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Seaport Entertainment Group Inc. (NYSE American: SEG), a player in the amusement and recreation services sector with a market capitalization of $271 million, has announced the issuance of performance-vesting restricted stock units (Performance RSUs) to key executives, as revealed in a recent SEC filing. According to InvestingPro data, the company maintains strong liquidity with a current ratio of 8.13, though it faces profitability challenges with negative EBITDA of -$77.7 million in the last twelve months. The grants, made by the company’s Compensation Committee, are part of the 2024 Equity Incentive Plan and are contingent on achieving specific performance goals by December 31, 2027.
The Performance RSUs are designed to incentivize executives based on the company’s financial success, with potential vesting on March 7, 2028. The performance criteria include a comparison of Seaport’s three-year annualized total shareholder return against the Russell 2000 Index and the company’s asset-level EBITDA for the 2027 fiscal year. This focus on performance metrics comes as the company grapples with challenging fundamentals, including a gross profit margin of -51.7% and revenue of $78.6 million in the last twelve months. Additionally, an EBITDA-based multiplier could enhance the awards if the company’s Non-GAAP adjusted net income for 2027 meets or exceeds certain thresholds.
The target number of Performance RSUs granted to executives Matthew Partridge and Lucy Fato are 20,482 and 4,824 units, respectively. The final number of RSUs that may vest for each executive ranges from 0% to 200% of these target amounts, depending on the achievement of the established performance goals.
The filing specifies that vesting of the Performance RSUs is subject to the executives’ continued employment through the vesting date, with provisions for accelerated vesting under certain conditions such as qualifying terminations of employment or a change in control of the company. Upon vesting, the Performance RSUs will be settled in shares of Seaport’s common stock.
The full details of the Performance RSUs and the conditions for their vesting are outlined in the PSU Agreement, which is attached as Exhibit 10.1 to the SEC filing. This move by Seaport Entertainment Group Inc. underscores the company’s commitment to aligning the interests of its leadership with those of its shareholders through performance-based compensation.
Investors and interested parties can refer to the SEC filing for a complete understanding of the terms and conditions associated with these Performance RSUs. This strategy reflects the company’s focus on driving performance and value creation over the next several years. The stock has experienced significant pressure, declining 28.75% over the past year, though InvestingPro analysis suggests the company is currently undervalued. Discover more insights and 6 additional ProTips about SEG’s financial health and growth prospects with an InvestingPro subscription.
In other recent news, Seaport Entertainment Group Inc. has opened a new dining and nightlife venue, GITANO NYC, at Pier 17 in New York. This establishment results from an interim license agreement and a long-term lease with Grupo Gitano, a company based in Tulum. GITANO NYC spans 13,605 square feet and represents Seaport’s first permanent, year-round venture in New York. The venue features a unique blend of Bohemian-inspired design and modern Mexican cuisine, with views of the Brooklyn Bridge and New York City skyline. In a strategic move, Seaport Entertainment Group has also integrated employees from Creative Culinary Management Company LLC to internalize its food and beverage operations. This step is part of a shared services agreement with CCMC, aimed at streamlining operations and improving efficiency for Seaport’s wholly owned and joint venture-owned restaurants. Anton Nikodemus, Chairman, President, and CEO, emphasized that these initiatives are pivotal for enhancing the company’s hospitality offerings and achieving sustainable growth.
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