Paramount Group Discloses Executive Exit, Cash Payout & LTIP Vesting

Rhea-AI Filing Summary

Paramount Group, Inc. (PGRE) filed an 8-K announcing the finalized separation terms for departing Senior Vice President, General Counsel & Secretary Gage Johnson, whose exit became effective 15-May-2025. The 4-Aug-2025 Separation Agreement covers cash, equity and post-employment covenants.

Financial terms

• $905,000 lump-sum cash (one year base salary + 2024 bonus)
• $73,011 health-care payment
• Accelerated vesting of 159,817 service-based LTIP Units, 49,837 service-based AOLTIP Units and 8,866 earned performance LTIP Units
• Pro-rata eligibility for 98,500 performance LTIP Units and 354,807 performance AOLTIP Units, contingent on future performance hurdles

Johnson agreed to customary non-compete and non-solicitation restrictions and issued a general release of claims. The package follows the company’s Executive Severance Plan, implying no incremental deviation from previously disclosed obligations. No other operational or financial updates were included.

Positive

• Severance terms align with existing plan, avoiding unexpected liabilities.
• Restrictive covenants (non-compete/non-solicitation) help safeguard client and employee relationships.
• Comprehensive claim release limits potential litigation exposure.

Negative

• Departure of key legal executive could introduce governance and compliance risk until a successor is appointed.
• One-time cash outflow of $978k plus substantial equity vesting, though modest, is an immediate cost to shareholders.

Insights

Corporate Governance Expert

TL;DR: Officer exit handled per plan; limited governance risk, modest one-time cost.

The agreement mirrors Paramount’s existing severance policy, reducing litigation risk through a comprehensive release. Covenants protect intellectual capital and client relationships. Although Johnson held a key legal post, transition planning began in May, limiting disruption. Total cash outlay (≈$978k) and equity acceleration are immaterial relative to PGRE’s market cap. Governance optics are neutral; investors should watch for a timely successor announcement.

Securities Analyst

TL;DR: Minor P&L impact; potential sentiment drag from senior legal departure.

The lump-sum and healthcare cost are non-recurring and unlikely to affect 2025 FFO. Equity units were already expensed under ASC 718; no incremental GAAP hit. Still, loss of an experienced GC may raise execution and compliance concerns in a challenging NYC office market. Impact on valuation is negligible unless a replacement with stronger capital-markets expertise is secured.

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): August 4, 2025

Paramount Group, Inc.

(Exact Name of Registrant as Specified in its Charter)

Maryland	001-36746	32-0439307
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)
1633 Broadway New York, New York		10019
(Address of Principal Executive Offices)		(Zip Code)

Registrant’s telephone number, including area code: (212) 237-3100

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2.):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each Class		Trading Symbol		Name of each exchange on which registered
Common stock of Paramount Group, Inc., $0.01 par value per share		PGRE		New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging Growth Company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangement of Certain Officers.

As previously disclosed on a Form 8-K filed with the Securities and Exchange Commission on May 19, 2025, Paramount Group, Inc. (the “Company” or “Paramount Group”) announced that Gage Johnson, Senior Vice President, General Counsel and Secretary, would leave his position with the Company and/or the Company’s affiliates or subsidiaries, effective May 15, 2025 (the “Separation Date”).

In connection with Mr. Johnson’s departure, on August 4, 2025, the Company, Paramount Group Management LP and Paramount Group Operating Partnership LP (the “Operating Partnership”) (collectively, the “Company Group”) and Mr. Johnson executed a Separation Agreement and Release (the “Separation Agreement”). Pursuant to the Separation Agreement, and consistent with the terms of the Company’s Executive Severance Plan (the “Severance Plan”), Mr. Johnson will receive a single lump sum payment, less applicable tax-related deductions and withholdings, consisting of (i) a payment of $905,000 (representing one year of base salary plus an amount equal to Mr. Johnson’s 2024 cash bonus payment), and (ii) a health care payment of $73,011.

In addition, Mr. Johnson’s units in the Operating Partnership consisting of (i) 159,817 service-based long-term incentive plan units (“LTIP Units”), (ii) 49,837 service-based appreciation only LTIP Units (“AOLTIP Units”), and (iii) 8,866 performance-based LTIP units that are earned but still subject to service-based vesting conditions have vested or will vest in accordance with the terms of the Severance Plan or the Separation Agreement, as applicable.

Mr. Johnson will also remain eligible to earn a pro-rata portion of 98,500 performance-based LTIP Units and 354,807 performance-based AOLTIP Units subject to the attainment of performance vesting conditions at the end of the applicable performance period.

Pursuant to the Separation Agreement, Mr. Johnson will remain subject to certain restrictive covenants, including non-solicitation and non-competition covenants. Additionally, pursuant to the Separation Agreement, Mr. Johnson and the Company Group have agreed to a general release of claims.

The summary of the Separation Agreement set forth above is qualified in its entirety by reference to the full text of the Separation Agreement, which is attached as Exhibit 10.1 hereto and incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits:

Exhibit Number				Description
	10.1			Separation Agreement and Release among Paramount Group, Inc., Paramount Group Management LP, Paramount Group Operating Partnership LP and Gage Johnson.
	104			Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	PARAMOUNT GROUP, INC.
Date: August 7, 2025	By:	/s/ Ermelinda Berberi
	Name:	Ermelinda Berberi
	Title	Executive Vice President, Chief Financial Officer and Treasurer

FAQ

Why did PGRE file an 8-K on 4-Aug-2025?

To disclose the executed Separation Agreement with former SVP & General Counsel Gage Johnson, a reportable event under Item 5.02.

How much is Gage Johnson receiving in severance from Paramount Group?

The agreement provides a $905,000 cash payment plus $73,011 for healthcare, totaling about $978,011 before taxes.

What happens to Johnson’s LTIP and AOLTIP units after his departure?

159,817 LTIP Units, 49,837 AOLTIP Units and 8,866 earned performance LTIPs vest; he may earn pro-rata portions of another 453,307 performance units if hurdles are met.

Are there protections for PGRE following the executive’s exit?

Yes, Johnson agreed to non-compete and non-solicitation clauses and granted a general release of claims against the company group.

Will the severance payment materially impact Paramount Group’s earnings?

The cash cost is small relative to PGRE’s asset base; previously expensed equity means minimal incremental earnings impact.