Ltc Properties Inc DEF 14A, filed Apr 16, 2024

About this DEF 14A

Ltc Properties Inc (LTC)

DEF 14A 2024-04-16 For: 2024-05-22

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Added on June 12, 2026

WELCOME FROM THE CHAIR AND CEO
On behalf of the Board of Directors, I present to you the 2024 Proxy Statement. We thank you for your ongoing support.

Last year was a significant year for LTC, demonstrating our commitment to optimizing our portfolio while positioning ourselves for growth.

We completed $262 million in investments, the largest investment year since 2015, while generating nearly $90 million in sales and mezzanine loan proceeds. In the meantime, we were laser-focused on asset management and strengthening our portfolio.

We successfully restructured our 35-property Brookdale portfolio. By re-leasing, transferring, and selling properties, we not only optimized our asset base but also enhanced our revenue stream, demonstrating our agility and strategic foresight in navigating market dynamics.

Our financial health remains robust, with liquidity of approximately $194 million at December 31, 2023, comprised of cash on hand, available lines of credit, and amounts available under our ATM. We are well positioned to seize new investment opportunities and to deliver value to our shareholders, as evidenced in our consistent monthly dividend.

From a governance perspective, as we bid farewell to Devra Shapiro and James Pieczynski we express our gratitude for their many years of dedicated service. We are pleased to welcome David Gruber to our Board. He brings a multi-decade career in investment banking and capital markets experience, plus a longstanding working relationship with LTC. Additionally, Brad Preber has been nominated to the Board. His expertise in leadership of a public accounting firm, including risk assessment and cybersecurity oversight, further strengthens our governance structure.

We remain optimistic about the future, buoyed by our ability to execute strategic transactions, maintain a strong balance sheet, and foster enduring relationships with our operators. Our agility, creativity, and focus on collaborative solutions underscore our commitment to creating shareholder value.

In closing, I am immensely proud of our accomplishments in 2023 and optimistic about the opportunities that lie ahead. I look forward to sharing our progress in the coming months and am grateful for your support.
Wendy Simpson
Chairman of the Board of Directors and Chief Executive Officer

WENDY SIMPSON
Chairman and
Chief Executive Officer

“2023 was a year of
execution for LTC. Due to
the hard work of our team
we resolved many of the
portfolio challenges we faced
during the year.”

Ltc Properties Inc filed this DEF 14A on April 16, 2024.

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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 under §240.14a-12

LTC 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):
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◻	Fee paid previously with preliminary materials.
◻	Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11.

Pamela J. Shelley-Kessler Co-President, Chief Financial Officer and Corporate Secretary April 16, 2024	◆
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	Important notice regarding the availability of proxy materials for the Stockholder Meeting to be held on May 22, 2024—the Proxy Statement and the 2023 Annual Report are available at http://materials.proxyvote.com/502175.
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PROXY SUMMARY		1
Voting Matters		1
Board Composition as of December 31, 2023		2
Our Business		3
2023 Business Highlights		5
Corporate Governance Highlights		5
Executive Compensation Highlights		6
ESG Highlights: Purposeful and Disciplined Approach		7

PROPOSAL 1 ELECTION OF DIRECTORS		8
Required Vote and Recommendations		11

DIRECTOR COMPENSATION		12
Director Compensation for the Year ended December 31, 2023		12

CORPORATE GOVERNANCE PRINCIPLES AND BOARD MATTERS		14
Code of Business Conduct and Ethics		14
Corporate Governance Guidelines		14
Board Leadership		14
Director Independence		15
Director Education, Development and Evaluation		16
Succession Planning		16
Whistleblower Protection		16
Board Committee Structure		17
Committees and Responsibilities		18
2023 Key Focus Areas: Risk, Cybersecurity, ESG		23
Consideration of Director Nominees		26
Director Selection Process		26
Stockholder Recommendations		27

PROPOSAL 2 ADVISORY VOTE TO APPROVE NAMED EXECUTIVE OFFICER COMPENSATION		28

PROPOSAL 3 RATIFICATION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM		29

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FEES AND SERVICES		30

REPORT OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS		31

EXECUTIVE COMPENSATION DISCUSSION AND ANALYSIS		33
Business Overview		35
Executive Compensation Program Philosophy and Objectives		40

Executive Compensation Program Elements		40
Other Elements of Compensation		41
Compensation Governance Policies and Guidelines		42
Compensation Committee		44
Competitive Considerations		44
Compensation Consultant		45
Executive Compensation Review		45
Executive Compensation Practices		45
Compensation Risk Assessment		51

EXECUTIVE COMPENSATION TABLES		52
Summary Compensation Table		52
CEO to Median Employee Pay Ratio		53
Pay Versus Performance		53
Employment Agreements		57
Grants of Plan-Based Awards		58
Outstanding Equity Awards at Year-End		59
Option Exercises and Stock Vested		59
Potential Payments Upon Termination or Change In Control		60

COMPENSATION COMMITTEE REPORT		62
Compensation Committee Interlocks and Insider Participation		62

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS		63
Beneficial Ownership Table		63
Securities Authorized for Issuance under Equity Compensation Plans		64
Delinquent Section 16(a) Reports		64

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS		65
Review, Approval or Ratification of Transactions with Related Persons		65
Transactions with Related Persons		65

QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING		66
Please Vote		69

ADDITIONAL INFORMATION		70
Other Matters		70
Stockholder Proposals and Nominations		70
Annual Report		70
Householding		71

APPENDIX A—RECONCILIATIONS OF NON GAAP FINANCIAL MEASURES		A-1


	Board Recommendation	Read More
Proposal 1. To elect six directors to serve on the Board of Directors for the ensuing year and until the election and qualification of their respective successors.	FOR each director nominee	Page 8
Proposal 2. To approve, on an advisory basis, the compensation of the named executive officers.	FOR	Page 28
Proposal 3. To ratify the appointment of Ernst & Young LLP as our independent registered public accounting firm for fiscal 2024.	FOR	Page 29

Board Member	Occupation	Committee Memberships					Independent
Board Member	Occupation			AC	CC	ESGC	Independent	IC	NCGC
Cornelia Cheng Director since 2021 Age 56	Independent Consultant		◆	◆	◆		X
David L. Gruber Director since 2023 Age 54	Capital Markets and Investment Consultant, Venture Visionary Partners		◆	◆	◆		X
Boyd W. Hendrickson Director since 2005 Age 79	Former Chief Executive Officer, Skilled Healthcare Group, Inc.		◆		◆	◆	X
James J. Pieczynski Director since 2014 Age 61	Former Vice Chairman, PacWest Bancorp	◆		◆	◆		X
Devra G. Shapiro Director since 2009 Age 77	Former Chief Financial Officer, IPC Healthcare, Inc.	◆		◆		◆	X
Wendy L. Simpson Director since 1995 Age 75	Chairman of the Board of Directors and Chief Executive Officer, LTC Properties, Inc.
Timothy J. Triche, MD Director since 2000 Age 79	Director, Center for Personalized Medicine, Children’s Hospital, Los Angeles	◆	◆			◆	X

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Our main objective is to build on our existing portfolio that creates and sustains shareholder value while providing current distribution income. To meet this objective, we strive to maintain a diversified portfolio by property type, operator concentration, geography and investment vehicles.
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AL 1 Skilled Nursing	AZ 3 Skilled Nursing	CA 3 Assisted Living 1 Skilled Nursing	CO 13 Assisted Living	FL 4 Assisted Living 7 Skilled Nursing	GA 3 Assisted Living

IL 5 Assisted Living 1 Skilled Nursing	KS 8 Assisted Living	KY 2 Skilled Nursing	LA 1 Skilled Nursing	MI 2 Assisted Living 22 Skilled Nursing	MO 1 Assisted Living 2 Skilled Nursing

MT 2 Assisted Living	NV 1 Other	NJ 3 Assisted Living	NM 5 Skilled Nursing	NC 33 Assisted Living	OH 8 Assisted Living 2 Skilled Nursing

OK 5 Assisted Living	OR 5 Assisted Living 1 Skilled Nursing	SC 3 Assisted Living 2 Skilled Nursing	TN 2 Skilled Nursing	TX 17 Assisted Living 20 Skilled Nursing	VA 4 Skilled Nursing

WA 2 Assisted Living	WI 7 Assisted Living 1 Skilled Nursing



◆ Completed $262 million in investments, our most successful year since 2015. ◆ Generated $76 million in sales proceeds, resulting in net gains of $37 million. ◆ Received nearly $11.8 million in mezzanine loan payoffs, generating $1.6 million of exit IRR income at a weighted average of 12%. ◆ Reduced leverage ahead of street expectations.	◆ Executed on the strategy of strengthening and optimizing LTC’s portfolio. ◆ Transitioned the Brookdale portfolio, resulting in more future revenue than generated from the original lease. ◆ Improved contractual revenue collection due to LTC compared with last year.	◆ More than 4.1 million Americans will turn 65 each year through 2027, which is more than 11,200 every day⁽¹⁾ – generating demand for years to come. ◆ The U.S. adult population age 85+ is rapidly growing, expected to hit 11 million by 2035 and surpass 17 million by 2050.⁽²⁾

◆ ◆			◆
◆ We maintain a separate “lead independent director” role in our leadership structure for the Board of Directors (the “Board”). ◆ Each committee of the Board is comprised solely of independent directors. ◆ All directors stand for election on an annual basis. ◆ Directors are elected by a majority of votes cast in uncontested elections, and any director who does not receive a majority of votes cast is required to submit his or her resignation for consideration by the Board.			◆ Board and committee performance is reviewed in an annual self-assessment, with results reported to, and evaluated by, the full Board. ◆ Lead independent director has the authority to call meetings of independent directors, and presides at executive sessions of the independent directors. ◆ Stock ownership guidelines for executive officers further align their personal wealth with the long-term performance of our company.

	Attract, Motivate and Retain Qualified Key Executives	Align Executives’ Financial Interests with Stockholders	Reward Company and Individual Performance and Effort
Base Salary	◆
Annual Bonuses			◆
Long-term Equity Incentives		◆
Severance	◆

What We Do		What We Do Not Do
◆ All members of our Compensation Committee are independent. ◆ We have double-trigger change in control arrangements. ◆ Clawback provisions provide our company with recourse in the event of material non-compliance with a financial reporting requirement that leads to a restatement. ◆ Restricted stock awards with long-term vesting periods provide executive officers with an incentive to make decisions that contribute to the long-term performance of our company.		◆ No pledging or hedging of our stock by directors, executives or employees. ◆ No excise tax gross-ups upon a change in control.

Visit our website to learn more about our ESG initiatives: www.LTCreit.com /ESG	◆
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		“We believe that our responsibilities as a corporate citizen are firmly aligned with our core business philosophy and recognize the importance of sharing more information about our activities and future goals to generate a deeper understanding of our business and our impact on society.” – WENDY SIMPSON Chairman and Chief Executive Officer
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LTC PROPERTIES, INC.	1	2024 PROXY STATEMENT


LTC PROPERTIES, INC.	2	2024 PROXY STATEMENT


LTC PROPERTIES, INC.	3	2024 PROXY STATEMENT

	26	202	30
	STATES	PROPERTIES	OPERATORS

	PROPOSAL 1 ELECTION OF DIRECTORS Six directors will be elected at the 2024 Annual Meeting of Stockholders. Each person elected as a director will hold office until the 2025 Annual Meeting of Stockholders and, in each case, until their respective successors have been duly elected and qualified. The terms of James Pieczynski and Devra Shapiro will expire with the 2024 Annual Meeting. The Board of Directors thanks Mr. Pieczynski and Ms. Shapiro for their many years of service. In accordance with the recommendation of the Nominating and Corporate Governance Committee, the Board of Directors has nominated for election at the 2024 Annual Meeting:
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	Cornelia Cheng		David L. Gruber	Boyd W. Hendrickson
	Bradley J. Preber		Wendy L. Simpson	Timothy J. Triche, MD
	If elected, Mr. Preber will be a new director. Each of the other nominees is currently a director of our company, including Mr. Gruber, who became a director in July 2023. The six director nominees, their business experience, and specific qualifications, attributes, or skills to serve as director, are set forth below:
		THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR EACH OF THE BOARD OF DIRECTORS’ NOMINEES FOR DIRECTOR.


David L. Gruber	Director since 2023	Age: 54
Reason for Nomination: Mr. Gruber’s service as an independent director of LTC since his appointment in July 2023 and his multi-decade investment banking and capital markets experience, qualify him to serve on the Board of Directors of LTC.
Background: Mr. Gruber has been a capital markets and investment consultant at Venture Visionary Partners since February 2024. Previously, until retiring in December 2022, he had a 25- year career with KeyBanc Capital Markets (“KeyBanc”) including as Managing Director, Head of Equity Capital Markets. At KeyBanc, he also chaired and was a member of its Equity Commitment and Capital Commitment Committees. His responsibilities at KeyBanc included involvement in corporate finance, the structuring and execution of various equity products, as well as governance, compliance, and risk management. Other Directorships: Mr. Gruber is a member of the advisory board for Cleveland Central Catholic High School in Cleveland, Ohio, and has served on numerous nonprofit organization boards.


Bradley J. Preber		Age: 64
Reason for Nomination: Mr. Preber’s forty years’ experience in financial and executive positions, including leadership of a public accounting firm, including responsibilities for risk assessment and cybersecurity oversight, and his ability to serve on our Audit Committee and as an audit committee financial expert, qualify him to serve on the Board of Directors of LTC.
Background; Mr. Preber was Chief Executive Officer of Grant Thornton LLP from June 2019 to August 2022. He also was on the Board of Directors of Grant Thornton from 2014 through 2022, including as its Chairman, from December 2018 to June 2019. While at Grant Thornton, he served on its Risk Committee and International Technology and Innovation Committee. Prior to becoming Chief Executive Officer of Grant Thornton, he led its Risk Advisory Services practice. Prior to joining Grant Thornton, he held roles in other national audit, tax and advisory firms, including as a partner responsible for accounting, financial reporting and controls. He also has been a member of the Center for Audit Quality since June 2019. Other Directorships: Mr. Preber is a director and Chair of the Audit Committee of The Plaza Group, and a director for Dine Development Company, both private entities. Since January 2021, Mr. Preber also has been a Trustee for the University of New Mexico Foundation.

Wendy L. Simpson	Director since 1995	Age: 75
Reason for nomination: Ms. Simpson has served as a senior executive officer of LTC for more than two decades, including currently as Chairman and Chief Executive Officer. Ms. Simpson brings a deep understanding of our company’s historical and current business and financial operations, and is able to lead the Board of Directors in anticipating and responding to key company developments, challenges, and opportunities. Additionally, our Corporate Governance Guidelines state that our Chief Executive Officer shall be nominated to serve on the Board of Directors. These factors qualify her to serve on the Board of Directors of LTC.
Background: Ms. Simpson was appointed Chairman of the Board of Directors of LTC in August 2013, and has served as our Chief Executive Officer since March 2007. She also served as President of our company from October 2005 through May 2020, Chief Financial Officer from July 2000 through March 2007, Treasurer from January 2005 through March 2007, and Chief Operating Officer from October 2005 through March 2007. She also was Vice Chairman of the Board from April 2000 through October 2005.


	Fees Earned or		Stock
Name	Paid in Cash		Awards⁽¹⁾		Total
Cornelia Cheng	$	95,000	$	95,000	$	190,000
David L. Gruber⁽²⁾		75,000		106,000		181,000
Boyd W. Hendrickson		105,000		95,000		200,000
James J. Pieczynski		95,000		95,000		190,000
Devra G. Shapiro		95,000		95,000		190,000
Timothy J. Triche		95,000		95,000		190,000


Type of Fee⁽¹⁾	Amount
Quarterly Retainer	$	15,000
Quarterly Lead Independent Director Retainer		2,500
Quarterly Audit Committee Chairman Retainer⁽²⁾		6,250
Quarterly Compensation Committee Chairman Retainer⁽²⁾		6,250
Quarterly Nominating and Corporate Governance Committee Chairman Retainer⁽²⁾		6,250
Quarterly ESG Committee Chairman Retainer⁽²⁾		6,250
Quarterly Committee Membership Fee (per Committee)		1,250


			Number of Unvested
			Shares of Restricted
	Number of Options		Common Stock
Name	Outstanding		Outstanding
Cornelia Cheng	—		3,012	⁽²⁾
David L. Gruber	—		3,000	⁽³⁾
Boyd W. Hendrickson	—		3,012	⁽²⁾
James J. Pieczynski	5,000	⁽¹⁾	3,012	⁽²⁾
Devra G. Shapiro	—		3,012	⁽²⁾
Timothy J. Triche	—		3,012	⁽²⁾

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Corporate governance documents including Board committee charters are available on our website at www.LTCreit.com
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Audit		Compensation		Environmental, Social, and Governance		Investment		Nominating & Corporate Governance


	2023		2022
Audit Fees	$	774,000	$	695,230
Audit-Related Fees		—		—
Tax Fees		91,575		119,200
All Other Fees		—		—


	Audit Committee
	Devra G. Shapiro, Chairman
	James J. Pieczynski
	Timothy J. Triche, MD

	Type	Number	Number
	of	of	of		Sales		Carrying		Net
State	Properties	Properties	Beds/Units		Price		Value		Gain (Loss)
Florida⁽¹⁾	ALF	5	246	$	23,600	$	9,084	$	13,327
Kentucky	ALF	1	60		11,000		10,720		57
Mississippi	ALF	1	67		1,650		1,639		(220)
New Jersey	ALF	1	39		2,000		1,552		266
New Mexico	SNF	2	235		21,250		5,523		15,287
Nebraska	ALF	3	117		2,984		2,934		—
Oklahoma	ALF	1	37		800		777		11
Pennsylvania	ALF	2	130		11,128		6,054		4,860
South Carolina	ALF	3	128		8,409		4,446		3,708
Total		19	1,059	$	82,821	$	42,729	$	37,296

	Key Credit Metrics as of December 31, 2023
	Key Credit Metrics as of December 31, 2023

	Key financial Metrics as of December 31, 2023
	Key financial Metrics as of December 31, 2023

	2023 COMPENSATION HIGHLIGHTS
	2023 COMPENSATION HIGHLIGHTS

	2023 “Say On Pay” Vote
	2023 “Say On Pay” Vote


		At LTC’s 2023 Annual Meeting of Stockholders, approximately 95% of the votes cast in the advisory “say-on-pay” vote were for approval of named executive officer compensation. The Board and Compensation Committee have considered the results of the 2023 “say-on-pay” vote and believe it indicates that stockholders are supportive of our company’s executive compensation program, which has generally continued with the same structure and value in 2023. The Board and Compensation Committee will continue to consider “say-on-pay” votes in formulating future executive compensation policies and decisions.

Our executive compensation program may be summarized as follows: ◆ An executive’s salary, bonuses, incentive compensation and other benefit programs should reflect their role, our company’s performance, and the executive’s individual performance and effort. ◆ Compensation should provide a financial interest in our company that parallels the financial interests of our stockholders.	◆
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	◆ We endeavor to ensure that the compensation programs for our executives are effective at attracting and retaining the key executives responsible for our success, and are administered to support the long-term interests of our company and our stockholders. ◆ Through the oversight of the Compensation Committee, we seek to align total compensation for executive management with our overall performance, as well as the individual performance and role of each executive.
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