Anthony E. Domalski
About Anthony E. Domalski
Anthony E. Domalski, age 64, is Sotherly Hotels’ Vice President, Secretary, and Chief Financial Officer (CFO) since January 1, 2013; he joined the company in May 2005 and served as Chief Accounting Officer until his CFO appointment. He is a certified public accountant with a B.S. in accounting and finance from the University of Maryland; as Corporate Secretary, he signs SEC filings and supports governance processes. As CFO, he oversees financial analysis, cash management, investments, risk management, and financial/tax reporting, and he reports to the Audit Committee on risk oversight. Company performance over 2022–2024 shows revenues rising from $109.6M to $119.1M and cumulative TSR declining to $44.56 on a $100 base through 2024; net income was $1.3M in 2024.
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Sotherly Hotels Inc. | Chief Financial Officer; Vice President; Corporate Secretary | 2013–present | Leads finance, risk management, capital allocation; supports board governance as Corporate Secretary. |
| Sotherly Hotels Inc. | Chief Accounting Officer | 2005–2013 | Built financial reporting, controls, and accounting infrastructure post-IPO era. |
| SwissFone, Inc. | Chief Financial Officer | 2001–2005 | Executed management-led buyout of Swisscom AG’s U.S. wholesale division; led telecom finance operations. |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| American Institute of Certified Public Accountants (AICPA) | Member | N/A | Professional standards adherence; enhances finance and audit credibility. |
Fixed Compensation
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Base Salary ($) | 357,849 | 382,680 | 394,160 |
| Target Bonus (% of Base) | 25–35% | 25–35% | 25–35% |
| Actual Cash Bonus ($) | 80,000 | 50,000 | 47,500 |
| ESOP Allocation ($) | 19,383 | 26,895 | 18,078 |
| All Other Compensation ($) | 78,107 | 81,032 | 67,497 |
| Total Compensation ($) | 515,956 | 609,855 | 551,907 |
- 2025 base salary approved at $406,971 (COLA increase); target bonus remains 25–35% of base per employment agreement.
Performance Compensation
Annual Incentives (Cash)
| Item | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Performance metric basis | Corporate goals and objectives (undisclosed by company) | Corporate goals and objectives (undisclosed by company) | Corporate goals and objectives (undisclosed by company) |
| Target bonus (% of base) | 25–35% | 25–35% | 25–35% |
| Actual cash bonus ($) | 80,000 | 50,000 | 47,500 |
Equity Awards and Vesting
| Award | Grant Date | Shares | Fair Value Basis | Vesting Schedule | Status/Unvested |
|---|---|---|---|---|---|
| Restricted Stock (CFO employment amendment) | Jan 23, 2023 | 34,000 | $1.8427/share (NASDAQ close on grant date) | 6,800 shares each March 31, 2023–2027 | 20,400 unvested as of 12/31/2024; $19,001 MV at $0.9314/share |
| Stock award (non-cash bonus for 2024 service) | Dec 23, 2024 (issued Jan 2, 2025) | 45,000 | $0.95/share (NASDAQ close on 1/2/2025) | Not specified | N/A |
- Options: None granted to named executive officers; company has never granted stock options.
2024 Stock Vested
| Name | Shares Vested (#) | Value Realized ($) |
|---|---|---|
| Anthony E. Domalski | 6,800 | 9,860 (at $1.45 on 3/31/2024) |
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial ownership (common) | 342,281 shares; 1.7% of class (20,490,501 outstanding as of 9/18/2025) |
| ESOP shares allocated | 87,331 shares allocated to Domalski per ESOP terms |
| Unvested restricted stock | 13,600 shares unvested under 2022 Plan, vesting 6,800 on March 31, 2026 and March 31, 2027 |
| Options (exercisable/unexercisable) | None; company has not granted options |
| Pledging | None of the directors or named executive officers have pledged shares as collateral |
| Hedging policy | Prohibits hedging and derivative transactions (puts, calls, shorts) by insiders |
| Insider filings | Filed Form 4 on 1/19/2024 (company investor site) |
Employment Terms
| Term | Key Provision |
|---|---|
| Agreement term | Extended to December 31, 2027 for named executive officers on Jan 12, 2023 |
| Bonus eligibility | Target 25–35% of base; committee may award above/below target to retain/motivate executives |
| Change-of-control/severance | If terminated without cause, resigns with good reason, or upon change of control: (i) 3× prior-year salary+actual bonus (lump sum within 5 days), (ii) accelerated vesting of equity, (iii) 5 years of life/health/disability premiums, plus accrued salary/bonus and unreimbursed expenses. Language indicates change-of-control is a trigger alongside termination scenarios. |
| Termination payments (as of 12/31/2024 assumption) | Cash: $1,398,512; Accelerated vesting: $19,001; Other benefits: $178,096; Total: $1,595,608. No excise tax gross-up disclosed. |
| COBRA/non-renewal | COBRA continuation benefits disclosed for CEO; not specified for CFO. |
Performance & Track Record
Company Performance (Annual)
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Revenues ($) | 109,553,906 | 114,748,834 | 119,079,903 |
| EBITDA ($) | 39,779,337* | 37,479,223* | 38,524,368* |
Values marked with * retrieved from S&P Global.
Pay Versus Performance (Company disclosures)
| Year | CEO SCT Total ($) | CEO Compensation Actually Paid ($) | Avg SCT Total for Non-CEO NEOs ($) | Avg Compensation Actually Paid ($) | Value of $100 TSR | Net Income ($) |
|---|---|---|---|---|---|---|
| 2022 | 731,818 | 723,418 | 628,542 | 627,842 | 86.60 | 32,536,521 |
| 2023 | 815,069 | 781,900 | 747,145 | 713,342 | 71.29 | 3,941,421 |
| 2024 | 749,144 | 719,346 | 665,784 | 647,082 | 44.56 | 1,302,369 |
Board Governance (Context)
- CFO role in risk oversight: Reports to Audit Committee on risk management; Audit met 14 times in 2024; NCGC (Compensation) met twice in 2024.
- NCGC responsibilities: Approves CFO compensation (on CEO recommendation), administers the 2022 LTIP, sets goals, reviews performance and peer/market data.
- Say-on-Pay: 2024 approval ~84.9% of votes cast.
- Insider trading policy: Prohibits hedging and derivatives; compliance aligned with Nasdaq and federal securities laws.
Compensation Structure Analysis
- Year-over-year mix: 2024 compensation for Domalski comprised base salary ($394,160), cash bonus ($47,500), and stock award as non-cash bonus (45,000 shares valued at $0.95/share), plus ESOP and benefits; consistent with prior years’ equity-heavy mix.
- Shift to RS/stock awards: Restricted stock grant in 2023 (34,000 shares vesting through 2027) emphasizes retention and long-term alignment; no options granted historically (lower risk instruments).
- Guaranteed vs at-risk: Target bonus range remains 25–35% of base tied to corporate goals; committee retains discretion to adjust to address retention/motivation.
- Performance metric disclosure: Company references “corporate goals and objectives” without specific weighting disclosure for bonuses (limited transparency).
- Clawback policy: Company states no restatement required that triggered recovery under its compensation recovery policy during/after last fiscal year.
Related Party Transactions (Governance Watchpoints)
- Management agreements with Our Town Hospitality (affiliated with Chairman, CEO, and former VP): Base fee 2.5% of hotel gross revenues, incentive fee tied to GOP over budget with 0.25% revenue cap; 2035 expirations with termination fees on hotel sales. Fees to Our Town: ~$4.7M base and ~$0.1M incentive (2024).
- Sublease: Company subleases office space to Our Town; rent income $135,511 (2024).
- Employee medical plan via Our Town’s self-insurance; company pays employer portion; surplus rebate policy disclosed.
- Family employment and equity vesting: Compensation and vesting events disclosed for Chairman’s family members; CFO not implicated.
Equity Ownership & Alignment Table (Detailed)
| Ownership Element | Amount/Status |
|---|---|
| Common shares owned | 342,281 shares; 1.7% of outstanding |
| ESOP | 87,331 shares allocated to CFO |
| Restricted stock (unvested, Dec 31, 2024) | 20,400 shares; $19,001 MV at $0.9314/share |
| Restricted stock (grant schedule) | 34,000 shares granted 1/23/2023; 6,800 vest each 3/31/2023–2027 |
| 2024 non-cash stock award | 45,000 shares approved 12/23/2024 (valued at $0.95/share on 1/2/2025) |
| Pledged shares | None (directors/NEOs) |
| Options | None |
| Hedging | Prohibited |
Employment Terms
| Scenario | Cash Payment ($) | Accelerated Vesting ($) | Other Benefits ($) | Total ($) |
|---|---|---|---|---|
| Without cause / Good reason (including change-of-control) | 1,398,512 | 19,001 | 178,096 | 1,595,608 |
- Key severance mechanics: 3× prior-year salary+actual bonus; immediate lump-sum within five days; five years of insurance premiums; accelerated vesting of equity; accrued/unreimbursed amounts paid.
Investment Implications
- Alignment and retention: Material equity ownership (1.7% of common), ESOP allocations, and long-dated RS vesting through 2027 align CFO with shareholders and create retention hooks; absence of pledging and prohibition on hedging reduce misalignment risks.
- Incentive transparency and discretion: Cash bonus metrics are not disclosed beyond “corporate goals,” but the NCGC retains discretion to adjust awards to retain executives; Say-on-Pay support (84.9%) suggests shareholder acceptance of the framework.
- Severance economics and potential overhang: Single-trigger-style change-of-control benefits alongside termination triggers (3× cash, 5-year benefits, accelerated vesting) raise payout levels in a transaction, but they also stabilize retention and focus; monitor M&A/capital market scenarios for possible executive payout overhang.
- Governance and related-party exposure: Extensive arrangements with an affiliate manager (Our Town) introduce governance sensitivity; CFO’s risk oversight role is central to mitigating operational/financial exposures; continue to monitor fee levels, incentive caps, and termination provisions.
- Performance trend context: Revenues increased FY 2022–2024 while TSR decelerated and net income fell in 2024, reinforcing the need to scrutinize how performance measures translate into bonus outcomes and equity awards pacing.
Notes
- EBITDA values marked with * are retrieved from S&P Global.