Nicholas Schorsch, American Realty Capital Properties Inc.’s (ARCP) former executive chairman, is walking away from a compensation package valued at about $100 million, company filings show.
Schorsch, who resigned on Dec. 12, is giving up about $91 million in salary and stock and cash bonuses, according to filings from the New York-based real estate investment trust. He’s also leaving behind 1 million units of a retention award, which were valued at $8.99 million on the day he resigned, and forfeiting about 15 million partnership units, which were worth $134 million, the filings show.
“To take the money would have been more controversial given the circumstances surrounding ARCP right now,” Kevin Gannon, president of Shrewsbury, New Jersey-based investment banking firm Robert A. Stanger & Co., said in a telephone interview. “Still others might have taken the money and fought over it later.”
Andy Merrill, a spokesman for ARCP with New York-based Teneo, declined to comment.
Schorsch, 53, stepped down as executive chairman and a director, according to a statement from ARCP. The company, which he built into one of the biggest REITs, disclosed in October that it found accounting errors that were intentionally concealed. Chief Executive Officer David Kay and Chief Operating Officer Lisa Beeson also resigned, according to the statement. The company’s chief financial officer and chief accounting officer stepped down in October.
William Stanley will act as CEO and chairman until permanent replacements are named. The changes are effective immediately.
“These actions build on ARCP’s significant real estate assets and asset management capabilities, and will further restore investor confidence in ARCP,” Stanley said in the statement.
While the investigation into the accounting errors is continuing, “we understand that to date there has not been any conclusion of unlawful conduct” by Schorsch, William Kahane, co-founder of AR Capital, a closely held firm co-founded by Schorsch, said in a separate statement.
The stock slid 8.5 percent yesterday after the company announced the resignations. Shares fell another 2.86 percent to $7.99 at 9:55 a.m. in New York trading.