Nick Lugo
About Nick Lugo
Nick R. Lugo, age 82, is an independent director of Ponce Financial Group, Inc. (PDLB) and serves as Vice Chairman of the Boards of Ponce Financial Group, Inc. and Ponce Bank; he has been a director since 1999 and his current term expires in 2027 . Lugo’s background spans real estate investing in the New York area (through several LLCs), President of Nick Lugo Travel Corp. (founded 1980), owner/publisher of the weekly newspaper LaVoz Hispana, and founder (2006) and Chairman/President of the New York City Hispanic Chamber of Commerce; he is also a Director of the Southern Boulevard Business Improvement District and a member of the company’s charitable Foundation board . The Board classifies Lugo as “independent” under Nasdaq standards .
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| Nick Lugo Travel Corp. | President | 1980–present | Travel services; entrepreneurial leadership |
| LaVoz Hispana (weekly newspaper) | Owner & Publisher | Not disclosed | Media/communications experience |
| Real estate investment LLCs | Investor | Not disclosed | Real estate acumen; NYC portfolio |
| NYC Hispanic Chamber of Commerce | Founder; Chairman & President | Founded 2006; currently serves | Community advocacy; network leadership |
| Southern Boulevard Business Improvement District | Director | Not disclosed | Community development influence |
External Roles
| Organization | Role | Public/Private | Notes |
|---|---|---|---|
| Ponce De Leon Foundation | Director | Non-profit | Company-affiliated 501(c)(3) foundation; votes shares proportionally |
| Southern Boulevard BID | Director | Non-profit | Local business improvement and community development |
Board Governance
- Committees: Audit (members: Alvarez, Demetriou, Feldman, Gurman, Lugo, Perez; chair: Demetriou), Executive Compensation (members: Alvarez, Demetriou, Feldman, Gurman, Lugo, Perez; chair: Feldman), Nominations (independent directors not up for nomination; for 2025: Demetriou, Lugo, Feldman, Perez; chair: Demetriou) .
- Attendance and meeting load: The Boards of PDLB and Ponce Bank each held 47 regular meetings in 2024; no director attended fewer than 75% of board and applicable committee meetings. Audit Committees of PDLB and Ponce Bank met 17 times; Executive Compensation Committee met once in 2024 .
- Leadership: Executive Chairman is not independent; the Board uses governance practices including an independent Vice Chairman and lead director, executive sessions of independent directors, and committee structures to reinforce oversight . Lugo is Vice Chairman and independent .
- Compensation consultant: Meridian Compensation Partners advised the Executive Compensation Committee on executive and director compensation in 2024 .
- Annual meeting attendance: All directors attended the 2024 annual meeting; the company expects director attendance absent conflicts .
Fixed Compensation
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Board Retainer (cash) | $48,000 (non‑employee directors) | $48,000 (non‑employee directors) | $48,000 (non‑employee directors) |
| Committee Fees | $500 per meeting | $500 per month; $1,000 per month for the lead director | $500 per month; $1,000 per month for audit committee chair |
| Health Allowance (“All Other”) – Lugo | $27,000 | $30,000 | $30,000 |
| Director Compensation – Nick Lugo | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Fees Earned or Paid in Cash ($) | $54,000 | $54,000 | $54,000 |
| Stock Awards ($) | $48,556 | $271,035 | — |
| Option Awards ($) | — | $60,450 | — |
| All Other Compensation ($) | $27,000 | $30,000 | $30,000 |
| Total ($) | $129,556 | $415,485 | $84,000 |
Notes:
- The company awarded time-based RSUs and options to non-employee directors on Dec 7, 2023 under the 2023 LTIP, intended to cover the next five years; no new director equity grants in 2024, and none planned for 2025 for recipients of 2023 grants .
Performance Compensation
| Equity Award Details (Dec 7, 2023) | Terms |
|---|---|
| RSUs (Lugo) | 28,530 RSUs; grant-date fair value $9.50/share; vest 20% annually beginning Dec 7, 2024 |
| Options (Lugo) | 15,000 options; five tranches vest 20% annually beginning Dec 7, 2024; exercise prices $10.33, $10.52, $10.70, $10.89, $11.08; grant-date fair values $3.77, $3.90, $4.04, $4.16, $4.28 per tranche |
| Director RSU/Restricted Shares Agreement | No transfer/pledge before vesting; immediate vesting upon Change of Control; forfeiture upon cessation as a Non‑Employee Director except death; no dividend equivalents until shares delivered |
| Plan Features (2023 LTIP) | Minimum five-year graded vesting (20%/year); at least 35% of authorized options must be “premium options” tying company/bank performance to rewards; director award limits $500,000 fair value per calendar year; non-employee directors in aggregate ≤30% of plan limits |
Emphasis: Director equity is primarily time-based RSUs and options with multi-year vesting; “premium options” under the plan are intended to link rewards to performance, but specific performance metrics (e.g., TSR, ROE) for director grants are not disclosed in proxies .
Other Directorships & Interlocks
| Relationship | Details | Period |
|---|---|---|
| Co-investments in real estate | Gurman was a co-investor/manager of the same 12 properties as Feldman and Lugo (historic interlock) | Disclosed in 2022 proxy |
| Demetriou–Tsavaris real estate holdings | Demetriou has invested in certain real estate holdings and other investments with Tsavaris, among others (board-level interlock) | Disclosed in 2025 proxy |
Expertise & Qualifications
- The Board cites Lugo’s real estate, media, marketing acumen, and community advocacy as qualifications; his stature among elected officials and community leaders is highlighted .
Equity Ownership
| Beneficial Ownership – Nick Lugo | As of Mar 28, 2022 | As of Apr 17, 2023 | As of Apr 15, 2024 | As of Apr 16, 2025 |
|---|---|---|---|---|
| Shares Beneficially Owned | 112,107 (incl. spouse 27,904; options exercisable within 60 days: 7,464) | 125,486 (incl. spouse 27,904; options exercisable within 60 days: 9,952) | 137,820 (incl. spouse 27,904; details as noted) | 148,077 (incl. spouse 27,904; options exercisable within 60 days: 15,442) |
| % of Shares Outstanding | <1% | <1% | <1% | <1% (outstanding 23,984,800) |
| Hedging/Pledging | Directors prohibited from hedging or pledging company securities |
- Section 16(a) compliance: Lugo filed one late Form 4 in fiscal 2022; the company reported all timely filings in fiscal 2024 .
Related Party Transactions and Conflicts
- Director loans: Community banks may extend loans to directors under regulatory exemptions. In 2021, Ponce Bank had outstanding loans to Feldman and Lugo, and to Naudon; these were repaid during the year. As of 2023–2025, outstanding loans were to Alvarez, Demetriou and Perez (not Lugo) and were made on market terms with standard collateral/risk features; the Audit Committee reviews related-party transactions per its charter .
- Prohibited practices: Directors are prohibited from short sales, hedging, pledging, and margin purchases under the Insider Trading Policy .
Governance Assessment
- Positives:
- Independence and leadership: Lugo is an independent director serving as Vice Chairman, reinforcing independent oversight in a structure with a non-independent Executive Chairman .
- Committee engagement and attendance: Active roles on Audit, Compensation, and Nominations; heavy meeting cadence in 2024 with full Board-level attendance thresholds met; audit committees met 17 times .
- Multi-year equity alignment: 2023 RSUs/options with five-year graded vesting; plan requires “premium options” and caps director award values, supporting pay-governance discipline .
- Risk controls: Explicit prohibitions on hedging/pledging, short sales, and margin purchases; director RSU agreements restrict transfer until vesting and accelerate only under change-of-control .
- Watch items / RED FLAGS:
- Historical interlocks: Real estate co-investments among directors (Gurman–Feldman–Lugo in 2022) and Demetriou’s investments with Tsavaris may create perceived conflicts; continued Audit Committee oversight of related-party transactions mitigates but warrants monitoring .
- Section 16 lapse: One late Form 4 filing by Lugo in 2022; subsequent years reported timely compliance, but late filings can affect investor confidence if recurring .
- Compensation Committee frequency: Only one Compensation Committee meeting in 2024; reliance on Meridian consulting is positive, but periodicity could be scrutinized given evolving compensation practices .
Director Compensation Structure Notes
| Item | Structure |
|---|---|
| Annual cash retainer | $48,000 for non-employee directors |
| Committee fees | $500/month; audit chair $1,000/month (2024–2025). In 2023, lead director received $1,000/month |
| Equity | 2023 RSUs (28,530 shares) and options (15,000), vesting 20% annually starting Dec 7, 2024; no new grants in 2024 and none planned in 2025 for 2023 recipients |
| Plan limits & governance | Director award fair value ≤$500,000/year; aggregate director cap ≤30% of plan limits; five-year minimum vesting; “premium options” ≥35% of authorized options |
Committee Assignments, Independence, and Attendance
| Attribute | Status |
|---|---|
| Independence | Independent director |
| Vice Chairman | Vice Chairman of PDLB and Ponce Bank Boards |
| Audit Committee | Member; Demetriou is chair; 17 meetings in 2024 |
| Executive Compensation Committee | Member; Feldman is chair; met once in 2024 |
| Nominations Committee | Member for 2025 with Demetriou, Feldman, Perez; Demetriou is chair |
| Board attendance | No director below 75% attendance in 2024; Boards held 47 meetings |
| Annual Meeting attendance | All directors attended 2024 annual meeting |
Change-of-Control and Clawbacks
- Director RSU acceleration: Non-employee director RSUs/Restricted Shares immediately vest upon a Change of Control; forfeiture applies upon cessation as a Non‑Employee Director except death; transfer restrictions until vesting; no dividend equivalents pre‑delivery .
- Executive agreements (context): Executive severance at 3x salary+prior-year incentive upon termination without cause (or 2x for good reason) and pro‑rata bonus, COBRA subsidies, and equity value protection—this informs board oversight expectations but is not specific to directors .
- Clawbacks: Proxy references insider trading and hedging prohibitions; clawback policy specifics for directors not disclosed in proxies reviewed .
Equity Ownership Guidelines and Pledging/Hedging
- Ownership guidelines for directors: Not disclosed in proxies reviewed.
- Hedging/pledging: Directors are prohibited from hedging or pledging company securities; short sales and margin purchases are also prohibited .
Section 16(a) Compliance
| Year | Disclosure |
|---|---|
| 2022 | Lugo filed one late Form 4 |
| 2023 | One late Form 4 by another insider (Lagoudis); others timely |
| 2024 | All filings timely |
Summary Implications for Investors
- Lugo’s long tenure, independent status, and Vice Chair role contribute to board continuity and community-linked oversight at a Minority Depository Institution; his committee service (Audit/Comp/Nominations) and attendance record support board effectiveness .
- Multi-year director equity (2023 RSUs/options) with graded vesting and plan-level guardrails aligns pay with retention, while prohibitions on hedging/pledging strengthen alignment. However, historical interlocks and a past related-party loan (repaid) are governance watch items; ongoing Audit Committee oversight and disclosure help mitigate conflict risk .