DEF 14A of Evi Industries, Inc.
Filed Nov 20, 2024 · FY20240001174947-24-001267
Board of Directors
Board of Directors Pursuant to the Company’s Amended and Restated Bylaws and Delaware law, the Company’s business and affairs are managed under the direction of the Company’s Board of Directors. Directors are kept informed of the Company’s business through discussions with management, including the Company’s Chief Executive Officer and other officers, by reviewing materials provided to them, and by participating in meetings of the Board of Directors and its committees. Controlled Company The Company’s Common Stock is listed for trading on the NYSE American. As described in further detail under “Certain Relationships and Related Transactions – Controlled Company” below, the Company’s management, including Henry M. Nahmad, the Company’s Chairman, Chief Executive Officer and President, and the Company’s Board of Directors pursuant to stockholders agreements entered into in connection with business acquisitions previously effected by the Company, has the power to vote shares representing a majority of the total voting power of the Company. Accordingly, the Company is considered a “controlled company” under the rules of the NYSE American. As a “controlled company,” the Company is exempt from certain rules and requirements of the NYSE American related to corporate governance matters, including the rules requiring that (i) the Company’s Board of Directors be comprised of at least a majority of independent directors, (ii) the compensation of the Company’s executive officers be determined, or recommended to the Board of Directors for determination, either by a compensation committee comprised of independent directors or by a majority of the independent directors, and (iii) nominations for election to the Company’s Board of Directors be either selected, or recommended for the Board of Directors’ selection, by either a nominating committee comprised solely of independent directors or by a majority of the independent directors. However, the Company’s Board of Directors is, and historically has been, comprised of a majority of independent directors. In addition, the Company has a standing Compensation Committee comprised solely of independent directors which, among other things, determines the compensation of the Company’s Chief Executive Officer and determines, or recommends to the Board of Directors the determination of, the compensation of the Company’s other executive officers. The Compensation Committee also serves as the administrative committee for the Company’s 2015 Equity Incentive Plan. Director Independence The Company’s Board of Directors has determined that David Blyer, Glen Kruger, Timothy P. LaMacchia and Hal M. Lucas, who together comprise a majority of the Board of Directors, are independent. For purposes of making its independence determinations, the Board of Directors used the definition of independence set forth in the rules of the NYSE American. Meetings of the Board The Company’s Board met five times during the fiscal year ended June 30, 2024 (“fiscal 2024”). Each member of the Board of Directors attended at least 75% of the meetings of the Board and committees on which he served during fiscal 2024. It is the Company’s policy that, absent extenuating circumstances, the Company’s directors attend meetings of stockholders. All six of the Company’s directors attended the Company’s 2023 Annual Meeting of Stockholders. Committees of the Board of Directors Audit Committee The Company’s Board of Directors has a standing Audit Committee. The Audit Committee is comprised of Timothy P. LaMacchia, Chairman, and Glen Kruger. As permitted by the Audit Committee’s charter and by the listing standards of the NYSE American due to the Company qualifying as a “smaller reporting company” under Regulation S-K promulgated by the SEC, the Audit Committee is permitted to be comprised of just two members. The Board has determined that each member of the Audit Committee is “financially literate” and “independent” within the meaning of rules of the NYSE American (including, with respect to their independence, the additional independence requirements applicable to audit committee members thereunder) and applicable Securities and Exchange Commission (“SEC”) rules and regulations. In addition, the Board has determined that Mr. LaMacchia qualifies as an “audit committee financial expert,” as defined under Item 407 of Regulation S-K promulgated by the SEC. The Audit Committee held four meetings during fiscal 2024. The Audit Committee operates under a written charter adopted by the Board. If the Audit Committee deems it to be appropriate, the Audit Committee may amend, or recommend to the full Board amendments to, the Audit Committee charter. The Audit Committee charter is posted in the “Investors – Governance – Governance Documents” section of the Company’s website at www.evi-ind.com. Pursuant to its charter, the Audit Committee provides assistance to the Board in fulfilling the Board’s oversight responsibilities with respect to accounting, auditing, financial reporting practices and legal compliance. Under its charter, the Audit Committee reviews the financial reports and other financial information provided by the Company to the SEC, the Company’s systems of internal control over financial reporting, and the Company’s auditing, accounting and financial reporting processes generally. The Audit Committee also is responsible for the appointment and retention of, and the Audit Committee reviews and appraises the performance, qualifications and independence of, the Company’s independent registered public accounting firm, and the Audit Committee approves the fees and other compensation paid to the Company’s independent registered public accounting firm. In addition, the Board has designated the Audit Committee with the responsibility of overseeing and reporting to the Board on management’s handling of cybersecurity risks and on the adequacy and effectiveness of the Company’s cybersecurity risk management strategy. The Audit Committee is also responsible for, among other things, reviewing and, if it determines to be advisable, approving related party transactions required to be disclosed under Item 404 of Regulation S-K promulgated by the SEC. A report from the Audit Committee is included in this Proxy Statement on page 34. Compensation Committee The Company’s Board of Directors has a standing Compensation Committee. The Compensation Committee is comprised of Hal M. Lucas, Chairman, and David Blyer. The Company’s Board of Directors has determined that each member of the Compensation Committee is “independent,” within the meaning of the rules of the NYSE American (including the additional independence requirements applicable to compensation committee members thereunder). The Compensation Committee met twice during fiscal 2024. The Compensation Committee operates under a written charter adopted by the Board. If the Compensation Committee deems it to be appropriate, the Compensation Committee will recommend to the full Board changes to the Compensation Committee charter. The Compensation Committee charter is posted in the “Investors – Governance – Governance Documents” section of the Company’s website at www.evi-ind.com. Among other responsibilities set forth in its charter, the Compensation Committee determines the compensation, including base salary and incentive compensation, of the Company’s Chief Executive Officer and, with the input and assistance of the Company’s Chief Executive Officer, determines, or recommends to the full Board, the compensation, including base salary and incentive compensation, of the Company’s other
Board of Directors
executive officers. The Company’s executive compensation program is designed to align the interests of the Company’s executive officers with those of stockholders, reward performance and long-term value creation, recognize the individual performance, skills and responsibilities of each executive officer, and attract, retain, motivate and reward executive officers who have the experience and ability to conceive and successfully execute the Company’s business strategies. The Compensation Committee reviews the Company’s executive compensation practices as considered to be necessary with a goal of assuring the fairness of the Company’s executive compensation and its support of the strategic goals of the Company. The Compensation Committee also recommends to the full Board, with the input and assistance of the Company’s Chief Executive Officer, the compensation of the Company’s directors and, subject to any permitted delegation, administers the Company’s 2015 Equity Incentive Plan and the Company’s 2017 Employee Stock Purchase Plan. Pursuant to its charter, the Compensation Committee has the authority to retain consultants to assist the Compensation Committee in its evaluation of executive compensation, as well as the authority to approve any such consultant’s fees and retention terms. The Compensation Committee did not utilize the services of any executive compensation consultants for fiscal 2024. No Standing Nominating Committee As described above, as a “controlled company” under the rules of the NYSE American, nominees for director of the Company are not required to be selected or recommended to the Board by either a standing nominating committee comprised solely of independent directors or by a majority of the Company’s independent directors. The Company does not have a standing nominating committee nor are directors required to be selected or recommended by a majority of the Company’s independent directors. Instead, the full Board of Directors participates in the consideration of director nominees. The Board believes this structure to be appropriate because, as described above, the Company’s management has voting power over a majority of the Company’s outstanding Common Stock and, therefore, is in a position to control the election of the Company’s directors. The Board does not have a charter governing its nomination process. While the Board will consider nominees recommended by stockholders, it has not actively solicited recommendations from stockholders. Although the Board has not established specific minimum qualifications, or specific qualities or skills for prospective nominees, the Board, in evaluating director nominees, generally considers, among other things, a potential nominee’s financial and business experience, educational background, understanding of the Company’s business and industry, skills that would complement rather than duplicate skills of existing Board members, demonstrated ability in his or her professional field, integrity and reputation, willingness to work productively with other members of the Board and represent the interests of stockholders as a whole, and time availability to perform the duties of a director. The Board considers these factors in light of the then-current size and composition of the Board. Although the Company does not have a formal diversity policy and does not follow any ratio or formula with respect to diversity in order to determine the appropriate composition of the Board, when considering a prospective nominee, the Board will generally take into account diversity of skills, experience and other qualities of the nominee that the Board believes can contribute to the success of the Company. No weight is assigned to any of the factors described above, and the Board may change its emphasis on certain of these factors from time to time in light of the needs of the Company at the time. The Board will evaluate nominees of stockholders using the same criteria as it uses in evaluating other nominees to the Board. See “Bylaw Advance Notice Procedures,” “Stockholder Proposals Intended for Inclusion in the Company’s Proxy Materials for its 2025 Annual Meeting of Stockholders” and “Universal Proxy Rules” under “Additional Information” below for information regarding timing and other requirements relating to stockholder proposals and director nominations.
PROPOSAL NO. 1 - ELECTION OF DIRECTORS
PROPOSAL NO. 1 - ELECTION OF DIRECTORS The Company’s Amended and Restated Bylaws provide that the Board of Directors shall consist of no less than three or more than nine directors, and for each director to serve for a term expiring at the Company’s next annual meeting of stockholders. The specific number of directors is set from time to time by resolution of the Board. The Board of Directors currently consists of six directors. The Board has nominated all six of its incumbent directors, Henry M. Nahmad, Dennis Mack, David Blyer, Glen Kruger, Timothy P. LaMacchia and Hal M. Lucas, for re-election at the Annual Meeting. Each of the director nominees is nominated to serve for a term expiring at the Company’s 2025 Annual Meeting of Stockholders and has consented to serve for his term. If any director nominee should become unavailable to serve as a director, the Board may designate a substitute nominee. In that case, the persons named as proxies will vote for the substitute nominee designated by the Board.
Nominees for Election as Directors
Nominees for Election as Directors
HENRY M. NAHMAD
HENRY M. NAHMAD Henry Nahmad, age 45, has served as a director of the Company and as Chairman, Chief Executive Officer and President of the Company since March 2015. Prior to joining the Company, Mr. Nahmad served as Chief Executive Officer of Chemstar Corp., a provider of food safety and sanitation solutions, from July 2009 to March 2014. From 2001 to 2004 and from 2007 to 2009, Mr. Nahmad worked in various capacities at Watsco, Inc., the largest distributor of HVAC/R products. The Board believes that Mr. Nahmad’s knowledge, leadership skills, business relationships, and experience, including with respect to growth from acquisitions and other strategic transactions, make Mr. Nahmad a valuable member of the Board and benefit the Company, including with respect to its business, operations and growth strategy.
DENNIS MACK
DENNIS MACK Dennis Mack, age 80, has served as a director of the Company since 2016. Mr. Mack served as Executive Vice President of the Company from October 2016, when he was appointed to such position in connection with the Company’s acquisition of Western State Design at that time, until December 2023. He continues to serve the Company in a non-executive position as strategic advisor to the Company’s Chief Executive Officer. Mr. Mack founded Western State Design in 1974 and served as its President from its inception through 2020. The Board believes that it benefits from Mr. Mack’s knowledge of the commercial laundry industry as well as his understanding of the operations, prospects, products, customers, suppliers and employees of Western State Design.
DAVID BLYER
DAVID BLYER David Blyer, age 64, has served as a director of the Company since 1998. Since April 2017, Mr. Blyer has served as President and Chief Executive Officer of Arreva LLC, which provides software to serve the fundraising and donor relationship management needs of nonprofit organizations. Arreva is the successor by merger to DonorCommunity Inc., a company founded by Mr. Blyer which provided a software platform to non-profit organizations to assist in their operational and fundraising activities. Mr. Blyer served as President and Chief Executive Officer of DonorCommunity from August 2010 until the time of its merger with Telosa Software to form Arreva. Mr. Blyer was Co-Chairman of Stone Profiles LLC (formerly Profiles in Concrete, Inc.), a manufacturer and installer of architectural cast stone for the residential and commercial construction markets, from January 2005 until March 2010. From July 2002 until January 2005, Mr. Blyer was an independent consultant. Mr. Blyer was Chief Executive Officer and President of Vento Software, Inc., a developer of software for specialized business applications, from 1994, when he co-founded Vento, until November 1999, when Vento was acquired by SPSS Inc., a computer software company that developed and distributed technology for the analysis of data in decision-making and which merged with a subsidiary of IBM in 2010. From November 1999 until December 2000, Mr. Blyer served as Vice President of Vento and, from January 2001 until July 2002, he served as President of the Enabling Technology Division of SPSS. The Board believes that Mr. Blyer brings to the Board broad experience in developing sales and marketing strategies, in addition to business operations skills gained through his founding and running of a number of diverse companies as well as his leading of a division of SPSS, which at the time was a publicly-held company. Mr. Blyer has an MBA in finance.
Glen Kruger
Glen Kruger Glen Kruger, age 49, has served as a director of the Company since December 2019. Since October 2023, Mr. Kruger has served as Managing Director, Technology & Services Investment Banking at Raymond James & Associates, a leading global investment bank with expertise in mergers and acquisitions, and capital markets. Mr. Kruger previously served as a Managing Director, Technology Investment Banking at Houlihan Lokey from November 2021, when Houlihan acquired his predecessor firm GCA Global, which he joined in 2017. He received a BSc in Mechanical Engineering from the University of Natal (South Africa) and an MBA from Babson College. The Board believes that Mr. Kruger is a valuable contributor to the Board based on, among other things, his experience and expertise with respect to the capital markets and merger and acquisition transactions.
TIMOTHY P. LaMACCHIA
TIMOTHY P. LaMACCHIA Timothy P. LaMacchia, age 62, has served as a director of the Company since December 2017. Mr. LaMacchia is a private investor. He was a Partner at Ernst & Young LLP from 2002 until his retirement in June 2017. Prior to joining Ernst & Young LLP, Mr. LaMacchia was a Partner at Arthur Andersen LLP, where he was employed since 1986. The Board believes that Mr. LaMacchia provides meaningful insight to the Board and makes important contributions to the Audit Committee, including as a result of his finance and accounting background.
HAL M. LUCAS
HAL M. LUCAS Hal M. Lucas, age 45, has served as a director of the Company since 2015. Mr. Lucas is an attorney in private practice. He is a founding partner of the law firm of Lucas Savitz P.L. (and its predecessor), where Mr. Lucas has practiced since 2011. Prior to that time, Mr. Lucas was an attorney at the law firm of Astigarraga Davis Mullins & Grossman, P.A. from 2008 to 2011 and at the law firm of Bilzin Sumberg Baena Price & Axelrod LLP from 2004 to 2008. Mr. Lucas also served as Of Counsel to Astigarraga Davis Mullins & Grossman, P.A. from 2011 to 2013. Since 2019, Mr. Lucas has also served as a director and President of South Tip Holdings, LLC, a Miami, Florida-based hemp and CBD producer. Mr. Lucas obtained his Juris Doctor degree from The University of Texas School of Law and a Bachelor’s degree in economics and international relations from The Johns Hopkins University. The Board believes that Mr. Lucas’ experience in legal and business matters gained from his career as a practicing attorney and his service as President and a director of South Tip Holdings benefits the Company and makes him a valuable asset to the Board.
Summary Compensation Table
Summary Compensation Table The following table sets forth certain summary information concerning compensation which, for the fiscal years ended June 30, 2024 and 2023, the Company paid to, or accrued on behalf of, Henry M. Nahmad, the Company’s Chairman, Chief Executive Officer and President, and Tom Marks and Robert H. Lazar, the Company’s next two highest paid executive officers during the fiscal year ended June 30, 2024. Messrs. Nahmad, Marks and Lazar are sometimes hereinafter referred to individually as a “Named Executive Officer” and collectively as the “Named Executive Officers.”
Summary Compensation Table
| Name and Principal Positions(1) | Fiscal Year | Salary(2) | Bonus(3) | Stock Awards(4) | Option Awards | Non- Equity Incentive Plan Compen- sation | Change in Pension Value and Nonqualified Deferred Compensation Earnings | All Other Compen- sation | Total | | Henry M. Nahmad | 2024 | $650,000 | $750,000 | $4,500,009 | - | - | - | $14,501 | $5,914,510 | | Chairman, Chief Executive Officer and President | 2023 | $650,000 | $550,000 | $3,299,609 | - | - | - | - | $4,499,609 | | Tom Marks | 2024 | $400,000 | $300,000 | $500,013 | - | - | - | $9,900 | $1,209,913 | | Executive Vice President, Business Development and President of West Region | 2023 | $400,000 | $300,000 | $659,922 | - | - | - | $9,150 | $1,369,072 | | Robert H. Lazar | 2024 | $283,846 | $60,000 | $250,017 | - | - | - | $6,500 | $600,363 | | Chief Financial Officer and Chief Accounting Officer | 2023 | $240,000 | $60,000 | $329,945 | - | - | - | $6,500 | $636,445 |
Summary Compensation Table
| (1) The Company does not have an employment agreement with any of the Named Executive Officers. The compensation of the Named Executive Officers is determined by the Compensation Committee of the Board of Directors. Each Named Executive Officer receives an annual base salary and may receive bonuses, in cash and/or equity awards, pursuant to bonus plans which may be established from time to time by the Compensation Committee or otherwise at the discretion of the Compensation Committee. Equity awards, if any, are granted under the Company’s 2015 Equity Incentive Plan. The Named Executive Officers are also provided certain benefits, including health and welfare benefits and the right to participate in the Company’s participatory Section 401(k) Profit Sharing Plan described below on the same basis as the Company’s other employees. |
Summary Compensation Table
| (2) Represents the annual base salary paid to the Named Executive Officer during the applicable fiscal year. Each Named Executive Officer’s annual base salary is subject to adjustment from time to time at the discretion of the Compensation Committee. During October 2023, Mr. Lazar’s annual base salary was increased from $240,000 to $300,000. |
Summary Compensation Table
| (3) Represents discretionary bonuses paid upon the approval of the Compensation Committee, in each cash, based upon a subjective evaluation of the performance of the Company and the applicable Named Executive Officer. See “Chief Executive Officer Compensation” below for information with respect to the bonuses paid to Mr. Nahmad, including the factors considered by the Compensation Committee in approving such bonuses and the restricted stock awards granted to Mr. Nahmad (as described in footnote 4 below). With respect to the bonuses paid to Mr. Marks and Mr. Lazar and the restricted stock units and awards granted to Mr. Marks and Mr. Lazar, respectively (as described in footnote 4 below), the Compensation Committee considered, among other things, the recommendations of Mr. Nahmad and the performance, financial condition and achievements of the Company. The bonus amount for Mr. Marks for each of fiscal 2024 and 2023 is comprised of a $150,000 discretionary cash bonus and a quarterly cash bonus of $37,500 (or a total of $150,000 of quarterly cash bonuses during each such fiscal year). The payment of the quarterly cash bonus to Mr. Marks is at the discretion of the Compensation Committee and may be modified or terminated at any time by the Compensation Committee. |
Summary Compensation Table
| (4) Represents the aggregate grant date fair value of (i) in the case of Mr. Nahmad, a restricted stock award of 166,667 shares of the Company’s Common Stock granted to Mr. Nahmad during October 2023 (which is included in Mr. Nahmad’s compensation for fiscal 2024) and a restricted stock award of 202,430 shares of the Company’s Common Stock granted to Mr. Nahmad during September 2022 (which is included in Mr. Nahmad’s compensation for fiscal 2023), (ii) in the case of Mr. Marks, 18,519 restricted stock units granted to Mr. Marks during October 2023, each of which represents a contingent right to receive one share of the Company’s Common Stock upon vesting (which is included in Mr. Marks’ compensation for fiscal 2024), and 40,486 |
Summary Compensation Table
restricted stock units granted to Mr. Marks during September 2022, each of which represents a contingent right to receive one share of the Company’s Common Stock upon vesting (which is included in Mr. Marks’ compensation for fiscal 2023), and (iii) in the case of Mr. Lazar, a restricted stock award of 9,134 shares of the Company’s Common Stock granted to Mr. Lazar during October 2023 (which is included in Mr. Lazar’s compensation for fiscal 2024) and a restricted stock award of 20,242 shares of the Company’ Common Stock granted to Mr. Lazar during September 2022 (which is included in Mr. Lazar’s compensation for fiscal 2023). Each such grant was made under the Company’s 2015 Equity Incentive Plan upon the approval of the Compensation Committee. Additional information regarding these grants, including the vesting schedules, is set forth below under “Outstanding Equity Awards at June 30, 2024” and, in the case of the grant to Mr. Nahmad, “Chief Executive Officer Compensation.” Assumptions used in the calculation of the grant date fair value of the restricted stock awards and units are included in Note 17 to the Company’s audited consolidated financial statements contained in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2024. Due to the long-term vesting of a majority of these restricted stock awards and units (subject to potential vesting acceleration under certain circumstances) and the risk of forfeiture until vesting, the present value of the restricted stock awards and units is significantly less than the grant date fair value presented in the table. During September 2024, the Company, upon the approval of the Compensation Committee, (i) paid discretionary cash bonuses of $650,000 to Mr. Nahmad, $150,000 to Mr. Marks and $60,000 to Mr. Lazar, and (ii) granted (a) a restricted stock award of 248,447 shares of the Company’s Common Stock to Mr. Nahmad, (b) 24,844 restricted stock units to Mr. Marks, and (c) a restricted stock award of 15,527 shares of the Company’s Common Stock to Mr. Lazar. Such restricted stock awards and units are scheduled to vest 50% on the ten-year anniversary of the grant date and 50% in four equal annual installments commencing in September 2025, subject to the terms and conditions of the Company’s 2015 Equity Incentive Plan and the related restricted stock award or unit agreement. Each restricted stock unit represents a contingent right to receive one share of the Company’s Common Stock upon vesting. These cash bonuses and restricted stock awards and units are not reflected in the Summary Compensation Table above but will be included in the applicable Named Executive Officer’s compensation for the fiscal year ending June 30, 2025. In making the compensation decisions with respect to Mr. Marks and Mr. Lazar, the Compensation Committee considered, among other things, the recommendations of Mr. Nahmad, the current and past compensation of Mr. Marks and Mr. Lazar, and the achievements of the Company, including with respect to its financial performance, business acquisitions, technology and modernization investments and initiatives, supplier relationships and investor relations. See “Chief Executive Officer Compensation” below for additional information with respect to the bonus paid and restricted stock award granted to Mr. Nahmad during September 2024, including the factors considered by the Compensation Committee in approving such items.
Outstanding Equity Awards at June 30, 2024
Outstanding Equity Awards at June 30, 2024 The following table sets forth certain information regarding restricted stock awards (or, in the case of Tom Marks only, restricted stock units) of the Company’s Common Stock held by Henry M. Nahmad, Tom Marks and Robert H. Lazar as of June 30, 2024. Other than as set forth below, none of the Named Executive Officers held any restricted stock awards, restricted stock units or other equity-based awards, including stock options, of the Company at June 30, 2024.
Outstanding Equity Awards at June 30, 2024
| | Stock Awards(1) | | | | | Name | Number of shares or units of stock that have not vested (#) | Market value of shares of units of stock that have not vested ($) | Equity incentive plan awards: Number of unearned shares, units or other rights that have not vested (#) | Equity incentive plan awards: Market or payout value of unearned shares, units or other rights that have not vested ($) | | Henry M. Nahmad | 311,071(2) | $5,885,463 | - | - | | | 311,071(2) | $5,885,463 | - | - | | | 101,626(3) | $1,922,764 | - | - | | | 85,462(4) | $1,616,941 | - | - | | | 177,126(5) | $3,351,224 | - | - | | | 166,667(6) | $3,153,340 | - | - | | Tom Marks | 45,000(7) | $851,400 | - | - | | | 35,425(8) | $670,241 | - | - | | | 18,519(9) | $350,379 | - | - | | Robert H. Lazar | 18,088(10) | $342,225 | - | - | | | 4,875(11) | $92,235 | - | - | | | 5,390(12) | $101,979 | - | - | | | 10,303(13) | $194,933 | - | - | | | 17,712(14) | $335,111 | - | - | | | 5,556(15) | $105,120 | - | - | | | 3,578(16) | $67,696 | - | - |
Outstanding Equity Awards at June 30, 2024
| (1) The stock awards for each of Mr. Nahmad and Mr. Lazar represent restricted shares of the Company’s Common Stock. The stock awards for Mr. Marks represent restricted stock units, each of which represents a contingent right to receive one share of the Company’s Common Stock upon vesting. The vesting schedules set forth in the following footnotes are as of June 30, 2024 and, in each case, are subject to the terms and conditions of the Company’s 2015 Equity Incentive Plan and the related restricted stock award agreement or restricted stock unit agreement, as the case may be, including as described under “Compensation Plans and Arrangements” below. |
Outstanding Equity Awards at June 30, 2024
| (2) These restricted shares are scheduled to vest on November 5, 2040, the date on which Mr. Nahmad will reach the age of 62. |
Outstanding Equity Awards at June 30, 2024
| (3) 67,751 of these restricted shares are scheduled to vest on November 5, 2040, with the balance scheduled to vest in four equal installments during October 2024, 2025, 2026 and 2027. The first such annual installment vested during October 2024. |
Outstanding Equity Awards at June 30, 2024
| (4) 46,616 of these restricted shares are scheduled to vest on November 5, 2040, the date on which Mr. Nahmad will reach the age of 62, 23,308 of these restricted shares are scheduled to vest in four equal installments during October 2024, 2025, 2026 and 2027, of which the first such annual installment vested during October 2024, and the balance of these restricted shares is scheduled to vest in two remaining equal installments during November 2024 and 2025. |
Outstanding Equity Awards at June 30, 2024
| (5) 101,215 of these restricted shares are scheduled to vest on September 27, 2032 with the balance scheduled to vest in three remaining equal installments during September 2024, 2025 and 2026. The September 2024 annual installment has vested. |
Outstanding Equity Awards at June 30, 2024
| (6) 83,333 of these restricted shares are scheduled to vest on October 9, 2033 with the balance scheduled to vest in four equal installments during October 2024, 2025, 2026 and 2027. The first such annual installment vested during October 2024. |
Outstanding Equity Awards at June 30, 2024
| (7) 30,000 of these restricted stock units are scheduled to vest on November 3, 2030 with the balance scheduled to vest in four equal installments during October 2024, 2025, 2026 and 2027. The first such annual installment vested during October 2024. |
Outstanding Equity Awards at June 30, 2024
| (8) 20,243 of these restricted stock units are scheduled to vest on September 27, 2032 with the balance scheduled to vest in three remaining equal installments during September 2024, 2025 and 2026. The September 2024 annual installment has vested. |
Outstanding Equity Awards at June 30, 2024
| (9) 9,259 of these restricted stock units are scheduled to vest on October 9, 2033 with the balance scheduled to vest in four equal installments during October 2024, 2025, 2026 and 2027. The first such annual installment vested during October 2024. |
Outstanding Equity Awards at June 30, 2024
| (10) These restricted shares are scheduled to vest on June 2, 2027. |
Outstanding Equity Awards at June 30, 2024
| (11) 3,250 of these restricted shares are scheduled to vest on October 28, 2029 with the balance scheduled to vest in four equal installments during October 2024, 2025, 2026 and 2027. The first such annual installment vested during October 2024. |
Outstanding Equity Awards at June 30, 2024
| (12) 3,234 of these restricted shares are scheduled to vest on February 12, 2026, 1,617 of these restricted shares are scheduled to vest in four equal installments during October 2024, 2025, 2026 and 2027, of which the first such annual installment vested during October 2024, and the balance of these restricted shares vested in November 2024. |
Outstanding Equity Awards at June 30, 2024
| (13) 7,727 of these restricted shares are scheduled to vest on September 10, 2031 with the balance scheduled to vest on September 10, 2025. |
Outstanding Equity Awards at June 30, 2024
| (14) 10,121 of these restricted shares are scheduled to vest on September 27, 2032 with the balance scheduled to vest in three remaining equal installments during September 2024, 2025 and 2026. The September 2024 annual installment has vested. |
Outstanding Equity Awards at June 30, 2024
| (15) 2,778 of these restricted shares are scheduled to vest on October 9, 2033 with the balance scheduled to vest in four equal installments during October 2024, 2025, 2026 and 2027. The first such annual installment vested during October 2024. |
Outstanding Equity Awards at June 30, 2024
| (16) 1,789 of these restricted shares are scheduled to vest on October 10, 2033 with the balance scheduled to vest in four equal installments during October 2024, 2025, 2026 and 2027. The first such annual installment vested during October 2024. |
Outstanding Equity Awards at June 30, 2024
As previously described, in addition to the restricted stock awards set forth in the table above, during September 2024, the Company, upon the approval of the Compensation Committee, granted (a) a restricted stock award of 248,447 shares of the Company’s Common Stock to Mr. Nahmad, (b) 24,844 restricted stock units to Mr. Marks, and (c) a restricted stock award of 15,527 shares of the Company’s Common Stock to Mr. Lazar. Such restricted stock awards and units are scheduled to vest 50% on the ten-year anniversary of the grant date and 50% in four equal annual installments commencing in September 2025, subject to the terms and conditions of the Company’s 2015 Equity Incentive Plan and the related restricted stock award or unit agreement. Each restricted stock unit represents a contingent right to receive one share of the Company’s Common Stock upon vesting.
Pay Versus Performance
Pay Versus Performance As required by Item 402(v) of Regulation S-K, the Company is providing the following information about the relationship between executive compensation actually paid and certain financial performance of the Company. For the most recently completed fiscal year, the Company did not use any “financial performance measures” as defined in Item 402(v) of Regulation S-K to link compensation paid to the Named Executive Officers to the Company’s performance. Pay Versus Performance Table The following table sets forth information concerning the compensation of the Named Executive Officers for each of the fiscal years ended June 30, 2024, 2023 and 2022, and the financial performance of the Company for each such fiscal year.
Pay Versus Performance
| Pay Versus Performance | | | | | | | | Year (a) | Summary Compensation Table Total for CEO (b)(1) | Compensation Actually Paid to CEO (c)(2) | Average Summary Compensation Table Total for Non-CEO NEOs (d)(1) | Average Compensation Actually Paid to Non-CEO NEOs (e)(2) | Value of Initial Fixed $100 Investment Based on Total Shareholder Return (“TSR”) (f)(3) | Net Income (g) | | 2024 | $5,914,510 | $(2,395,367) | $905,138 | $258,079 | $66 | $5,646,000 | | 2023 | $4,499,609 | $13,177,071 | $1,002,759 | $1,298,489 | $76 | $9,719,000 | | 2022 | $5,657,678 | $(16,551,261) | $526,06 | $(529,562) | $34 | $4,095,000 |
Pay Versus Performance
| (1) The Company’s CEO for 2024, 2023 and 2022 is Henry M. Nahmad, and its Non-CEO NEOs for whom the average compensation is presented in this table for 2024, 2023 and 2022 are Tom Marks and Robert H. Lazar. |
Pay Versus Performance
| (2) Compensation actually paid to the Company’s NEOs represents the “Total” compensation reported in the Summary Compensation Table for the applicable fiscal year, as adjusted as follows: |
Pay Versus Performance
| | 2024 | | 2023 | | 2022 | | | Adjustments | CEO | Average Non- CEO NEOs | CEO | Average Non- CEO NEOs | CEO | Average Non- CEO NEOs | | Deduction for amounts reported under the “Stock Awards” column in the Summary Compensation Table for applicable fiscal year | $(4,500,009) | $(375,015) | $(3,299,609) | $(494,934) | $(4,499,986) | $(127,500) | | Increase (deduction) in fair value of awards granted during applicable fiscal year that remained unvested as of applicable fiscal year end, determined as of applicable fiscal year end | $(1,346,669) | $(113,418) | $1,153,851 | $173,075 | $(3,258,139) | $(76,036) | | Increase (deduction) for awards granted during prior fiscal year that were outstanding and unvested as of applicable fiscal year end, determined based on change in fair value from prior fiscal year end to applicable fiscal year end | $(3,037,976) | $(210,661) | $10,634,543 | $615,134 | $(14,363,979) | $(853,055) | | Increase (deduction) for awards granted during prior fiscal year that vested during applicable fiscal year, determined based on change in fair value from prior fiscal year end to vesting date | $246,595 | $38,937 | $188,677 | $2,455 | $(86,835) | $968 | | Dollar value of any dividends (or dividend equivalents) or other earnings paid on unvested awards during the fiscal year that are not otherwise reflected in the fair value of the award or in any other component of total compensation | $328,183 | $23,098 | - | - | - | - | | Total Adjustments | $(8,309,877) | $(637,059) | $8,677,462 | $295,731 | $(22,208,939) | $(1,055,623) |
Pay Versus Performance
| (3) Cumulative TSR is calculated by dividing the sum of the cumulative amount of dividends for the measurement period, assuming dividend reinvestment, and the difference between the Company’s share price at the end and the beginning of the measurement period by the Company’s share price at the beginning of the measurement period. The Company did not pay any dividends during the |
Pay Versus Performance
fiscal year ended June 30, 2023 or 2022. During October 2023, the Company paid a special cash dividend on its common stock of $0.28 per share. Relationship Between Financial Performance Measures While the Company utilizes several performance measures in order to align executive compensation with Company performance, all of those Company measures are not presented in the Pay Versus Performance table above. Moreover, the Company generally seeks to incentivize long-term performance, and therefore does not specifically align the Company’s performance measures with compensation actually paid (which, for all purposes hereof, shall be as computed in accordance with SEC rules) for a particular year. In accordance with SEC rules, the Company is providing the following descriptions of the relationships between information presented in the Pay Versus Performance table. Compensation Actually Paid and Cumulative Total Shareholder Return The following chart sets forth the relationship between the compensation actually paid to the Company’s Chief Executive Officer, the average of the compensation actually paid to the other Named Executive Officers, and the Company’s cumulative total shareholder return over the three most recently completed fiscal years. Compensation Actually Paid and Net Income The following chart sets forth the relationship between the compensation actually paid to the Company’s Chief Executive Officer, the average of the compensation actually paid to the other Named Executive Officers, and the Company’s net income for the three most recently completed fiscal years.
DIRECTOR COMPENSATION
DIRECTOR COMPENSATION The Compensation Committee, with the input and assistance of the Company’s Chief Executive Officer, recommends director compensation to the full Board of Directors. The Board of Directors approves director compensation based on factors it considers to be appropriate, market conditions and trends, and the recommendation of the Compensation Committee. The compensation program for the Company’s non-employee directors is intended to assist the Company in attracting and retaining qualified directors, reward non-employee directors for their service on the Board and its committees through both equity awards and cash fees, and align the interests of the non-employee directors with those of stockholders. Pursuant to the program, each non-employee director currently receives annually a grant of $50,000 of restricted stock units (based on the closing price of the Company’s Common Stock on the date of grant), which generally vest in four equal annual installments beginning on the first anniversary of the grant date. The restricted stock units are granted under, and subject to, the Company’s 2015 Equity Incentive Plan and related restricted stock unit agreements. Each restricted stock unit represents a contingent right to receive one share of the Company’s Common Stock upon vesting. In addition, the Company’s compensation program for its non-employee directors also includes a cash component, pursuant to which (i) each non-employee director currently receives an annual cash fee of $5,000, (ii) the Chairman of the Audit Committee currently receives an additional annual cash fee of $20,000 (which was increased from $12,000 during December 2023), (iii) each other member of the Audit Committee currently receives an additional annual cash fee of $5,000 (which was increased from $4,000 during December 2023), (iv) the Chairman of the Compensation Committee currently receives an additional annual cash fee of $10,000 (which was increased from $7,500 during December 2023), and (v) each other member of the Compensation Committee currently receives an additional annual cash fee of $7,000 (which was increased from $4,000 during December 2023). The Company does not provide any tax gross-ups to its non-employee directors, all of whom are responsible for their respective tax obligations relating to their compensation for Board and committee service. Directors are also reimbursed for their reasonable out-of-pocket expenses incurred in connection with performing their duties. Directors of the Company who are also employees of the Company do not receive compensation for their service as directors, but are reimbursed for their reasonable out-of-pocket expenses incurred in connection with performing their duties as directors. Director Compensation Table – Fiscal 2024 The following table sets forth certain information regarding the compensation paid to the Company’s non-employee directors during fiscal 2024 in consideration for his service on the Board and its committees during the year.
DIRECTOR COMPENSATION
| Name | Fees Earned or Paid in Cash | Stock Awards(1) | Option Awards | Non-Equity Incentive Plan Compensation | Change in Pension Value and Nonqualified Deferred Compensation Earnings | All Other Compensation | Total | | David Blyer | $11,000 | $50,000 | - | - | - | - | $61,000 | | Glen Kruger | $9,500 | $50,000 | - | - | - | - | $59,500 | | Timothy P. LaMacchia | $21,000 | $50,000 | - | - | - | - | $71,000 | | Hal M. Lucas | $13,750 | $50,000 | - | - | - | - | $63,750 |
DIRECTOR COMPENSATION
| (1) Represents the grant date fair value of 1,981 restricted stock units granted to each of directors Blyer, Kruger, LaMacchia and Lucas during December 2023. The restricted stock units are scheduled to vest in equal annual installments on the first, second, third and fourth anniversary of the grant date. Assumptions used in the calculation of the grant date fair value of these restricted stock units are included in in Note 17 to the Company’s audited consolidated financial statements contained in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2024. |