Named Executive Officers were increased by a range of 3.0%-5.9% for 2020 to align with market. The 2019 and 2020 base salaries for each Named Executive Officer and the percentage increase from 2019 to 2020 are shown in the following table:
Named Executive Officer
2019 Salary ($)
2020 Salary ($)
Increase (%)
Marshall A. Loeb
675,000
695,000
3.0
Brent W. Wood
425,000
450,000
5.9
John F. Coleman
415,000
432,638
4.3
R. Reid Dunbar
385,000
401,363
4.3
Ryan M. Collins
340,000
351,900
3.5
Annual Cash and Equity Incentive Compensation. Our Named Executive Officers have an opportunity to earn annual incentive awards, paid one-half in cash and one-half in equity, designed to reward annual corporate performance and individual performance. Each year the Compensation Committee establishes a target annual incentive award opportunity for each of our Named Executive Officers following a review of their individual scope of responsibilities, experience, qualifications, individual performance and contributions to the Company, as well as an analysis of the surveys and market data based on our peer groups, as discussed previously.
2020 AIP Target Opportunity. The Compensation Committee set the target annual cash incentive and target annual equity incentive each equal to the following percentage of annual base salary: Mr. Loeb (130%), Mr. Wood (85%), Mr. Coleman (60%), Mr. Dunbar (60%) and Mr. Collins (55%). If the target goal for a corporate performance metric is achieved, then the corporate performance metric will be deemed to be earned at 100%. If the threshold or maximum goal for a performance metric is achieved, then the corporate performance metric will be deemed to be earned at 50% or 150%, respectively. Results below threshold result in a zero payout and achievement at levels between threshold and maximum are determined via linear interpolation. No more than 150% of the target award may be earned under the AIP.
 
Target Annual Cash
Incentive
Target Annual Equity Incentive
Named Executive Officer
($)
($)
Shares (#)(1)
Marshall A. Loeb
903,500
903,500
6,810
Brent W. Wood
382,500
382,500
2,883
John F. Coleman
259,583
259,583
1,957
R. Reid Dunbar
240,818
240,818
1,815
Ryan M. Collins
193,545
193,545
1,459
(1)
Shares valued at a closing stock price at the beginning of the performance period, which was $132.67 at December 31, 2019.
2020 AIP Corporate Performance Goals. The performance metrics and their relative weightings for the 2020 annual cash and equity incentive awards are described below, along with why we believe these were appropriate metrics to use in measuring short-term performance.
Metric
Relative
Weighting
Rationale
FFO Per Share
50%
FFO is a commonly used REIT financial metric defined by Nareit
 
 
 
 
 
 
Allows shareholders to compare operating performance among REITs over time on a consistent basis
 
 
 
 
 
 
May significantly impact the trading price of a REIT’s common stock and, therefore, may significantly impact TSR
 
 
 
 
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Metric
Relative
Weighting
Rationale
Increase in Same PNOI
10%
Internal performance metric measuring growth in our existing real estate portfolio
 
 
 
 
 
 
Allows shareholders to compare year-over-year improvements in our earnings from established investments and our ability to maintain occupancy and increase rental rates
 
 
 
 
Debt-to-EBITDAre Ratio
10%
A measure of the Company's financial condition and operating performance relative to our leverage
 
 
 
 
Fixed Charge Coverage
10%
Fixed charge coverage ratio reflects the strength of our balance sheet and our ability to generate sufficient cash flow to meet our debt obligations and continue to pay or increase our dividend
 
 
 
 
Individual Objectives
20%
Assessment of individual contributions to the Company’s financial and operational performance, as well as accomplishments relative to annual objectives
 
 
 
 
 
 
Strongly influenced by objective criteria, such as occupancy, new and renewed leasing rates, development projects, asset recycling and other quantitative and qualitative performance metrics and trends as determined by our Compensation Committee
 
 
 
 
 
 
Incentivizes and rewards individual initiative, achievements and contributions
The annual performance goals were based on the initial guidance for 2020 in our February 6, 2020 earnings press release.
 
Performance Goals
 
 
Criteria
Threshold
Target
Maximum
2020
Actual
Results
% of
Target
Earned
Corporate Performance Goals(1)
 
 
 
 
 
FFO Per Share
$5.25
$5.30
$5.35
$5.38
150%
Increase in Same PNOI
1.7%
2.2%
2.7%
2.4%(2)
120%
Debt-to-EBITDAre Ratio
6.0
5.5
5.0
5.3
120%
Fixed Charge Coverage
3.0x
3.5x
4.0x
5.8x
150%
(1)
FFO, Same PNOI and EBITDAre are not computed in accordance with GAAP. Reconciliations of FFO and Same PNOI and other required disclosure can be found on pages 22 and 23 of our Annual Report on Form 10-K for the year ended December 31, 2020, which we filed with the SEC on February 17, 2021. Reconciliations of EBITDAre and other required disclosure, including disclosure related to the Debt-to-EBITDAre ratio and Interest and Fixed Charge Coverage ratio, can be found on pages 5, 6, 8, 10, 21, 23 and 24 in the Company’s quarterly Supplemental Information for the period ended December 31, 2020, which can be found on the Investor Relations page of the Company’s website at www.eastgroup.net. Interest and Fixed Charge Coverage ratio is calculated as EBITDAre divided by the sum of interest expense plus principal amortization.
(2)
The Compensation Committee approved an adjustment to Same PNOI for a non-cash, tenant-specific charge. Without the adjustment, the actual result would have been 2.1%, which would have resulted in 90% of Target.
2020 AIP Individual Performance Goals. Each Named Executive Officer was assigned individual goals related to his scope of responsibility and aligned with our overall strategic priorities. These goals account for 20% of a Named Executive Officer’s AIP award and may be qualitative or quantitative in nature. In considering the individual performance of the Named Executive Officers, the Compensation Committee did not set specific factors or goals and
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did not assign specific weightings to any factors considered, but instead considered them together as part of a comprehensive qualitative review. We believe that disclosure of individual details regarding these performance goals would cause potential significant competitive harm to us without adding meaningfully to the understanding of our business or the AIP. Our Compensation Committee sets such individual performance goals at rigorous levels which we believe are sufficiently high to require substantial and sustained performance by the Named Executive Officers to be attained.
2020 AIP Actual Results. Based on the Compensation Committee’s analysis of all the foregoing criteria, the Compensation Committee determined that our actual performance resulted in a weighted average of 143% of the target level for Company performance goals (95% of maximum) and between threshold and maximum for the individual performance goals (varies by Named Executive Officer, as shown in the table below). The table below summarizes the overall AIP payouts which were based on the corporate and individual performance goals and weightings for each Named Executive Officer.
Named Executive Officer
% of Target
Earned:
Company Performance
Goals
% of Target
Earned:
Individual
Performance Goals
% of Target
Earned: Total
Award
Annual
Incentive Cash
Awards
Earned ($)
Annual
Incentive
Equity Awards
Earned (#
shares)
Marshall A. Loeb
143%
135%
141%
1,273,935
9,602
Brent W. Wood
143%
135%
141%
539,325
4,065
John F. Coleman
143%
140%
142%
368,608
2,778
R. Reid Dunbar
143%
135%
141%
339,553
2,559
Ryan M. Collins
143%
90%
132%
255,479
1,926
The annual incentive equity awards, granted in the form of restricted shares, vested 34% on the date the performance results were certified by the Compensation Committee and will vest 33% on each of January 1, 2022 and 2023, subject to continued employment with the Company through each applicable vesting date. Dividends on the annual equity incentive awards accumulate beginning January 1, 2020 and are paid if and when the restricted shares vest.
Long-Term Equity Incentive Compensation. Our Named Executive Officers have an opportunity to earn long-term equity incentive awards intended to provide incentives to our executives for the creation of value and the corresponding growth of our stock price over time. The Compensation Committee believes that our long-term equity incentive awards, together with the annual equity incentive awards discussed above, provide an appropriate balance between performance incentive and retention awards since the recipient must remain employed by the Company for an additional period following the performance period in order for the restricted shares to vest.
LTIP Target Opportunity. The Compensation Committee set the target for the three-year LTIP award, equal to the following percentage of base salary: Mr. Loeb (216%), Mr. Wood (141%), Mr. Coleman (81%), Mr. Dunbar (80%) and Mr. Collins (79%). For each three-year LTIP award, 70% of the target award was performance-based (i.e., TSR-based) and 30% of the target award was service-based. If the target goal for a performance metric is achieved, then the performance metric will be deemed to be earned at 100%. If the threshold or maximum goal for a performance metric is achieved, then the performance metric will be deemed to be earned at 50% or 150%, respectively. Results below threshold result in a zero payout and achievement at levels between threshold and maximum are determined via linear interpolation. No more than 150% of the target LTIP award may be earned. The service-based portion of the LTIP award vests 25% per year for four years.
Three-year LTIP Awards
Named Executive Officer
Target for the Three-
Year LTIP Awards ($)
Target for the
Three-Year LTIP
Awards (# Shares)(1)
Target for the
Three-Year LTIP
Awards (#
Performance-
Based Shares)
Three-Year LTIP
Awards (#
Service-Based
Shares)
Marshall A. Loeb
1,498,000
11,291
7,904
3,387
Brent W. Wood
635,000
4,786
3,350
1,436
John F. Coleman
349,000
2,630
1,841
789
R. Reid Dunbar
320,000
2,412
1,688
724
Ryan M. Collins
279,500
2,107
1,475
632
(1)
Shares valued at a closing stock price at the beginning of the performance period, which was $132.67 at December 31, 2019.
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LTIP Performance Goals. The performance goals for the long-term equity incentive awards are based on the Company’s TSR over a three-year period (2020-2022 for awards granted in 2020) and include a one-year service-based component following the end of the performance period. The performance-based LTIP awards vest 75% at the end of the performance period and the remainder on January 1 of the following year, subject to the executive officer’s continued service with the Company through such date. The metrics are shown in the following table. Because the performance period is the three-year period ending December 31, 2022, actual results will not be determined until the first quarter of 2023.
 
Performance Goal
 
Criteria
Threshold
Target
Maximum
Weighting
TSR Compared to Nareit Equity Index
250 basis
points below
Equal to Index
250 basis points above
35%
TSR Compared to member companies of the Nareit Industrial Index
25th
Percentile
50th
Percentile
75th
Percentile
35%
Retentive Service-Based Award
n/a
award at Target
n/a
30%
Retention Grants. On March 4, 2010, the Compensation Committee awarded 20,000 restricted shares per employee as a retention bonus to three of the Company’s Senior Vice Presidents, including Messrs. Coleman and Wood. The final vesting of the retention grants occurred on January 10, 2020; therefore, there are currently no outstanding unvested shares subject to the retention grants.
Retirement Plans. We have a 401(k) Plan pursuant to which the Company makes matching contributions of 50% of the eligible employee’s contributions (limited to 10% of compensation as defined by the plan) and may also make annual discretionary contributions. For 2020, the Company made a discretionary contribution of 4.7% of eligible employees’ compensation. The percentages of Company contributions for eligible Named Executive Officers are the same percentages as for other eligible employees. When the Compensation Committee calculates targeted overall compensation for our senior management, it factors in the benefits expected to be received under the 401(k) Plan.
Perquisites and Other Benefits. The Compensation Committee annually reviews the perquisites that senior management receive. The primary perquisite for executive officers is the Company’s provision of life insurance equal to 2.5x base salary up to a maximum amount of $400,000. Executive officers also participate in the Company’s medical insurance plans on the same terms as other officers. In certain circumstances, we provide reimbursement of reasonable expenses for relocations or substantial changes to the location of an executive officer’s workplace. We do not provide our executive officers automobiles or reimbursement for country clubs, financial planning or things of a similar nature.
Severance Benefits. In order to recruit executives and encourage retention of employees, we believe it is appropriate and necessary to provide assurance of certain severance payments if the Company terminates the individual’s employment without cause. Pursuant to our Severance and Change in Control Agreements, in the event an executive officer’s employment is terminated involuntarily by the Company without cause, as defined in the applicable agreement, and provided the employee executes a full and irrevocable release of claims, in a form satisfactory to the Company, promptly following termination, the employee will be entitled to receive certain severance benefits discussed below under the heading “Potential Payments upon Termination or Change in Control.” We believe that the size of the severance package for each Named Executive Officer is consistent with severance benefits offered by other companies of our size or in our industry to an officer in a similar position.
Change in Control. Our senior management and other employees have built the Company into a successful real estate investment trust and the Board believes that it is important to protect them in the event of a change in control. Further, it is the Board’s belief that the interests of shareholders will be best served if the interests of our senior management are aligned with them, and providing change in control benefits should eliminate, or at least reduce, the reluctance of senior management to pursue potential change in control transactions that may result in their job loss, but which may be in the best interests of shareholders. Upon a change in control and a qualifying termination, Messrs. Loeb, Wood and Coleman would receive a lump sum cash severance payment equal to three times the executive’s average annual compensation. Messrs. Dunbar and Collins would receive a lump sum cash severance payment equal to 2.5 times the executive’s average annual compensation. The severance payments would be paid in cash 60 days
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after termination and upon execution of a waiver and release agreement. The executive would also be provided life insurance and be reimbursed for health insurance for a period of time. Relative to the overall value of the Company, these potential change in control benefits are relatively minor. See “Potential Payments upon Termination or Change in Control” for additional information.
Clawback. We have a policy that requires the reimbursement of incentive compensation in the event of a substantial restatement of our financial results caused by intentional misconduct by senior officers of the Company. The Board reserves the right to review the incentive compensation received by the senior officers with respect to the period to which the restatement relates, recalculate the Company’s results for the period to which the restatement relates and seek reimbursement of that portion of the incentive compensation that was based on the misstated financial results from the senior officer or officers whose intentional misconduct was the cause of the restatement.
Hedging and Pledging Policy. Our Board has adopted a policy that prohibits Company directors, officers and certain designated employees from (i) engaging in any hedging or monetization transactions involving Company securities or from purchasing or selling any put or call option contract or similar instrument with respect to Company securities and (ii) pledging Company securities as collateral for a loan or holding such shares in a margin account.
Stock Ownership Policy. We have a policy that requires ownership of Company stock by directors and executive officers who have served in their role as a director or executive officer for a minimum of five years. Directors are required to own Company stock with a market value (number of shares multiplied by the current price of common stock) of at least five times the annual cash retainer for directors. Executive officers are required to own Company stock with a market value of at least: (i) five times annual base salary for the Chief Executive Officer, (ii) three times annual base salary for Executive Vice Presidents, and (iii) two times annual base salary for Senior Vice Presidents. Director and executive officer stock ownership is reviewed by the Nominating and Corporate Governance Committee on at least an annual basis, and all directors and executive officers who have served in their role as a director or executive officer for a minimum of five years are currently in compliance.
Tax and Accounting Considerations
Deductibility of Executive Compensation
Section 162(m) of the U.S. Internal Revenue Code of 1986 (the “Code”), as amended by the Tax Cuts and Jobs Act of 2017 (the “TCJA”), limits to $1 million the deduction that publicly traded corporations may take for compensation paid to “covered employees” of the corporation. Under a series of private letter rulings issued by the Internal Revenue Service (the “IRS”) prior to the enactment of the TCJA, compensation paid by an operating partnership to executive officers of a REIT that serves as its general partner was not subject to the limitation on deductibility under Section 162(m) to the extent such compensation was attributable to services rendered to the REIT’s operating partnership. In December 2020, the IRS issued final Treasury regulations under Section 162(m) (the “Final Regulations”) that overturn the guidance in the private letter rulings and apply Section 162(m)’s $1 million deduction limit to a REIT’s distributive share of any compensation paid by the REIT’s operating partnership to certain current and former executive officers of the REIT. The guidance under the Final Regulations applies to all compensation deductible in tax years ending on or after December 20, 2020 other than compensation paid pursuant to a written binding contract in effect on December 20, 2019 that is not subsequently materially modified. This guidance represents a significant change in IRS guidance regarding the deductibility of compensation for REITs and, to the extent that compensation paid to our executive officers does not qualify for deduction under Section 162(m), a larger portion of stockholder distributions may be subject to U.S. federal income taxation as dividend income rather than return of capital.
Accounting for Stock-Based Compensation
We follow the FASB ASC Topic 718 for our stock-based compensation awards.
Compensation Risk Assessment
In 2020, in consultation with management and FPL, our Compensation Committee’s independent compensation consultant, our Compensation Committee assessed our compensation plans, policies and practices for the Named Executive Officers and other employees and concluded that they do not create risks that are reasonably likely to have a material adverse effect on our company. This risk assessment included, among other things, a review of our cash and equity incentive compensation plans to ensure that they are aligned with our Company performance goals and overall target total direct compensation to ensure an appropriate balance between fixed and variable pay components. Our Compensation Committee conducts this assessment annually.
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Compensation Committee Report
The following Report of the Compensation Committee does not constitute soliciting material and should not be deemed filed or incorporated by reference into any other filing by the Company under the Securities Act of 1933 or the Securities Exchange Act of 1934 except to the extent the Company specifically incorporates this Report by reference therein.
The Compensation Committee of the Company has reviewed and discussed the Compensation Discussion and Analysis required by Item 402(b) of Regulation S-K with management and, based on such review and discussions, the Compensation Committee recommended to the Board that the Compensation Discussion and Analysis be included in this proxy statement.
 
Submitted by the Compensation Committee:
 
 
 
H. Eric Bolton Jr., Chair
 
H.C. Bailey, Jr.
 
Donald F. Colleran
 
Hayden C. Eaves III
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Summary Compensation Table
The following table summarizes, for the fiscal years ended December 31, 2020, 2019 and 2018, the amount of compensation earned, or paid by the Company to, the Named Executive Officers.
Name and
Principal Position
Year
Salary
($)
Bonus
($)
Stock
Awards ($)
(1)(2)
Non-Equity
Incentive Plan
Compensation
($)(3)
All Other
Compensation
($)(4)
Total ($)
Marshall A. Loeb
President and Chief Executive Officer
2020
695,000
2,481,393
1,273,935
215,942
4,666,270
2019
675,000
2,683,357
1,231,875
143,020
4,733,252
2018
650,000
2,516,243
1,106,300
86,689
4,359,232
Brent W. Wood
Executive Vice President and Chief Financial Officer
2020
450,000
1,034,538
539,325
262,615
2,286,478
2019
425,000
1,071,146
465,375
203,944
2,165,465
2018
407,000
829,449
451,770
156,153
1,844,372
John F. Coleman
Executive Vice President
2020
432,638
643,485
368,608
256,948
1,701,679
2019
415,000
715,862
366,030
201,747
1,698,639
2018
403,000
665,884
353,028
158,681
1,580,593
R. Reid Dunbar
Senior Vice President
2020
401,363
593,536
339,553
36,481
1,370,933
2019
385,000
671,526
339,570
29,350
1,425,446
2018
371,000
200,000(5)
551,426
331,674
10,978
1,465,078
Ryan M. Collins
Senior Vice President
2020
351,900
472,503
255,479
34,799
1,114,681
2019
340,000
561,230
258,060
23,045
1,182,335
2018
325,000
65,000(6)
462,303
259,188
10,974
1,122,465
(1)
The amounts in this column represent the aggregate grant date fair values of the restricted shares of Common Stock awarded to the Named Executive Officers during the fiscal years ended December 31, 2020, 2019 and 2018, as applicable, determined in accordance with FASB ASC Topic 718. Such aggregate grant date fair values do not include any estimated forfeitures related to service-based vesting conditions. The valuation assumptions used in determining such amounts are described in the Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2020, filed with the SEC on February 17, 2021. In the case of the performance-based restricted shares granted in 2020, the aggregate grant date fair value is reported assuming the probable outcome of the performance conditions. The maximum values of such restricted shares as of the grant date were as follows: $3,317,212 for Mr. Loeb, $1,388,708 for Mr. Wood, $857,735 for Mr. Coleman, $791,105 for Mr. Dunbar and $638,357 for Mr. Collins.
(2)
The amounts in this column for 2020 represent (i) the performance-based restricted shares awarded in March 2020 with respect to 2019 performance under the 2019 AIP based on individual performance goals, (ii) performance-based restricted shares awarded in March 2020 with respect to 2020 performance under the 2020 AIP based on corporate performance goals, (iii) performance-based awards of restricted shares granted in March 2020 for the three-year LTIP awards and (iv) service-based restricted shares granted in March 2020 for the three-year LTIP awards.
(3)
The amounts in this column represent the annual incentive cash awards earned under the Company’s AIP for the applicable fiscal year.
(4)
The amounts in this column represent the Company’s contributions under its 401(k) Plan for the Named Executive Officer’s benefit, dividends paid on vested restricted stock, and the amount of premium paid by the Company for group term life insurance for the Named Executive Officer.
 
401(k)
Contributions ($)
Restricted Stock
Dividends ($)
Life Insurance
Premium ($)
Total ($)
Marshall A. Loeb
27,001
188,370
571
215,942
Brent W. Wood
27,001
235,043
571
262,615
John F. Coleman
27,001
229,376
571
256,948
R. Reid Dunbar
23,751
12,159
571
36,481
Ryan M. Collins
23,751
10,477
571
34,799
(5)
Since Mr. Dunbar commenced employment with the Company on May 29, 2017, Mr. Dunbar was entitled to a $300,000 signing bonus which was paid in three equal installments on May 29, 2017, January 1, 2018 and June 30, 2018.
(6)
Since Mr. Collins commenced employment with the Company on June 1, 2017, Mr. Collins was entitled to a $130,000 signing bonus which was paid in two equal installments on June 1, 2017 and January 1, 2018.
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Grants of Plan-Based Awards in 2020
 
 
Estimated Future Payouts
Under Non-Equity
Incentive Plan Awards
($)
Estimated Future Payouts
Under Equity
Incentive Plan Awards
(#)
All Other
Stock
Awards:
Number of
Shares of
Stock or
Units (#)
Grant
Date Fair
Value of
Stock
Awards ($)
Name/Type of Grant
Grant
Date
Threshold
Target
Maximum
Threshold
Target
Maximum
Marshall A. Loeb
 
 
 
 
 
 
 
 
 
2020 AIP (Cash)(1)
 
451,750
903,500
1,355,250
 
 
 
 
 
2020 AIP (Equity)(2)
03/06/20
 
 
 
2,724
5,448
8,172
 
715,649
2020 Three-Year LTIP Award(3)
03/06/20
 
 
 
3,952
7,904
11,856
 
955,989
2020 Three-Year LTIP Award(4)
03/06/20
 
 
 
 
 
 
3,387
444,916
2019 AIP Awards(5)
02/13/20
 
 
 
 
 
 
2,576
364,839
Brent W. Wood
 
 
 
 
 
 
 
 
 
2020 AIP (Cash)(1)
 
191,250
382,500
573,750
 
 
 
 
 
2020 AIP (Equity)(2)
03/06/20
 
 
 
1,153
2,306
3,459
 
302,916
2020 Three-Year LTIP Award(3)
03/06/20
 
 
 
1,675
3,350
5,026
 
405,183
2020 Three-Year LTIP Award(4)
03/06/20
 
 
 
 
 
 
1,436
188,633
2019 AIP Awards(5)
02/13/20
 
 
 
 
 
 
973
137,806
John F. Coleman
 
 
 
 
 
 
 
 
 
2020 AIP (Cash)(1)
 
129,792
259,583
389,375
 
 
 
 
 
2020 AIP (Equity)(2)
03/06/20
 
 
 
783
1,566
2,349
 
205,710
2020 Three-Year LTIP Award(3)
03/06/20
 
 
 
921
1,841
2,762
 
222,669
2020 Three-Year LTIP Award(4)
03/06/20
 
 
 
 
 
 
789
103,643
2019 AIP Awards(5)
02/13/20
 
 
 
 
 
 
787
111,463
R. Reid Dunbar
 
 
 
 
 
 
 
 
 
2020 AIP (Cash)(1)
 
120,409
240,818
361,227
 
 
 
 
 
2020 AIP (Equity)(2)
03/06/20
 
 
 
726
1,452
2,178
 
190,735
2020 Three-Year LTIP Award(3)
03/06/20
 
 
 
844
1,688
2,533
 
204,164
2020 Three-Year LTIP Award(4)
03/06/20
 
 
 
 
 
 
724
95,105
2019 AIP Awards(5)
02/13/20
 
 
 
 
 
 
731
103,532
Ryan M. Collins
 
 
 
 
 
 
 
 
 
2020 AIP (Cash)(1)
 
96,773
193,545
290,318
 
 
 
 
 
2020 AIP (Equity)(2)
03/06/20
 
 
 
584
1,167
1,751
 
153,297
2020 Three-Year LTIP Award(3)
03/06/20
 
 
 
737
1,475
2,212
 
178,401
2020 Three-Year LTIP Award(4)
03/06/20
 
 
 
 
 
 
632
83,020
2019 AIP Awards(5)
02/13/20
 
 
 
 
 
 
408
57,785
(1)
Represents the 2020 annual cash incentive bonus opportunities under the 2020 AIP. See the description of the annual cash incentive award in the CD&A. The actual amount earned by each Named Executive Officer in 2020 is reported under the Non-Equity Incentive Plan Compensation column in the Summary Compensation Table.
(2)
Represents the number of restricted shares that could be earned, based on corporate performance goals only, under the 2020 AIP for 2020 performance. The number of restricted shares earned based on the individual performance goals under the 2020 AIP for 2020 performance, were granted on February 17, 2021, and are therefore not included in this table.
(3)
Represents the number of restricted shares that could be earned under the performance-based portion of the three-year LTIP awards pursuant to the 2020 LTIP.
(4)
Represents the number of restricted shares under the service-based portion of the three-year LTIP awards pursuant to the 2020 LTIP.
(5)
Represents restricted shares awarded on February 13, 2020 in connection with the individual performance goals under the 2019 AIP for 2019 performance.
Outstanding Equity Awards at 2020 Fiscal Year-End
The following table summarizes the number of non-fully vested outstanding equity awards held by each of our Named Executive Officers as of December 31, 2020, including awards earned by December 31, 2020 but not issued until 2021. Please refer to the footnotes of the