DEF 14A of Immucell Corp /De/, Apr 26, 2024

DEF 14A of Immucell Corp /De/

Filed Apr 26, 2024 · FY20230001213900-24-036378

Open on EDGAR

  1. DIRECTOR COMPENSATION

    DIRECTOR COMPENSATION The following table contains information as to the compensation paid by the Company to its non-executive directors for services rendered during the year ended December 31, 2023:

  2. DIRECTOR COMPENSATION

    | Name | Fees Earned or Paid in Cash | Stock Option Awards(1)(2) | All Other Compensation | Total | | Gloria J. Basse | $28,000 | $0 | $0 | $28,000 | | David S. Cunningham | $14,000 | $0 | $0 | $14,000 | | Bryan K. Gathagan | $15,000 | $36,300 | $0 | $51,300 | | Steven T. Rosgen | $30,000 | $0 | $0 | $30,000 | | David S. Tomsche, D.V.M. | $42,000 | $0 | $0 | $42,000 | | Paul R. Wainman | $30,000 | $0 | $0 | $30,000 |

  3. DIRECTOR COMPENSATION

    ____________ (1) This amount represents the total non-cash compensation expense related to stock options granted during the year ended December 31, 2023, which is being expensed over the three-year vesting period from grant date. (2) As of December 31, 2023, Ms. Basse had 35,000 stock options outstanding; Mr. Cunningham had no stock options outstanding; Mr. Gathagan had 15,000 stock options outstanding; Mr. Rosgen had 20,000 stock options outstanding; Dr. Tomsche had 20,000 stock options outstanding; and Mr. Wainman had 20,000 stock options outstanding. Officers of the Company, who are also directors, do not receive additional compensation for attendance at Board of Directors’ meetings or committee meetings (and no such employee directors are members of any of the Company’s Committees). Effective January 1, 2022, this annual fee paid to non-employee directors was increased from $24,000 to $28,000. Effective January 1, 2022, compensation for members of the Audit Committee was set at $2,000 per year. Effective January 1, 2013, the additional compensation for the Chair of the Board of Directors was set at $12,000 per year (Dr. Tomsche served as Chair during 2023). All fees paid to directors are paid quarterly. Historically, fees paid to directors were payable on the first day of the quarter during which they were earned. Beginning with the second quarter of 2024, fees paid to directors became payable at the end of the quarter during which they are earned. No other increases in these fees have been made since those noted above. On March 19, 2018, each of the then serving outside directors were granted non-qualified stock options to purchase 15,000 shares of common stock under the 2017 Stock Option and Incentive Plan. These options had an exercise price equal to $7.08 per share, which was the fair market value of the common stock on the date of grant, and they vested on March 18, 2021. These options expired March 18, 2023. At the time first appointed to the board, Ms. Basse was granted a non-qualified stock option to purchase 15,000 shares of common stock under the 2017 Stock Option and Incentive Plan with terms similar to those previously granted to all other directors. Ms. Basse’s options have an exercise price equal to $4.81 per share, which was the fair market value of the common stock on the date of grant (June 29, 2020), and vested on June 28, 2023. These options expire if not exercised by June 28, 2025 or, if earlier, within one month (twelve months if in the case of death or disability) after termination of service as a director. On June 17, 2021, each of the then serving outside directors were granted non-qualified stock options to purchase 10,000 shares of common stock under the 2017 Stock Option and Incentive Plan. These options have an exercise price equal to $10.04 per share, which was the fair market value on the date of grant, and they vest on June 16, 2024. These options expire if not exercised by June 16, 2026 or, if earlier, within one month (twelve months in the case of death or disability) after termination of service as a director. On December 15, 2022, each of the then serving outside directors were granted non-qualified stock options to purchase 10,000 shares of common stock under the 2017 Stock Option and Incentive Plan. These options have an exercise price equal to $6.52 per share, which was the fair market value on the date of grant, and they vest on December 14, 2025. These options expire if not exercised by December 14, 2027 or, if earlier, within one month (twelve months in the case of death or disability) after termination of service as a director. At the time first appointed to the board, Mr. Gathagan was granted a non-qualified stock option to purchase 15,000 shares of common stock under the 2017 Stock Option and Incentive Plan with terms similar to those previously granted to all other directors. Mr. Gathagan’s options have an exercise price equal to $5.11 per share, which was the fair market value of the common stock on the date of grant (June 28, 2023), and vest on June 27, 2026. These options expire if not exercised by June 27, 2028 or, if earlier, within one month (twelve months if in the case of death or disability) after termination of service as a director.

  4. SUMMARY COMPENSATION TABLE

    SUMMARY COMPENSATION TABLE The following table contains information as to the total compensation paid by the Company to its named executive officers for services rendered during the years ended December 31, 2023 and 2022:

  5. SUMMARY COMPENSATION TABLE

    | Name and Principal Position | Year | Salary | Bonus(1) | Stock Option Awards(2) | All Other Compensation(3) | Total | | Michael F. Brigham | 2023 | $355,267 | $0 | $0 | $39,968 | $395,235 | | President, Chief Executive Officer, Treasurer and Secretary | 2022 | $342,944 | $0 | $4,500 | $252,500 | $599,944 | | Bobbi Jo Brockmann | 2023 | $268,846 | $25,000 | $0 | $29,675 | $323,521 | | Vice President of Sales and Marketing | 2022 | $259,522 | $0 | $0 | $28,159 | $287,681 | | Elizabeth L. Williams | 2023 | $264,173 | $25,000 | $0 | $22,899 | $312,072 | | Vice President of Manufacturing Operations | 2022 | $254,678 | $0 | $4,500 | $20,760 | $279,938 |

  6. SUMMARY COMPENSATION TABLE

    ____________ (1) Bonus (or variable compensation) is reported in the year earned, even if paid in the beginning of the next year. (2) This amount represents the total non-cash compensation expense related to stock option awards granted during the year that they were earned, which is being expensed over the three-year vesting period from grant date. (3) This amount includes Company-paid contributions to a 401(k) Plan, health insurance premiums and life insurance premiums that are available to all employees of similar employment status, if elected. For Mr. Brigham, this amount includes approximately $8,000 and $222,000 worth of earned and unused paid time off described under “EMPLOYMENT AGREEMENTS” below that was accrued during the first quarter of 2023 and 2022, respectively, and is due to be paid to Mr. Brigham upon his separation from the Company. For Ms. Brockmann, this amount also includes the personal use of a Company-owned vehicle. Generally during the first quarter of each year, annual salaries and bonuses for these named executive officers are determined at the discretion of the Compensation and Stock Option Committee. Effective January 30, 2021, the annual salary for Mr. Brigham was increased by 2% to $332,212. Effective February 26, 2022, the annual salary for Mr. Brigham was increased by 4% to $345,500. Effective February 25, 2023, the annual salary for Mr. Brigham was increased by 3.5% to $357,592. No such annual increase was provided to Mr. Brigham for 2024. Effective January 30, 2021, the annual salary for Ms. Brockmann was increased by 2% to $251,400, and she was paid $12,645 in variable compensation related to her 2020 performance. Effective February 26, 2022, the annual salary for Ms. Brockmann was increased by 4% to $261,456, and she was paid $22,500 and awarded 18,000 stock options with an exercise price of $8.15 per share in variable compensation related to her 2021 performance. Effective February 25, 2023, the annual salary for Ms. Brockmann was increased by 3.5% to $270,606, and she was paid a discretionary bonus of $25,000 on March 1, 2023. Effective February 10, 2024, the annual salary for Ms. Brockmann was increased by 4% to $281,430. Effective January 30, 2021, the annual salary for Ms. Williams was increased by 4% to $246,707. Effective February 26, 2022, the annual salary for Ms. Williams was increased by 4% to $256,575. Effective February 25, 2023, the annual salary for Ms. Williams was increased by 3.5% to $265,555, and she was paid a performance bonus of $25,000 on August 30, 2023. Effective February 10, 2024, the annual salary for Ms. Williams was increased by 4% to $276,177. Effective December 1, 2022 through November 30, 2023, the Company contributed approximately $18,400 per year towards the cost of family health insurance coverage for each full-time employee electing this coverage. Effective December 1, 2023 through November 30, 2024, this annual contribution is $20,755. Mr. Brigham and Ms. Brockmann elected this coverage. Effective December 1, 2022 through November 30, 2023, the Company contributed approximately $12,600 per year towards the cost of employee and spouse health insurance coverage for each full-time employee electing this coverage. Effective December 1, 2023 through November 30, 2024, this annual contribution is $14,250. Ms. Williams elected this coverage.

  7. OUTSTANDING EQUITY AWARDS

    OUTSTANDING EQUITY AWARDS Stock options are the only outstanding form of equity awards to the Company’s employees and directors. The following table contains information on stock options held by the Company’s named executive officers that were outstanding as of December 31, 2023:

  8. OUTSTANDING EQUITY AWARDS

    | Name | Number of Shares Underlying Unexercised Stock Options – Exercisable | Number of Shares Underlying Unexercised Stock Options – Unexercisable(1) | Stock Option Exercise Price | Date of Grant | Expiration Date | | Michael F. Brigham | 25,000 | 0 | $5.84 | 02/10/2017 | 02/09/2027 | | | 20,000 | 0 | $7.80 | 01/08/2018 | 01/07/2028 | | | 0 | 1,000 | $8.15 | 06/15/2022 | 06/14/2032 | | Bobbi Jo Brockmann | 10,000 | 0 | $7.54 | 12/16/2015 | 12/15/2025 | | | 10,000 | 0 | $5.84 | 02/10/2017 | 02/09/2027 | | | 7,500 | 0 | $7.80 | 01/08/2018 | 01/07/2028 | | | 10,000 | 0 | $5.18 | 12/11/2019 | 12/10/2029 | | | 0 | 18,000 | $8.15 | 01/31/2022 | 01/30/2032 | | Elizabeth L. Williams | 25,000 | 0 | $6.70 | 04/04/2016 | 04/03/2026 | | | 10,000 | 0 | $5.84 | 02/10/2017 | 02/09/2027 | | | 7,500 | 0 | $7.80 | 01/08/2018 | 01/07/2028 | | | 10,000 | 0 | $5.18 | 12/11/2019 | 12/10/2029 | | | 0 | 1,000 | $8.15 | 06/15/2022 | 06/14/2032 |

  9. OUTSTANDING EQUITY AWARDS

    ____________ (1) These stock options become exercisable three years after the date of grant. Equity Compensation Plan Information The table below summarizes the common stock reserved for issuance upon the exercise of stock options outstanding under the 2010 Stock Option and Incentive Plan and the 2017 Stock Option and Incentive Plan, as of December 31, 2023 or that could be granted in the future:

  10. OUTSTANDING EQUITY AWARDS

    | | Number of shares to be issued upon exercise of outstanding options | Weighted-average exercise price of outstanding options | Number of shares remaining available for future issuance under stock-based compensation plans (excluding shares reflected in first column of this table) | | Equity compensation plans approved by stockholders | 618,500 | $6.82 | 202,000 | | Equity compensation plans not approved by stockholders | — | — | — | | Total | 618,500 | $6.82 | 202,000 |

  11. PAY VERSUS PERFORMANCE

    PAY VERSUS PERFORMANCE The following tables and related disclosures provide certain information regarding the relationship between the compensation actually paid to Mr. Brigham, the Company’s President and CEO (CEO), and its other named executive officers (Other NEOs) and the Company’s financial performance, as required by Section 953(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 402(v) of Regulation S-K. This disclosure does not necessarily reflect value actually realized by the executives or how the Compensation Committee evaluates compensation decisions in light of Company or individual performance. The following table sets forth the following for each of the last three completed fiscal years: (i) the total compensation of the CEO and the average of the total compensation paid to the Other NEOs, as presented in the Summary Compensation Table for such year, (ii) the compensation “actually paid” to the CEO and the average compensation “actually paid” to the Other NEOs, calculated pursuant to Regulation S-K, (iii) our Total Shareholder Return (TSR), illustrating the value, as of the last day of the indicated fiscal year, of an investment of $100 in the Company’s common stock as of December 31, 2020 (approximately 16.81 shares valued at $5.95 per share) and (iv) our net (loss) as reflected in our audited financial statements for the applicable year.

  12. PAY VERSUS PERFORMANCE

    | Year(1) | Summary Compensation Table Total for CEO | Compensation Actually Paid to CEO(2) | Average Summary Compensation Table Total for Other NEOs | Average Compensation Actually Paid to Other NEOs(2) | Value of Initial Fixed $100 Investment Based on Total Shareholder Return | Net (Loss) (in thousands) | | 2023 | $395,235 | $394,505 | $317,797 | $310,862 | $86 | $(5,775) | | 2022 | $599,944 | $598,394 | $283,810 | $301,985 | $103 | $(2,494) | | 2021 | $359,589 | $364,389 | $320,599 | $293,999 | $134 | $(78) |

  13. PAY VERSUS PERFORMANCE

    ____________ (1) The CEO during 2023, 2022 and 2021 was Michael F. Brigham. The Other NEOs for whom the average compensation is presented in this table during 2023, 2022 and 2021 were Bobbi Jo Brockmann and Elizabeth L. Williams. (2) The amounts shown as Compensation Actually Paid have been calculated in accordance with Item 402(v) of Regulation S-K and do not reflect compensation actually realized or received by the Company’s CEO and Other NEOs. These amounts reflect total compensation as set forth in the Summary Compensation Table for each year, adjusted as described in the table below. Equity values are calculated in accordance with ASC Topic 718.

  14. PAY VERSUS PERFORMANCE

    | Year | | 2021 | 2022 | 2023 | | Summary Compensation Table (SCT) Total for CEO | | $359,589 | $599,944 | $395,235 | | Deductions | Grant date fair value of stock option awards granted during fiscal year as reported in the SCT | 0 | (4,500) | 0 | | Additions | Fair value as of year end of outstanding and unvested stock option awards granted during fiscal year | 0 | 2,950 | 0 | | | Change in fair value (comparing year end to the end of prior fiscal year) of stock option awards granted in a prior fiscal year that are outstanding and unvested at year end | 0 | 0 | (730) | | | Fair value of stock option awards on vest date for stock option awards granted and vested during fiscal year | 0 | 0 | 0 | | | Change in fair value (comparing the vesting date to the end of the prior fiscal year) of stock option awards granted in a prior fiscal year that vested during the fiscal year | 4,800 | 0 | 0 | | Compensation Actually Paid to CEO | | $364,389 | $598,394 | $394,505 |

  15. PAY VERSUS PERFORMANCE

    | Year | | 2021 | 2022 | 2023 | | Summary Compensation Table (SCT) Average Total for Other NEOs | | $320,599 | $283,810 | $317,797 | | Deductions | Grant date fair value of stock option awards granted during fiscal year as reported in the SCT | (38,250) | (2,250) | 0 | | | Fair value of stock option awards granted prior to fiscal year that were forfeited during fiscal year | (7,650) | 0 | 0 | | Additions | Fair value as of year end of outstanding and unvested stock option awards granted during fiscal year | 0 | 28,025 | 0 | | | Change in fair value (comparing year end to the end of prior fiscal year) of stock option awards granted in a prior fiscal year that are outstanding and unvested at year end | 17,500 | 0 | (6,935) | | | Fair value of stock option awards on vest date for stock option awards granted and vested during fiscal year | 0 | 0 | 0 | | | Change in fair value (comparing the vesting date to the end of the prior fiscal year) of stock option awards granted in a prior fiscal year that vested during the fiscal year | 1,800 | (7,600) | 0 | | Average Compensation Actually Paid to Other NEOs | | $293,999 | $301,985 | $310,862 |

  16. PAY VERSUS PERFORMANCE

    Description of Relationship Between CEO and Other NEO Compensation Actually Paid and Company Total Stockholder Return (TSR) The following chart sets forth the relationship between Compensation Actually Paid to our CEO, the average of Compensation Actually Paid to Other NEOs, and the Company’s TSR during the three-year period ended December 31, 2023. Description of Relationship Between CEO and Other NEO Compensation Actually Paid and Net (Loss) of the Company The following chart sets forth the relationship between Compensation Actually Paid to our CEO, and the average of Compensation Actually Paid to Other NEOs, and the Company’s Net (Loss) during the three-year period ended December 31, 2023.

  17. ELECTION OF THE BOARD OF DIRECTORS (Proposal One)

    ELECTION OF THE BOARD OF DIRECTORS (Proposal One) Each of the seven persons listed below has been nominated to serve as a director until the next Annual Meeting of Stockholders and until his or her successor is chosen and qualified. Proxies in the enclosed form which are executed and returned will be voted (unless otherwise directed) FOR election as directors of the nominees listed below:

  18. ELECTION OF THE BOARD OF DIRECTORS (Proposal One)

    | GLORIA J. BASSE Age: 64 Director since: June 2020 | Ms. Basse was first elected to our Board of Directors at the 2020 Annual Meeting of Stockholders. Ms. Basse has been the senior executive director of Tonisity International, an animal nutrition company with offices in Ireland, Brazil and the United States, from 2017 to the present. Since 2016, Ms. Basse has been a Senior Associate at the Context Network, a business management and strategy consulting firm providing services to agriculture, biotechnology and food companies. She held various positions at Zoetis Inc. (formerly Pfizer Animal Health) from 1985 to 2015 and most recently served as Vice President of its U.S. pork business. Ms. Basse is a graduate of the University of Wisconsin and earned her Masters in Business Administration from the University of Rochester. | | MICHAEL F. BRIGHAM Age: 63 Officer since: October 1991 Director since: March 1999 | Mr. Brigham was appointed to serve as President and Chief Executive Officer in February 2000, while maintaining the titles of Treasurer and Secretary, and was appointed to serve as a Director of the Company in March 1999. He previously had been elected Vice President of the Company in December 1998 and had served as Chief Financial Officer since October 1991. He has served as Secretary since December 1995 and as Treasurer since October 1991. Prior to that, he served as Director of Finance and Administration since originally joining the Company in September 1989. Mr. Brigham served as a member of the Board of Directors of the United Way of York County from 2012 to 2019, serving as its Treasurer until June 2016 and as Chair of the Board of Directors for one year and as a member of its Executive Committee. Mr. Brigham served as the Treasurer of the Board of Trustees of the Kennebunk Free Library from 2005 to 2011. He re-joined the Finance Committee of the library in 2012. Prior to joining the Company, he was employed as an audit manager for the public accounting firm of Ernst & Young in New York City. Mr. Brigham earned his Masters in Business Administration from New York University in 1989 and a Bachelor of Arts degree (with a double major in Economics and Spanish) from Trinity College in Hartford, Connecticut in 1983. | | BOBBI JO BROCKMANN Age: 48 Officer since: February 2015 Director since: March 2017 | Ms. Brockmann served as a Director of the Company from March 2017 to September 2017 and from January 2018 to the present. She was promoted to Vice President of Sales and Marketing in February 2015. She joined the Company as Director of Sales and Marketing in January 2010. Prior to that, she had been employed as Director of Sales since May 2008 and Sales Manager from February 2004 to April 2008 at APC, Inc. of Ankeny, Iowa, a developer and marketer of functional protein products for animal health and nutrition. Prior to that, she held other sales and marketing positions at APC, W & G Marketing Company, Inc. of Ames, Iowa, The Council for Agricultural Science and Technology of Ames, Iowa and Meyocks Group Advertising of West Des Moines, Iowa after graduating from Iowa State University. |

  19. ELECTION OF THE BOARD OF DIRECTORS (Proposal One)

    | BRYAN K. GATHAGAN Age: 56 Director since: June 2023 | Mr. Gathagan is the owner and a managing member of broad Thinking, LLC, a management consulting firm and has 25 years of animal health experience. He is a founding member of Animalytix LLC and has served as its Chief Financial and Chief Technology Officer since it began operations in 2010. Prior to Animalytix, he was a senior executive and Vice President of IT and Finance for Intervet, Inc. and oversaw various finance, IT, and general business functions between 1998 to 2008, including 3 years in a global role based in The Netherlands. Before entering the animal health industry, he served as a Vice President at MBNA and Norwest Bank responsible for various IT functions and started his career in IT roles at the University of Maryland, Baltimore County (UMBC). He holds a BS in Information Systems Management from UMBC and an MS in Business from Johns Hopkins University. | | STEVEN T. ROSGEN Age: 58 Director since: January 2018 | Mr. Rosgen joined the Board of Directors in January 2018 and the Audit Committee of the Board of Directors effective April 1, 2018. He is President of Strategem Research Inc., founded in 2005. Strategem’s mission is to capture and leverage customer insights when launching new technologies and revitalizing brands that have struggled in the market. Mr. Rosgen specializes in value proposition development and pricing strategy. He has worked with global brands across a range of industries including multiple agricultural sectors (ag informatics, animal health, biotechnology, crop protection, fertilizer, equipment, finance, grain marketing, livestock production, retail and seed technology). Before founding Strategem, Mr. Rosgen was a senior partner with Street Smart Strategic Planning and Research Coordinator for Baker Lovick/BBDO Advertising. He holds a Bachelor of Commerce Degree from the University of Calgary. | | David S. Tomsche, D.V.M. Age: 67 Director since: December 2006 | Dr. Tomsche was appointed to serve as Chair of the Board of Directors in February 2013. He served on the Nominating Committee of the Board of Directors until September 2017. He served on the Audit Committee from February 2014 through March 2014 and rejoined this committee in June 2021. He is a large animal veterinarian and owner of Leedstone Inc. (formerly Stearns Veterinary Outlet, Inc., an animal health distribution and milking system installation company) and of J-t Enterprises of Melrose, Inc., an exporter of ImmuCell products. He also is a dairy producer. He obtained his degrees from the University of Minnesota. | | PAUL R. WAINMAN Age: 59 Director since: March 2014 | Mr. Wainman was appointed to the Board of Directors on March 31, 2014 and is a member of the Audit and Nominating Committees and serves as Chair of the Audit Committee. He qualifies to serve as a “financial expert” given his background in accounting and finance. Mr. Wainman served as Chief Financial Officer of Hancock Lumber, a 725-employee lumber and building products company located in Casco, Maine, from February 2016 and its President and CFO from January 2020 until, most recently, becoming President and CEO in January 2023. From April 2015 until February 2016, he was a business strategy and financial consultant specializing in the paper and greeting card industry. Prior to that, he was President of Kleinfeld, a personalized wedding stationery company, from September 2013 until April 2015. From 2005 to 2012, he was President and CEO of William Arthur, Inc., a division of Hallmark Cards, where he led a 275-employee manufacturer of luxury stationery products. Prior to that, he served another division of Hallmark Cards as CFO and COO from 1998 to 2004. He obtained a degree in Accounting and Financial Control from Sheffield City University in England and qualified as a Chartered Accountant of England and Wales in 1990. |

  20. ELECTION OF THE BOARD OF DIRECTORS (Proposal One)

    Each of these individuals brings distinct skills, perspectives and attributes to the Board of Directors. Ms. Basse has extensive animal health marketing experience. Mr. Brigham is an executive officer who has been employed by the Company since 1989 and has a financial and accounting background. Ms. Brockmann is an executive officer who has been employed by the Company since 2010 and has extensive experience in the sales and marketing of products to the dairy and beef industries. Mr. Gathagan has significant experience with information systems and finance as well as relevant animal health industry experience. Mr. Rosgen has a depth of experience in sales and marketing and product branding. Dr. Tomsche is a veterinarian and owner of a distribution outlet of products and services for animals, as well as an investor in and owner of dairy farms, and brings to the board substantial expertise in our industry. Mr. Wainman has extensive managerial and financial training and expertise. There is no family relationship between any director, executive officer or person nominated or chosen by the Company to become a director or executive officer. Except for Mr. Brigham and Ms. Brockmann (both of whom are Company employees), each of the Company’s existing directors or nominees qualifies as an “independent director” as defined under applicable NASDAQ Stock Market rules. In evaluating the independence of directors, the board did consider the matters described above under the caption “CERTAIN RELATIONSHIPS, RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE”. If any of the individuals named above should not be available for election as contemplated, it is the intention of the persons named in the proxy to vote for such other person or persons as management may recommend. Management has no reason to believe any nominees will be unavailable. Any vacancies that may occur during the year may be filled by the Board of Directors to serve until the next Annual Meeting. Under Nasdaq’s Board Diversity Rule, all operating companies listed on Nasdaq’s U.S. exchange are required to publicly disclose diversity statistics regarding their Board of Directors using the Board Diversity Matrix. The following chart describes the diversity characteristics of the seven directors serving the Company as of the filing date of this Proxy Statement:

  21. ELECTION OF THE BOARD OF DIRECTORS (Proposal One)

    | Board Diversity Matrix | | | | | | Board Size: | | | | | | Total Number of Directors | 7 | | | | | | Female | Male | Non-Binary | Did not Disclose Gender | | Gender: | | | | | | Directors | 2 | 5 | 0 | 0 | | Number of Directors who identify in Any of the Categories Below: | | | | | | African American or Black | 0 | 0 | 0 | 0 | | Alaskan Native or Native American | 0 | 0 | 0 | 0 | | Asian (other than South Asian) | 0 | 0 | 0 | 0 | | South Asian | 0 | 0 | 0 | 0 | | Hispanic or Latinx | 0 | 0 | 0 | 0 | | Native Hawaiian or Pacific Islander | 0 | 0 | 0 | 0 | | White | 2 | 5 | 0 | 0 | | Two or More Races or Ethnicities | 0 | 0 | 0 | 0 | | LGBTQ+ | 0 | | | | | Persons with Disabilities | 0 | | | |

  22. ELECTION OF THE BOARD OF DIRECTORS (Proposal One)

    The Board of Directors recommends that you vote FOR the election of the seven nominees listed above.

  23. Pre-Approval Policy

    Pre-Approval Policy In accordance with the procedures set forth in its charter, the Audit Committee pre-approves all auditing services and permitted non-audit services (including the fees and other terms of those services) to be performed for the Company by its Independent Registered Public Accounting Firm. Such approval may be accomplished by approving the terms of the engagement prior to the engagement of the Independent Registered Public Accounting Firm with respect to such services or by establishing detailed pre-approval policies and procedures to govern such engagement. The Audit Committee authorizes management to spend up to $5,000 per year for services that are not anticipated at the time of the engagement, provided that the Audit Committee is promptly informed of such services. Audit Committee Financial Expert Mr. Paul R. Wainman, who joined our Board of Directors in March of 2014 and currently serves as Chair of the Audit Committee, and Mr. Bryan K. Gathagan, who joined our Board of Directors in June of 2023, both meet the criteria for “audit committee financial expert” as defined by SEC rules. It is the opinion of the Company’s Board of Directors that the Company addresses its audit functions with a depth of penetration and rigor that meets the intent of the requirements of the Sarbanes-Oxley Act for the following reasons: • All four members of the Audit Committee are independent directors, as defined by the SEC and NASDAQ. • The four members of the Audit Committee have knowledge of accounting for both their own businesses as well as for the Company. • Internal audit work of the Company is performed by its Director of Finance and Administration, two Finance and Administrative Associates and its Manager of Administrative Operations. • The Company also continuously reviews, at its own initiative, the expertise of the members of its Board of Directors and its Audit Committee.