DEF 14A of Genasys Inc., Jan 28, 2025

DEF 14A of Genasys Inc.

Filed Jan 28, 2025 · FY20240000950170-25-009856

Open on EDGAR

  1. ELECTION OF DIRECTORS

    ELECTION OF DIRECTORS

  2. Cooperation Agreement with Nicoya

    Cooperation Agreement with Nicoya During December of 2024, representatives of Nicoya Capital LLC and/or other affiliates (“Nicoya”) indicated to us its intention to nominate directors to stand for election at the Annual Meeting and solicit proxies in favor of its nominees. During December of 2024 and early January of 2025, Richard Danforth, our Chief Executive Officer, and Rick Osgood, Chairman of the Board, engaged in discussions with representatives of Nicoya regarding Nicoya’s intention to make such nominations. On January 14, 2015, we entered into a cooperation agreement (the “Cooperation Agreement”) with Nicoya and certain of its affiliates pertaining to the election of directors at the Annual Meeting. Pursuant to the Cooperation Agreement, among other things, we agreed to increase the size of our Board to seven and to appoint R. Rimmy Malhotra to the Board and to the Audit Committee of the Board, each effective January 15, 2025, and Nicoya agreed to abide by certain standstill restrictions and voting commitments, subject to certain limited exceptions, during the term of the Cooperation Agreement. The foregoing is not a complete description of the Cooperation Agreement. For a further description of the Cooperation Agreement and a copy of the Cooperation Agreement, please see our Current Report on Form 8-K filed with the SEC on January 16, 2025. Richard S. Danforth, Susan Lee Schmeiser, Richard H. Osgood III, Mark Culhane, William H. Dodd, and W. Craig Fugate are currently members of our Board, and R. Rimmy Malhotra was appointed pursuant to the terms of the Cooperation Agreement effective January 15, 2025. The Board unanimously recommends a vote IN FAVOR of each of the Board’s nominees for director.

  3. Director Nominees

    Director Nominees The Board currently consists of seven directors, Richard S. Danforth, Susan Lee Schmeiser, Richard H. Osgood III, Mark Culhane, William H. Dodd, W. Craig Fugate and R. Rimmy Malhotra. Messrs. Danforth and Osgood and Ms. Schmeiser were elected to our Board at the 2024 annual meeting of stockholders and Messrs. Culhane, Dodd, Fugate and Malhotra were appointed by the Board since the 2024 annual meeting of stockholders, Mr. Malhotra pursuant to the Cooperation Agreement. Each director to be elected will hold office until the next annual meeting of stockholders and until his or her successor is elected and has qualified, or until such director’s earlier death, resignation or removal. The Board, upon recommendation by our Nominating and Corporate Governance Committee, has nominated the nominees listed below for election to our Board. We encourage our Board members to attend our Annual Meeting of stockholders. All nominees who were members of the Board at the time attended the 2024 Annual Meeting of stockholders virtually.

  4. Nominees

    Nominees The names of the nominees and certain information about them are set forth below. Such information includes their present positions, principal occupations and public company directorships held in the past five years as well as the specific experience, qualifications, attributes or skills of each nominee that led the Board to believe that, as of the date of this Proxy Statement, the nominee is qualified to serve on the Board. However, each member of the Board may have a variety of reasons for believing a particular person would be an appropriate Board member, and these views may differ from the views of other members of the Board.

  5. Nominees

    | Name | Age | Position and Offices | Director Since | | Richard H. Osgood III (2)(3) | 70 | Chairman of the Board | 2013 | | Richard S. Danforth | 65 | Chief Executive Officer and Director | 2017 | | Mark Culhane (1)(2) | 65 | Director | 2024 | | William H. Dodd (1)(2) | 68 | Director | 2024 | | W. Craig Fugate (3) | 65 | Director | 2024 | | R. Rimmy Malhotra (1) | 49 | Director | 2025 | | Susan Lee Schmeiser (1)(3) | 48 | Director | 2021 |

  6. Nominees

    (1) Member of Audit Committee (2) Member of Compensation Committee (3) Member of Nominating and Corporate Governance Committee Richard H. Osgood III, age 70, has been a member of the Board since July 2013 and was appointed Chairman of our Board in November 2021. Mr. Osgood retired in 2012 after serving as Head of Equity Capital Markets for Wedbush Securities since January 2009. Mr. Osgood joined Wedbush Securities when it acquired Pacific Growth Equities, which Mr. Osgood founded in 1991. Mr. Osgood served in various capacities with Pacific Growth Equities prior to its acquisition, including President, Chief Executive Officer, Chief Operating Officer, Chairman and Executive Chairman. Prior to founding Pacific Growth Equities, Mr. Osgood was the Head of Capital Markets, Sales and Trading at Volpe, Welty and Company, a company he also co-founded in 1986. Previously, Mr. Osgood held senior positions in institutional sales at Montgomery Securities, Rotan Mosely and Smith Barney. Mr. Osgood holds a B.S. in Psychology from the University of the South. Mr. Osgood’s capital markets and securities industry expertise, as well as his management and strategic experience qualify him to serve on our Board. Richard S. Danforth, age 65, was appointed Chief Executive Officer in August 2016. Mr. Danforth formed the strategic business consulting firm, RsD Aero, Ltd., in 2014, which provided consulting services for the Defense, Aerospace, Space and Transportation sectors, with an emphasis on M&A and Transatlantic trade. He served at DRS Technologies as Group President of DRS Integrated Defense Systems & Service (2013 – 2014); Chief Executive Officer, President and Board Member of DRS Defense Solutions (2008 – 2012); President, Command Control & Communication (2005 – 2008); President, Navy Electronics & Intelligence Systems (2004 – 2005); and Executive Vice President, Electronics Systems Group (2002 – 2004). He began his career at Raytheon in 1982 and held various manufacturing, quality assurance and program manager positions until 1996. Mr. Danforth was then appointed Vice President of Operations for Raytheon Aircraft Company (1996 – 2000). In 2000, he was named Senior Vice President of Raytheon Aircraft Company’s Commercial Aircraft Business division, where he led a staff of 370 sales, marketing and customer service personnel. Mr. Danforth holds a Bachelor of Science in Industrial Technology from the University of Massachusetts Lowell and a Masters in Engineering Management from Western New England College. Mr. Danforth’s extensive business experience with strategy, leadership and execution at large defense companies qualifies him to serve on our Board. Mark Culhane, age 65, has been a member of the Board since July 2024. Mr. Culhane has been the Managing Partner of Culhane Advisory since 2016. From April 2017 to April 2022, Mr. Culhane served on the Board of Directors and was Audit Committee Chair of UserZoom. From November 2017 to June 2021, Mr. Culhane was Executive Vice President and Chief Financial Officer at Teradata Corporation. Mr. Culhane also served as Chief Financial Officer at Lithium Technologies from December 2012 to August 2016; Executive Vice President and Chief Financial Officer at DemandTec from August 2001 to May 2012; Chief Financial Officer at iManage from 1998 to 2001; Chief Financial Officer at SciClone Pharmaceuticals from 1992 to 1998; and from 1982 to 1992 held various positions with Pricewaterhouse Coopers. Mr. Culhane holds a B.S. in Business Administration from the University of South Dakota. Mr. Culhane’s extensive accounting and financial reporting expertise and business leadership experience qualify him to serve on our Board. William H. Dodd, age 68, has been a member of the Board since May 2024. Mr. Dodd served in the California State Senate from December 2016 to December 2024. He finished his second term as Chair of the Government Organization Committee, a member of the Transportation Committee, Energy Utilities and Communications Committee, the Business Professions Committee, and the Insurance Committee. From November 2014 to November 2016, Mr. Dodd served in the California State Assembly. Mr. Dodd began public service in March 2000, serving on the Napa County Board of Supervisors until December 2014. Prior to his time in elected office, Mr. Dodd owned and operated a full-service water company and served as president of the water quality industry’s state and national trade associations. Mr. Dodd earned a B.S. in Business Administration from California State University, Chico. Mr. Dodd’s extensive government service and experience, and industry and business management background, qualify him to serve on our Board. W. Craig Fugate, age 65, has been a member of the Board since May 2024. Prior to starting Craig Fugate Consulting in March 2017 to pursue building a more resilient nation and train the next generation of emergency managers, Mr. Fugate served as Administrator of the Federal Emergency Management Agency (FEMA) from May 2009 to January 2017. Mr. Fugate led FEMA and oversaw the federal government’s response to major disasters, including the Joplin and Moore tornadoes, Hurricane Sandy, Hurricane Matthew, and Louisiana flooding. From October 2001 to May 2009, Mr. Fugate served as Director of the Florida Division of Emergency Management, leading the state of Florida’s emergency response to 11 declared disasters. Mr. Fugate began his emergency management career as a volunteer firefighter, paramedic, and a lieutenant with the Alachua County Fire Rescue before serving as Emergency Manager for Alachua County in Gainesville, Florida from 1987 to 1997. Mr. Fugate also serves on the Board of Directors of PG&E Corporation and Pacific Gas and Electric Company. Mr. Fugate’s local, state, and national leadership and substantial emergency management experience qualify him to serve on our Board. R. Rimmy Malhotra, age 49, has been a member of the Board since January 2025. From 2013 to the present, Mr. Malhotra has served as the Managing Member and Portfolio Manager for Nicoya Fund LP, a private investment partnership. Previously, from 2008 to 2013 he served as portfolio manager of the Gratio Values Fund, a mutual fund registered under the Investment Act of 1940. Prior to this, he was an Investment Analyst at a New York based hedge fund. Since November 2019, Mr. Malhotra has been a member of the Board of Directors of Optex Systems Holdings, Inc. (NASDAQ:OPXS), is the Chair of its Nominating and Corporate Governance Committee, and sits on its Audit and Compensation Committees. Since January 2021 until August of 2024 when it merged with Horizon Kinetics, he had served on the Board of Directors as lead independent director and was Chair of the Audit Committee for Scott’s Liquid Gold-Inc. (OTCBB:SLGD). Since April 2016, he has been a member of the Board of Directors of HireQuest, Inc. (Nasdaq:HQI), where he serves as Vice-Chairman of its Board of Directors, its lead independent director and sits on its Audit and Compensation Committees. In October of 2024, he was appointed to the board of FRMO (OTC:FRMO) where he serves as the Chair of the Audit Committee. He earned an MBA in Finance from The Wharton School and a Master’s degree in International Relations from the University of Pennsylvania where he was a Lauder Fellow. Mr. Malhotra holds undergraduate degrees in Computer Science and Economics from Johns Hopkins University. Mr. Malhotra’s experience with public equity, including his service on the boards of directors of multiple public companies, and his qualifications as a financial matters expert qualify him to serve on our Board.

  7. Nominees

    Susan Lee Schmeiser, age 48, has been a member of the Board since September 2021. Ms. Schmeiser has over 20 years of experience in digital marketing software, media, data analytics, and strategic partnerships. Prior to May 2023, Ms. Schmeiser served as Group President of Digital Marketing & Technology Solutions at Vericast, a MacAndrews & Forbes company, since November 2020. Prior to her current position, from April 2020 to November 2020, Ms. Schmeiser served as Chief Product Officer and Senior Executive Vice President at Vericast. From 2017 to 2020, Ms. Schmeiser was Senior Vice President of Business Development and Strategy at Valassis, a leader in marketing technology and consumer engagement. From 2011 to 2017, Ms. Schmeiser served as the Vice President of Corporate Development and Strategy of MaxPoint Interactive, Inc., which was acquired by Valassis after going public in 2017. Ms. Schmeiser served as Vice President, Ad Sales Strategy at Univision from 2007 to 2011. She also held the role of Vice President at MTV Networks from 2004 to 2007. She began her career as a Financial Analyst in the Financial Sponsors Group of Morgan Stanley’s Investment Banking Division. Ms. Schmeiser earned a B.A. in Economics from New York University and an M.B.A. in General Management from Harvard Business School. Ms. Schmeiser’s leadership experience, and expertise in corporate development and strategy qualify her to serve on our Board.

  8. BOARD AND COMMITTEE MATTERS

    BOARD AND COMMITTEE MATTERS

  9. AND CORPORATE GOVERNANCE MATTERS

    AND CORPORATE GOVERNANCE MATTERS

  10. Corporate Governance

    Corporate Governance We maintain a corporate governance page on our website that includes key information about our corporate governance initiatives, including our Code of Business Conduct and Ethics, our Charters for the committees of the Board, and our Whistleblower Protection Policy. The corporate governance page can be found at www.genasys.com by clicking on “Investors” and then clicking on “Investor Relations” and then clicking on “Governance.” The information contained on our website is not incorporated by reference into and does not form a part of this Proxy Statement. Our policies and practices reflect corporate governance initiatives that are designed to be compliant with the listing requirements of the NASDAQ Stock Market and the corporate governance requirements of applicable securities laws, including: • Six of our seven Board members are independent of our company and our management; • All members of our standing Board committees are independent of our company and our management; • The independent members of our Board meet regularly without the presence of management; • We have a clear code of business conduct and ethics that applies to our principal executive officers, our directors and all of our employees, and is monitored by our Audit Committee; • The charters of the Board committees clearly establish their respective roles and responsibilities; and • We have a hotline available to all employees, and our Audit Committee has procedures in place for the anonymous submission of employee complaints on accounting, internal accounting controls, or auditing matters.

  11. Board of Directors

    Board of Directors Our Board currently consists of seven directors: Richard S. Danforth, Susan Lee Schmeiser, Richard H. Osgood III, Mark Culhane, William H. Dodd, W. Craig Fugate and R. Rimmy Malhotra. During the fiscal year ended September 30, 2024, our Board held five meetings. All directors serving on the Board during the fiscal year ended September 30, 2024 attended at least 75% of the aggregate of the total number of the meetings of the Board and the total number of meetings held by all committees of the Board on which he or she served (in each case during the period in which he or she served).

  12. Information Regarding the Board Committees

    Information Regarding the Board Committees During the full fiscal year ended September 30, 2024, the Board had three standing committees: the Audit Committee, the Compensation Committee and the Nominating and Corporate Governance Committee. The current charters for the Audit Committee, the Compensation Committee, and the Nominating and Corporate Governance Committee can be found on our website at www.genasys.com.

  13. Evaluating Nominees for Director

    Evaluating Nominees for Director The Nominating and Corporate Governance Committee reviews candidates for director nominees in the context of the current composition of our Board, our operating requirements and the long-term interests of stockholders. In conducting this assessment, the Nominating and Corporate Governance Committee currently considers, among other factors, diversity, age, skills, and such other factors as it deems appropriate given the current needs of the Board and our company, to maintain a balance of knowledge, experience and capability. In the case of incumbent directors whose terms of office are set to expire, the Nominating and Corporate Governance Committee reviews such directors’ overall service to our company during their term, including the number of meetings attended, level of participation, quality of performance, and any other relationships and transactions that might impair such directors’ independence. In the case of new director candidates, the Nominating and Corporate Governance Committee also determines whether the nominee must be independent, which determination is based upon applicable NASDAQ listing standards, applicable SEC rules and regulations and the advice of counsel, if necessary. The Nominating and Corporate Governance Committee intends to use a variety of means to compile a list of potential candidates, including recommendations from current Board members and executive officers and recommendations from shareholders. The Nominating and Corporate Governance Committee may also engage, if it deems appropriate, professional search firms and other advisors to assist it in identifying candidates for the Board. The Nominating and Corporate Governance Committee conducts any appropriate and necessary inquiries into the background and qualifications of possible candidates after considering the function and needs of our Board. The Nominating and Corporate Governance Committee meets to discuss and consider such candidates’ qualifications and then selects a nominee for recommendation to our Board by majority vote.

  14. Summary Compensation Table

    Summary Compensation Table The table below summarizes the total compensation paid or earned by our Chief Executive Officer and Chief Financial Officer for the fiscal years ended September 30, 2024 and 2023. We refer to each such person as a “named executive officer.”

  15. Summary Compensation Table

    | Name and Principal Position | Fiscal Year | Salary | Bonus | Stock Awards | Option Awards | All Other Compensation | Total | | Richard S. Danforth | 2024 | $437,091 | — | — | $592,605(1) | $14,454 | $1,044,150 | | Chief Executive Officer | 2023 | $428,685 | — | — | $224,000(2) | $14,806 | $667,491 | | Dennis D. Klahn | 2024 | $283,500 | — | — | $75,321(3) | $12,757 | $371,578 | | Chief Financial Officer & Secretary | 2023 | $277,846 | — | $120,000(4) | — | $12,771 | $410,617 |

  16. Summary Compensation Table

    (1) In the year ended September 30, 2024, stock options subject to time vesting were granted with an aggregate grant date fair value of $592,605, computed in accordance with ASC 718, “Compensation-Stock Compensation”. Assumptions used in the calculation of these amounts are included in the notes to our audited financial statements for the fiscal year ended September 30, 2024, included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on December 13, 2024. (2) In the year ended September 30, 2023, stock options subject to performance conditions were granted with an aggregate grant date fair value of $1,216,000, computed in accordance with ASC 718, “Compensation-Stock Compensation”. This amount represents the highest level of achievement possible under the terms of the grant. (3) In the year ended September 30, 2024, stock options subject to time vesting were granted with an aggregate grant date fair value of $75,321, computed in accordance with ASC 718, “Compensation-Stock Compensation”. Assumptions used in the calculation of these amounts are included in the notes to our audited financial statements for the fiscal year ended September 30, 2024, included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on December 13, 2024. (4) The amounts for 2023 reflect the aggregate grant date fair value for restricted stock units granted during the fiscal year ended September 30, 2023, computed in accordance with ASC 718, “Compensation-Stock Compensation.” Assumptions used in the calculation of these amounts are included in the notes to our audited financial statements for the fiscal year ended September 30, 2023, included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on December 7, 2023. No named executive officer received any form of non-cash compensation from us in the fiscal year ended September 30, 2024, or currently receives any such compensation, in excess of 10% of the total amount of annual salary and bonus reported for the named executive officer above.

  17. Outstanding Equity Awards at Fiscal Year-End

    Outstanding Equity Awards at Fiscal Year-End The following table contains information regarding unexercised options for each named executive officer outstanding as of September 30, 2024.

  18. Outstanding Equity Awards at Fiscal Year-End

    | | Option Awards | | | | | | Stock Awards | | | | Grant | Number of Securities Underlying Unexercised Options (#) | Number of Securities Underlying Unexercised Options (#) | Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned | Option Exercise | Option Expiration | Number of Shares or Units of Stock That Have Not | Market Value of Shares or Units of Stock That Have Not | | Name | Date | Exercisable | Unexercisable | Options (#) | Price ($) | Date | Vested (#) | Vested ($) | | Richard S. Danforth | 10/4/2019 | 187,138 | —(1) | 212,862 | $3.39 | 10/4/2026 | — | — | | | 10/8/2022 | 100,000 | 100,000(2) | — | $2.69 | 10/8/2029 | — | — | | | 10/8/2022 | — | 400,000(3) | — | $2.69 | 10/8/2029 | — | — | | | 10/8/2022 | — | 400,000(4) | — | $2.69 | 10/8/2029 | — | — | | | 8/19/2024 | 150,000 | 300,000(5) | — | $2.70 | 8/19/2031 | — | — | | Dennis Klahn | 2/10/2022 | — | — | — | — | — | 3,333 | $11,865(6) | | | 2/14/2023 | — | — | — | — | — | 20,000 | $71,200(7) | | | 12/12/2023 | — | 90,000(8) | — | $1.70 | 12/12/2030 | — | — |

  19. Outstanding Equity Awards at Fiscal Year-End

    (1) The option is fully vested. (2) The option vests as to 1/2 of the shares on each anniversary of the date of grant of October 8, 2022, until fully vested. (3) The number of shares that vest is based on the achievement of certain performance criteria as determined on September 30, 2025. (4) The number of shares that vest is based on the achievement of certain performance criteria as determined on September 30, 2026. (5) The option vests as to 1/3 of the shares on September 30, 2024, and 1/3 of the shares on September 30, 2025 and 1/3 of the shares on September 30, 2026. (6) The restricted stock unit vests as to 1/3 of the shares on each anniversary of the date of grant of February 10, 2022, until fully vested. (7) The restricted stock unit vests as to 1/3 of the shares on each anniversary of the date of grant of February 14, 2023, until fully vested. (8) The option vests as to 1/3 of the shares on each anniversary of the date of grant of December 12, 2023, until fully vested. We do not have any stock appreciation rights plans in effect and we have no long-term incentive plans, as those terms are defined in SEC regulations. We have no defined benefit or actuarial plans covering any named executive officer.

  20. Potential Payments Upon Termination or Change-in-Control

    Potential Payments Upon Termination or Change-in-Control Mr. Danforth’s employment agreement provides for payments and other benefits upon certain termination and change in control events as described above in “Employment Agreements.” We also have a Change in Control Severance Benefit Plan under which, in the event of a qualifying termination, a participating executive will be entitled to receive (a) a lump sum payment equal to twenty-four months’ base salary (less applicable tax and other withholdings), (b) a lump sum payment equal to the officer’s target bonus for the year in which the officer is terminated, (c) continuation of health benefits for twenty-four months and (d) accelerated vesting of any unvested stock options and other securities or similar incentives held at the time of termination. A qualifying termination under the Change in Control Severance Benefit Plan is any involuntary termination without cause or any voluntary termination for good reason, in each case occurring within three months before or twelve months after a change of control of our Company.

  21. COMPENSATION OF DIRECTORS

    COMPENSATION OF DIRECTORS The following table shows all the fees earned or cash paid during the fiscal year ended September 30, 2024 to our non-employee directors. No option or restricted stock awards, long-term incentive plan payouts or other types of payments, other than the amount identified in the chart below, were paid to these directors during the fiscal year ended September 30, 2024.

  22. Director Compensation Fiscal Year 2024

    Director Compensation Fiscal Year 2024

  23. Director Compensation Fiscal Year 2024

    | Name | Fees Earned or Paid in Cash | Stock Awards(1) | Total | | Scott L. Anchin (2) | $20,000 | $53,700 | $73,700 | | Mark Culhane (3) | $7,500 | $45,400 | $52,900 | | William Dodd (4) | $10,000 | $45,416 | $55,416 | | Craig Fugate (4) | $10,000 | $45,416 | $55,416 | | Richard H. Osgood III | $30,000 | $53,700 | $83,700 | | Susan Lee Schmeiser | $30,000 | $53,700 | $83,700 | | Caltha Seymour (5) | $22,500 | $53,700 | $76,200 |

  24. Director Compensation Fiscal Year 2024

    (1) Reflects the aggregate grant date fair value for restricted stock units granted during the fiscal year ended September 30, 2024, computed in accordance with ASC 718, “Compensation-Stock Compensation.” Assumptions used in the calculation of these amounts are included in the notes to our audited financial statements for the fiscal year ended September 30, 2024, included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on December 13, 2024. (2) Mr. Anchin resigned from the Board, effective May 31, 2024. (3) Mr. Culhane joined the Board, effective July 10, 2024 and received a pro-rated initial RSU grant of 20,000 shares of common stock. (4) Mr. Dodd and Mr. Fugate joined the Board, effective June 1, 2024, and each received a pro-rated initial RSU grant of 23,654 shares of common stock. (5) Ms. Seymour resigned from the Board, effective July 1, 2024. Each of our non-employee directors receives a grant of 30,000 restricted stock units annually on the date of our annual meeting of stockholders, subject to the overall director compensation limits set forth in the Amended Plan. Each of our non-employee directors also receives an annual cash retainer equal to $30,000, which is paid in equal quarterly installments and is prorated for partial year service. No additional amounts are payable for committee participation.

  25. PAY VERSUS PERFORMANCE

    PAY VERSUS PERFORMANCE The following table shows information about the relationship between compensation actually paid for our principal executive officer (PEO) and our non-PEO named executive officers (NEO) and certain financial performance of the Company for the fiscal years ending September 30, 2024 and September 30, 2023.

  26. PAY VERSUS PERFORMANCE

    | Year | Summary compensation table total for PEO (1) | Compensation actually paid to PEO (2) | Average summary compensation table total for non-PEO NEOs (3) | Average compensation actually paid to non-PEO NEOs (4) | Value of initial fixed $100 investment based on: Total shareholder return (5) | Net income (Loss) | | 2024 | $1,044,150 | $1,235,962 | $371,578 | $535,768 | $177.11 | $(31,730,000) | | 2023 | $667,491 | $553,491 | $410,617 | $352,584 | $72.56 | $(18,396,000) | | 2022 | $828,008 | $828,008 | $470,776 | $439,912 | $38.80 | $(16,212,000) |

  27. PAY VERSUS PERFORMANCE

    (1) The dollar amounts reported are the amounts of total compensation reported for our PEO, Richard Danforth, in the Summary Compensation Table for fiscal years 2024, 2023 and 2022. The dollar amounts reported represent the amount of “compensation actually paid”, as computed in accordance with SEC rules. The dollar amounts reported are the amounts of total compensation reported for Mr. Danforth during the applicable year after adjusting for the fair value of stock options granted under our Amended and Restated 2015 Equity Incentive Plan. The dollar amounts reported are the average of the total compensation reported for our NEO, other than our PEO, Dennis Klahn, who served as Chief Financial Officer for fiscal years 2024, 2023 and 2022. The dollar amounts reported represent the amount of “compensation actually paid”, as computed in accordance with SEC rules. The dollar amounts reported are the amounts of total compensation reported for Mr. Klahn during the applicable year after adjusting for the fair value of restricted stock units granted under our Amended and Restated 2015 Equity Incentive Plan. (5) Total shareholder return is calculated as the difference between the price of our common stock at the end of each fiscal year, represented by the closing trading price as of that date, compared to the price of our common stock at the beginning of the measurement period, represented by the closing trading price as of the last day of our 2021 fiscal year. No dividends were declared or paid during either of the fiscal years presented.