DEF 14A of Saga Communications Inc, Apr 11, 2024

DEF 14A of Saga Communications Inc

Filed Apr 11, 2024 · FY20230001104659-24-046282

Open on EDGAR

  1. PROPOSAL 1 — ELECTION OF DIRECTORS

    PROPOSAL 1 — ELECTION OF DIRECTORS Our Board of Directors has the authority, pursuant to Section 3.02 of our bylaws, to increase the size of the Board at any regular or special meeting of the Board. Our Board currently has eight members. Gary G. Stevens currently serves as a member of our Board but will retire when his term expires at the 2024 Annual Meeting and will not stand for reelection. As a result of this action, the Board will be comprised of seven members following the Annual Meeting. Holders of our Class A Common Stock will vote as a single class for all seven directors, with each share of Class A Common Stock entitled to one vote. Holders of our Class A Common Stock are not entitled to cumulative voting in the election of directors. The persons named below have been nominated for election as directors at the Annual Meeting. The directors who are elected shall hold office until the 2025 Annual Meeting of Shareholders and the election and qualification of their successors. In accordance with the Florida Business Corporation Act, directors are elected by a plurality of the votes of the shares present in person or represented by proxy at the Annual Meeting. This means the director nominees receiving the highest number of “FOR” votes will be elected as directors. Our Board of Directors recommends that you vote “FOR” each of the seven nominees named below. Unless otherwise instructed, the persons named as proxies intend to vote all proxies received for the election of the nominees. All nominees are members of the present Board. Each of the nominees for director has consented to being named a nominee in this proxy statement and has agreed to serve as a director, if elected at the Annual Meeting. If, due to circumstances not now foreseen, any of the nominees named below will not be available for election, the proxies will be voted for such other person or persons as the Board may select. The following table provides information as of the date of this proxy statement about each nominee. The information presented includes information that each director has given us about their age, all positions they hold, and their principal occupation and business experience for at least the past five years. In addition to the information presented below regarding each nominee’s specific experience, qualifications, attributes, and skills that led our Board to the conclusion that they should serve as a director, we also believe that all of our director nominees, as required by our Corporate Governance Guidelines, possess the highest personal and professional ethics, integrity, and values, and are committed to representing the long-term interests of the shareholders as a whole. Further, each nominee has demonstrated business acumen as well as a commitment of service to our Board. The Board recommends a vote “FOR” each of the following nominees:

  2. PROPOSAL 1 — ELECTION OF DIRECTORS

    | Name and Age | Principal Occupation During the Past Five Years | Director Since | | Clarke R. Brown, Jr., 83 | Retired; President of Jefferson-Pilot Communications Company from 1991 to June 2005. We believe that Mr. Brown’s qualifications to sit on our Board include his thirty-eight years in the broadcast industry, including fourteen years as President of the radio division of a then-public company. | July 2004 | | Timothy J. Clarke, 79 | President and Owner, Clarke Company from 1987 to present. Mr. Clarke is also the Chairman of Gulfside Bank, a full-service community bank in Sarasota, Florida. We believe that Mr. Clarke’s qualifications to sit on our Board include his more than twenty-five years in the advertising and public relations industry, including twenty as president of a full-service advertising and public relations agency servicing markets that included radio and television, as well as his involvement in the startup and management of three community banks. | December 2013 |

  3. PROPOSAL 1 — ELECTION OF DIRECTORS

    | Name and Age | Principal Occupation During the Past Five Years | Director Since | | Roy F. Coppedge III, 75 | Retired; Senior Advisor, BV Investment Partners (formerly Boston Ventures Management) from 2012 to 2017. From 1983 to 2012, Mr. Coppedge was Managing Director of BV Investment Partners. We believe that Mr. Coppedge’s qualifications to sit on our Board include his more than twenty-five years in the private equity investment industry, primarily at a firm that has made investments in seventy-eight private companies that have operated in the specific industries: media, communications, broadcasting, entertainment, and information and business services. | June 2013 | | Christopher S. Forgy, 63 | President, Chief Executive Officer, and Director of Saga Communications, Inc. since December 7, 2022. Mr. Forgy joined the Company in 1995 and has been with Saga for more than twenty years. He initially served as Director of Sales for the Company’s radio stations in Columbus, Ohio until 2006 when he left Saga to serve as general manager of radio clusters of other broadcast companies until 2011. In 2011, Mr. Forgy rejoined Saga as President and General Manager of our Columbus, Ohio market where he served until being promoted to Senior Vice President of Operations in May 2018. Thereafter, he was appointed to President, Chief Executive Officer, and Director of the Company effective as of December 7, 2022. We believe that Mr. Forgy’s qualifications to sit on our Board include his more than twenty-five years of professional service in the broadcast industry, including his more than twenty years of service as an employee of the Company and more than five years as our Senior Vice President of Operations. | December 2022 | | Warren S. Lada, 69 | Retired; Interim Chief Executive Officer of the Company from August 22, 2022 to December 7, 2022; Chief Operating Officer of the Company from March 2016 to June 30, 2018. Mr. Lada began his broadcast career in 1976 and served in various capacities for several broadcast companies before joining the Company in 1991. He initially served as General Manager of WAQY, Rock 102 in Springfield, MA and Regional Vice President for Saga Communications of New England. Mr. Lada held several positions during his twenty-seven years with the Company. We believe that Mr. Lada’s qualifications to sit on our Board include his twenty-seven years in the broadcast industry working for the Company. | May 2018 |

  4. PROPOSAL 1 — ELECTION OF DIRECTORS

    | Name and Age | Principal Occupation During the Past Five Years | Director Since | | Marcia K. Lobaito, 75 | Ms. Lobaito was the Director of Business Affairs and Corporate Secretary since our inception in 1986, Vice President from 1996 to 2005, and Senior Vice President from 2005 to 2020. Effective March 13, 2020, Ms. Lobaito retired from Senior Vice President and Director of Business Affairs. Effective November 30, 2023, Ms. Lobaito retired as Corporate Secretary. We believe that Ms. Lobaito’s qualifications to sit on our Board include her more than thirty-six years in the broadcast industry working for the Company, including her two years as a director of the Company. | September 2021 | | Michael W. Schechter, 59 | Mr. Schechter has been Partner at TowerView LLC and its predecessor since 1991. Prior to that he was an Analyst at Donaldson Lufkin & Jenrette. Mr. Schechter also serves as a board member of Emmis Corporation. We believe Mr. Schechter’s qualifications to sit on the board include his more than thirty-five years in the investment industry which includes investing in the media space and his experience in public market securities, capital allocation, and risk management as well as his experience serving as a director of the Company for the past year. | May 2023 |

  5. CORPORATE GOVERNANCE

    CORPORATE GOVERNANCE We are committed to having sound corporate governance principles. Having such principles is essential to maintaining our integrity in the marketplace and ensuring that we are managed for the long-term benefit of our shareholders. Our business affairs are conducted under the direction of our Board. Our Board strives to ensure the success and continuity of our business through the selection of a qualified management team. It is also responsible for ensuring that our activities are conducted in a responsible and ethical manner. Our Corporate Governance Guidelines, Code of Business Conduct and Ethics, and charters for the Finance and Audit Committee, the Nominating and Corporate Governance Committee, the Compensation Committee and the Cybersecurity Subcommittee Charter are posted on the “Investors — Corporate Governance — Governance Overview — Governance Documents” page of our website at www.sagacom.com, and will be provided free of charge to any shareholder upon written request to our Corporate Secretary at our corporate headquarters. Information contained in, or accessible through, our website does not constitute part of this proxy statement.

  6. Board of Directors

    Board of Directors

  7. Identifying Director Nominees; Consideration of Nominees of the Shareholders

    Identifying Director Nominees; Consideration of Nominees of the Shareholders The Nominating and Corporate Governance Committee employs a variety of methods for identifying and evaluating director nominees, as described in its charter. In addition, the Board regularly assesses the size of the Board, the need for particular expertise on the Board, and whether any vacancies on the Board are expected due to retirement or otherwise. In the event that vacancies are anticipated, or otherwise arise, the Nominating and Corporate Governance Committee will consider various potential candidates for director which may come to its attention through current Board members, professional search firms, shareholders, or other persons. These candidates are evaluated at regular or special meetings of the Nominating and Corporate Governance Committee and may be considered at any point during the year. The Nominating and Corporate Governance Committee will consider candidates recommended by shareholders when the nominations are properly submitted pursuant to the procedures set forth in the Company’s Bylaws and proxy statement. The deadlines and procedures for shareholder submissions of director nominees are described below under “Shareholder Proposals and Director Nominations for Annual Meetings.” Following verification of the shareholder status of persons recommending candidates, the Nominating and Corporate Governance Committee will make an initial analysis of the qualifications of any candidate recommended by shareholders or others pursuant to the criteria summarized above to determine whether the candidate is qualified for service on the Board before deciding to undertake a complete evaluation of the candidate. If any materials are provided by a shareholder or professional search firm in connection with the nomination of a director candidate, such materials are forwarded to the Nominating and Corporate Governance Committee as part of its review. Other than the verification of compliance with procedures and shareholder status, and the initial analysis performed by the Nominating and Corporate Governance Committee, a potential candidate nominated by a shareholder is treated like any other potential candidate during the review process by the Nominating and Corporate Governance Committee.

  8. COMPENSATION OF DIRECTORS

    COMPENSATION OF DIRECTORS Historically, each director besides the CEO received an annual cash retainer of $34,000 and chairpersons of each committee who were not employees received an additional annual cash retainer of $9,500. The Lead Director received an additional annual retainer of $25,000. Directors were also eligible to receive stock awards of up to 75% of their annual cash retainer. Beginning on October 1, 2022, the annual cash retainer was increased to $72,000 per year, the committee chairperson additional annual retainer was increased to $10,000 per year and the Chairman of the Board receives an additional annual retainer of $10,000. Beginning in 2023, each director other than the CEO will receive stock grants of $53,000 annually. The retainers are paid quarterly. All directors who are not employees are required to hold and maintain 1,250 shares of the Company’s Class A Common Stock. Such directors are required to achieve this guideline within five years of joining the Board, or in the case of such directors serving at the time the guidelines were adopted, within five years of the date of the adoption of the guideline. Directors may elect to pay out-of-pocket for health insurance benefits currently offered by the Company to its employees under its self-insured program. In the alternative, directors may elect to have part of their annual retainer used to pay for such benefits. Directors are also permitted to take into income the value of the health insurance benefit.

  9. 2023 Director Compensation Table

    2023 Director Compensation Table

  10. 2023 Director Compensation Table

    | Name(1) | Fees Earned or Paid in Cash ($) | Stock Awards ($)(2) | All Other Compensation ($)(3) | Total ($) | | Michael J. Bergner(4) | $25,319 | $— | $3,411 | $28,730 | | Clarke R. Brown, Jr(5) | $78,456 | $53,005 | $5,138 | $136,599 | | Timothy J. Clarke(6) | $82,000 | $53,005 | $6,364 | $141,369 | | Roy F. Coppedge III(7) | $82,000 | $53,005 | $5,138 | $140,143 | | Warren S. Lada(8) | $82,000 | $53,005 | $5,344 | $140,349 | | Marcia K. Lobaito | $72,000 | $53,005 | $41,071 | $166,076 | | Michael W. Schechter(9) | $46,681 | $30,921 | $— | $77,602 | | Gary G. Stevens(10) | $75,544 | $53,005 | $9,811 | $138,360 |

  11. 2023 Director Compensation Table

    (1) The compensation of our current Chief Executive Officer, Christopher S. Forgy, has been omitted from this table. The compensation is included in the Summary Compensation Table. (2) All stock awards comprise grants of Class A Common Restricted Stock which vest in one-third increments on December 15, 2024, and 2025, and 2026, if the reporting person is a director on the applicable date. Stock award values are calculated based on the closing price of our Class A Common Stock on the NASDAQ on December 7, 2023 ($20.41 per share). As of December 31, 2023, the following directors held the following number of unvested restricted stock awards: Mr. Brown, 3,601; Mr. Clarke, 3,837; Mr. Coppedge, 3,601; Mr. Lada, 3,644; Ms. Lobaito, 3,355; and Mr. Schechter, 1,515, and Mr. Stevens, 4,454. All such restricted stock, however, shall vest if the reporting person is a director upon the occurrence or deemed occurrence of a change-in-control. Effective November 30, 2023, Ms. Lobaito retired from her position as Corporate Secretary, but continues to serve the Company as a Director. (3) With respect to Mr. Stevens, includes the value of dental insurance provided and dividends paid on unvested restricted stock. With respect to Ms. Lobaito, includes compensation earned for her role as Corporate Secretary of the Company, and dividends paid on unvested restricted stock, but does not include $61,002 of non qualified deferred income distributions paid to Ms. Lobaito during the fiscal year for her services as an officer of the Company. With respect to Mr. Bergner, Mr. Brown, Mr. Clarke, Mr. Coppedge, and Mr. Lada, includes dividends paid on unvested restricted stock. (4) Mr. Bergner served on our Board of Directors until May 2023. (5) Chairman of Compensation Committee. (6) Chairman of Finance and Audit Committee. (7) Chairman of the Nominating and Corporate Governance Committee. Elected as a Director in May, 2023. (8) Chairman of the Board. (9) Chairman of the Cybersecurity Subcommittee of the Finance and Audit Committee. Mr. Stevens is not standing for re-election at the 2024 Annual Meeting of Shareholders.

  12. Executive Compensation Objectives and Policies

    Executive Compensation Objectives and Policies The Committee believes that in order to maximize shareholder value, we must have a compensation program designed to attract and retain superior management at all levels in the organization. The objective of the management program is to both reward short-term performance and motivate long-term performance so that management’s incentives are aligned with the interests of the shareholders. The Committee believes that management at all levels should have a meaningful equity participation in the ownership of our Company, although no specific target level of equity holdings has been established for management by the Committee. While the Committee has awarded both restricted stock and options in the past, since 2008, based on a recommendation from Towers Watson, the Committee has awarded only restricted stock to our executive officers and other key members of management. In 2022, we awarded our named executive officers 16,383 shares of restricted stock (which consisted of all Class A Common Restricted Stock). In 2023, we awarded our named executive officers 55,979 shares of restricted stock (which consisted of all Class A Common Restricted Stock). We attempt to achieve our objectives through compensation plans that tie a portion of our executives’ overall compensation to our financial performance and that are competitive with the marketplace. To that end, the Committee reviews the proxy statements of other public companies in the same industry to see if the compensation of our executive officers is generally in line with other companies in our industry, and with respect to the executive officers other than the CEO, the Committee also gives weight to the recommendations of the CEO. However, the Committee does not benchmark compensation of our executive officers to the compensation paid to executive officers of other public companies in the same industry. Other public companies that the Committee has looked at in past years for comparison include: Beasley Broadcast Group, Inc.; CC Media Holdings, Inc.; Cumulus Media Inc.; Emmis Communications Corporation; Audacy, Inc.; Entravision Communications Corporation; Urban One, Inc.; Salem Media Group, Inc.; Townsquare Media, Inc.; Sirius XM Holdings Inc.; and Spanish Broadcasting System, Inc. The Committee’s current policy is that the various elements of the compensation package are not interrelated in that gains or losses from past equity incentives are not factored into the determination of other compensation. For instance, if restricted stock that was granted in a previous year declines in value the next year, the Committee does not take that into consideration in determining the amount of the bonus or restricted stock to be granted the next year. Similarly, if the restricted shares granted in a previous year become extremely valuable, the Committee does not take that into consideration in determining the bonus or restricted stock to be awarded for the next year. In addition, the amount of a cash bonus does not affect the number of restricted shares that are granted during a particular year. We have certain rights with regard to the adjustment or recovery of certain incentive-based compensation awards or payments if the relevant performance measures upon which they are based are restated or otherwise adjusted in a manner that would reduce the size of an award or payment.

  13. Compensation Components

    Compensation Components The key components of our executive compensation program generally consist of a base salary, a cash bonus and participation in our 2023 Incentive Compensation Plan (pursuant to which restricted stock, restricted stock units, incentive stock options, nonqualified stock options, and performance awards, including cash, may be granted). In addition, the Company also has a 401(k) Plan and a deferred compensation plan. Our executives can invest in our Class A Common Stock through our 401(k) Plan and in our Common Stock, as applicable, through the award of grants of stock options and/or restricted stock under the 2023 Incentive Compensation Plan. As noted above, in 2023 and 2022, there were no awards of stock options, while in 2023 and 2022 certain awards of restricted stock were made. Our executive officers also receive certain health benefits and perquisites. In addition, pursuant to agreements with our executive officers, we provide for severance following a sale or change-in-control.

  14. Bonuses

    Bonuses The Company entered into the CEO Plan effective as of January 1, 2000, which was approved by shareholders at the 2000 Annual Meeting of Shareholders and re-approved by shareholders at the 2005, 2010, 2015, and 2020 Annual Meetings of Shareholders. Mr. Christian’s amended 2011 employment agreement and Mr. Forgy’s 2022 employment agreement provided that they had the opportunity to earn an annual performance bonus pursuant to the terms of the CEO Plan and was also eligible for a bonus determined in the discretion of the Committee. Among other reasons, the use of performance driven requirements were designed to permit the bonus payments to be fully deductible and exempt from Section 162(m) of the Code, which generally disallows a tax deduction to public corporations for compensation over $1 million paid for any calendar year to the CEO and certain other highly compensated executive officers included in the 2023 Summary Compensation Table. The Tax Cuts and Jobs Act, (the “Act”) eliminated the performance-based compensation exception to the $1 million limitation, beginning January 1, 2018. The Act, however, provided a transition rule with respect to performance-based remuneration which is provided pursuant to a written binding contract which was in effect on November 2, 2017 and which was not materially modified after that date, such as the CEO Plan. Under the CEO Plan, within ninety days after the beginning of each fiscal year, the Committee establishes the bonus opportunity for the CEO. The bonus opportunity for the CEO is based on the achievement of one or more performance objectives in alignment with our business strategies, and, if realized, provides for a total compensation generally in line with the total compensation paid to other CEOs in our peer group. In March 2022, the Committee approved a broadcast cash flow (“BCF”) goal for Mr. Christian with five different BCF targets of $29 million, $30 million, $31 million, $32 million, and $33 million, allowing for a possible award of $800,000, $850,000, $900,000, $950,000 and $1,000,000, respectively, payable in cash and/or restricted stock if such targets were achieved. The Committee further determined, in the event of a sale or acquisition of broadcast assets during the fiscal year 2022, the established BCF goals would be adjusted. The established BCF goals would be reduced by the budgeted BCF for the broadcast assets sold during fiscal year 2022 on a pro-rata basis. Pro-rata BCF generated from broadcast assets acquired during fiscal year 2022 would be added to adjust the BCF goals. The BCF target levels are selected to reward improvements in BCF. It is believed that the initial target level will be achievable based on past performance, while the other targets will be more difficult to achieve. For fiscal year 2022, the Committee determined that Mr. Christian achieved the $32 million target under the BCF performance goal and awarded Mr. Christian a prorated aggregate cash bonus of $633,333. The Committee awarded Mr. Forgy a discretionary bonus of $50,000 for the 2022 fiscal year for his role as President and Chief Executive Officer. In March 2023, the Committee approved a BCF goal for Mr. Forgy with four different BCF targets of $30 million, $31 million, $32 million, and $33 million, allowing for a possible award of $235,000, $380,000, $525,000, and $670,000, respectively, payable in cash if such targets were achieved. The Committee further determined, in the event of a sale or acquisition of broadcast assets during the fiscal year 2023, the established BCF goals would be adjusted. The established BCF goals would be reduced by the budgeted BCF for the broadcast assets sold during fiscal year 2023 on a pro-rata basis. Pro-rata BCF generated from broadcast assets acquired during fiscal year 2023 would be added to adjust the BCF goals. The BCF target levels are selected to reward improvements in BCF. It is believed that the initial target level will be achievable based on past performance, while the other targets will be more difficult to achieve. For fiscal year 2023, the Committee determined that BCF did not meet any of the established BCF goals noted above. The Committee awarded Mr. Forgy with a discretionary bonus of $245,000 due to the significant achievements of the Company under the leadership of Mr. Forgy during 2023, including significant investments in initiatives to diversify our revenue and building our Corporate management team to establish a base for future growth and to hold revenue flat in comparison to 2022 year-end during a year when revenue was impacted by a reduction in political revenue. The CEO provides input and makes recommendations to the Committee as to the bonuses to be paid to the other executive officers. As a result of Mr. Christian’s passing in 2022, the Committee made a recommendation to the Board to award a special bonus of $25,000 to Mr. Forgy, and Mr. Bush and the Board agreed. Based on his subjective review of the 2022 performance of the executive officers, Mr. Forgy recommended that 2022 cash bonuses be awarded in the amount of $50,000 for Mr. Bush, and the Committee agreed. The Committee then made such recommendation to the Board for the Board’s final approval, and the Board agreed. In his role as President and General Manager of our Norfolk, Virginia market, Mr. Leland earned an annual bonus of $40,000 in 2022. Based on his subjective review of the 2023 performance of the executive officers, Mr. Forgy recommended that 2023 cash bonuses be awarded in the amount of $52,500 for Mr. Bush and $35,000 for Mr. Leland, and the Committee agreed and the Board approved these bonuses.

  15. Long-Term Incentives

    Long-Term Incentives In 2005, we engaged Towers Watson (then Towers Perrin) to conduct a review of our long-term incentive plan and provide recommendations, as appropriate, for redesigning our plan. We did not request, and Towers Watson did not conduct, a review of our long-term incentive award opportunities relative to market levels. The purpose of the review was to determine a long-term strategy for providing an effective equity incentive package which would attract, motivate, and retain our executive officers. Based on Towers Watson’s recommendations, we developed a new strategy to award a combination of stock options and restricted stock, and adopted the 2005 Incentive Compensation Plan, subject to shareholder approval. Shareholders approved this Plan at the 2005 Annual Meeting of Shareholders and re-approved it at the 2010 Annual Meeting of Shareholders, by written consent in 2013 and at the 2018 Annual Meeting of Shareholders. In June 2008, the Committee determined that it would only award restricted stock pursuant to the 2005 Incentive Compensation Plan, since stock options historically had not been an effective strategy, as previously granted options were generally underwater, and stock options had the potential to result in the issuance of a far larger number of shares than by granting only restricted stock. In March 2013, we engaged Towers Watson to again advise us with respect to possible grants of stock options and/or restricted stock under our 2005 Incentive Compensation Plan. Under this plan, we awarded our named executive officers shares of restricted stock in each of 2013 – 2019, and in 2021 – 2022. No restricted stock or options were granted to our named executive officers in 2020 because of the uncertainty of the COVID-19 pandemic and the related impact to the economy. In recent years, the restricted stock has been granted with pro-rata vesting at the end of each of the ensuing three years from the date of grant. All such awards of restricted stock, however, shall vest if the named executive officer is an employee upon the occurrence or deemed occurrence of a change-in-control. Under the terms of the 2005 Incentive Compensation Plan and the form of restricted stock grant agreement, each officer must retain 50% of the net award of restricted stock until such time as the officer is no longer an employee of the Company. In May 2023, our shareholders approved the 2023 Incentive Compensation Plan. The 2023 Incentive Compensation Plan replaces the 2005 Incentive Compensation Plan. The Board does not intend to make any further awards under the 2005 Incentive Compensation Plan. However, each outstanding award under the 2005 Incentive Compensation Plan will remain outstanding under the 2005 Incentive Compensation Plan and will continue to be governed under its terms and any applicable award agreement. The 2023 Incentive Compensation Plan allows for the granting of restricted stock, restricted stock units, incentive stock options, nonqualified stock options, and performance awards, including cash to eligible employees and non-employee directors of the Company and its subsidiaries. Under this plan, we awarded our named executive officers shares of restricted stock in 2023. The restricted stock was granted with pro-rata vesting at the end of each of the ensuing three years from the date of grant. All such awards of restricted stock, however, shall vest if the named executive officer is an employee upon the occurrence or deemed occurrence of a change-in-control. Under the terms of the 2023 Incentive Compensation Plan and the form of restricted stock grant agreement, each officer must retain 50% of the net award of restricted stock until such time as the officer is no longer an employee of the Company. Mr. Christian’s awards of stock options and restricted stock related to Class B Common Stock and the other executive officers’ awards of stock options and/or restricted stock relate to Class A Common Stock. Only Mr. Christian or an affiliate of Mr. Christian was able to hold Class B Common Stock. An affiliate includes (i) any individual or entity who or that controls or is under common control with Mr. Christian, (ii) any corporation or organization in which Mr. Christian is an officer or partner or the beneficial owner of 10% of more of the voting securities (other than the Company or a majority-owned subsidiary of the Company), (iii) a trust or estate in which Mr. Christian has a substantial beneficial interest or as to which he serves as trustee or in a similar fiduciary capacity, or (iv) any relative or spouse of Mr. Christian, or any relative of such spouse, who has the same home as Mr. Christian or who is a director or officer of the Company or any of its subsidiaries. An executive officer generally forfeits any unvested stock option and restricted stock award upon ceasing employment.

  16. Severance Arrangements

    Severance Arrangements As discussed in more detail in the section below entitled “Compensation of Executive Officers- Employment Agreement and Potential Payments Upon Termination or Change-in-Control,” Mr. Christian’s amended 2011 employment agreement had change-in-control severance arrangements. In addition, in December 2007, the Committee determined to enter into change-in-control agreements with its other executive officers. The agreements are intended to help retain executives during continued industry consolidation and are designed to attract and retain senior managers and to provide for continuity of management in the event of a change-in-control. Mr. Christian’s amended 2011 employment agreement provided that following a change-in-control of the Company, the CEO would have the right to terminate his employment. Further, upon such change-in- control, he would be paid an amount equal to 2.99 times the average of his total annual salary and bonus for each of the three immediately preceding periods of twelve consecutive months, plus an additional amount as is necessary for applicable tax liabilities related to the payment. See “Employment Agreement and Potential Payments Upon Termination or Change-in-Control.” With respect to the other executive officers, including Mr. Forgy, the change-in-control agreements provide that we shall pay a lump sum payment within forty-five days of the change-in-control of 1.5 times the average of the executive’s last three full calendar years of such executive’s base salary and any annual cash bonus. We or the surviving entity may require as a condition to receipt of payment that the executive continue in employment for a period of up to six months after consummation of the change-in-control. During such six months, the executive will continue to earn his pre-existing salary and benefits.

  17. Securities Authorized for Issuance Under Equity Compensation Plan Information

    Securities Authorized for Issuance Under Equity Compensation Plan Information The following table sets forth as of December 31, 2023, the number of securities outstanding under our equity compensation plans, the weighted average exercise price of such securities and the number of securities available for grant under these plans:

  18. Securities Authorized for Issuance Under Equity Compensation Plan Information

    | | (a) | (b) | (c) | | Plan Category | Number of Shares to be Issued Upon Exercise of Outstanding Options Warrants, and Rights | Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Column (a)) | | Equity Compensation Plans Approved by Shareholders: | | | | | Employees’ 401(k) Savings and Investment Plan | — | $— | 520,665 | | 2005 Incentive Compensation Plan | 53,896 | $—(2) | — | | 2023 Incentive Compensation Plan | 139,633 | $—(2) | 460,367 | | Equity Compensation Plans Not Approved by Shareholders: | | | | | None | — | | — | | Total | 193,529(1) | | 981,032 |

  19. Securities Authorized for Issuance Under Equity Compensation Plan Information

    (1) All 193,529 shares are restricted stock. Weighted-Average Exercise Price of Outstanding Options is $0.00 as they are all restricted stock.

  20. 2023 Summary Compensation Table

    2023 Summary Compensation Table

  21. 2023 Summary Compensation Table

    | Name and Principal Positions | Year | Salary(1) $ | Bonus(2) $ | Stock Awards(3) | Option Awards(4) | Non-Equity Incentive Plan Comp $ | All Other Comp(5) $ | Total Comp $ | | Edward K. Christian, Former President and CEO(6) | 2023 | $— | $— | $— | $— | $— | $— | $— | | | 2022 | $792,385 | $—(2) | $— | $— | $633,333(2) | $4,101,946 | $5,527,664 | | Christopher S. Forgy, President and CEO(7) | 2023 | $671,766 | $245,000 | $737,005 | $— | $— | $98,071 | $1,751,842 | | | 2022 | $325,616 | $75,000 | $187,698 | $— | $— | $51,476 | $639,740 | | Warren S. Lada, Interim President and CEO(8) | 2023 | $— | $— | $— | $— | $— | $— | $— | | | 2022 | $225,000 | $— | $34,947 | $— | $— | $50,925 | $310,422 | | Samuel D. Bush, Senior Vice President and CFO | 2023 | $365,000 | $52,500 | $255,513 | $— | $— | $67,445 | $740,458 | | | 2022 | $365,000 | $75,000 | $207,501 | $— | $— | $58,501 | $706,002 | | Wayne Leland, Senior Vice President of Operations | 2023 | $300,000 | $35,000 | $150,014 | $— | $— | $47,169 | $532,183 | | | 2022 | $250,000 | $40,000 | $74,993 | $— | $— | $12,501 | $377,494 |

  22. 2023 Summary Compensation Table

    (1) Includes amounts deferred under the Company’s 401(k) Plan, the 2005 deferred compensation plan, and Mr. Christian’s amended 2011 employment agreement. (2) Upon the recommendation of the Compensation Committee, a discretionary bonus of $50,000 was awarded by the Board to Mr. Forgy for 2022 as outlined in his employment agreement. A bonus in the amount of $50,000 paid to Mr. Bush in 2022 was approved by our Board upon the recommendation of Mr. Forgy and the Compensation Committee. As a result of Mr. Christian’s passing in 2022, our Board upon the recommendation of the Compensation Committee awarded a special bonus of $25,000 to Mr. Forgy and Mr. Bush. The bonus awarded to Mr. Christian in 2022 was based on his having satisified the BCF performance goals and was prorated to the date of his death. The amount of the bonus for Mr. Christian is disclosed under the column entitled “Non Equity Incentive Plan Comp” Upon approval of the Compensation Committee, a discretionary bonus of $245,000 was awarded to Mr. Forgy for 2023 as outlined in his employment agreement. Bonuses in the amount of $52,500 and $35,000 for Mr. Bush and Mr. Leland, respectively, were approved by the Compensation Committee upon the recommendation of Mr. Forgy. (3) Includes the value of restricted stock awarded on December 7, 2023, and December 15, 2022, respectively, to Messrs. Forgy and Bush and Mr. Leland in their capacity as officers, and to Mr. Lada in his capacity as a director. See “Long Term Incentives” under “Compensation Overview” above. Refer to Note 7, “Stock-Based Compensation” in the Notes to our Consolidated Financial Statements included in our Annual Report to the SEC on Form 10-K for the year ended December 31, 2023, for the relevant assumptions used to determine the valuation of the stock awards. (4) No options were awarded in 2023 or 2022. With respect to Mr. Christian, perquisites include personal use of Company provided automobile, country club dues, medical expense reimbursement, participation in an executive medical plan, personal tax consulting and tax return preparation fees, and personal use of a private airplane in 2022. In 2022, the personal use of the private airplane for Mr. Christian was in the amounts of $75,241 (computed using the actual invoice cost incurred by the Company). In 2022, the one-time payments under Mr. Christian’s employment agreement due to his death were in the amounts of $1,290,423 for one-year salary, $789,144 for accrued unused vacation time, $500,000 for split dollar life insurance payments for his spouse for ten years, $315,000 for health insurance premiums and medical expense reimbursement for his spouse for ten years, and $974,363 related to the value of the split dollar life insurance policy to be transferred to his irrevocable trust. Not included in this amount is the tax consequence of the transfer to the estate due to uncertainty related to the timing of the transfer. With respect to Mr. Forgy perquisites include personal use of the Company provided automobile, housing accommodations, and medical expense reimbursements in 2022 and 2023, and in 2023 included personal use of the Company’s private plane lease and country club dues. The personal use of the Company’s private plane lease was $16,470 (computed using the actual invoice cost incurred by the Company). In 2023 and 2022, Mr. Bush received perquisites for automobile allowance, housing accommodation and medical expense reimbursements. Mr. Leland received perquisites for automobile allowance in 2022 and moving expenses and housing accommodations in 2023. In 2022, Mr. Lada received perquisites of $5,295 for transportation costs related to his travel to the Company office while acting as Interim Chief Executive Officer in 2022, director fees earned in the amount of $27,375, the value of health insurance provided in the amount of $15,247, and $3,008 in dividends paid on unvested restricted stock awarded to him in his capacity as a director. Perquisites are valued based on the aggregate incremental costs to the Company. In addition, in 2023, the Company paid life insurance (including split dollar) premiums for Mr. Bush in the amount of $10,000, while in 2022, the Company paid life insurance (including split dollar) premiums for Mr. Christian, and Mr. Bush in the amounts of $50,000 and $10,000, respectively. In 2023 and 2022, the Company paid long-term care insurance premiums for Mr. Forgy in the amounts of $250 and $250, respectively. Under the 401(k) Plan, all matching funds in the amount of $1,200 and $1,200, respectively, were used to purchase 51 and 49 shares of Class A Common Stock in 2023 and 2022, respectively, for Mr. Bush, Mr. Forgy and Mr. Leland. Under the Second Restated and Amended 2005 Plan and 2023 Plan, dividends paid on unvested restricted stock were $36,120 and $25,647 for Mr. Bush, $31,579 and $20,045 for Mr. Forgy and $10,537 and $5,301 for Mr. Leland in 2023 and 2022, respectively. Mr. Christian served as our President and CEO until his death on August 19, 2022. (7) Mr. Forgy was appointed as our President and CEO effective December 7, 2022. Prior to that date, he served as our Senior Vice President of Operations. (8) Mr. Lada served as Interim President and Chief Executive Officer of the Company from August 21, 2022 to December 6, 2022. The information included in this Summary Compensation Table for Mr. Lada for 2022 includes compensation earned for his role as Interim President and Chief Executive Officer and compensation paid to him in his capacity as a director. Mr. Lada continues to serve as a member of the Company’s Board, which he joined in May 2018. Mr. Lada’s compensation paid to him in his capacity as a director in 2023 is included in the Compensation of Directors Table.

  23. Outstanding Equity Awards at Fiscal Year-End

    Outstanding Equity Awards at Fiscal Year-End The following table provides information as of December 31, 2023 regarding unexercised options and restricted stock that has not vested for each named executive officer outstanding as of December 31, 2023:

  24. Outstanding Equity Awards at Fiscal Year-End Table

    Outstanding Equity Awards at Fiscal Year-End Table

  25. Outstanding Equity Awards at Fiscal Year-End Table

    | Name | Option Awards | | | | Stock Award(1) | | | | Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#) Unexercisable | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($)(2) | | Christopher S. Forgy | | | | | | | | 12/7/2023 | — | — | — | — | 36,110 | $803,809 | | 12/15/2022 | — | — | — | — | 4,360 | $97,054 | | 12/10/2021 | — | — | — | — | 1,739 | $38,710 | | Warren S. Lada | | | | | | | | 12/7/2023 | — | — | — | — | 2,597 | $57,809 | | 12/15/2022 | — | — | — | — | 801 | $17,830 | | 12/10/2021 | — | — | — | — | 246 | $5,476 | | Samuel D. Bush | | | | | | | | 12/7/2023 | — | — | — | — | 12,519 | $278,673 | | 12/15/2022 | — | — | — | — | 4,820 | $107,293 | | 12/10/2021 | — | — | — | — | 2,116 | $47,102 | | Wayne P. Leland | | | | | | | | 12/7/2023 | — | — | — | — | 7,350 | $163,611 | | 12/15/2022 | — | — | — | — | 1,742 | $38,777 | | 12/10/2021 | — | — | — | — | 362 | $8,058 |

  26. Outstanding Equity Awards at Fiscal Year-End Table

    (1) Restricted stock awarded on December 7, 2023 vest in one-third increments on December 15, 2024, 2025 and 2026. Restricted stock awarded on December 15, 2022 vest in one-third increments on November 6, 2023, 2024 and 2025. Restricted stock awarded on December 10, 2021 vest in one-third increments on November 6, 2022, 2023 and 2024. All such restricted stock, however, shall vest if the recipient is an employee or director on the occurrence or deemed occurrence of a change-in-control. All restricted stock awards comprise Class A Common Stock. (2) Based on $22.26 per share, which was the closing price of our Class A Common Stock on the NASDAQ on December 29, 2023 (the last business day of the fiscal year). (3) Mr. Lada was a named executive officer for 2022 for his role as Interim President and Chief Executive Officer from August 21, 2022 to December 6, 2022. Stock awards held by Mr. Lada were awarded to him in his capacity as a director.

  27. Employment Agreements and Potential Payments Upon Termination or Change-in-Control

    Employment Agreements and Potential Payments Upon Termination or Change-in-Control

  28. PAY VERSUS PERFORMANCE

    PAY VERSUS PERFORMANCE The following table sets forth the pay versus performance including relationship between executive compensation actually paid, as calculated by SEC rules and Company performance.

  29. Pay versus Performance Table

    Pay versus Performance Table

  30. Pay versus Performance Table

    | Year (a) | Summary Compensation table total for first PEO (b) | Summary Compensation table total for second PEO (b) | Summary Compensation table total for third PEO (b) | Compensation actually paid to first PEO (c)(1)(2) | Compensation actually paid to second PEO (c)(1)(2) | Compensation actually paid to third PEO (c)(1)(2) | Average Summary compensation table total for non-PEO NEOs (d) | Average compensation actually paid to non-PEO NEOs (e)(1)(2) | Value of initial fixed $100 investment based on shareholder return (f)(3) | Net income (h)(4) | | 2023 | N/A | N/A | $1,751,842 | N/A | N/A | $1,796,443 | $636,321 | $638,334 | $131.66 | $9,500,000 | | 2022 | $5,527,664 | $310,422 | $639,740 | $5,561,608 | $304,032 | $604,528 | $585,681 | $553,693 | $122.99 | $9,202,000 | | 2021 | $3,209,748 | N/A | N/A | $3,319,458 | N/A | N/A | $513,274 | $524,993 | $104.94 | $11,157,000 |

  31. Pay versus Performance Table

    (1) Edward K. Christian served as our first principal executive officer (“PEO”) for the full year 2021 and from January 1, 2022 until his passing on August 19, 2022. Warren S. Lada served as our second PEO on an interim basis from August 21, 2022 until Christopher S. Forgy was appointed to President and CEO and became our third PEO on December 7, 2022. Our non-PEO named executive officers (“NEOs”) included (a) for 2021, Samuel D. Bush and Christopher S. Forgy and (b) for 2022, Samuel D. Bush and Catherine A. Bobinski and (c) for 2023, Samuel D. Bush and Wayne P. Leland. (2) For each year the values included in these columns for the compensation actually paid to our PEO and the average compensation actually paid to our non-PEO NEOs reflect the following adjustments to the values included in columns (b) and (d), respectively:

  32. Pay versus Performance Table

    | | First PEO | | Second PEO | Third PEO | | | PEO | 2022 | 2021 | 2022 | 2023 | 2022 | | Summary Compensation Table (“SCT”) Total for PEO (column (b)) | $5,527,664 | $3,209,748 | $310,422 | $1,751,842 | $639,740 | | - SCT “Stock Awards” Column (grant date FV of equity awards reported in SCT) | | (919,448) | (34,497) | (737,005) | (187,698) | | + year-end fair value of equity awards granted in the covered year that were outstanding and unvested as of the covered year-end | | 966,620 | 28,367 | 803,809 | 154,344 | | +/- year over year change in fair value of equity awards granted in prior years that are outstanding and unvested as of the covered year-end | | 2,364 | (285) | (8,173) | (2,017) | | + vesting date fair value of equity awards granted and vested in the covered year | | | | | | | +/- year-over-year change in fair value of equity awards granted in prior years that vested in the covered year | 33,944 | 60,174 | 26 | (14,030) | 159 | | - fair value as of prior year end equity awards granted in prior years that failed to vest in the covered year (i.e., forfeited) | | | | | | | + dollar value of dividends/earnings paid on equity awards in the covered year | | | | | | | + excess fair value for equity award modifications | | | | | | | Compensation Actually Paid to PEO (column (c)) | $5,561,608 | $3,319,458 | $304,032 | $1,796,443 | $604,528 |

  33. Pay versus Performance Table

    | Average for Non-PEO NEOs | 2023 | 2022 | 2021 | | Average SCT Total for Non-PEO NEOs (column (d)) | $636,321 | $585,681 | $513,274 | | - SCT “Stock Awards” Column (grant date FV of equity awards reported in SCT) | (202,763) | (170,004) | (132,998) | | + year-end fair value of equity awards granted in the covered year that were outstanding and unvested as of the covered year-end | 221,142 | 139,795 | 139,821 | | +/- year over year change in fair value of equity awards granted in prior years that are outstanding and unvested as of the covered year-end | (6,057) | (1,950) | 193 | | + vesting date fair value of equity awards granted and vested in the covered year | | | | | +/- year-over-year change in fair value of equity awards granted in prior years that vested in the covered year | (10,309) | 171 | 4,703 | | ‘- fair value as of prior year end equity awards granted in prior years that failed to vest in the covered year (i.e., forfeited) | | | | | + dollar value of dividends/earnings paid on equity awards in the covered year | | | | | + excess fair value for equity award modification | | | | | Average Compensation Actually Paid to Non-PEO NEOs (column ( e)) | $638,334 | $553,693 | $524,993 |

  34. Pay versus Performance Table

    For each year, total shareholder return for the Company was calculated in accordance with Item 201 (e) and Item 402 (v) of Regulation S-K. (4) Net income is rounded to the nearest thousand.

  35. Pay Versus Performance Relationship Descriptions

    Pay Versus Performance Relationship Descriptions The following graphical comparisons describe the relationships between certain figures included in the Pay Versus Performance Tables for each of 2023, 2022 and 2021, including: (a) a comparison between our cumulative total shareholder return and (b) comparisons between (i) the compensation actually paid to the PEO (on an aggregate basis) and the average compensation actually paid to our non-PEO NEOs and (ii) the performance measure set forth in column (f) and (h) of the Pay Versus Performance Table. The compensation actually paid to the PEO is affected by the one-time payments to our former CEO, Mr. Christian, in the event of his death as disclosed in the “All Other Compensation” column of the Summary Compensation Table.