DEF 14A of Flotek Industries Inc/CN/, Apr 2, 2025

DEF 14A of Flotek Industries Inc/CN/

Filed Apr 2, 2025 · FY20240000928054-25-000025

Open on EDGAR

  1. Director Nominees

    Director Nominees Each of the six nominees for director is an incumbent that is up for reelection. Highlights of their respective backgrounds and service on the Board to date are described below:

  2. Director Nominees

    | Harsha V. Agadi | | Age: 62 | | | | Director Since: July 2020 | | | EXPERIENCE •Chairman and CEO of GHS Holdings, L.L.C. (2000 to present)* •Interim CEO of Flotek Industries, Inc. (January 2023 to June 2023) •Board member (August 2010 to May 2021) and former President and CEO (August 2015 to May 2020) of Crawford & Company (NYSE: CRD-A) •Board member (March 2022 to present) of myKaarma* •Board member (May 2022 to present) of GLD Shop* •Former Board member of Diversified Foodservice Supply, Inc. (2016 to December 2022) •Former Chairman of Quiznos, LLC •Former Chairman, The Krystal Company •Former Chairman and CEO of Friendly’s Ice Cream, LLC •Former President and CEO of Church’s Chicken PHILANTHROPY & PUBLIC SERVICE •Chairman and Managing Trustee, GHS Charitable Foundation, Inc.* •Chairman and Managing Trustee SKSVMA Charitable Trust* •Board Member Emeritus of Fuqua School of Business, Duke University* •Member of the Board of Trustees of Babson College* •Member of the Board of Governors at the International Tennis Hall of Fame (ITHF)* | EDUCATION •Master of Business Administration, Fuqua School of Business at Duke University •Bachelor of Commerce, University of Mumbai BOARD ROLES •Non-Executive Chairman of the Board (June 2023 to present)* •Member and Chairman of the Compensation Committee (July 2020 to January 2023) •Member of the Audit Committee and Audit Committee Financial Expert (June 2021 to January 2023) •Member of the Risk and Sustainability Committee (June 2021 to June 2023) •Independent Director (July 2020 to January 2023, June 2023 to present)* |

  3. Director Nominees

    Mr. Agadi’s extensive experience serving on company boards, having served as a director of two public companies in addition to Flotek as well as several private companies, demonstrate his expertise in corporate governance. Furthermore, Mr. Agadi’s distinguished career as a five-time chief executive officer underscores his strong leadership capabilities. Mr. Agadi also possesses valuable international experience, having built several successful global brands throughout his highly accomplished career. We believe Mr. Agadi’s combination of expertise in corporate governance, executive leadership and international business make him a valuable member of our Board.

  4. Director Nominees

    | Ryan G. Ezell | | Age: 46 | | | | Director Since: June 2023 | | | EXPERIENCE •Chief Executive Officer of Flotek Industries, Inc. (June 2023 to present)* •Chief Operating Officer of Flotek Industries, Inc. (March 2022 to June 2023) •Various increasing roles of responsibility at Flotek industries including, President of Chemistry Technologies, SVP, Operations, VP, Operations (August 2019 to March 2022) •Various global leadership roles at Halliburton, most recently serving as Vice President of Baroid Drilling Fluids (May 2006 to July 2019) •Published scientist •Author on more than 26 patents •Member of the American Association of Drilling Engineers, American Chemical Society, Society of Petroleum Engineers, National Association of Corporate Directors, Sustainability Accounting Standards Board, Vistage Advisory Board PHILANTHROPY & PUBLIC SERVICE •Energy Workforce and Technology Council Advisory Board* •Neuhaus Education Center Advisory Board* •Volunteer at Houston Food Bank, Habitat for Humanity, Star of Hope Mission, Fellowship of Montgomery •Volunteer Coach i9 Sports, Montgomery Little League | EDUCATION •Ph.D. in Polymer Science, the University of Southern Mississippi •Bachelor of Science in Chemistry, Millsaps College BOARD ROLES •Member of the Board (June 2023 to present)* |

  5. Director Nominees

    With his background as a published scientist, extensive patent portfolio and over two decades of energy industry experience, Dr. Ezell brings a wealth of expertise and knowledge to the Board. His international experience further broadens his perspective and provides valuable insight for the Company’s international operations. Dr. Ezell’s strategic and operational understanding of the chemistry and data analytics fields provides our Board with a unique perspective on the opportunities and challenges we face. Dr. Ezell has also demonstrated exceptional leadership skills in helping return the Company to profitability. We believe Dr. Ezell’s unique knowledge of our Company, industry and international expertise and exceptional leadership skills make him a valuable asset to our Board.

  6. Director Nominees

    | Evan R. Farber | | Age: 52 | | | | Director Since: October 2022 | | | EXPERIENCE •General Counsel of The Cranemere Group, an industrial holding company (March 2019 to present)* •Acting General Counsel of NorthStar Anesthesia, an operating company of The Cranemere Group (July 2018 to March 2019) •Chief Legal Officer (September 2015 to April 2018), General Counsel (October 2007 to September 2015) of The Advisory Board Company (NASDAQ: ABCO) •Partner at Hogan & Hartson LLP (now Hogan Lovells US LLP) PHILANTHROPY & PUBLIC SERVICE •Emeritus Board of the Children’s Law Center* •Board of Trustees of Concord Hill School | EDUCATION •Juris Doctorate, The George Washington University Law School •Bachelor of Arts from State University of New York at Binghamton BOARD ROLES •Member and Chair of the Corporate Governance and Nominating Committee (October 2022 to present)* •Member of the Audit Committee (June 2023 to present)* •Member of the Risk and Sustainability Committee (June 2023 to present)* •Member of the Compensation Committee (October 2022 to June 2023, June 2024 to present)* •Independent Director (October 2022 to present)* |

  7. Director Nominees

    Mr. Farber has extensive senior executive experience, including at a public company. Mr. Farber brings valuable expertise to our Board relating to transformational change, corporate governance and risk management. We believe the combination of executive leadership and legal expertise makes Mr. Farber a valuable asset to our Board. Mr. Farber was appointed to our Board pursuant to certain contractual rights discussed more fully under “Corporate Governance — ProFrac Holdings Directors.”

  8. Director Nominees

    | Michael J. Fucci | | Age: 66 | | | | Director Since: November 2020 | | | EXPERIENCE •Director, Acadia Healthcare Company, Inc. (October 2020 to present)(NASDAQ: ACHC)* •Executive Chairman (March 2015 to June 2019), Chairman Emeritus (June 2019 to October 2020) of Deloitte U.S. LLP •Member of the Global Board of Deloitte •Chief Operating Officer of Deloitte Consulting (2009 to 2015) PHILANTHROPY & PUBLIC SERVICE •Supporter of Montclair State University Business School* •Involved in various community educational initiatives* | EDUCATION •Bachelor of Science in Mathematics, Montclair State University BOARD ROLES •Member and Chairman of the Risk and Sustainability Committee (June 2021 to present)* •Member of the Compensation Committee (June 2021-present); Chairman (June 2023 to present)* •Member of the Audit Committee (June 2024 to present)* •Member of the Corporate Governance and Nominating Committee (June 2024 to present)* •Independent Director (November 2020 to present)* •Audit Committee Financial Expert (March 2025 to present)* |

  9. Director Nominees

    Mr. Fucci's extensive experience spanning over four decades as a senior leader and practitioner at Deloitte U.S. LLP underscore his remarkable multinational leadership capabilities. Mr. Fucci’s unique perspective on human resource transformation, corporate talent strategies and risk mitigation adds a valuable dimension to our Board’s expertise. We believe that Mr. Fucci’s extensive operational and corporate governance experience both in the United States and globally provide a unique perspective to our Board.

  10. Director Nominees

    | Lisa Mayr | | Age: 57 | | | | Director Since: June 2021 | | | EXPERIENCE •Chief Financial Officer, Marigold (September 2023 to present)* •Chief Financial Officer, Internap Holding LLC (July 2020-August 2023) •Chief Financial Officer, MicroStrategy Incorporated (November 2019 to April 2020)(NASDAQ: MSTR) •Chief Financial Officer, EverFi (February 2018 to October 2019) •Chief Financial Officer, Blackboard •Board Observer and Member of the Audit Committee, WorldStrides •Certified Public Accountant* PHILANTHROPY & PUBLIC SERVICE •Board Member, STEM for Her* •Georgetown University MBA Advisory Council | EDUCATION •MBA, Georgetown University •Bachelor of Arts in International Studies and Economics, American University BOARD ROLES •Member of the Audit Committee (June 2021 to present); Chairman (June 2023 to present)* •Member of the Corporate Governance and Nominating Committee (June 2021 to present)* •Member of the Compensation Committee (June 2023 to present)* •Member of the Risk and Sustainability Committee (June 2024 to present)* •Independent Director (June 2021 to present)* •Audit Committee Financial Expert (June 2021 to present)* |

  11. Director Nominees

    Ms. Mayr brings valuable technological expertise to our Board with over two decades of experience in global technologies and software companies. Ms. Mayr, a certified public accountant, also has over 25 years of financial and accounting experience, having served in financial leadership roles at both public and private companies. We believe Ms. Mayr’s combined technological and financial knowledge enhance our Board’s ability to drive innovation and operational excellence in a financially prudent manner.

  12. Director Nominees

    | Matthew D. Wilks | | Age: 42 | | | | Director Since: June 2022 | | | Matt D. Wilks has served as the Executive Chairman of the Board of Directors for ProFrac Holding Corp. since August 2021. Mr. Wilks has been the President of ProFrac since October 2018 and previously served as the Chief Financial Officer from May 2017 to August 2021. Mr. Wilks also serves as Vice President of Investments for Wilks Brothers since January 2012. From 2010 to 2012, Mr. Wilks served as Vice President of Logistics for FTSI. Additionally, Mr. Wilks served as a member of the Board of Directors of Approach Resources, Inc. (NASDAQ: “AREX"), an upstream oil and gas company focused on the exploration, development and production of unconventional oil and gas resources in the United States, from January 2017 to November 2019. | |

  13. Director Nominees

    As the Executive Chairman of ProFrac Holdings Corp., a technology-focused, vertically integrated energy services company, Mr. Wilks has developed extensive industry knowledge and valuable executive experience. We believe Mr. Wilks energy industry background and executive leadership skills allow our Board to better navigate the complexities of the energy industry and enhance our strategic decision-making. Mr. Wilks was appointed to our Board pursuant to certain contractual rights discussed more fully under “Corporate Governance — ProFrac Holdings Directors.” The above biographical and other information for the six director nominees is current as of March 26, 2025. The Board is committed to ensuring that the composition of the Board reflects the appropriate level of diverse viewpoints, taking into account experience, background, perspective, gender and ethnicity.

  14. Director Compensation

    Director Compensation Board members receive an annual retainer of $52,000 and additional retainers for serving as a chair or member of a Board committee. Directors may elect to receive their annual retainer in stock of the Company in lieu of cash. The Audit Committee chair receives an annual retainer of $32,000 and Audit Committee members receive an annual retainer of $8,000. The Compensation Committee chair receives an annual retainer of $20,000 and Compensation Committee members receive an annual retainer of $8,000. The Governance Committee chair receives an annual retainer of $16,000 and Governance Committee members receive an annual retainer of $4,000. The Risk Committee chair receives an annual retainer of $16,000 and Risk Committee members receive an annual retainer of $4,000. The Non-Executive Chairman receives an annual retainer of $80,000, which was increased from $60,000 effective October 30, 2024. From time-to-time, the Board may form a special committee for a particular purpose and service on that special committee can generate additional director fees. Directors do not receive fees for attending Board or standing committee meetings. The members of the Board also receive an annual grant of restricted stock awards equal to a market value of $100,000 based upon the fair market value of the Company’s common stock on the grant date. The restricted stock awards vest on the one-year anniversary of the grant date or on the date of the annual meeting of shareholders following the grant, whichever is earlier, so long as the next annual meeting occurs at least fifty (50) weeks after the grant date. We do not expect to pay our directors who are also our officers, such as Dr. Ezell, any additional amounts for their service to us in their capacities as directors. Accordingly, Dr. Ezell did not receive any additional compensation for his service as a member of the Board. Dr. Ezell’s compensation is reported below in “Item II. Advisory Vote on Executive Compensation – Summary Compensation Table.” Mr. Wilks did not receive any compensation for his service as a member of the Board in 2024. The following table presents the total compensation for each person who served as a non-employee member of the Board during 2024.

  15. Director Compensation

    | Name | Fees earned or paid in cash(1) | Stock awards(2)(3)(4) | | Non-equity incentive plan compensation | | All other compensation | | Total | | Harsha V. Agadi | $139,500 | | 100,000 | | — | | — | $239,500 | | Evan R. Farber | $100,500 | | 100,000 | | — | | — | $200,500 | | Michael J. Fucci | $110,500 | | 100,000 | | — | | — | $210,500 | | Lisa Mayr | $114,500 | | 100,000 | | — | | — | $214,500 | | David Nierenberg | $45,500 | | — | | — | | — | $45,500 | | Matthew D. Wilks | $— | | — | | — | | — | $— |

  16. Director Compensation

    (1)For each of Mr. Agadi, Mr. Farber, Mr. Fucci and Ms. Mayr these amounts reflect annual cash Board retainer fees, committee chair fees and committee membership fees, as applicable. For Mr. Nierenberg, this amount includes cash fees of $7,500 associated with Board committee service and $38,000 in annual Board retainer fees, committee chair fees and committee membership fees, as applicable, that Mr. Nierenberg elected in receive in stock in lieu of cash. (2)These amounts reflect the aggregate grant date fair value, calculated in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718, Compensation-Stock Compensation (ASC 718), of awards pursuant to the Flotek Industries, Inc. 2018 Long-Term Incentive Plan. Assumptions used in the calculation of these amounts are included in “Note 14 — Stock-Based Compensation and Other Benefit Plans” to the Consolidated Financial Statements included under “Item 8. Financial Statements and Supplementary Data” in the Company’s 2024 Form 10-K. Awards (other than those reflected for Mr. Nirenberg) were not vested as of December 31, 2024, and vest on the one-year anniversary of the grant, or on the date of the annual meeting of shareholders following the grant, whichever is earlier, so long as the next annual meeting occurs at least fifty (50) weeks after the grant date. (3)As of December 31, 2024, Mr. Agadi had 22,173 stock awards outstanding, Mr. Farber had 22,173 stock awards outstanding, Mr. Fucci had 22,173 stock awards outstanding, Mr. Wilks had no stock awards outstanding and Ms. Mayr had 22,173 stock awards outstanding. (4)Mr. Nierenberg resigned from our Board effective as of May 24, 2024 and did not receive any awards pursuant to the Flotek Industries, Inc. 2018 Long-Term Incentive Plan during 2024. Security Ownership of Certain Beneficial Owners,

  17. Named Executive Officer Compensation

    | Compensation Element | Objective | Key Features | | Base Salary | Provides regular income, reflecting scope of responsibilities, job characteristics, leadership skills and experience. | Reviewed annually based on individual performance. While base salary is not performance-based, annual increases are not guaranteed. | | Short-Term Incentives | Rewards contributions to achievement of annual targets and individual performance, with a focus on key financial indicators. | Compensation Committee determines performance metrics to align awards with short-term goals. | | Long-Term Incentives | Correlates pay with shareholder value and aligns executives with value increases; promotes retention in the competitive energy market. | Gives incentive for performance over the long term with a combination of time vesting and vesting tied to performance conditions. |

  18. Short-Term Incentive Program

    Short-Term Incentive Program Historically the short-term incentive program has included financial and individual performance metrics intended to reward named executive officers for either Company or individual performance as determined by the Compensation Committee. After considering the Company’s performance during 2022, the Compensation Committee did not award any payments with respect to the 2022 short-term incentive program. In lieu of an award under the 2022 short-term incentive program, and in order to focus the Company’s resources on retaining and incentivizing certain key employees, the Compensation Committee awarded a 2023 retention bonus that was paid in March 2023 to certain employees. The 2023 retention bonus required continuous service throughout 2023 and was subject to pro-rata repayment by the recipient employee if the service condition was not met. Dr. Ezell was paid a retention bonus of $425,000 for continuous service in 2023. Mr. Clement did not receive a 2023 retention bonus. For 2023, Dr. Ezell and Mr. Clement each had an annual target bonus equal to 100% of base salary. Ms. Blakeway was not a named executive officer for 2023 and, as a result, her 2023 short-term incentive compensation is not discussed in this section. For 2023, the Compensation Committee established three quantitative performance metrics used as the primary determination of short-term incentive awards for the 2023 named executive officers:

  19. Short-Term Incentive Program

    | | Weighting | | Related party revenue | 25% | | Non-related party revenue | 25% | | Positive annual adjusted EBITDA | 50% |

  20. Short-Term Incentive Program

    During 2023, related party revenue increased by 49% and revenue from non-related parties increased by 22%, each as compared to 2022. In addition, during 2023 the Company achieved the first annual positive adjusted EBITDA since 2017. Adjusted EBITDA is the sum of net income, interest expense, depreciation and amortization expense, tax expense, non-cash amortization of contract assets and certain other non-cash or non-recurring items. Please refer to the reconciliations of this non-GAAP metric to the nearest comparable GAAP metric contained in our Form 8-Ks filed with the SEC with respect to our quarterly earnings releases. In addition to the quantitative performance metrics above, the Compensation Committee also considered the following 2023 accomplishments in evaluating awards under the 2023 short-term incentive program: •Revenues, gross profit and net income increased by $52 million, $31 million and $67 million, respectively, from the year ended December 31, 2022; •Material weakness and going concern issues identified in connection with the 2022 audit were resolved; and •Safety first operational focus resulted in no injuries or lost time accidents. After considering the significant operational and financial accomplishments made during 2023 as outlined above, as well as results with respect to the three quantitative performance metrics, the Compensation Committee determined that the Company achieved a bonus award equal to 80% of the 2023 named executive officers’ target bonus. As a result, the Compensation Committee approved the following awards to the 2023 named executive officers under the 2023 short-term incentive program:

  21. Short-Term Incentive Program

    | Name | Target Bonus | Actual Bonus | % of Target Bonus | | Ryan G. Ezell | $550,000 | $440,000 | 80% | | J. Bond Clement | $400,000 | $320,000 | 80% |

  22. Short-Term Incentive Program

    For 2024, Dr. Ezell and Mr. Clement each had an annual target bonus equal to 100% of base salary and Ms. Blakeway had an annual bonus target equal to 50% of base salary. For 2024, the Compensation Committee established four quantitative performance metrics used as the primary determination of short-term incentive awards for the NEOs. Performance metrics were measured against the Company’s 2024 budget as approved by the Compensation Committee in December 2023, as well as an updated forecast provided to the Compensation Committee in January 2024. The performance metrics for 2024 were as follows:

  23. Short-Term Incentive Program

    | | Weighting | | Adjusted Revenue | 20% | | Data Analytics Revenue | 25% | | Adjusted Gross Margin | 25% | | Adjusted EBITDA | 30% |

  24. Short-Term Incentive Program

    During 2024, the Company exceeded the performance metric requirements for Adjusted Gross Margin and Adjusted EBITDA under both the December 2023 budget and the January 2024 forecast. Adjusted Gross Margin is a non-GAAP metric that adds back non-cash amortization of contract assets and certain other non-cash items to GAAP gross margin. Adjusted EBITDA is the sum of net income, interest expense, depreciation and amortization expense, tax expense, non-cash amortization of contract assets and certain other non-cash or non-recurring items. The Company met the performance metric requirement for Adjusted Revenue under the January 2024 forecast. Adjusted Revenue adds back non-cash amortization of contract assets to revenue. Please refer to the reconciliations of these non-GAAP metrics to the nearest comparable GAAP metrics contained in our Form 8-Ks filed with the SEC with respect to our quarterly earnings releases. The Company did not meet the performance metric for Data Analytics revenue under either the December 2023 budget or the January 2024 forecast. In addition to the quantitative performance metrics above, the Compensation Committee also considered the following 2024 accomplishments in evaluating awards under the 2024 short-term incentive program: •No lost time incidents or recordable spills; •143% increase in the Company’s stock price; •Addition to the Russell Microcap® Index; •Addition of three sell-side analysts covering the Company; •Approximately $20 million increase in net income from 2023 (excluding 2023 non-cash gains); •Approximately 11% reduction in general and administrative expenses; and •Expansion of asset-based loan facility at improved interest rate. After considering the significant operational and financial accomplishments made during 2024 as outlined above, as well as results with respect to the quantitative performance metrics, the Compensation Committee determined that the Company achieved a bonus award equal to 90% of the NEOs’ target bonus. As a result, the Compensation Committee approved the following awards to the NEOs under the 2024 short-term incentive program:

  25. Short-Term Incentive Program

    | Name | Target Bonus | Actual Bonus | % of Target Bonus | | Ryan G. Ezell | $550,000 | $495,000 | 90% | | J. Bond Clement | $400,000 | $360,000 | 90% | | Amy E. Blakeway (1) | $150,000 | $112,500 | 90% |

  26. Short-Term Incentive Program

    (1)Ms. Blakeway’s 2024 bonus award was prorated to reflect her partial year of service during 2024.

  27. Long-Term Incentive Program

    Long-Term Incentive Program The long-term incentive program has historically included equity awards focused on incentivizing long-term performance and aligning executive compensation with shareholder returns. For 2023, the Compensation Committee approved grants of time vested restricted stock units and performance-based stock options. The performance-based stock options granted are subject to a vesting condition based on long-term cumulative adjusted EBITDA thresholds. If the Company does not achieve the adjusted EBITDA threshold over the measurement period, no stock options will vest. The time-based restricted stock units vest evenly over three years from date of grant. The allocation of award values related to grants made to the 2023 named executive officers under the 2023 long-term incentive program were as follows:

  28. Long-Term Incentive Program

    | Name | Time-Vested Awards | Performance-Based Awards | | Ryan G. Ezell | 25% | 75% | | J. Bond Clement | 25% | 75% |

  29. Long-Term Incentive Program

    During 2023, Dr. Ezell and Mr. Clement were granted 62,881 and 45,732 performance-based options, respectively, and 13,974 and 10,163 time vested restricted stock units, respectively. For 2024, the Compensation Committee approved grants of time vested restricted stock units and performance-based restricted stock units. Half of the performance-based restricted stock units are subject to a vesting condition based on achieving a 2025 adjusted EBITDA threshold and the other half of the performance-based restricted stock units are subject to a share price vesting condition. If the applicable vesting conditions are not met during the applicable performance period, the applicable awards will not vest. The time-based restricted stock units vest evenly over three years from date of grant. The allocation of award values related to grants made to the 2024 named executive officers under the 2024 long-term incentive program were as follows:

  30. Long-Term Incentive Program

    | Name | Time-Vested Awards | Performance-Based Awards | | Ryan G. Ezell | 50% | 50% | | J. Bond Clement | 50% | 50% | | Amy E. Blakeway | 50% | 50% |

  31. Long-Term Incentive Program

    During 2024, Dr. Ezell, Mr. Clement and Ms. Blakeway were granted 60,000, 30,000 and 12,000 performance-based restricted stock units, respectively, and 60,000, 30,000 and 12,000 time-based restricted stock units, respectively. Ms. Blakeway’s 2024 long-term incentive award grants reflect a pro-rated amount based upon her partial year of service during 2024.

  32. Independent Compensation Consultant

    Independent Compensation Consultant The Compensation Committee periodically utilizes the services of compensation consultants related to matters of executive compensation. In 2023 and 2024, Pay Governance provided market pay analyses and reviewed annual and long-term incentive design with the Compensation Committee. Pay Governance also provided guidance on matters related to the CEO’s contract and compensation in 2023. In compliance with SEC rules, the Compensation Committee has assessed the independence of Pay Governance and concluded that no conflict of interest exists that would prevent Pay Governance from independently representing the Compensation Committee. Pay Governance periodically provides certain administrative services, the value of which was less than $120,000 per year during 2023 and 2024.

  33. Employment Agreements; Terminations and Change-in Control Arrangements

    Employment Agreements; Terminations and Change-in Control Arrangements A brief summary of the employment agreements of our 2024 named executive officers and the NEOs is as follows:

  34. Ryan G. Ezell - Employment Agreement

    Ryan G. Ezell - Employment Agreement In connection with his appointment to Chief Executive Officer, Dr. Ezell entered into an employment agreement with the Company on June 7, 2023. Under the terms of the agreement, Dr. Ezell is paid a base salary of $550,000 annually and is eligible for an annual bonus with a target amount of 100% of base salary. In the event that Dr. Ezell’s employment is terminated without “cause” or for “good reason,” Dr. Ezell, upon execution and delivery of a suitable release agreement, will be eligible to receive severance benefits equal to 18 months of Dr. Ezell’s base salary (payable over 18 months) plus a pro-rata portion of Dr. Ezell’s annual bonus for the year of termination (determined and paid in the normal bonus cycle), and reimbursement of the difference between the amount Dr. Ezell pays for COBRA premiums and the amount similarly situated employees of the Company would pay for such coverage for up to 18 months. In addition, if such termination occurs within 18 months of a “change of control,” all unvested equity awards shall become fully vested immediately prior to such termination. Dr. Ezell’s unvested equity awards will continue to vest if he is terminated without “cause” or for “good reason.” For a full description of Dr. Ezell’s employment agreement, please see the Company’s Current Report on Form 8-K filed with the SEC on June 8, 2023.

  35. J. Bond Clement - Employment Agreement

    J. Bond Clement - Employment Agreement Mr. Clement entered into an employment agreement with the Company on December 19, 2022. Under the terms of the agreement, Mr. Clement is paid a base salary of $400,000 annually and is eligible for an annual bonus with a target amount of 100% of base salary. Mr. Clement will be eligible to receive severance equal to Mr. Clement’s base salary (payable over 12 months) plus a pro-rata portion of Mr. Clement’s annual bonus for the year of termination (determined and paid in the normal bonus cycle), and reimbursement of the difference between the amount Mr. Clement pays for COBRA premiums and the amount similarly situated employees of the Company would pay for such coverage for up to 12 months. In addition, if such termination occurs within 18 months of a “change of control,” all unvested equity awards shall become fully vested immediately prior to such termination. For a full description of Mr. Clement’s employment agreement, please see the Company’s Current Report on Form 8-K filed with the SEC on December 19, 2022.

  36. Amy E. Blakeway – Employment Agreement

    Amy E. Blakeway – Employment Agreement Ms. Blakeway entered into an employment agreement with the Company on March 1, 2024. Under the terms of the agreement, Ms. Blakeway is paid a base salary of $300,000 annually and is eligible for an annual bonus with a target amount of 50% of base salary. Ms. Blakeway is eligible to receive severance equal to her base salary (payable over 12 months) plus a pro-rata portion of her annual bonus for the year of termination (determined and paid in the normal bonus cycle), and reimbursement of the difference between the amount she would pay for COBRA premiums and the amount similarly situated employees of the Company would pay for such coverage for up to 12 months. In addition, if such termination occurs due to a “change of control,” all her unvested equity awards shall become fully vested immediately prior to such termination. For a full description of Ms. Blakeway’s employment agreement, please see the Company’s Annual Report on Form 10-K filed with the SEC on March 15, 2024.

  37. Tax Gross-Ups on Severance

    Tax Gross-Ups on Severance There are no tax gross-ups on any payments to executives, including severance payments, except we provided a one-time de minimis tax gross up during 2023 to Mr. Clement in connection with the reimbursement of his relocation expenses, which in the aggregate were less than half the amount Mr. Clement was entitled to receive under his employment agreement.

  38. Summary Compensation Table

    Summary Compensation Table The following table provides summary information regarding the total compensation awarded to, earned by, or paid to each of the named executive officers for services rendered to us for the years ended December 31, 2024 and 2023:

  39. Summary Compensation Table

    | Name and Principal Position | Year | Salary(1) | Bonus(2) | Stock | Option | Non-Equity Incentive Plan | All Other | Total | | | | | | Awards(3) | Awards(4) | Compensation (5) | Compensation(6) | | | Ryan G. Ezell – Chief Executive Officer (7) | 2024 | $550,000 | $— | $567,000 | $— | $495,000 | $48,262 | $1,660,262 | | | 2023 | $494,712 | $425,000 | $45,835 | $161,604 | $440,000 | $8,194 | $1,575,345 | | J. Bond Clement - Chief Financial Officer | 2024 | $400,000 | $— | $283,500 | $— | $360,000 | $9,546 | $1,053,046 | | | 2023 | $400,000 | $— | $33,335 | $277,450 | $320,000 | $50,627 | $1,081,412 | | Amy E. Blakeway (8) Senior Vice President, General Counsel and Corporate Secretary | 2024 | $251,538 | $— | $138,402 | $— | $112,500 | $490 | $502,930 |

  40. Summary Compensation Table

    (1)Amounts reflected in this column include total annual salary paid during the applicable fiscal year. (2)The amount reported in this column represents a $425,000 retention bonus Dr. Ezell received for his service during 2023. In lieu of an award under the 2022 short-term incentive program, and in order to focus the Company’s resources on retaining and incentivizing certain key employees, the Compensation Committee awarded a 2023 retention bonus to certain employees, including Dr. Ezell. The 2023 retention bonus was paid in March 2023 and required continuous service throughout 2023 and was subject to pro-rata repayment if the service condition was not met. (3)The amounts reported in this column reflect the aggregate grant date fair value of restricted stock unit awards granted during the applicable year, if any, computed in accordance with FASB ASC Topic 718, excluding estimated forfeitures. See Note 14, “Stock-Based Compensation and Other Benefit Plans,” to the Consolidated Financial Statements included under “Item 8. Financial Statements and Supplementary Data” in the Company’s 2024 Form 10-K for additional detail regarding assumptions used to calculate these amounts. (4)The amounts reported in this column reflect the aggregate grant date fair value of option awards granted during the applicable year, if any, computed in accordance with FASB ASC Topic 718, excluding estimated forfeitures. See Note 14, “Stock-Based Compensation and Other Benefit Plans,” to the Consolidated Financial Statements included under “Item 8. Financial Statements and Supplementary Data” in the Company’s 2024 Form 10-K for additional detail regarding assumptions used to calculate these amounts. (5)The amounts reported in this column represent annual cash incentive awards based upon the achievement of quantitative performance metrics and qualitative yearly accomplishments. For more information about our executive officers' discretionary bonuses and our short-term incentive program, see the section entitled "—2024 Executive Officer Compensation—Short-Term Incentive Program" above. (6)In fiscal 2024, “All Other Compensation” for Dr. Ezell consisted of 401(k) matching contribution costs, group term life insurance costs, parking expense, a five-year service award, $28,229 in golf membership fees and $10,380 in peer advisory group fees; for Mr. Clement consisted of 401(k) matching contribution costs, group term life insurance costs and parking expense; and for Ms. Blakeway consisted of group term life insurance costs. (7)Dr. Ezell was the Company's President and Chief Operating Officer during 2022 and through June 5, 2023. Effective June 6, 2023, Dr. Ezell was appointed Chief Executive Officer and in connection with his promotion, his base salary increased from $425,000 to $550,000. (8)Ms. Blakeway was appointed the Company’s Senior Vice President, General Counsel and Corporate Secretary on March 1, 2024. Her fiscal year 2024 base salary was set at $300,000 per year. The salary reported above for 2024 reflects the base salary she was actually paid for services provided to us during her partial year of service in 2024.The bonus and stock award amounts reported above for Ms. Blakeway are pro-rated amounts reflecting Ms. Blakeway’s partial year of service during 2024.

  41. Outstanding Equity Awards

    Outstanding Equity Awards The following table provides information relating to outstanding equity-based awards held by each named executive officer as of December 31, 2024:

  42. Outstanding Equity Awards

    | | Option Awards | | | | | | Stock Awards | | | | | Name | Year of Grant | Number of underlying unexercised options exercisable | Number of securities underlying unexercised options unexercisable | Equity incentive plan awards: Number of securities underlying unexercised unearned options | Option Exercise Price | Option Expiration Date | Number of shares or units of stock that have not vested | Market value of shares of units of stock that have not vested (1) | Equity Incentive plan awards: Number of shares, units or other rights that have not vested | Equity Incentive plan awards: Market or payout value of unearned shares, units or other rights that have not vested (1) | | Ryan G. Ezell | 2024 (2) | — | — | — | — | — | 60,000 | $571,800 | — | — | | | 2024 (3) | — | — | — | — | — | — | — | 60,000 | $571,800 | | | 2023 (4) | — | 62,881 | — | $3.28 | 12/5/2033 | — | — | — | — | | | 2023 (5) | — | — | — | — | — | 9,317 | $88,795 | — | — | | | 2022 (6) | — | — | — | — | — | 4,817 | $45,906 | — | — | | | 2021 | 24,306 | — | — | $8.64 | 4/19/2031 | — | — | — | — | | | 2021 (7) | — | 24,306 | — | $8.64 | 4/19/2031 | — | — | — | — | | | 2021 (8) | — | — | — | — | — | 8,102 | $77,212 | — | — | | J. Bond Clement | 2024 (2) | — | — | — | — | — | 30,000 | $285,900 | — | — | | | 2024 (3) | — | — | — | — | — | — | — | 30,000 | $285,900 | | | 2023 (9) | — | 61,984 | — | $3.72 | 6/7/2033 | — | — | — | — | | | 2023 (4) | — | 45,732 | — | $3.28 | 12/5/2033 | — | — | — | — | | | 2023 (5) | — | — | — | — | — | 6,776 | $64,572 | — | — | | | 2022 (10) | — | — | — | — | — | 24,794 | $236,285 | — | — | | Amy E. Blakeway | 2024 (2) | — | — | — | — | — | 12,000 | $114,360 | — | — | | | 2024 (3) | — | — | — | — | — | — | — | 12,000 | $114,360 | | | 2024 (11) | — | — | — | — | — | 8,065 | $76,859 | — | — |

  43. Outstanding Equity Awards

    (1)The market value is based upon the applicable number of shares shown in the table multiplied by $9.53, the closing market price of our stock on December 31, 2024. (2)Vests ratably over a three-year period on each anniversary of the grant date of October 30, 2024. (3)Fifty percent (50%) of the shares subject to this performance-based award will vest if, and to the extent, the Company’s earnings before interest, taxes, depreciation, and amortization, and certain other adjustments meets or exceeds a certain threshold during the performance period of January 1, 2025 to December 31, 2025 and fifty percent (50%) of the shares subject to this performance based award will vest, if, and to the extent, the price of the Company’s common stock meets a certain threshold on or before December 31, 2025. (4)Seventy five percent (75%) of the shares subject to this option will vest if the Company achieves a specified performance target during the performance period of January 1, 2023 through December 31, 2026 and one hundred percent (100%) of the shares subject to the option will vest if the Company achieves another specified performance target during the performance period. (5)Vests ratably over a three-year period on each anniversary of the grant date of December 5, 2023. (6)Vests ratably over a three-year period on each anniversary of the grant date of March 8, 2022. (7)Twenty-five percent (25%) of the shares subject to this option will vest if the 90-day volume weighted average price (the “90 day VWAP”) reaches $18 per share during the performance period (which is April 19, 2021 through December 31, 2024), twenty-five percent (25%) of the shares subject to this option will vest if the 90 VWAP reaches $24 per share during the performance period, twenty-five percent (25%) of the shares subject to this option will vest if the 90 VWAP reaches $30 per share during the performance period, and twenty-five percent (25%) of the shares subject to this option will vest if the 90 VWAP reaches $42 per share during the performance period. As none of the performance criteria were satisfied as of December 31, 2024, the options were forfeited on December 31, 2024. (8)Vests ratably over a four-year period on each anniversary of the grant date of April 19, 2021. (9)Vests if the Company’s share price equals or exceeds $18 per share for thirty consecutive trading days at any point during the performance period of June 7, 2023 through June 7, 2033. (10)Vests ratably over a five-year period on each anniversary of the grant date of December 19, 2022. (11)Vests ratably over a three-year period on each anniversary of the grant date of March 1, 2024.

  44. Pay Versus Performance (PVP)

    Pay Versus Performance (PVP) As required by Section 953(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, and Item 402(v) of Regulation S-K, we are providing the following information about the relationship between compensation actually paid to our Named Executive Officers (NEOs) and certain financial performance metrics of the Company using a methodology prescribed by the SEC.

  45. Pay Versus Performance (PVP)

    | Fiscal Year | Summary Compensation Table Total for Mr. Gibson (1) | Summary Compensation Table Total for Mr. Agadi | Summary Compensation Table Total for Dr. Ezell | Compensation Actually Paid to Mr. Gibson | Compensation Actually Paid to Mr. Agadi | | Compensation Actually Paid to Dr. Ezell | Average Summary Compensation Table Total for non-PEO NEOs(2) | Average Compensation Actually Paid to non-PEO NEOs(3) | Value of Initial Fixed $100 Investment Based On: Total Shareholder Return | Net Income (Loss) ($ millions) | | (a) | (b) | (b) | (b) | (c) | (c) | | (c) | (d) | (e) | (f) | (g) | | 2024 | n/a | n/a | $1,660,262 | n/a | n/a | | $2,675,380 | $777,988 | $1,458,457 | $140.56 | $10.5 | | 2023 | $1,568,553 | $683,050 | $1,575,345 | $305,193 | | 531,423 | $1,539,071 | $877,526 | $836,275 | $57.82 | $24.7 | | 2022 | $596,823 | n/a | n/a | $381,403 | n/a | | n/a | $433,781 | $246,334 | $99.12 | $(42.3) |

  46. Pay Versus Performance (PVP)

    (1)Mr. Gibson’s 2023 compensation includes $1,517,714 in severance payments. (2)Dr. Ezell served as principal executive officer (PEO) for 2024 and a portion of 2023. Mr. Gibson served as PEO for 2022 and a portion of 2023. Mr. Agadi served as interim PEO for a portion of 2023. Our non-PEO named executive officers (NEOs) included Mr. Clement for 2023 and 2024, Ms. Blakeway for 2024, Nathan Snoke for 2023, and Dr. Ezell, James Silas and Michael E. Borton for 2022. (3)The following amounts were deducted from / added to Summary Compensation Table (SCT) total compensation in accordance with the SEC-mandated adjustments to calculate Compensation Actually Paid (CAP) to our principal executive officer (PEO) and average CAP to our non-PEO named executive officers. The fair value of equity awards was determined using methodologies and assumptions developed in a manner substantively consistent with those used to determine the grant date fair value of such awards.