DEF 14A of Pure Cycle Corp, Dec 4, 2025

DEF 14A of Pure Cycle Corp

Filed Dec 4, 2025 · FY20250001104659-25-118311

Open on EDGAR

  1. DIRECTORS, DIRECTOR NOMINEES AND EXECUTIVE OFFICERS5

    DIRECTORS, DIRECTOR NOMINEES AND EXECUTIVE OFFICERS5 Directors and Director Nominees5 Executive Officer (Non-Director)7

  2. EXECUTIVE COMPENSATION11

    EXECUTIVE COMPENSATION11 Named Executive Officers (“NEO”)11 Executive Compensation Discussion11 Compensation Philosophy11 Shareholder Feedback and Say-On-Pay Results12 Compensation Components12 Compensation of Pure Cycle’s Executive Officers12 Stock Ownership Guidelines for Executive Officers13 Insider Trading Policy13 Policies and Practices for Granting Stock Options and Stock Appreciation Awards.13 Employment and Severance Agreements13 Summary Compensation Table14 Outstanding Equity Awards at Fiscal Year-End14 Pay versus Performance Table14 Pay versus Performance Narrative15

  3. PROPOSAL 1 – ELECTION OF DIRECTORS18

    PROPOSAL 1 – ELECTION OF DIRECTORS18

  4. Securities Authorized for Issuance Under Equity Compensation Plans

    Securities Authorized for Issuance Under Equity Compensation Plans The following table sets forth certain information regarding our equity compensation plans as of August 31, 2025. All securities outstanding represent options to purchase common stock pursuant to our 2024 Equity Incentive Plan (the “2024 Plan”) and our 2014 Equity Incentive Plan.

  5. Securities Authorized for Issuance Under Equity Compensation Plans

    | Plan category | Number of securities to be issued upon exercise of outstanding options (a) | Weighted-average exercise price of outstanding options (b) | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (c) | | Equity compensation plans: | | | | | Approved by security holders | 489,500 | $9.52 | 1,973,796 | | Not approved by security holders | — | — | — | | Total | 489,500 | $9.52 | 1,973,796 |

  6. DIRECTORS, DIRECTOR NOMINEES AND EXECUTIVE OFFICERS

    DIRECTORS, DIRECTOR NOMINEES AND EXECUTIVE OFFICERS The following table sets forth the name, age and title of each current director, each nominee standing for election to the board of directors and each of our executive officers.

  7. DIRECTORS, DIRECTOR NOMINEES AND EXECUTIVE OFFICERS

    | Name | Age | Position | | Mark W. Harding | 62 | Director, President and CEO* | | Marc S. Spezialy | 43 | Vice President and CFO | | Wanda J. Abel | 67 | Director* | | Patrick J. Beirne | 62 | Director* and Chair | | Frederick A. Fendel III | 70 | Director* | | Susan D. Heitmann | 61 | Director* | | Daniel R. Kozlowski | 54 | Director* | | Jeffrey G. Sheets | 71 | Director* |

  8. DIRECTORS, DIRECTOR NOMINEES AND EXECUTIVE OFFICERS

    | * Director nominee |

  9. DIRECTORS, DIRECTOR NOMINEES AND EXECUTIVE OFFICERS

    Directors are elected for one-year terms, which expire at the next annual meeting of shareholders or when their successors are duly elected and qualified. Our executive officers are elected by the board of directors, typically annually, and serve at the discretion of the board of directors. Set forth below are the names of the director nominees and executive officers, all positions and offices held by each such persons, the period during which each has served as such, and the principal occupations and employment of and public company directorships held by such persons during at least the last five years. With respect to nominees, additional information is included regarding the skills, knowledge and experience with respect to each nominee that has led the board of directors to conclude that each such nominee should be elected or re-elected as a director.

  10. Directors and Director Nominees

    Directors and Director Nominees Mark W. Harding. Mr. Harding joined us in April 1990 as Corporate Secretary and Chief Financial Officer (“CFO”). He was appointed as our President in April 2001, Chief Executive Officer (“CEO”) in April 2005, and a member of the board of directors in February 2004. Mr. Harding stepped down as CFO in April 2020. Mr. Harding brings a background in investment banking and public finance, having worked from 1988 to 1990 for Price Waterhouse’s management consulting services where he assisted clients in public finance and provided other investment banking related services. Mr. Harding is the President and a board member of the Rangeview Metropolitan District, Sky Ranch Metropolitan District Nos. 1, 3, 4, 5, 6, 7 and 8 and the Sky Ranch Community Authority Board, and President of the South Metro Water Supply Authority. Mr. Harding also serves on the board of directors and as the President of the Sky Ranch Academy school board and is a board member of the managing partner of Hawaiian Macadamia Nut Orchards, L.P., which until June 2018 was a publicly traded limited partnership. Mr. Harding earned a Bachelor of Science degree in Computer Science and a Master of Business Administration in Finance from the University of Denver. In determining Mr. Harding’s qualifications to be on the board of directors, the board of directors considered, among other things, Mr. Harding’s extensive experience with Pure Cycle and his service on a number of advisory boards relating to water and wastewater issues in the Denver region as well as municipal boards, school boards, and chamber of commerce boards. Wanda J. Abel. Ms. Abel was elected to the board of directors in January 2022. Since 1993, Ms. Abel has been a partner at the law firm of Davis Graham & Stubbs LLP, a Denver, Colorado-based firm, where she started as an associate in 1986. She served as our outside corporate-counsel from 1990 until she was elected to the board of directors, and as our outside securities counsel from 1990 through 2020. In addition, she has represented both public and private companies in securities matters, mergers and acquisitions, complex commercial agreements, financings and joint ventures, and served as in-house counsel for a NYSE-listed company. Ms. Abel received a Bachelor of Arts degree and a Master of Library Science from Indiana University and a Juris Doctor degree from the University of Colorado Law School. In determining Ms. Abel’s qualifications to serve on the board of directors, the board of directors has considered, among other things, her expertise in securities law, corporate governance, and complex commercial agreements, in particular her extensive knowledge of and experience with our State Land Board Lease and the other Rangeview Water Agreements. Patrick J. Beirne. Mr. Beirne was appointed to the board of directors in January 2016 and appointed as Chair of the board of directors in January 2021. Since April 2015, Mr. Beirne has been the Chairman and CEO of Nelson Pipeline Constructors LLC (“Nelson Pipeline”), a private company majority owned by Mr. Beirne. Nelson Pipeline is an underground utility contractor specializing in the construction of underground sanitary sewer, water and storm water pipelines. Prior to working at Nelson Pipeline, Mr. Beirne worked at Pulte Group, Inc. for 29 years in various management roles, where he gained extensive experience in the home building industry. In his last position with Pulte Group, Inc., from January 2008 to September 2014, he served as Central Area President, where he helped create the strategy for the firm’s long-term vision and oversaw operations in 10 states. Mr. Beirne also serves on two private company boards: Ox Engineered Products, Inc., a manufacturer of building materials based in Northville, Michigan, where he serves on the audit and compensation committees, and DPIS Engineering, LLC, an engineering service provider to residential builders across the country based in Houston, Texas. Mr. Beirne earned a Bachelor of Science degree from Michigan State University, is a Licensed General Contractor (Florida), and is active in many community and charitable organizations. In determining Mr. Beirne’s qualifications to serve on the board of directors, the board of directors has considered, among other things, his extensive experience and expertise in the home building industry and in construction of water and sewer pipelines. Frederick A. Fendel III. Mr. Fendel was elected to the board of directors in January 2021. Mr. Fendel was an associate and then a partner at the Denver, Colorado law firm of Petrock Fendel Poznanovic, P.C. from 1980 through his retirement on December 31, 2020. He has served as outside water law counsel to us and the Rangeview Metropolitan District from 2002 through his retirement. In addition, he has represented many local governments, water utilities, special districts, developers, corporations, ditch companies, farmers and ranchers in water rights litigation; land and water acquisitions; development, zoning and subdivision approvals; real estate transactions and disputes; easement and right-of-way matters; water quality regulatory matters; and monitoring and supporting or opposing state legislation and rule-making. Mr. Fendel received a Bachelor of Arts degree from the University of Colorado and a Juris Doctor degree from the University of Michigan Law School. In determining Mr. Fendel’s qualifications to serve on the board of directors, the board of directors has considered, among other things, his extensive experience and expertise in Colorado water law and special district law, particularly with respect to the water rights we own or control. Susan D. Heitmann. Ms. Heitmann was appointed to the board of directors in May 2024. Ms. Heitmann has over 30 years of accounting and finance experience. Ms. Heitmann is a recently retired partner from KPMG LLP, based in Denver, Colorado, where she started as an associate in 1987. Ms. Heitmann has served as an auditor for SEC clients and private equity entities, as well as large privately held companies. Ms. Heitmann received a Bachelor of Science degree from the University of Illinois. In determining Ms. Heitmann’s qualifications to serve on the board of directors, the board of directors has considered, among other things, her extensive experience and expertise in finance and financial reporting, qualifying her as an audit committee financial expert. Her background and experience is invaluable in her oversight role at Pure Cycle as an independent director. Daniel R. Kozlowski. Mr. Kozlowski was elected to the board of directors in January 2021. Mr. Kozlowski is the founder and managing member of Plaisance Capital, LLC (“Plaisance Capital”), which serves as the general partner of the Plaisance Midway Fund LP and the Plaisance Fund LP. Plaisance Capital, LLC previously served as the general partner of Plaisance SPV I, LLC, a holder of Pure Cycle common stock. From 2000 until the founding of Plaisance Capital in 2017, Mr. Kozlowski worked at Janus Capital Corporation (now part of Janus Henderson Group PLC) (“Janus Capital”). While at Janus Capital, Mr. Kozlowski was the sole portfolio manager of Janus Capital’s Opportunistic Alpha strategies, including the $4 billion Janus Contrarian Fund. Mr. Kozlowski also managed a long-short equity account in addition to long-only strategies. Mr. Kozlowski earned a Bachelor of Business Administration from the University of Miami and a Master of Business Administration from the University of Chicago’s Booth School of Business. In determining Mr. Kozlowski’s qualifications to serve on the board of directors, the board of directors considered, among other things, his extensive experience in finance and investment management.

  11. Directors and Director Nominees

    Jeffrey G. Sheets. Mr. Sheets was appointed to the board of directors in January 2020. Since 1991, Mr. Sheets has been Vice President of Koelbel and Company, a private Colorado commercial and residential development company. In addition, Mr. Sheets serves as a board member for a number of special districts in Colorado. Mr. Sheets received his undergraduate degree from Westmont College in Santa Barbara, California and his master’s degree from the University of Denver. In determining Mr. Sheets’ qualifications to serve on the board of directors, the board of directors considered, among other things, his extensive knowledge of real estate development in Colorado, including his experience with master planning and entitlements for both residential and commercial projects, land acquisitions, property assessments, and special districts.

  12. Director Compensation

    Director Compensation Pursuant to our director’s compensation structure approved at the board of director’s May 2022 meeting, each non-employee director receives an annual payment of $24,000 for each full year in which they serve as a director, with an additional $7,500 for serving as the chair of the Audit Committee, $3,500 for serving as chair of the Nominating Committee or Compensation Committee, $3,000 for serving on the Audit Committee, $2,000 for serving on the Nominating Committee or the Compensation Committee, and $7,500 for serving as chair of the board. In addition, the compensation structure provides for an award of the number of unrestricted shares of common stock upon election or reelection to the board of directors equal to $30,000 divided by the closing price of Pure Cycle’s common stock on the award date. Directors who are also our employees receive no fees for board service. Currently, Mr. Harding is the only director who is also an employee. The following table sets forth summary information concerning the compensation paid to our non-employee directors in fiscal 2025 for their board services:

  13. Director Compensation

    | Director Compensation | | | | | Name | Fees Earned Paid in Cash ($) | Stock Awards(1) ($) | Total ($) | | P. Beirne(2) | $34,500 | $29,997 | $64,497 | | W. Abel(3) | $27,500 | $29,997 | $57,497 | | F. Fendel(4) | $29,000 | $29,997 | $58,997 | | S. Heitmann(5) | $31,500 | $29,997 | $61,497 | | D. Kozlowski(6) | $29,500 | $29,997 | $59,497 | | J. Sheets(7) | $28,000 | $29,997 | $57,997 |

  14. Director Compensation

    | (1) In addition to cash compensation, pursuant to the 2024 Plan, non-employee directors may receive equity-based awards at the discretion of the board. The board’s discretion includes the discretion to adopt one or more formulas for the determination of non-employee director awards as well as the discretion to determine the terms of such awards. The value reported in this column reflects the grant date fair market value calculated in accordance with FASB Accounting Standards Codification Topic 718, Compensation – Stock Compensation (“ASC 718”), utilizing the assumptions discussed in Note 8 to our audited consolidated financial statements for the fiscal year ended August 31, 2025, which are included in our Annual Report on Form 10-K for the fiscal year ended August 31, 2025. There are no outstanding unvested stock awards. |

  15. Director Compensation

    | (2) The fees earned by Mr. Beirne are comprised of $24,000 for serving on the board of directors, $7,500 for serving as the board chair and $3,000 for serving on the Audit Committee. |

  16. Director Compensation

    | (3) The fees earned by Ms. Abel are comprised of $24,000 for serving on the board of directors and $3,500 for serving as chair of the Nominating Committee. |

  17. Director Compensation

    | (4) The fees earned by Mr. Fendel are comprised of $24,000 for serving on the board of directors and $5,000 for serving on the Audit and Compensation Committees. |

  18. Director Compensation

    | (5) The fees earned by Ms. Heitmann are comprised of $24,000 for serving on the board of directors and $7,500 for serving as chair of the Audit Committee since May 22, 2024. |

  19. Director Compensation

    | (6) The fees earned by Mr. Kozlowski are comprised of $24,000 for serving on the board of directors, $3,500 for serving as the chair of the Compensation Committee, and $2,000 for serving on the Nominating Committee. |

  20. Director Compensation

    | (7) The fees earned by Mr. Sheets are comprised of $24,000 for serving on the board of directors and $4,000 for serving on the Compensation and Nominating Committees. |

  21. Director Compensation

    The following table sets forth the outstanding option awards by each non-employee director as of August 31, 2025:

  22. Director Compensation

    | Name | Options Outstanding | | P. Beirne | 19,500 | | W. Abel | - | | F. Fendel | - | | S. Heitmann | - | | D. Kozlowski | - | | J. Sheets | - | | Total | 19,500 |

  23. Compensation Components

    Compensation Components The current compensation program for our executive officers consists of the following components: Base Salary – Base salary is intended to provide our executive officers with basic non-variable compensation that is competitive considering each officer’s responsibilities, experience and performance, and our financial resources. Discretionary Incentive Bonus – The Compensation Committee’s goal in granting incentive bonuses is typically to tie a portion of each executive officer’s compensation to our operating performance and to the officer’s individual contributions to that performance. Long-Term Equity Incentives – The goal of long-term equity incentive compensation is to align the interests of the executive officers with our shareholders and to provide the officers with a long-term incentive to manage from the perspective of an owner with an equity stake in the business. It is the belief of the Compensation Committee that stock and other equity-based awards directly motivate an executive to maximize long-term shareholder value. The philosophy of the Compensation Committee in administering our 2024 Plan is to tie the number of stock options and shares of stock awarded to each employee to our performance and to the individual employee’s contribution to our performance.

  24. Insider Trading Policy

    Insider Trading Policy We have adopted an Insider Trading and Non-Disclosure Policy and Procedure (“Insider Trading Policy”) containing policies and procedures governing the purchase, sale and/or other dispositions of our securities by our directors, officers and employees. Such policies and procedures are reasonably designed to promote compliance with insider trading laws, rules and regulations, and any listing standards applicable to us. The Insider Trading Policy also prohibits directors, officers and employees from engaging in short sales of our securities, buying or selling put or call options of our securities, buying financial instruments designed to hedge or offset any decrease in the market value of our securities, holding our securities in a margin account or pledging our securities as collateral, or engaging in frequent trading (for example, daily or weekly) to take advantage of fluctuations in share price. A copy of the Insider Trading Policy is filed as Exhibit 19.1 to our most recent Annual Report on Form 10-K and is also available on our website at www.purecyclewater.com. Policies and Practices for Granting Stock Options and Stock Appreciation Awards. During the fiscal years ended August 31, 2025 and August 31, 2024, we did not award any stock options or stock appreciation rights to our NEOs and therefore do not have a formal written policy in place with regard to the timing of such awards in relation to the disclosure of material nonpublic information. Nonetheless, the Compensation Committee does not seek to time equity grants to take advantage of information, either positive or negative, about the Company that has not been publicly disclosed. Previous awards of stock options have generally been made and at the same time that the Company has issued other types of equity awards as part of its ordinary annual grant practices. Stock option grants, if made, are effective on the date the award determination is made by the Compensation Committee, and the exercise price of stock options is the closing market price of the Company’s common stock on the business day of the grant or, if the grant is made on a weekend or holiday, on the prior business day.

  25. Employment and Severance Agreements

    Employment and Severance Agreements We do not have any written employment, change of control, severance, or other similar agreement with our executive officers.

  26. Summary Compensation Table

    Summary Compensation Table The following summary compensation table summarizes the compensation paid to our NEOs for the fiscal years ended August 31, 2025 and August 31, 2024.

  27. Summary Compensation Table

    | Name and Principal Position | Fiscal Year | Salary ($) | Bonus ($) | Stock Awards (1) ($) | Option Awards ($) | All Other Compensation (2) ($) | Total ($) | | Mark W. Harding | 2025 | $525,000 | $300,000 | $114,300 | $- | $25,716 | $965,016 | | President and CEO | 2024 | $525,000 | $675,000 | $- | $- | $2,500 | $1,202,500 | | Marc S. Spezialy | 2025 | $310,000 | $15,000(3) | $- | $- | $2,500 | $327,500 | | Vice President and CFO | 2024 | $275,000 | $31,800 | $- | $- | $2,500 | $309,300 |

  28. Summary Compensation Table

    | (1) Amounts in this column are the aggregate grant date fair market value of restricted stock awards granted in fiscal 2025, calculated in accordance with FASB ASC 718, utilizing the assumptions discussed in Note 8 to the Company’s consolidated financial statements for the fiscal year ended Augst 31, 2025. |

  29. Summary Compensation Table

    | (2) The other compensation in both years presented for Mr. Harding and Mr. Spezialy consists of our matching contribution to the 401(k) Plan and medical insurance premiums for Mr. Harding and his dependents. |

  30. Summary Compensation Table

    | (3) Includes $10,000 paid in January 2025 following the completion of the fiscal year 2024 audit. |

  31. Outstanding Equity Awards at Fiscal Year-End

    Outstanding Equity Awards at Fiscal Year-End The following table summarizes certain information regarding outstanding option awards held by our NEOs at August 31, 2025.

  32. Outstanding Equity Awards at Fiscal Year-End

    | Name | Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#) Unexercisable | Option Exercise Price | Option Expiration Date | | Mark W. Harding | 50,000 | — | $5.61 | 10/12/2026 | | Mark W. Harding | 50,000 | — | $7.60 | 9/27/2027 | | Mark W. Harding | 50,000 | — | $11.15 | 9/26/2028 | | Mark W. Harding | 50,000 | — | $10.35 | 9/27/2029 | | Mark W. Harding | 30,000 | - | $9.00 | 9/23/2030 | | Mark W. Harding | 75,000 | - | $13.37 | 9/15/2031 | | | 305,000 | - | | |

  33. Pay versus Performance Table

    Pay versus Performance Table

  34. Pay versus Performance Table

    | Year | Summary Compensation Table Total for CEO | Compensation Actually Paid to CEO (1) | Average Summary Compensation Table Total for other NEOs (2) | Average Compensation Actually Paid to other NEOs (3) | Value of initial fixed $100 investment based on Total Shareholder Return | Net Income (in thousands) | | (a) | (b) | (c) | (d) | (e) | (f) | (g) | | 2025 | $965,016 | $1,174,751 | $326,319 | $326,319 | $(3) | $13,110 | | 2024 | $1,202,500 | $1,144,442 | $309,300 | $309,300 | $(3) | $11,613 | | 2023 | $1,052,500 | $1,050,895 | $435,168 | $(26,067) | $6 | $4,699 |

  35. Pay versus Performance Table

    | (1) The Summary Compensation Table totals reported for the CEO for each year were subject to the following adjustments per Item 402(v)(2)(iii) of Regulation S-K to calculate compensation actually paid: |

  36. Pay versus Performance Table

    | Year | Fair Value of covered year Unvested Equity Awards for CEO | Fair Value of the covered year Vested Equity Awards for CEO | Change in Fair Value of covered year Unvested Equity Awards for CEO | Change in Fair Value of covered year Vested Awards for CEO | Amounts reported in the Summary Compensation Table for Equity Awards for CEO | Equity Value Included in Compensation Actually Paid to CEO | | (a) | (b) | (c) | (d) | (e) | (f) | (g) = (b)+(c)+(d)+(e)-(f) | | 2025 | $- | $114,300 | $- | $95,435 | $- | $209,735 | | 2024 | $- | $- | $(5,337) | $(52,721) | $- | $(58,058) | | 2023 | $- | $- | $25,885 | $(27,490) | $- | $(1,605) |

  37. Pay versus Performance Table

    | (2) Other NEOs were Mr. Spezialy in 2025, Mr. Spezialy in 2024, and Mr. Spezialy and Mr. McNeill in 2023. |

  38. Pay versus Performance Table

    | (3) The Summary Compensation Table totals reported for the other NEOs for each year were subject to the following adjustments per Item 402(v)(2)(iii) of Regulation S-K to calculate compensation actually paid: |

  39. Pay versus Performance Table

    | Year | Fair Value of covered year Unvested Equity Awards for other NEOs | Fair Value of the covered year Vested Equity Awards for other NEOs | Change in Fair Value of covered year Unvested Equity Awards for other NEOs | Change in Fair Value of covered year Vested Awards for other NEOs | Amounts reported in the Summary Compensation Table for Equity Awards for other NEOs | Equity Value Included in Compensation Actually Paid to other NEOs | | (a) | (b) | (c) | (d) | (e) | (g) | (h) = (b)+(c)+(d)+(e)+(f)-(g) | | 2025 | $- | $- | $- | $- | $- | $- | | 2024 | $- | $- | $- | $- | $- | $- | | 2023 | $- | $98,900 | $- | $(2,875) | $494,500 | $(461,234) |

  40. Pay versus Performance Narrative

    Pay versus Performance Narrative The relationship between compensation actually paid and the pay of our NEOs is described below: Relationship Between Compensation Paid to the CEO and Average Other Named Officers and the Corporation’s Cumulative Total Shareholder Return (“TSR”) - In fiscal years 2025 and 2024, the compensation actually paid to the CEO decreased slightly despite our TSR staying relatively unchanged. This is due to the CEO being primarily paid in cash due to his substantial ownership in the Company. In 2025, the compensation paid to other NEO’s was slightly higher than 2024 manly due to inflation adjusted annual salary increases. In 2023, the compensation paid to other NEOs was lower than the Summary Compensation Total due to the average of the compensation paid to our two CFOs during 2023. The chart below shows the relationship between the compensation actually paid to the CEO and the average compensation actually paid to our other NEOs, on one hand, and the Corporation’s cumulative TSR (total shareholder return, based on an initial investment of $100) over the two most recently completed financial years. Relationship Between Compensation Actually Paid to the CEO and Average Other Named Officers and the Corporation’s Net Income - The changes in compensation actually paid to the CEO and our other NEOs in fiscal year 2025 were largely driven by equity award-related adjustments, and to a lesser extent by variability in annual salary and bonus. As a result, such changes are not directly related to the changes in our net income. The chart below shows the relationship between the compensation actually paid to the CEO and the average compensation actually paid to our other NEOs, on one hand, and the Corporation’s net income over the two most recently completed financial years.

  41. PROPOSAL 1 – ELECTION OF DIRECTORS

    PROPOSAL 1 – ELECTION OF DIRECTORS Our board of directors currently has seven members. The board of directors nominates the following persons currently serving on the board for re-election to the board: Mark W. Harding, Patrick J. Beirne, Wanda J. Abel, Frederick A. Fendel III, Susan D. Heitmann, Daniel R. Kozlowski, and Jeffrey G. Sheets. The principal occupation and other information about each of the nominees for election to the board of directors, including the period during which each has served as a director, can be found beginning on page 5. The proxy cannot be voted for more than the seven nominees named. Directors are elected for one-year terms or until the next annual meeting of the shareholders and until their successors are elected and qualified. All of the nominees have expressed their willingness to serve, but if because of circumstances not contemplated, one or more nominees is not available for election, the proxy holders named in the proxy card intend to vote for such other person or persons as the board of directors may nominate unless the board chooses to reduce the number of directors serving on the board. THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE “FOR” THE ELECTION AS DIRECTORS OF THE PERSONS NOMINATED.