NEW YORK CITY—Cedar Realty Trust reached a settlement agreement with Snow Park Capital Partners, which is a 3.9% common stock shareholder. Under the deal, Snow Park will be consulted and can interview the candidate to fill the Cedar Realty board director position left open by Paul Kirk. On Feb. 15, 2018, Cedar Realty had announced Kirk's retirement, following his 13 years of service. Kirk had previously served as a US senator for the state of Massachusetts.
In return, Snow Park has agreed to vote all of its shares in support of all of Cedar's director nominees at the 2018 annual meeting and to end its activist campaign. Last September, Snow Park built a stake in Cedar Realty and in the fall publicly urged the REIT to consider strategic alternatives including potential sale.
During this time period, in November 2017, Cedar Realty's former COO, Nancy Mozzachio, had filed a sexual harassment lawsuit against the company's CEO and president, Bruce Schanzer. It alleges that for several years, up to the date of her termination, Schanzer sexually harassed her, creating a hostile work environment.
With the announcement of the Snow Park cooperation agreement, Jeffrey Pierce, managing partner of Snow Park, provided the following statement: “Based on information provided to us by Cedar regarding the allegations against Bruce Schanzer and other members of the management team, I believe that the Board thoroughly investigated claims and am comfortable with its findings that the allegations are without merit.”
In response, Mozzachio provided the following excerpted comment to GlobeSt.com.
“In my opinion, Cedar's investigations are likely curated. I do not know what Mr. Pierce was shown however I can assure you his conclusion is in direct conflict with multiple statements made by others about Schanzer's behavior. I assume this is why Cedar is trying so hard to keep this matter out of open court. As a shareholder myself, I urge Mr. Pierce and the institutional shareholders to demand an independent investigation, including present and former employees, without the involvement of Cedar's GC.”
A spokesperson for Cedar Realty tells GlobeSt.com that the company is not commenting beyond the press release at this time.
On Dec. 18, 2017, Bruce Schanzer had filed a motion to dismiss Mozzachio's complaint, to compel arbitration and to sanction Mozzachio for filing a frivolous lawsuit. The motion noted the complaint was filed when Snow Park was agitating for change at Cedar Realty. It also emphasized that the plaintiff had previously filed for arbitration.
On Feb. 7, 2018, Mozzachio filed a pleading opposing Schanzer's motion. It noted Schanzer had not signed and was not a party to the arbitration agreement existing between Mozzachio and Cedar Realty. Thus, he could not compel arbitration of her case against him.
The lawsuit continues with the parties agreeing that Schanzer's reply to Mozzachio's pleading will be due later in March.
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Betsy Kim
Betsy Kim was the bureau chief, East Coast, and New York City reporter for Real Estate Forum and GlobeSt.com. As a lawyer and journalist, Betsy has worked as the director of editorial and content for LexisNexis Lawyers.com, a TV/multi-media journalist for NBC and CBS affiliated TV stations in the Midwest, and an associate producer at Court TV.
