DEF 14A of Spectral AI, Inc., Apr 4, 2024

DEF 14A of Spectral AI, Inc.

Filed Apr 4, 2024 · FY20230001213900-24-030137

Open on EDGAR

  1. Common Stock

    Common Stock The following table sets forth certain information known to us as of April 2, 2024 with respect to the Shares of our Common Stock beneficially owned as of that date by: (i) each of our directors and each of our nominees for director; (ii) each of our executive officers named in the 2023 Summary Compensation Table contained in this proxy statement; (iii) all of our directors and executive officers as a group; and (iv) each person known by us to beneficially own more than 5% of our Common Stock. Except as otherwise indicated, we believe each beneficial owner named below has sole voting and sole investment power with respect to all Shares beneficially owned by that holder. Except as otherwise indicated, the address for each stockholder is 2515 McKinney Avenue, Suite 1000, Dallas, TX 75201. Percentage calculations of beneficial ownership are based on 17,482,333 Shares of Common Stock outstanding on April 2, 2024.

  2. Common Stock

    | Name and Address of Beneficial Owner(1)(2) | Number of Shares Beneficially Owned | | | Directors and Named Executive Officers of the Company | | | | Wensheng Fan(5) | 1,686,865 | 9.48% | | Cynthia Cai | — | | | Richard Cotton | 47,529 | * | | Martin Mellish | — | | | Michael P. Murphy(3)(4) | 848,333 | 4.85% | | Deepak Sadagopan | — | * | | Niko Pagoulatos, Ph.D.(6) | 40,417 | * | | Nils Windler(7) | 72,744 | * | | Peter M. Carlson | — | | | Vincent Capone(8) | 57,743 | * | | Erich Spangenberg(9) | 4,736,131 | 27.09% | | John Michael DiMaio, M.D.(10) | 2,485,908 | 14.22% | | All Directors and Executive Officers of the Company as a Group (13 Individuals)(11) | 9,975,670 | 56.73% | | Five Percent Holders | | | | Erich Spangenberg(12) | 4,736,131 | 27.09% | | John Michael DiMaio(13) | 2,485,908 | 14.22% | | Wensheng Fan | 1,686,865 | 9.48% | | Octopus Investments plc(15) | 960,211 | 5.49% | | Jeffrey Thatcher, Ph.D.(16) | 820,723 | 4.68% |

  3. Common Stock

    * Less than one percent. (1) Unless otherwise noted, the business address of each of the following individuals is c/o Spectral AI, Inc., 2515 McKinney Avenue, Suite 1000, Dallas, Texas 75201. (2) Excludes Shares issuable pursuant to warrants issued in connection with the Rosecliff Initial Public Offering. (3) Shares of Common Stock following the conversion of Class B common stock upon the Closing on a one-for-one basis, subject to adjustment, as described in the section entitled “Description of Securities” in our prospectus filed with the SEC pursuant to Rule 424(b)(4) (File No. 333-252478). (4) Rosecliff Acquisition Sponsor I LLC, the Sponsor, is the record holder of 848,333 shares of Common Stock following the conversion of Class B common stock upon the Closing of the Business Combination and has a principal place of business in New York. Michael P. Murphy is the managing member of Rosecliff Credit Opportunity Fund I GP, LLC, a Delaware limited liability company, which is the general partner of Rosecliff Credit Opportunity Fund I, L.P., a Delaware limited partnership, which is the managing member of the Sponsor. Each of Rosecliff Credit Opportunity Fund I GP, LLC and Rosecliff Credit Opportunity Fund I, L.P. has a principal place of business in New York. Mr. Murphy is a U.S. person living in New York. (5) Includes 1,652,086 shares issuable upon exercise of stock options of the Company which are exercisable within 60 days of the date hereof. (6) Consists of 40,417 shares issuable upon exercise of stock options of the Company which are exercisable within 60 days of the date hereof. (7) Consists of 72,744 shares issuable upon exercise of stock options of the Company which are exercisable within 60 days of the date hereof. (8) Includes 48,043 shares issuable upon exercise of stock options of the Company which are exercisable within 60 days of the date hereof. (9) Mr. Spangenberg joined our Board on November 10, 2023. (10) Dr. DiMaio joined our Board on February 7, 2024. (11) Includes 1,813,290 shares issuable upon exercise of stock options of the Company which are exercisable within 60 days of the date hereof. (12) Includes 577,574 shares held by Erich Spangenberg and 4,158,557 owned by ELS 1960 Family, L.P. The business address of ELS 1960 Family, L.P. is 241 Navajo Street, Miami, Florida 33166. ELS 1960 Family, L.P. is a limited partnership that was established in 2017 for the benefit of Mr. Erich Spangenberg and his heirs. Mr. Spangenberg is currently the majority limited partner of ELS 1960 Family, L.P. and the co-managing partner of ELS 1960 Family GP, LLC which also holds an interest in ELS 1960 Family, L.P. (13) The business address for Dr. DiMaio is 4708 Alliance Blvd., Pavilion I, Suite 540, Plano, Texas 75093. (14) The business address for Board of Regents of the University of Texas System for the Benefit of the University of Texas Southwestern Medical Center is UT Southwestern Medical Center, 5323 Harry Hines Blvd., Dallas, Texas 75390 (15) The business address for Octopus Investments plc is PO Box 10847, Chelmsford CM99 2BU. Octopus Investments is a United Kingdom based financial services company managing more than £12.9 billion on behalf of over 63,000 investors while employing over 750 employees. It is the United Kingdom’s largest provider of venture capital trust (VCT), Enterprise Investment Scheme (EIS) and Business Property Relief (BPR)-qualified investments. VCT, EIS and BPR programs are large UK government-sponsored programs to provide tax and other incentives for institutional and individual investments in areas such as venture capital and commercial real estate transactions. (16) Includes 820,723 shares issuable upon exercise of stock options of the Company which are exercisable within 60 days of the date hereof.

  4. PROPOSAL NO. 1: ELECTION OF DIRECTORS

    PROPOSAL NO. 1: ELECTION OF DIRECTORS The Board of Directors (the “Board”) has fixed the number of directors at six for the coming year. The Board, upon recommendation from the Nominating and Corporate Governance Committee, has nominated the individuals listed below for election as directors at the Annual Meeting to be held on May 14, 2024, to serve until the next Annual Meeting of Stockholders and until their successors are elected and qualified. Each nominee has consented to being named a nominee in this proxy statement and to serve, if elected, as a director. If any nominee is unable to serve, proxies will be voted for such other candidates as may be nominated by the Board.

  5. Required Vote

    Required Vote Directors will be elected by a plurality of the votes cast by the stockholders entitled to vote on this proposal at the meeting. Abstentions, broker non-votes, and votes withheld will not be treated as votes cast for this purpose and will not affect the outcome of the election. The Board of Directors recommends that you vote FOR the election of each of the nominees listed below.

  6. Nominees for Director

    Nominees for Director The following table contains certain information about the nominees for director as of April 2, 2024, including their business experience, qualifications and other directorships. All of the directors’ present terms expire in 2024.

  7. Nominees for Director

    | Name and Age | Business Experience During Past Five Years, Other Directorships and Qualifications | Director Since | | Richard Cotton Age: 63 | Richard Cotton is the current Chairman of the Company’s Board of Directors. Richard Cotton has a wealth of experience in non-executive director, advisory and senior financial roles in life sciences and other industrial sectors. His extensive experience covers all the value creation activities from R&D, to manufacturing and commercial in international organizations. He has significant experience in the development and successful execution of strategy, corporate finance and M&A, capital markets and governance. Currently Richard is Chair at Nasdaq listed AI predictive diagnostics company Spectral AI, and is also a Financial Adviser at Novumgen Ltd., a Specialty Pharmaceuticals company. His prior executive roles include highly successful tenures as Chief Financial Officer at Dechra Pharmaceuticals plc, an FTSE 250 animal health company, and as Chief Financial Officer at Consort Medical plc., a medical device and drug formulation business. Mr. Cotton is a fellow of the Chartered Institute of Management Accountants and holds a BA (Hons) in Business Studies from Kingston University. | 6/2021 | | Peter M. Carlson Age: 59 | Mr. Carlson is the Company’s Chief Executive Officer. Mr. Carlson most recently served as the Chief Financial Officer of the Company. Prior to his role as CFO at the Company, Mr. Carlson served as CFO at MiMedx Group, Inc., a pioneer and leader in the advanced wound care space. Prior to his work at MiMedx, Mr. Carlson served as Chief Operating Officer at Brighthouse Financial, Inc. after its spin-off from MetLife, Inc., where he worked for eight years. At MetLife, Mr. Carlson served as the Chief Accounting Officer. Prior to MetLife, Mr. Carlson was the Controller at Wachovia Corporation and an audit partner for a Big Four accounting firm. Mr. Carlson serves as a Board Member at White Mountains Insurance Group and as a trustee for Wake Forest University. He is a certified public accountant in New York and North Carolina, and he received a Bachelor of Science from Wake Forest University. | 2/2024 |

  8. Nominees for Director

    | Name and Age | Business Experience During Past Five Years, Other Directorships and Qualifications | Director Since | | Dr. J. Michael DiMaio Age: 68 | Dr. Michael DiMaio is one of the Company’s founders and previously served as the Company’s Chief Executive Officer and Chairman of the Board of Directors from 2011 to 2020. He is the Chief of Staff and a practicing board-certified general, cardiac and thoracic surgeon at Baylor Scott & White-The Heart Hospitals. He has been elected or served as a member on many distinguished medical organizations including the American Surgical Association, Society of Thoracic Surgeons, American College of Surgeons, American Association of Thoracic Surgery, American Heart Association, American Burn Association, International Society of Heart and Lung Transplantation, American Society of Transplant Surgeons, and the Southern Thoracic Surgical Association. He has authored nearly 500 peer-reviewed publications and directs a research group that has produced over 1,000 publications in medical journals that include JAMA, New England Journal of Medicine, Lancet, Science, and Circulation. Dr. DiMaio has served as an editorial board member or reviewer for some the most prestigious medical journals in the world and has served as a grant reviewer for the National Institutes of Health (NIH), the American Heart Association, and the U.S. Department of Defense in an addition to serving on international medical guideline committees. Dr. DiMaio earned his medical degree from the University of Miami and completed his internal medicine, general surgery, and cardiothoracic surgery residencies at Duke University Medical Center. | 2/2024 | | Martin Mellish Age: 66 | Martin Mellish has served as the founding director of Aspen Advisory Services Ltd., since 1994. Aspen is a London-based private office overseeing investments in North America, Europe, and Asia. Mr. Mellish serves as non-executive director of Nucana Ltd (NASD: NCNA; member, Audit Committee) a clinical-stage biopharmaceutical company focused on improved chemotherapy agents, and Levitronix Technologies Inc. (Chair, Audit Committee) a technology company handling high-purity fluids for the semiconductor and life science industries, among other non-executive directorships. He is a member of the International Advisory Council of the Massachusetts General Hospital (MGH), Boston. He holds an M.Sc. from the Master of Health Care Delivery Science program at Dartmouth; an SM (Management) from the Massachusetts Institute of Technology and an M.Sc. (Accounting) from Northeastern University. | 6/2021 | | Deepak Sadagopan Age: 50 | Deepak Sadagopan currently serves as Chief Operating Officer of Population Health at Providence St. Joseph Health, where he leads population health initiatives across the system to transform care. Mr. Sadagopan has more than 22 years of experience in health care, serving in leadership roles at Siemens PLM Solutions, Quest Diagnostics, McKesson, and Edifecs. Over the past eight years, he has focused on working closely with payers and providers on the use of technology to drive business decisions making the transition from volume to value-based delivery models. Mr. Sadagopan is a leading voice in ensuring value-based care and Health IT policy initiatives enable equitable access to health care. He serves on the steering committee for HL7’s DaVinci Accelerator to guide value-based care collaboration between payers and providers, and on the Department of Health and Human Services’ ONC FAST National Steering Committee to accelerate interoperability data standards. He serves on the faculty of the School of Public Health at the University of Washington as Clinical Assistant Professor, teaching MHA courses in Value-Based Care and economics. Mr. Sadagopan earned his master’s degree in healthcare delivery and economics from Dartmouth College. He also has a master’s degree in engineering, specializing in data science, from the University of Connecticut and has completed an executive management program with the MIT Sloan School of Management. | 9/2023 |

  9. Nominees for Director

    | Name and Age | Business Experience During Past Five Years, Other Directorships and Qualifications | Director Since | | Marion Snyder Age: 51 | In her current position as Sr. Director Corporate Accounts at Shockwave Medical, Ms. Snyder spearheads the strategic development of corporate strategy related to its corporate and government accounts. Ms. Snyder has also founded Lakeview Healthcare Consulting, offering strategic guidance on the market access landscape in the US Healthcare market. During her nine-year tenure at MiMedx Group, Ms. Snyder held pivotal roles including Chief of Staff to the CEO, Senior Vice President of Government Affairs, and Senior Vice President of Market Access. In these roles, she oversaw key cross functional corporate projects including employee engagement and board presentations. Marion also played a key role in government affairs and patient advocacy efforts. As the co-chair of the organization’s first Inclusion and Diversity Council, Ms. Snyder displayed her dedication to creating an inclusive work environment. Her experience of over 13 years at Pfizer, including roles such as Director of Payer Marketing, Channel Account Manager and Government Account Manager, highlights her diverse skill set and she was instrumental in driving brand payer marketing planning, developing strategic business plans and fostering partnerships across various account types. She earned a BS degree in Business Administration with a concentration in marketing from Delaware Valley University. Ms. Snyder is affiliated with the Healthcare Businesswoman’s Association and serves as a director on the board of the Palmetto Chapter of Folds of Honor. Marion is also engaged in volunteer work with the Therapy Dogs Program at the Medical University of South Carolina. | New Nominee |

  10. EXECUTIVE OFFICER AND DIRECTOR COMPENSATION

    EXECUTIVE OFFICER AND DIRECTOR COMPENSATION

  11. 2023 Summary Compensation Table

    2023 Summary Compensation Table The following table summarizes the compensation earned by each of our named executive officers for the fiscal year ended December 31, 2023.

  12. 2023 Summary Compensation Table

    | Name and Principal Position | Year | Salary ($) | Bonus(1) ($) | Stock Awards ($) | Option Awards(2) ($) | All Other Compensation(3) ($) | Total ($) | | Wensheng Fan(4) | 2023 | 523,958 | 385,000 | | 370,806 | 88,757 | 1,368,521 | | Former Chief Executive Officer | 2022 | 496,875 | 265,000 | | 232,000 | 92,804 | 1,086,679 | | Nils Windler(5) | 2023 | 350,000 | 60,000 | | 117,056 | 33,122 | 560,177 | | Former Chief Financial Officer | 2022 | 350,000 | 50,000 | | 103,982 | 19,814 | 523,796 | | Niko Pagoulatos, Ph.D.(6) | 2023 | 350,000 | — | | 78,611 | 33,423 | 462,035 | | Chief Operating Officer | 2022 | 38,447 | 20,000 | | 11,792 | 1,873 | 72,112 | | Vincent Capone(7) | 2023 | 331,250 | 65,000 | | 97,010 | 34,616 | 527,876 | | General Counsel and Chief Financial Officer | 2022 | 162,500 | | | 45,600 | 11,837 | 219,937 | | Christine Marks | 2023 | 286,500 | 40,000 | | 23,354 | 22,818 | 372,672 | | Vice President, Marketing & Commercialization | 2022 | 193,750 | | | 11,400 | 12,017 | 217,167 |

  13. 2023 Summary Compensation Table

    (1) The amounts shown in this column represent the payments of bonuses earned during fiscal year 2022. (2) The amounts shown in this column represent the grant date fair values of option awards granted in 2023 as computed in accordance with Financial Accounting Standards Board (FASB) Accounting Standard Codification Topic 718. See Note 12 to the consolidated financial statements for a discussion of the assumptions used in the calculation of these amounts. (3) For Mr. Fan, in 2023, the amount included in this column consists of $51,777 for his participation as an executive member of our board of directors; $17,893 representing matching contributions to Mr. Fan’s 401(K) plan and $19,088 for health benefits provided to him. For Mr. Fan, in 2022, the amount included in this column consists of $48,392 for his participation as an executive member of our board of directors; $25,896 representing matching contributions to Mr. Fan’s 401(K) plan and $18,516 for health benefits provided to him. For Mr. Windler, in 2023, the amount included in this column consists of $15,272 representing matching contributions to Mr. Windler’s 401(K) plan and $17,850 for health benefits provided to him. For Mr. Windler, in 2022, the amount included in this column consists of $19,814 for health benefits provided to him. For Dr. Pagoulatos in 2023, the amount in this column consists of $15,563 in matching contributions to Dr. Pagoulatos’ 401(K) plan and $17,860 for health benefits provided to him. For Dr. Pagoulatos in 2022, the amount in this column consists of $1,873 for health benefits provided to him. For Mr. Capone in 2023, the amount in this column consists of $20,275 in matching contributions to Mr. Capone’s 401(K) plan and $14,341 for health benefits provided to him. For Mr. Capone in 2022, the amount in this column consists of $5,250 in matching contributions to Mr. Capone’s 401(K) plan and $6,587 for health benefits provided to him. For Ms. Marks in 2023, the amount in this column consists of $17,062 in matching contributions to Ms. Marks’ 401(K) plan and $5,756 for health benefits provided to her. For Ms. Marks in 2022, the amount in this column consists of $6,875 in matching contributions to Ms. Marks’ 401(K) plan and $5,142 for health benefits provided to her. (4) Mr. Fan resigned as our Chief Executive Officer effective February 29, 2024. (6) Dr. Pagoulatos was hired effective as of November 7, 2022 and resigned as our Chief Operating Officer on March 29, 2024. (7) Mr. Capone was appointed as our Chief Financial Officer effective February 29, 2024, in addition to his position as General Counsel.

  14. Outstanding Equity Awards at Fiscal Year-End 2023

    Outstanding Equity Awards at Fiscal Year-End 2023 The following table provides information regarding outstanding equity awards held by each of our named executive officers as of December 31, 2023.

  15. Outstanding Equity Awards at Fiscal Year-End 2023

    | | Option Awards(1) | | | | | | Name | Grant Date | Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#) Unexercisable | Option Exercise Price ($) | Option Expiration Date | | Wensheng Fan(2)(3) | 5/1/2019 | 872,939 | — | 1.03 | 5/1/2029 | | | 6/25/2020 | 261,882 | — | 2.17 | 6/25/2030 | | | 6/25/2020 | 87,294 | — | 2.17 | 6/25/2030 | | | 11/20/2020 | — | — | 2.06 | 11/20/2023 | | | 1/15/2021 | 342,192 | — | 2.17 | 1/15/2031 | | | 10/8/2021 | 6,466 | 3,233 | 5.46 | 10/8/2031 | | | 2/3/2022 | 51,730 | 25,865 | 4.95 | 2/3/2032 | | | 4/13/2023 | — | 22,044 | 4.54 | 4/13/2033 | | | 4/13/2023 | — | 66,705 | 4.54 | 4/13/2033 | | Nils Windler(4)(5) | 12/17/2021 | 70,050 | 26,943 | 5.26 | 12/17/2031 | | | 4/13/2023 | — | 12,932 | 4.48 | 4/13/2033 | | | 4/13/2023 | — | 6,466 | 4.48 | 4/13/2033 | | Dr. Niko Pagoulatos, Ph.D.(6)(7) | 11/07/2022 | 28,913 | 49,730 | 3.81 | 11/07/2032 | | | 11/07/2022 | 8,810 | 9,540 | 3.81 | 11/07/2032 | | Vincent Capone(8)(9) | 5/06/2022 | 16,165 | 44,790 | 4.47 | 5/06/2032 | | | 5/06/2022 | — | 6,939 | 4.47 | 5/06/2032 | | | 4/13/2023 | — | 6,014 | 4.48 | 4/13/2033 | | | 4/13/2023 | — | 12,027 | 4.48 | 4/13/2033 | | | 6/29/2023 | — | 6,466 | 5.54 | 6/01/2033 | | | 6/29/2023 | — | 12,932 | 5.54 | 6/01/2033 | | Christine Marks(10) | 5/06/2022 | 4,210 | 12,933 | 4.47 | 5/06/2032 | | | 4/13/2023 | — | 7,274 | 4.48 | 5/06/2032 | | Peter Carlson(11) | — | — | — | — | — |

  16. Outstanding Equity Awards at Fiscal Year-End 2023

    (1) Each of the options granted were incentive stock options and were issued at their then current fair market value. (2) The options awarded to Mr. Fan vest in three equal annual installments beginning on the grant date, subject to his continued provision of service to us on each vesting date. (3) Mr. Fan resigned as our Chief Executive Officer effective February 29, 2024. (4) The options awarded to Mr. Windler vest in three equal annual installments beginning on the grant date, subject to his continued provision of service to us on each vesting date. (5) Mr. Windler resigned as our Chief Financial Officer effective January 3, 2024. (6) The options awarded to Dr. Pagoulatos vest in three equal annual installments beginning on the grant date, subject to his continued provision of service to us on each vesting date. (7) Dr. Pagoulatos resigned as our Chief Operating Officer on March 29, 2024. (8) The options awarded to Mr. Capone vest in three equal annual installments beginning on the grant date, subject to his continued provision of service to us on each vesting date. (9) Mr. Capone was appointed as Chief Financial Officer effective February 29, 2024, in addition to his role as General Counsel. (10) The options awarded to Ms. Marks vest in three equal annual installments beginning on the grant date, subject to his continued provision of service to us on each vesting date. (11) Mr. Carlson was not issued an equity award until January 3, 2024, when he joined the Company.

  17. Director Compensation in Fiscal Year 2023

    Director Compensation in Fiscal Year 2023 In 2023, we paid our non-executive and executive directors cash compensation for their contributions to the operations of the business. The following table provides the compensation amounts for each non-executive member of the Board of Directors for 2023. Mr. Fan received $51,777 for his participation as an executive member of our board of directors. For additional details on Mr. Fan’s compensation, please see the 2023 Summary Compensation Table on page 15 of this proxy statement.

  18. Director Compensation in Fiscal Year 2023

    | Name | Fees Earned or Paid in Cash ($) | Option Awards ($) | All Other Compensation ($) | Total ($) | | Richard Cotton | 88,983 | 32,270 | | 121,253 | | Gerry Beaney(1) | 58,985 | — | | 58,985 | | Cynthia Cai | 73,445 | 32,270 | | 105,715 | | Martin Mellish | 93,509 | 32,270 | | 125,779 | | Deepak Sadagopan(2) | 10,000 | — | | 10,000 | | Erich Spangenberg(3) | 10,000 | 6,525 | | 16,525 | | Michael Murphy(4) | — | — | | — |

  19. Director Compensation in Fiscal Year 2023

    (1) Mr. Beaney resigned from the Board on September 8, 2023 in connection with the closing of the Business Combination. (2) Mr. Sadagopan joined the Board on September 11, 2023 in connection with the closing of the Business Combination. (3) Mr. Spangenberg joined the Board on November 27, 2023. (4) Mr. Murphy joined the Board on September 11, 2023 in connection with the closing of the Business Combination. Mr. Murphy resigned from the Board on January 30, 2024.

  20. Executive Officer and Director Compensation Arrangements

    Executive Officer and Director Compensation Arrangements Equity In connection with the Business Combination, the equity-based awards for Spectral’s named executive officers were treated in accordance with the terms of the Business Combination Agreement and converted into equity-based awards that settle in shares of the Company’s Common Stock. RCLF and Spectral waived the requirement in the Business Combination Agreement that RCLF approve and adopt the Equity Incentive Plan to be effective in connection with the Business Combination. Instead, the Company will seek to approve and adopt a new equity incentive plan at its first annual meeting following the Business Combination, pursuant to the terms of the Business Combination Agreement, which shall provide for an aggregate share reserve thereunder equal to (a) such number of shares of Common Stock sufficient to satisfy all Legacy Spectral Options plus (b) no more than 15% of RCLF’s fully-diluted outstanding stock immediately after the Business Combination. The Equity Incentive Plan shall also include a customary 5% evergreen provision. Employment Arrangements We entered into employment agreements (the “Executive Employment Agreements”) with each of Wensheng Fan, Peter Carlson, Nils Windler, Vincent Capone and Dr. Niko Pagoulatos, that govern certain terms and conditions of such executive officers’ employment with us. The Executive Employment Agreements provide for base salary, eligibility to receive an annual bonus, eligibility to receive certain severance benefits upon involuntary terminations of employment, as well as customary confidentiality, assignment of intellectual property provisions, and certain restrictive covenants, including post-employment non-solicitation provisions. Non-Employee Director Compensation The Company’s Board expects to review director compensation periodically to ensure that director compensation remains competitive such that we are able to recruit and retain qualified directors. The Company has adopted a director compensation program that is designed to align compensation with its business objectives and the creation of stockholder value, while enabling the Company to attract, retain, incentivize and reward directors who contribute to the long-term success of the Company.