Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On February 7, 2020, the Compensation Committee of the Board of Directors of the
Company ("Compensation Committee") approved changes to base compensation for
certain executive officers and new compensation plans as shown below.
Base Compensation - The Compensation Committee approved a base compensation
increase effective with the February 14, 2020 payroll as follows:
Executive Officer Position New Base Salary ($)
Diana P. Diaz Vice President and Chief Financial Officer $250,000
Dennis P. Halligan Vice President of Marketing
$190,000
2020 Compensation and Incentive Plan - The Compensation Committee approved a
Compensation and Incentive Plan for fiscal years 2020 (ending June 30, 2020)
(the "2020 CIP"). Under the 2020 CIP, the covered participants will be eligible
for an incentive bonus pool payable in cash if the Company achieves a
pre-established amount of annual revenue for the period. If the target is
achieved, a cash bonus of $100,000 will be paid of which 40% is applicable to
the Chief Executive Officer ("CEO"), 20% is applicable to the Chief Financial
Officer ("CFO") and the remainder is allocable to other specific Company
executives.
2021 Compensation and Incentive Plan - The Compensation Committee approved a
Compensation and Incentive Plan for fiscal year 2021 (ending June 30, 2021) (the
"2021 CIP"). Under the 2021 CIP, the covered participants will be eligible for
an incentive, weighted by target, if the Company achieves the following CIP
performance targets:
• Achievement of a pre-established amount of annual revenue for the
period - weighted 50%
• Achievement of a pre-established amount of annual net income - weighted 25%
• Discretionary portion - weighted 25% - approved by the Compensation
Committee based on positioning the Company for future growth
If the targets are achieved under the 2021 CIP, a cash bonus of $200,000 will be
paid of which 40% is applicable to the CEO, 20% is applicable to the CFO and the
remainder is allocable to other specific Company executives. The 2021 CIP also
includes a stock option pool of 320,000 stock options to be awarded if the
targets are achieved, of which 102,400 stock options are applicable to the CEO,
51,200 stock options are applicable to the CFO, 64,000 stock options are
applicable to non-executive employees and the remainder are allocable to other
specific Company executives.
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