<PAGE>
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 /X/
Filed by a party other than the registrant / /
Check the appropriate box:
/ / Preliminary proxy statement
/X/ Definitive proxy statement
/ / Definitive additional materials
/ / Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
BRT REALTY TRUST
________________________________________________________________________________
(Name of Registrant as Specified in Its Charter)
BRT REALTY TRUST
________________________________________________________________________________
(Name of Person(s) Filing Proxy Statement)
Payment of filing fee (Check the appropriate box):
/X/ $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
/ / $550 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
________________________________________________________________________________
(2) Aggregate number of securities to which transactions applies:
________________________________________________________________________________
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:(1)
________________________________________________________________________________
(4) Proposed maximum aggregate value of transaction:
________________________________________________________________________________
/ / Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the form or schedule and the date of its filing.
(1) Amount previously paid:
________________________________________________________________________________
(2) Form, schedule or registration statement no.:
________________________________________________________________________________
(3) Filing party:
________________________________________________________________________________
(4) Date filed:
________________________________________________________________________________
- ------------------------
(1)Set forth the amount on which the filing fee is calculated and state how
it was determined.
<PAGE>
BRT REALTY TRUST
60 CUTTER MILL ROAD
GREAT NECK, N.Y. 11021
----------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
MARCH 7, 1994
----------------
To the Shareholders of BRT Realty Trust:
Notice is hereby given that the Annual Meeting of Shareholders (the "Annual
Meeting") of BRT Realty Trust (the "Trust") will be held at the offices of the
Trust, 60 Cutter Mill Road, Great Neck, N.Y., Suite 303, at 9:00 A.M., local
time, on March 7, 1994 for the following purposes:
1. To elect three Class I Trustees to the Board of Trustees;
2. To appoint Kenneth Leventhal & Company as the Trust's independent
certified public accountants for the fiscal year ending September 30, 1994; and
3. To act on such other business as may properly come before the Annual
Meeting or any adjournment thereof.
The close of business on January 20, 1994 has been fixed as the record date
for the determination of shareholders entitled to notice of, and to vote at, the
Annual Meeting. The stock transfer books of the Trust will not be closed.
By order of the Board of Trustees
Simeon Brinberg, Secretary
January 27, 1994
All Shareholders are cordially invited to attend the Annual Meeting. Whether
or not you expect to attend, you are requested to sign, date and return the
enclosed proxy promptly. Your vote is important and it will not be counted
unless you return the proxy or attend the Annual Meeting. If you attend the
Annual Meeting, you may withdraw the proxy and vote your own shares. A return
envelope, which requires no postage if mailed in the United States, is enclosed
for your convenience.
SHAREHOLDERS ARE URGED TO DATE, SIGN AND
RETURN THEIR PROXIES PROMPTLY
<PAGE>
BRT REALTY TRUST
60 CUTTER MILL ROAD
GREAT NECK, N.Y. 11021
(516) 466-3100
----------------
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
----------------
This Proxy Statement is furnished in connection with the solicitation by the
Board of Trustees of BRT Realty Trust (the "Trust") of proxies in the enclosed
form for the Annual Meeting of Shareholders ("Annual Meeting") to be held at the
offices of the Trust, 60 Cutter Mill Road, Suite 303, Great Neck, New York, at
9:00 A.M., local time on March 7, 1994, and for any adjournments thereof, for
the purposes set forth in the accompanying Notice of Annual Meeting of
Shareholders. Any shareholder giving a proxy has the power to revoke the proxy
at any time before it is voted. Written notice of such revocation should be
forwarded directly to the Secretary of the Trust. Proxies may also be revoked by
attending the Annual Meeting and voting in person or submitting a proxy bearing
a later date.
The principal executive offices of the Trust are located at 60 Cutter Mill
Road, Suite 303, Great Neck, NY 11021. The approximate date on which this Proxy
Statement and the form of proxy included herewith are being first sent to
shareholders is January 27, 1994.
VOTING SECURITIES
Only holders of shares of beneficial interest, par value $3.00 per share
("Beneficial Shares"), and holders of convertible preferred shares, par value
$1.00 per share ("Preferred Shares") of record as at the close of business on
January 20, 1994, are entitled to vote at the meeting. On the record date there
were issued and outstanding 7,346,624 Beneficial Shares (excluding treasury
shares and shares which have been reserved for issuance in connection with a
previous acquisition) and 1,030,000 Preferred Shares. Each outstanding
Beneficial Share and Preferred Share is entitled to one vote. The holders of a
majority of the outstanding Beneficial Shares and Preferred Shares, considered
as one class, shall constitute a quorum.
If the enclosed form of proxy is properly executed and returned, the
Beneficial Shares represented thereby will be voted in accordance with the
instructions thereon. If no instructions are indicated thereon, such Beneficial
Shares will be voted (i) for the election, as Class I Trustees, of the nominees
set forth under the caption "Election of Trustees," and (ii) for approval of the
appointment of Kenneth Leventhal & Company as the Trust's independent certified
public accountants for the fiscal year ending September 30, 1994. Approval of
each of the above items requires the affirmative vote of the holders of a
majority of the Beneficial Shares and Preferred Shares, voting as one class,
present in person or by proxy. If a shareholder, present in person or by proxy,
abstains on either matter, the shareholder's shares will not be voted on such
matter. Thus, an abstention from voting on any matter has the same legal effect
as a vote "against" the matter, even though the shareholder may interpret such
action differently.
The cost of soliciting proxies in the accompanying form has been, or will
be, paid by the Trust. In addition to the solicitation of proxies by use of the
mails, certain officers and regular employees (who will receive no compensation
therefor in addition to their regular salaries) may be used to solicit proxies
personally and by telephone and telegraph. In addition, banks, brokers and other
custodians, nominees and fiduciaries will be requested to forward copies of the
proxy material to their principals and to request authority for the execution of
proxies. The Trust will reimburse such persons for their expenses in so doing.
1
<PAGE>
BENEFICIAL OWNERSHIP BY TRUSTEES AND OFFICERS
Set forth below is information concerning stock ownership of all persons
known by the Trust to own beneficially 5% or more of the Beneficial Shares and
Preferred Shares of the Trust considered as one class, all Trustees and all
Trustees and officers of the Trust as a group, based upon the number of
outstanding Beneficial Shares and Preferred Shares as of January 20, 1994.
<TABLE>
<CAPTION>
AMOUNT OF
NAME OF BENEFICIAL BENEFICIAL PERCENT
OWNER OWNERSHIP (1)(2) OF CLASS
- ------------------------------------------------------------------------------------- --------------- --------
<S> <C> <C>
Patrick J. Callan (3)
55 East 52nd Street
New York, N.Y. 10055................................................................. 30,500 *
Fredric H. Gould (4)(5)(6)(13)(14)................................................... 1,948,301 22.50%
Stuart S. Gould (3)(4)(5)(7)(8)...................................................... 388,107 4.48%
Arthur Hurand (3)(9)
G-4300 W. Pierson Road
Flint, MI 48504...................................................................... 147,157 1.70%
Gary Hurand (3)(10)
G-4300 W. Pierson Road
Flint, MI 48504...................................................................... 41,817 *
Nathan Kupin (3)(4)(5)(7)............................................................ 308,307 3.56%
Herbert C. Lust, II (3)
54 Porchuck Road
Greenwich, CT 06830.................................................................. 67,500 *
Marshall Rose (5)(11)
667 Madison Avenue
New York, N.Y. 10021................................................................. 2,018,563 23.31%
Israel Rosenzweig (4)(12)(13)........................................................ 275,611 3.18%
One Liberty Properties, Inc. (2)(4).................................................. 1,233,767 14.27%
All Trustees and Officers as a group
(15 in number) (15)................................................................. 3,341,032(16) 38.59%
* Less than 1%
<FN>
- ------------------------
(1) All individuals listed are Trustees of the Trust. All persons listed,
except One Liberty Properties, Inc. own Beneficial Shares. One Liberty
Properties, Inc. owns 203,767 Beneficial Shares and 1,030,000 Preferred
Shares.
(2) Securities are listed as beneficially owned by a person who directly or
indirectly holds or shares the power to vote or to dispose of the
securities, whether or not the person has an economic interest in the
securities. In addition, a person is deemed a beneficial owner if he has
the right to acquire beneficial ownership within 60 days, whether upon the
exercise of a stock option or otherwise.
(3) Includes 7,500 Beneficial Shares which underlie unexercised options.
(4) Address is 60 Cutter Mill Road, Great Neck, N.Y. 11021.
(5) Includes 254,334 Beneficial Shares owned by the pension and profit sharing
trusts of REIT Management Corp. of which Stuart S. Gould, Fredric H.
Gould, Nathan Kupin and Marshall Rose are trustees, as to which Beneficial
Shares Messrs. Gould, Kupin and Rose each has shared voting and investment
power.
</TABLE>
(FOOTNOTES CONTINUED ON NEXT PAGE)
2
<PAGE>
<TABLE>
<S> <C>
(6) Includes 34,762 Beneficial Shares held by Mr. Gould as joint custodian for
the children of his brother, 4,790 Beneficial Shares owned by Georgetown
Group, Inc., of which Mr. Gould is a Vice President and 212,048 Beneficial
Shares owned by three entities in which Mr. Gould is a general partner or
principal. Also includes 203,767 Beneficial Shares and 1,030,000 Preferred
Shares owned by One Liberty Properties, Inc. ("OLP"), of which Mr. Gould
is an officer and director and in which Gould Investors L.P. ("GLP"), (an
entity in which Mr. Gould is a general partner and a principal executive
officer of the managing general partner) is a controlling shareholder,
93,588 Beneficial Shares, representing Mr. Gould's proportional interest
in Beneficial Shares owned by GLP and 52,500 Beneficial Shares which
underlie unexercised options. Does not include 18,815 Beneficial Shares
owned by Mrs. Fredric H. Gould, as to which Beneficial Shares Mr. Gould
disclaims beneficial interest and Mrs. Gould has sole voting and
investment power.
(7) Includes 33,381 Beneficial Shares owned by the pension trust of Gould
Investors L.P., of which Stuart S. Gould, Nathan Kupin and a non-Trustee
officer of the Trust are trustees, as to which Beneficial Shares said
trustees have shared voting and investment power.
(8) Does not include 56,568 Beneficial Shares owned by Mrs. Stuart S. Gould,
as to which Beneficial Shares Mr. Gould disclaims beneficial interest and
Mrs. Gould has sole voting and investment power.
(9) Includes 105,081 Beneficial Shares owned by Mr. Hurand and his wife as
joint tenants, 822 Beneficial Shares held by Mr. Hurand as custodian for
his grandchildren and 2,687 Beneficial Shares owned by Hurand & Hurand in
which Mr. Hurand is a partner.
(10) Includes 2,687 Beneficial Shares owned by Hurand & Hurand in which Mr.
Hurand is a partner.
(11) Includes 23,913 Beneficial Shares owned by Mr. Rose in a retirement
account, 4,790 Beneficial Shares owned by Georgetown Group, Inc. in which
Mr. Rose is an officer, 76,983 Beneficial Shares owned by the pension and
profit sharing trusts of Georgetown Group, Inc. of which Mr. Rose is
trustee, 212,048 Beneficial Shares owned by three entities in which Mr.
Rose is a general partner or principal shareholder, 8,644 Beneficial
Shares owned by Jill and Marshall Rose Foundation of which Mr. Rose is a
trustee, 58,722 Beneficial Shares owned by Mr. Rose for the benefit of
others, 203,767 Beneficial Shares and 1,030,000 Preferred Shares owned by
One Liberty, of which Mr. Rose is an officer and director and in which GLP
(an entity in which Mr. Rose is a general partner and a principal
executive officer of the managing general partner) is a controlling
shareholder, 92,862 Beneficial Shares representing Mr. Rose's proportional
interest in Beneficial Shares owned by GLP, and 52,500 Beneficial Shares
which underlie unexercised options. Does not include 41,662 and 1,600
Beneficial Shares owned by Mrs. Rose as a trustee for her children and
included in her Keogh Plan, respectively, as to which Beneficial Shares
Mr. Rose disclaims beneficial interest and Mrs. Rose has sole voting and
investment power.
(12) Includes 8,750 Beneficial Shares owned by Mr. Rosenzweig in retirement
accounts, 41,100 Beneficial Shares owned by Mr. Rosenzweig's son and Mr.
Rosenzweig as custodian for his minor children, and 52,500 Beneficial
Shares which underlie unexercised options. Mr. Rosenzweig disclaims
beneficial ownership of the Beneficial Shares owned by his son and owned
by him as custodian for his minor children.
(13) Includes 15,915 Beneficial Shares owned by the pension trust of the Trust
of which Fredric H. Gould, Israel Rosenzweig and a non-Trustee officer of
the Trust are trustees, as to which Beneficial Shares said trustees have
shared voting and investment power.
(14) Includes 9,214 Beneficial Shares owned by the pension and profit sharing
plans of Gould Capital Corp. of which Fredric H. Gould is a trustee and as
to which Mr. Gould has shared voting and investment power.
(15) This total is qualified by notes (5) through (14).
(16) Includes an aggregate of 285,750 Beneficial Shares which underlie
unexercised options.
</TABLE>
3
<PAGE>
ELECTION OF TRUSTEES
Pursuant to the Declaration of Trust, the Board of Trustees is divided into
three classes of Trustees, each of which is elected for a term of three years.
The Declaration of Trust provides for the number of Trustees to be between five
and fifteen, the exact number to be determined by resolution adopted by a
majority of the entire Board of Trustees. The Board of Trustees has fixed the
number of Trustees at nine (9).
At the meeting, the Class I Trustees will be elected by shareholders. The
accompanying form of proxy will be voted for the election as Class I Trustees of
Patrick J. Callan, Stuart S. Gould and Israel Rosenzweig unless the proxy
contains contrary instructions. Proxies cannot be voted for a greater number of
persons than the number of nominees named in the Proxy Statement. Management has
no reason to believe that any of the nominees will become unable to serve.
However, in the event that any of the nominees should become unable or unwilling
to serve as Trustee, the proxy will be voted for the election of such person or
persons as shall be designated by the Board of Trustees.
During the last full fiscal year, the Board of Trustees held 3 meetings.
Trustees attended all Board meetings held, except that Stuart S. Gould missed
two meetings and Arthur Hurand, Nathan Kupin and Israel Rosenzweig each missed
one meeting.
The Board of Trustees has appointed an Audit Committee consisting of Gary
Hurand, Herbert C. Lust, II and Patrick J. Callan. The functions of the Audit
Committee include reviewing the annual audit, reviewing the adequacy of
accounting and financial controls, and recommending independent auditors to the
Board of Trustees. The Audit Committee held one meeting in the 1993 fiscal year.
The Board of Trustees has appointed a Compensation Committee consisting of
Gary Hurand, Herbert C. Lust, II and Patrick J. Callan. The Compensation
Committee is composed entirely of independent outside directors and is
responsible for setting and administering the policies which govern both annual
compensation and the Trust's Stock Option Plans and Bonus Plan for executive
officers. The Compensation Committee held one meeting in the 1993 fiscal year.
The Trust has no Nominating Committee or any committee performing similar
functions.
Each Class I nominee, if elected, will serve until the annual meeting to be
held in 1997 and until his successor is elected and qualifies. Each other
Trustee will serve until the annual meeting to be held in the year set forth
opposite his name and until his successor is elected and qualifies.
The Board of Trustees of the Trust recommends a vote "FOR" the election of
the three nominees. Proxies solicited by the Board of Trustees will be so voted
unless shareholders specify in their proxies a contrary choice.
The following table sets forth certain information concerning the Trustees,
including the three nominees:
<TABLE>
<CAPTION>
TERM PRINCIPAL TRUSTEE
NAME AGE EXPIRING OCCUPATION (1) SINCE
- -------------------------------------- --- --------- ------------------------------------------------- --------
<S> <C> <C> <C> <C>
CLASS I
Patrick J. Callan (3)(4)(5)........... 57 1997(2) Principal of The RREEF Funds, pension fund real 1984
estate investments; Director of The East New York
Savings Bank; Director of First Empire State
Corporation.
Stuart S. Gould....................... 87 1997(2) Director of REIT Management Corp.; Chairman of 1983
the Executive Committee of Georgetown Partners
Inc., the Managing General Partner of Gould
Investors, L.P.
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
TERM PRINCIPAL TRUSTEE
NAME AGE EXPIRING OCCUPATION (1) SINCE
- -------------------------------------- --- --------- ------------------------------------------------- --------
<S> <C> <C> <C> <C>
Israel Rosenzweig (3)................. 46 1997(2) President and Chief Executive Officer of the 1984
Trust; Senior Vice President of Georgetown
Partners, Inc.; Senior Vice President of One
Liberty Properties, Inc.; Senior Vice President
of Georgetown OLP Corp.; Director of Nautica
Enterprises, Inc.
CLASS II
Arthur Hurand (3)..................... 77 1995 Private Investor; General Partner of the Motor 1989
Inn Limited Partnership; Director of the Key
State Bank; Director of One Liberty Properties,
Inc.
Herbert C. Lust, II (3)(4)(5)......... 67 1995 Private Investor; Director of Prime Hospitality, 1981
Inc.
Marshall Rose (3)..................... 57 1995 Vice Chairman of the Board of Trustees; Chairman 1986
of the Board of Georgetown Partners, Inc.; Vice
Chairman of the Board of One Liberty Properties
Inc. and Chairman of Georgetown OLP Corp.;
Chairman of the Board of REIT Management Corp.;
President of Georgetown Equities, Inc.
CLASS III
Fredric H. Gould (3).................. 58 1996 Chairman of the Board of Trustees; President of 1983
Georgetown Partners, Inc.; Chairman of the Board
of One Liberty Properties, Inc. and President of
Georgetown OLP Corp.; President of REIT
Management Corp.; Director of BFS Bankorp, Inc.
Nathan Kupin.......................... 79 1996 Vice President of the Trust; Director of REIT 1983
Management Corp.; Vice Chairman of the Board of
Georgetown Partners, Inc.; Senior Vice President
of One Liberty Properties, Inc.
Gary Hurand (4)(5).................... 47 1996 President of Dawn Donut Systems, Inc.; Director 1990
of Republic Bancorp; Director of Republic Bank;
Director of Premier Bank.
<FN>
- ------------------------
(1) Each Trustee has been engaged in the principal occupation indicated for at
least the past five years, except as noted.
(2) If elected at the meeting.
(3) Member of the Executive Committee.
(4) Member of the Audit Committee.
(5) Member of the Compensation Committee.
</TABLE>
Stuart S. Gould is the father of Fredric H. Gould. Arthur Hurand is the
father of Gary Hurand.
5
<PAGE>
TRUSTEE'S FEES AND OTHER COMPENSATION
Each unaffiliated Trustee was paid an annual retainer of $7,900 for services
as a Trustee in the 1993 fiscal year. Through April 30, 1993 unaffiliated
Trustees were paid $350 per meeting for each Trustee's meeting attended.
Subsequent to April 30, 1993 unaffiliated Trustees were paid $500 per meeting
for each Trustee's meeting and each committee meeting attended. With respect to
fees (charged to operations) paid and accrued during the fiscal year for REIT
Management Corp. (the "Advisor") under the Advisory Agreement, see "Interest of
Management in Certain Transactions."
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 ("Section 16(a)")
requires executive officers and directors, and persons who beneficially own more
than 10% of the Trust's shares, to file Initial Reports of Ownership and Reports
of Changes in Ownership with the Securities and Exchange Commission ("SEC") and
the New York Stock Exchange. Executive officers, Trustees and greater than 10%
beneficial owners are required by SEC regulations to furnish the Trust with
copies of all Section 16(a) forms they file. The Trust prepares and files the
requisite forms on behalf of its executive officers and Trustees. Based on a
review of information supplied to the Trust by the executive officers and
Trustees, the Trust believes that all Section 16(a) filing requirements
applicable to its executive officers, Trustees and greater than 10% beneficial
owners were complied with, except that a form 4 with respect to a transaction
which took place in January 1992 by One Liberty Properties, Inc. ("OLP"), in
which Matthew Gould, a Vice President of the Trust, is President, and amended
form 4's for the months of August, September and October, 1992 with respect to
transactions by OLP, were filed in November, 1992. The transactions by OLP were
reported on a timely basis in filings made by OLP and in filings made by Fredric
H. Gould and Marshall Rose, Chairman and Vice Chairman, respectively, of both
the Trust and OLP.
EXECUTIVE COMPENSATION
REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
The Compensation Committee of BRT is composed of three independent
non-employee trustees. The Committee is responsible for advising management and
the Board of Trustees on matters pertaining to compensation arrangements for
executive employees, as well administration of BRT's stock option plans and
bonus plan.
COMPENSATION OVERVIEW
It is the view of the Compensation Committee that the annual compensation of
executive officers is composed of two key elements:
(i) an Annual Component made up of base salary and annual bonus; and
(ii) a long term component, i.e. stock options.
ANNUAL COMPONENT; BASE SALARY AND BONUS
Base salaries are intended to be competitive and to reflect an individuals
performance and contribution to the Trust. In reviewing base salaries,
consideration is given to the effectiveness of each executive in the performance
of his duties. The Compensation Committee has taken in account the operations of
the Trust and has given consideration to the difficult real estate market of the
past several years. Because of the substantial number of defaults, foreclosures
and bankruptcies which have affected the real estate industry in general and the
Trust in particular the Compensation Committee believes it must recognize the
diligence and managerial expertise which the executive officers have
demonstrated in managing the business of the Trust. The analysis referred to
and, accordingly, the recommendations concerning executive compensation, are
subjective in nature. The factors considered are not weighted in any specific
manner.
The concept of the annual bonus is to link a portion of the compensation of
executives to the performance of the Trust. Under the Trust's existing bonus
plan, which the Compensation Committee recommends be retained, the Trust must
produce a minimum return to shareholders before any bonuses are awarded. Under
the plan a bonus pool is to be established in each fiscal year in an amount
equal to 15% of
6
<PAGE>
the amount by which the net income of the Trust in any fiscal year exceeds
stockholders' equity multiplied by the average prime rate of interest plus 1%.
Accordingly, the Trust must have a degree of success before bonuses are paid to
executive officers. However, the Compensation Committee deems it advisable to
recognize significant individual contributions by key employees in any
particular fiscal year even if, pursuant to the bonus plan, there are not
sufficient earnings to establish, under the terms of the plan, a bonus pool.
Accordingly, the Compensation Committee recommends that $50,000 be used to pay
bonuses to officers and employees (other than executive officers) if, in the
opinion of the Compensation Committee, based upon recommendations made by the
advisor to the Trust, any individual made a significant contribution to the
Trust during the year.
LONG TERM COMPENSATION -- STOCK OPTIONS
Stock options are granted periodically to provide incentive for the creation
of shareholder value over the long term, since the full benefit of the
compensation provided for under stock options cannot be realized unless there is
an appreciation in the price of the Trust's shares over a specified number of
years. Under the existing stock option plan, options are granted at an exercise
price equal to the fair market value of the stock of the Trust on the date of
grant and are exercisable over a number of years (generally five to six years),
in increments ranging between 20% and 25% per year on a cumulative basis. Stock
options are the only form of long term incentive currently used by BRT.
At the present time there are options outstanding which have been granted to
executive officers and other key personnel of the Trust which have an exercise
prices ranging from $3.50 to $3.625 per share. With respect to the executive
officers of the Trust I.E. Israel Rosenzweig, and Jeffrey A. Gould, they have
been granted 70,000, and 40,000 options, respectively. These options have
approximately two and a half years remaining and it is the recommendation of the
Compensation Committee that no additional options be granted at this time since
the outstanding options, both amount and exercise price, are adequate to
incentivize the executive officers of the Trust.
CEO COMPENSATION
In the view of the Compensation Committee the base salary of the chief
executive officer of the Trust should be frozen at $350,000 per annum for the
1993 fiscal year. The Compensation Committee has taken cognizance of the
difficult real estate environment. In addition, the Chief Executive Officer was
involved in restructuring and extending the bank credit agreement, in
supervising and participating in negotiating workouts, property dispositions and
supervising the operations of real estate owned. In recognition of his diligence
and managerial expertise, the Compensation Committee recommends that the salary
of the Chief Executive Officer be maintained at $350,000.
In view of the current operations of the Trust, the Compensation Committee
recommends that all executive salaries in fiscal 1993 be frozen at the levels in
effect in fiscal 1992.
Respectfully submitted,
Patrick J. Callan
Gary Hurand
Herbert C. Lust, II
7
<PAGE>
ANNUAL COMPENSATION
The following Summary Compensation Table includes information with respect
to compensation paid and accrued by the Trust for services rendered in all
capacities to the Trust during the fiscal years ended September 30, 1991, 1992
and 1993, for the Chief Executive Officer of the Trust and the one other
executive officer of the Trust whose annual compensation from the Trust exceeded
$100,000 for the fiscal year ended September 30, 1993:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
ANNUAL ------------
COMPENSATION (1) STOCK OPTION
NAME AND ---------------- GRANTS ALL OTHER
PRINCIPAL POSITION YEAR SALARY (SHARES) COMPENSATION (2)
- ------------------------------------------------------ ---- ---------------- ------------ ----------------
<S> <C> <C> <C> <C>
Israel Rosenzweig,
President, Chief Executive
Officer and Trustee.................................. 1993 $ 350,000 0 $ 30,000
1992 $ 350,000 0 $ 30,000
1991 $ 350,000 70,000 $ 30,000
Jeffrey A. Gould,
Executive Vice President............................. 1993 $ 122,000 0 $ 18,300
1992 $ 122,000 0 $ 18,300
1991 $ 92,038 40,000 $ 13,846
<FN>
- ------------------------
(1) The Trust does not have any profit sharing plan, but it does have Stock
Option Plans, a Pension Plan and a Bonus Plan for executive officers. No
bonuses were granted to the Trust's executive officers during any of the
above periods. See "Stock Option Plans" and "Pension Plan," below.
(2) Represents annual contributions under the Trust's Pension Plan, which are
based on each participant's annual earnings.
</TABLE>
PENSION PLAN
The Trust has a non-contributory defined contribution pension plan covering
employees. The Pension Plan is administered by Fredric H. Gould, Israel
Rosenzweig and an employee of the Trust. Annual contributions of the Trust are
based on 15% of an employee's annual earnings, not to exceed $30,000 per annum.
Partial vesting starts one year after employment, increasing annually until full
vesting is achieved at the completion of five years of employment. Benefits to
participants upon retirement are determined by the participant, who may elect a
lump sum payment or the purchase of an annuity, the amount of which is
determined primarily by the amount of contributions. In fiscal 1993, $30,000 and
$18,300, respectively, were contributed for the benefit of Israel Rosenzweig and
Jeffrey A. Gould. The aggregate amount accrued to date for Messrs. Rosenzweig
and Gould is approximately $295,000 and $83,000, respectively. The estimated
credited years of service for each of Messrs. Rosenzweig and Gould is 10 and 7,
respectively.
STOCK OPTION PLANS
On May 22, 1984, the Board of Trustees of the Trust adopted a Stock Option
Plan (the "1984 Plan"). The 1984 Plan was approved by the shareholders of the
Trust on March 1, 1985. The 1984 Plan provides for the issuance of up to 300,000
Beneficial Shares to key personnel of the Trust of which 31,581 remain available
for grant. The 1984 Plan does not provide for the issuance of stock appreciation
rights. Options are granted at per share amounts at least equal to their fair
market value at the date of grant. Options are not exercisable for a period of
one year following the date of grant and thereafter options may be exercised to
the extent of 20% thereof in any year on a cumulative basis, and expire five and
one-half years after grant. In fiscal 1993 no options were granted and no
options remain unexercised.
On August 19, 1988 the Board of Trustees adopted a Stock Option Plan (the
"1988 Plan"). The 1988 Plan was approved by the shareholders of the Trust on
March 2, 1989. The 1988 Plan provides for the issuance of up to 500,000
Beneficial Shares to officers, trustees and employees of the Trust. The options
granted may be either incentive stock options or options which do not qualify as
incentive stock options. The exercise price of any option granted under the 1988
Plan must be not less than 100% of the fair market value
8
<PAGE>
of the Beneficial Shares on the date of grant. The 1988 Plan does not provide
for the issuance of stock appreciation rights. At September 30, 1993, 38,000
shares remain available for grant and options to purchase 334,000 shares are
exercisable. No options were granted during fiscal 1993.
The following table sets forth certain information with respect to
outstanding stock options held by the Trust's Chief Executive Officer and by the
other executive officer of the Trust named in the preceding Annual Compensation
table. No executive officer exercised stock options during fiscal 1993.
UNEXERCISED STOCK OPTIONS AT FISCAL YEAR END
<TABLE>
<CAPTION>
VALUE OF UNEXERCISED
NUMBER OF UNEXERCISED IN-THE-MONEY OPTIONS AT
OPTIONS AT FISCAL YEAR END FISCAL YEAR END (1)
---------------------------- ---------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---------------------------------------------------------- ----------- ------------- ----------- ------------
<S> <C> <C> <C> <C>
Israel Rosenzweig......................................... 52,500 17,500 $ 32,813 $ 10,938
Jeffrey A. Gould.......................................... 30,000 10,000 $ 18,750 $ 6,250
<FN>
- ------------------------
(1) Based upon a price per Beneficial Share at September 30, 1993 of $4.125.
</TABLE>
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN
The following graph compares the performance of the Trust's Beneficial
Shares with the Standard & Poor's 500 Stock Index and a peer group index
consisting of thirty publicly traded mortgage REIT's prepared by the National
Association of Real Estate Investment Trusts. The graph assumes $100 was
invested on September 30, 1988 in the Trust's Beneficial Shares, the S&P 500
Index and the peer group index and assumes the reinvestment of dividends. The
Trust will provide (upon written request) the names of REIT's included in the
peer group index.
[GRAPHIC]
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
BRT Realty Trust 100 82 31 19 17 29
All Mortgage REITs 100 91 64 89 88 101
S&P 500 Index 100 133 121 158 176 199
</TABLE>
9
<PAGE>
INTEREST OF MANAGEMENT IN CERTAIN TRANSACTIONS
The Trust and REIT Management Corp. ("REIT" or "Advisor") are parties to an
Advisory Agreement pursuant to which REIT furnishes administrative services with
respect to the Trust's assets and, subject to the supervision of the Trustees,
advises the Trust with respect to its investments. The Trust believes that the
Advisory Agreement is on terms as favorable to the Trust as would be available
from an unaffiliated party. The term of the Advisory Agreement has been renewed
by the Board of Trustees to December 31, 1997. Messrs. Stuart S. Gould, Fredric
H. Gould, Nathan Kupin and Marshall Rose are directors of REIT and Messrs.
Fredric H. Gould and Marshall Rose are officers of REIT. All of the outstanding
shares of REIT are owned by Fredric H. Gould.
For services performed by REIT under the Advisory Agreement, REIT receives
an annual fee of 1/2 of 1% of the Invested Assets of the Trust other than
mortgages receivable, subordinated land leases and investments in unconsolidated
ventures with a 1% fee payable on mortgages receivable, subordinated land leases
and investments in unconsolidated ventures. The term "Invested Assets" is
defined in the Advisory Agreement as the aggregate of all assets of the Trust as
shown on the balance sheet of the Trust without deduction for (i) mortgages and
other security interests to which the assets are subject, (ii) depreciation, and
(iii) amortization, but excluding (a) cash and cash items, (b) amounts due from
managing agents, (c) rents and other receivables (not including mortgages
receivable or other receivables arising from the sale of invested assets), (d)
rent security, (e) prepaid expenses and deferred charges, and (f) obligations of
municipal, state and federal governments and governmental agencies, other than
securities of the Federal Housing Authority, the Veterans Administration and the
Federal National Mortgage Association and securities issued by governmental
agencies that are backed by a pool of mortgages.
The fee to REIT is based on net assets and computation of the fee includes
non-accruing mortgage receivables to the extent they exceed allowances for loan
losses. The fee under the Advisory Agreement is computed and payable quarterly,
subject to adjustment at year end based on the Trust's audited financial
statements. During the fiscal year ended September 30, 1993, REIT earned
$1,295,000 from the Trust under the Advisory Agreement.
Under the Advisory Agreement, the Trust bears all expenses including
interest, discount and other costs for borrowed money; taxes on income or
property and license fees (including franchise taxes); rental paid for office
space used by the Trust; audit fees and expenses; legal fees; expenses of
litigation involving the Trust; charges of custodians, transfer agents,
registrars, warrant agents, dividend disbursing agent, brokers, underwriters and
banks; expenses relating to meetings of trustees and shareholders; expenses
connected with the acquisition, disposition or ownership of investment assets,
including, but not limited to, travel expenses, costs of appraisal, leasing,
maintenance, repair, improvement and foreclosure of property and origination and
mortgage servicing fees and real estate brokerage commissions; fees for the
management of real estate owned by the Trust; fees and expenses payable to
trustees, officers and employees (other than fees payable to Trustees, officers
and employees who are directors, officers and employees of REIT, whose
compensation is payable solely by REIT), independent contractors, consultants,
managers, or agents; the expenses of revising, amending, modifying or
terminating the Trust; and indemnification required to be made by the Trust
under the Declaration of Trust.
The Advisory Agreement provides that directors, officers, and employees of
REIT may serve as trustees, officers and employees of the Trust, but such
persons are not and may not receive cash compensation from the Trust for
services rendered in the latter capacities.
The Advisory Agreement is not assignable by REIT without the written consent
of the Trust. The Advisory Agreement is not assignable by the Trust without the
written consent of REIT, except to a successor to the business and assets of the
Trust. The Advisory Agreement has been renewed for a term ending December 31,
1997 and may be renewed on an annual basis by the Board of Trustees, for a
maximum five year period. Notwithstanding such renewal of the Advisory Agreement
by the Board of Trustees, the shareholders have the right to rescind the renewal
of the Advisory Agreement authorized at the preceding Board of Trustees Meeting,
if at a special meeting of shareholders called by at least twenty percent of the
outstanding Beneficial Shares specifically for such purpose a majority of the
outstanding Beneficial Shares
10
<PAGE>
entitled to vote thereon shall determine that the Advisory Agreement shall not
be renewed. In the event the Advisory Agreement is not renewed in any year by
the Board of Trustees or such renewal is rescinded by a majority of the
outstanding Beneficial Shares entitled to vote thereon at a special meeting
called for such purpose, the Advisory Agreement will have a balance of four
years remaining in the existing term.
The Trust engages entities affiliated with REIT to manage properties
acquired by the Trust in foreclosure or deed in lieu of foreclosure. The
management services include, among other things, rent billing and collection,
leasing (including document preparation), maintenance, construction supervision,
compliance with regulatory statutes and rules (i.e. New York City rent control
and rent stabilization rules) and property dispositions. In fiscal 1993 the
Trust paid $706,000 to these entities for management and construction
supervision fees and leasing and selling fees. The Trust believes these fees are
on terms at least as favorable to the Trust as would be available from
unaffiliated entities. The payment of these fees was ratified by the
unaffiliated trustees.
During the year ended September 30, 1993 Fredric H. Gould and Marshall Rose,
Chairman and Vice Chairman of the Board of Trustees, were officers and directors
of the corporate general partners of Gould Investors L.P. ("GLP"), a public
master limited partnership, including the Managing General Partner of GLP. The
Trust, GLP and other related entities occupy common office space, and share
office services, equipment and personnel. In fiscal 1993, $1,283,000 of common
general and administrative expenses were allocated to the Trust. This amount
includes $117,124 and $108,308, allocated to the Trust for legal services and
accounting services performed by Simeon Brinberg and David W. Kalish,
respectively. Messrs. Brinberg and Kalish, who receive remuneration or payment
of fees directly from GLP and related entities, are also executive officers of
the Trust.
During the year ended September 30, 1993 a law firm in which Simeon
Brinberg, an officer of the Trust, is a Partner, received an aggregate of
approximately $95,000 directly from borrowers of the Trust, for services
rendered to the Trust in transactions involving such borrowers.
APPOINTMENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Board of Trustees of the Trust is seeking the appointment of Kenneth
Leventhal & Company as independent certified public accountants to audit the
books, records and accounts of the Trust for the fiscal year ending September
30, 1994. This firm has served as the Trust's independent certified public
accountants since 1986. Representatives of Kenneth Leventhal & Company are
expected to be present at the Annual Meeting and will have the opportunity to
make a statement if they desire to do so and will be available to respond to
questions of the Trust's shareholders.
If the Trust's shareholders do not approve of the appointment of Kenneth
Leventhal & Company, the selection of independent certified public accountants
will be made by the Trust's Board of Trustees.
The Board of Trustees recommends a vote "FOR" the appointment of Kenneth
Leventhal & Company as the Trust's independent certified public accountants for
the fiscal year ending September 30, 1994.
GENERAL
Management of the Trust does not know of any matters other than those stated
in this Proxy Statement which are to be presented for action at the Annual
Meeting. If any other matters should properly come before the Annual Meeting, it
is intended that proxies in the accompanying form will be voted on any such
other matters in accordance with the judgment of the persons voting such
proxies. Discretionary authority to vote on such voting matters is conferred by
such proxies upon the persons voting them. The expenses in connection with the
solicitation of the accompanying form of proxy, including the cost of preparing,
printing and mailing the notice of meeting, form or proxy and Proxy Statement,
have been or will be borne by the Trust.
11
<PAGE>
SHAREHOLDER PROPOSALS
The annual meeting of the Trust for the year ending September 30, 1994 is
scheduled to be held in March 1995. In order to have any proposal to be
presented by a shareholder at such meeting included in the Trust's proxy
statement and form or proxy relating to the meeting, the proposal must be
received by the Trust not later than September 28, 1994.
By order of the Board of Trustees
SIMEON BRINBERG, Secretary
Dated: January 27, 1994
12
<PAGE>
PROXY BRT REALTY TRUST
PROXY FOR THE ANNUAL MEETING OF STOCKHOLDERS
MARCH 7, 1994
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES
The undersigned hereby appoints FREDRIC H. GOULD, ISRAEL ROSENZWEIG and
SIMEON BRINBERG, as Proxies each with the power to appoint his substitute, and
hereby authorizes them to represent and to vote, as designated below, all the
shares of Beneficial Interest, $3.00 par value per share, of BRT Realty Trust
held of record by the undersigned on January 20, 1994 at the Annual Meeting of
Shareholders to be held on March 7, 1994 or any adjournments thereof.
1. Election of Class I Trustees
/ / FOR ALL NOMINEES / / WITHHOLD ALL NOMINEES
Nominees: Patrick J. Callan, Stuart S. Gould, Israel
Rosenzweig
/ / INSTRUCTIONS: To withhold authority to vote for
any individual nominee, place an "X" in the box on
the left and strike a line through
the nominee's name listed above.
FOR AGAINST ABSTAIN
/ / / / / / 2. Appointment of Kenneth Leventhal & Company as
Independent Certified Public Accountants for the
fiscal year ending September 30, 1994.
3. In their discretion, the proxies are authorized to
vote upon such other business as may properly come
before the meeting.
This Proxy when properly executed will be voted in the manner directed
hereby by the undersigned shareholder.
<PAGE>
PLEASE DATE, SIGN AND RETURN THIS PROXY IN THE ENCLOSED ENVELOPE.
Dated: __________________________, 1994
__________________________________ L.S.
__________________________________ L.S.
(NOTE: PLEASE SIGN EXACTLY AS YOUR NAME
APPEARS HEREON. EXECUTORS,
ADMINISTRATORS, TRUSTEES, ETC. SHOULD
SO INDICATE WHEN SIGNING, GIVING FULL
TITLE AS SUCH. IF SIGNER IS A
CORPORATION, EXECUTE IN FULL CORPORATE
NAME BY AUTHORIZED OFFICER. IF SHARES
HELD IN THE NAME OF TWO OR MORE
PERSONS, ALL SHOULD SIGN.)
