DEF 14A of OptimizeRx Corp, Apr 29, 2024

DEF 14A of OptimizeRx Corp

Filed Apr 29, 2024 · FY20230001213900-24-036855

Open on EDGAR

  1. PROPOSAL NO. 1 ELECTION OF DIRECTORS

    PROPOSAL NO. 1 ELECTION OF DIRECTORS Our bylaws provide that our business shall be managed by or under the direction of a board of directors of not less than three nor more than seven directors, which number shall be fixed from time to time by such board of directors. The Board currently consists of seven directors. Pursuant to our bylaws, the Board has fixed the number of directors at six, as of the adjournment of the annual meeting. There are six nominees for election to the Board at the annual meeting. Each of the six nominees, if elected, will hold office for a term that expires at the next annual stockholders’ meeting. Each director shall hold office for the term for which the director was elected and until the director’s successor is elected and qualified or until the director’s earlier death, resignation, or removal. Proxies solicited by the Board will, unless otherwise directed, be voted to elect the six nominees named below to constitute the entire Board. The Board has nominated each of the following individuals for election as a director at the annual meeting: William J. Febbo, Lynn O’Connor Vos, James Lang, Patrick Spangler, Gregory D. Wasson and Catherine Klema. The Board did not nominate Gus Halas for re-election and his term will expire at the conclusion of the annual meeting. Each nomination for director was based upon the recommendation of our Nominating and Governance Committee and each nominee for director is a current member of the Board. All nominees have consented to be named and have indicated their intent to serve if elected. In the event any of the nominees shall be unable or unwilling to serve as a director, the persons named in the proxy intend to vote “FOR” the election of any person as may be nominated by the Board in substitution. The Company has no reason to believe that any of the nominees named below will be unable to serve as a director if elected. The following table sets forth certain information, as of the date of this proxy statement, as to each nominee for the office of director:

  2. PROPOSAL NO. 1 ELECTION OF DIRECTORS

    | Name | Age | Position | Director Since | | William J. Febbo | 55 | Chief Executive Officer and Director | 2016 | | Lynn O’Connor Vos | 68 | Chairperson | 2015 | | James Lang | 59 | Director | 2017 | | Patrick Spangler | 68 | Director | 2018 | | Gregory D. Wasson | 65 | Director | 2020 | | Catherine Klema | 65 | Director | 2024 |

  3. PROPOSAL NO. 1 ELECTION OF DIRECTORS

    The following information about our directors is based, in part, upon information supplied by them. Unless otherwise indicated, each individual has had the same principal occupation for more than five years.

  4. William J. Febbo

    William J. Febbo Mr. Febbo joined the Company as Chief Executive Officer and as a director in February 2016. Mr. Febbo founded Plexuus, LLC, a payment processing business for medical professionals in September 2015 and remained its Chairman from September 2015 to December 2020. From April 2007 to September 2015, Mr. Febbo served as Chief Operating Officer of Merriman Holdings, Inc., an investment banking firm, where he assisted with capital raises in the tech, biotech, cleantech, consumer and resources industries. Mr. Febbo was a co-founder of, and from September 2013 to September 2015 served as Chief Executive Officer of, Digital Capital Network, Inc., a transaction platform for institutional and accredited investors. Mr. Febbo was a co-founder of, and from January 1999 to September 2015 was Chief Executive Officer of, MedPanel, LLC, a provider of market intelligence and communications for the pharmaceutical, biomedical, and medical device industries. Since 2017, Mr. Febbo has been a faculty member of the Massachusetts Institute of Technology’s linQ program, which is a collaborative initiative focused on increasing the potential of innovative research to benefit society and the economy. Mr. Febbo currently serves as a director of LifeMD Inc, a publicly traded provider of virtual primary care that offers telemedicine, laboratory and pharmacy services and specialized treatment across more than 200 conditions, and as a director of Augmedix, Inc., a publicly traded provider of automated medical documentation and data services. Previously, Mr. Febbo served as a director of Modular Medical, a publicly traded development stage medical device company focused on the design, development and eventual commercialization of an innovative insulin pump. In addition, Mr. Febbo has been a board member of the United Nations Association of Greater Boston, a resource for the citizens of Greater Boston on the broad agenda of critical global issues addressed by the UN and its agencies, since 2004. On January 29, 2018, FINRA accepted a Letter of Acceptance, Waiver and Consent (the “Consent”) submitted by William Febbo. Without admitting or denying the findings, Mr. Febbo consented to the sanctions and to the entry of findings that he permitted Merriman Capital, Inc. to conduct a securities business while below its net capital requirement. From August 2012 to October 2015, Mr. Febbo was the Financial and Operations Principal (FinOp) for a registered broker-dealer, Merriman Capital, Inc. (“Merriman”). During certain months while Mr. Febbo was FinOp, FINRA found that certain of Merriman’s net capital filings with FINRA were inaccurate because of the method by which Merriman calculated net capital and that, when corrected, it was retroactively determined that Merriman had operated below its minimum net capital requirements. Mr. Febbo, as FinOp, signed certain of these reports and was thus held responsible. Based on the Consent, in settlement, Mr. Febbo, who was then no longer registered with any broker-dealer, accepted a fine of $5,000, a 10-business day suspension from acting as FinOp for any FINRA member and required to requalify by examination for the Series 27 license before again acting in a FinOp capacity. Mr. Febbo is qualified to serve on our Board because he brings more than 20 years of experience in building and managing health services and financial businesses. In addition, as the only current management representative on the Board, Mr. Febbo’s leadership of OptimizerRx’s business provides the Board with invaluable insight into the Company’s operations and strategic direction.

  5. Lynn O’Connor Vos

    Lynn O’Connor Vos Ms. Vos, Chairperson of OptimizeRx Board of Directors, initially joined the Company as a director in September 2015, representing Grey Healthcare Group, a healthcare advertising and communications company and wholly-owned operating company of WPP plc, when it acquired a minority interest in OptimizeRx as a strategic investor. Since 2017, Ms. Vos has served as an independent director of the Company and, in 2024 was appointed Chairperson of the Company. Since November 2020, Ms. Vos has served as President of VosHealth, LLC, a healthcare consulting firm focused on advising healthcare start-ups and marketing organizations. From August 2021 to March 2022, Ms. Vos served as the interim Chief Executive Officer of Modular Medical, a publicly traded development stage medical device company focused on the design, development, and eventual commercialization of an innovative insulin pump. From October 2017 to November 2020, Ms. Vos served as the President and Chief Executive Officer of the Muscular Dystrophy Association. From October 1994 to September 2017, Ms. Vos served as the Chief Executive Officer of Grey Healthcare Group. Ms. Vos currently serves as the Chairperson of Medisafe, Inc., a medication adherence platform, and as a director of Aspira Women’s Health, Inc., a publicly traded bio-analytical based company focused on the development of gynecologic disease diagnostic tools, and as a director of Modular Medical, and previously served on the boards of nTelos Wireless, a wireless telecommunications company and PCS provider; the Jed Foundation, a leading nonprofit dedicated to protecting the emotional health of college students; and was a founding board member of Multiple Myeloma Research Foundation (MMRF), a pioneering cancer research foundation. Ms. Vos is a founding member of Extraordinary Women on Boards (EWOB). Ms. Vos is qualified to serve on our Board because of her CEO and Board experience and extensive executive skills in digital marketing, commercialization, and communications in the healthcare industry, as well as her knowledge and experience in corporate diversity, equity, inclusion and belonging (DEI&B) as well as in environmental, social and governance (ESG) matters.

  6. James Lang

    James Lang Mr. Lang joined the Company as a director in January 2017. Since May 2017, Mr. Lang has served as the Chief Executive Officer of EVERSANA, a leading provider of global commercialization services to the life science industry. Since December 2016, Mr. Lang has also served as an executive advisor to Water Street Healthcare Partners, a strategic private equity firm focused exclusively on building market-leading companies in healthcare. From 2012 to 2016, Mr. Lang served in leadership roles at Decision Resources Group (DRG), a multi-national corporation that provides high value global data solutions, analytics, and consulting services to pharmaceutical, biotech, medical device, healthcare provider and payer, and managed care companies, including as its Chief Executive Officer from 2014 to 2016. From 2006 to 2008, he served as President of IHS Cambridge Energy Research Associates, an international research and consulting firm, which delivered strategic knowledge and independent analysis on energy markets, geopolitics, industry trends, and strategy. From 1989 to 2006, he held various roles at Strategic Decisions Group (SDG), a global strategy consulting firm, including as President and Chief Operating Officer from 2000 to 2006. Mr. Lang is an active private investor in healthcare and has served on several private and public boards. Mr. Lang currently serves as a director of BioVie Inc., a publicly traded clinical-stage company pursuing several solutions, one targeting Alzheimer’s and Parkinson’s and another targeting complications from liver cirrhosis. Mr. Lang brings more than 30 years of experience in healthcare data, analytic, and technology enabled business services and is qualified to serve on our Board because of his extensive executive skills and background in the healthcare industry.

  7. Patrick Spangler

    Patrick Spangler Mr. Spangler joined the Company as a director in March 2018. Since October 2020, Mr. Spangler has served as Chief Financial Officer of On Target Laboratories, a developer of fluorescent markers to target and illuminate cancer during surgery. From March 2020 to September 2020, Mr. Spangler served as Chief Financial Officer of MHC Software, LLC, a supplier of document automation software to a variety of industries. Prior to MHC, Mr. Spangler served as Chief Financial Officer of VigiLanz Corporation, a digital healthcare intelligence firm, from September 2014 to October 2019; Chief Financial Officer of Healthland Inc., an EHR company serving the critical access hospital market, from August 2012 to August 2014; Senior Vice President and Chief Financial Officer of Epocrates, Inc., then a public company listed on Nasdaq and a point-of-care medical applications provider, from October 2010 to August 2012; Operating Partner and CFO Advisor of Three Fields Capital, a private equity and venture capital investment firm, from April 2010 to October 2010; Chief Financial Officer of HighJump Software, a global provider of supply chain management software, from June 2009 to April 2010; Senior Vice President and Chief Financial Officer of ev3 Inc., then a public company listed on NASDAQ and a global endovascular company focused on identifying and treating peripheral vascular disease, from March 2005 to January 2009; and Executive Vice President and Chief Financial Officer for EMPI Inc., a medical device manufacturer, from July 1997 to March 2005. Prior to joining EMPI Inc., Mr. Spangler served for over eleven years in various senior finance leadership positions at Medtronic, Inc., a publicly traded lobal medical device company, Mr. Spangler currently serves as a director of Lifespace Communities, Inc., which owns and operates 15 CCRCs in eight states and houses more than 5100 residents, and previously served on the board of Urologix, Inc., then a public company and a leader in less invasive in office BPH treatments, from August 2010 to February 2016. Mr. Spangler has over 35 years of experience in IPOs, mergers and acquisitions, operations and financial management experience in the medical device and health care IT industries. Mr. Spangler is qualified to serve on our Board because of his extensive executive skills and background in the healthcare industry and his finance experience.

  8. Gregory D. Wasson

    Gregory D. Wasson Mr. Wasson joined the Company as a director in July 2020. From November 2019 to present, Mr. Wasson has been the Executive Chairman of Innovation Associates dba iA., a privately held provider of Pharmacy Intelligence™ and high-volume pharmacy automation to the retail, hospital, government, and mail order pharmacy markets. Since January 2016, Mr. Wasson has served as President and Co-founder of Wasson Enterprise, a family office that partners to build sustainable, high-growth businesses. In January 2015, Mr. Wasson served as President and Chief Executive Officer of Walgreens Boots Alliance, Inc., a global, pharmacy-led health and wellbeing enterprise. Prior to being appointed President and Chief Executive Officer of the combined companies, Walgreens Boots Alliance, Mr. Wasson rose through the ranks through a number of positions of increasing responsibility and executive leadership at Walgreens including, from 2009 to 2015 as its President and Chief Executive Officer, from 2007 to 2009 as its President and Chief Operating Officer, from 2001 to 2006 as the President and Executive Vice President of Walgreen Health Services, from 1999 to 2001 as its Vice President of Store Operations, from 1986 to 1999 as a District Manager, and from 1981 to 1986 as a Pharmacy Technician, Pharmacist and Store Manager. In November 2017, Mr. Wasson co-founded Cooler Screens, Inc., the world’s largest point of sale media platform, transforming retail cooler surfaces into IoT-enabled screens that deliver marketing opportunities and smart merchandising for consumers, retails, and brands and has, since inception, served as its Chairman. Mr. Wasson currently serves on the board of P3 Health Partners Inc., a publicly traded patient-centered and physician-led population health management company, and served as the Chairperson of its predecessor Foresight Acquisition Corp. from 2020 to 2021. Mr. Wasson additionally serves on the boards of the following privately held companies: Truvian, Reliefband, Golden Fleece Beverages, Inc., and Performance Health Systems. Mr. Wasson previously served on the boards of the following publicly traded companies: PNC Financial Services Group, Inc. from July 2015 to October 2018 and Verizon Communications Inc. from February 2013 to October 2018. On September 28, 2018, the Securities and Exchange Commission (“SEC”) entered an Administrative Order consensually resolving an investigation into forward-looking financial goals and related disclosures by Mr. Wasson’s former employer, Walgreen Co. (“Walgreens”). The Order settled the SEC’s investigation into various allegedly misleading statements made by or on behalf of Walgreens, including statements made by Mr. Wasson and Walgreens’ former Chief Financial Officer (“CFO”), relating to its ability to achieve certain previously stated financial goals associated with its anticipated future merger with Alliance Boots GmbH. Without admitting or denying any of the SEC’s findings, Walgreens, Mr. Wasson and the company’s former CFO each consented to the entry of an SEC order finding that they violated the antifraud provision contained in Section 17(a)(2) of the Securities Act and each agreed to cease and desist from any future violations of Section 17(a)(2) of the Securities Act and to the payment of specified penalties. For his part, Mr. Wasson agreed to pay a civil monetary penalty of $160,000. Mr. Wasson is qualified to serve on our Board because of his extensive experience as an executive in, and in-depth knowledge of, the healthcare industry.

  9. Catherine Klema

    Catherine Klema Ms. Klema joined the Company as a director in January 2024. Since establishing Nettleton Advisors LLC in 2001, Ms. Klema has served as President of the healthcare strategic advisory consulting firm. Prior to establishing Nettleton Advisors, Ms. Klema served as Managing Director, Healthcare Investment Banking at SG Cowen Securities and Furman Selz LLC. In 2020, Ms. Klema joined the Board of Managers of Quorum Health, the owner or operator of 12 hospitals in 10 states. Ms. Klema serves as Chair of Quorum’s Board of Managers and Chair of Quorum’s Compensation Committee. In 2020, Ms. Klema also joined the Board of Trustees of Albert Einstein College of Medicine, where she serves as Audit Committee Chair. In 2012, Ms. Klema was appointed to the Board of Trustees for Montefiore Health System, an academic health system consisting of Albert Einstein College of Medicine, 11 hospitals, an extended care facility and home health program, School of Nursing, and primary and specialty care regional network including the largest school health program in the US. Ms. Klema serves as Vice Chair of the Montefiore Health System, Chair of the Montefiore Health System Audit Committee and Co-Chair of the Montefiore Health System Medical Committee. Ms. Klema also served as a Director of Allergan plc, a global pharmaceutical company, from 2004 to 2019, and as a Director of Pharmaceutical Product Development, Inc., a global contract research organization, from 2000 to 2011. Ms. Klema brings 40 years of experience in healthcare investment, data, analytics, and technology-enabled business services and is qualified to serve on our Board because of her extensive executive skills and background in the healthcare industry. THE BOARD RECOMMENDS A VOTE “FOR” EACH OF THE NOMINEES.

  10. Stockholder Recommendations for Director Nominees

    Stockholder Recommendations for Director Nominees Any stockholder wishing to recommend a candidate for director should submit the recommendation in writing to our principal executive offices: OptimizeRx Corporation, 260 Charles Street, Suite 302, Waltham, MA 02453, Attn: Corporate Secretary. The recommendation must include the same information that would be required for a candidate to be nominated by a stockholder at a meeting of stockholders as described under “Stockholder Proposals” on page 56. Candidates who are recommended by stockholders, as opposed to nominated, will receive the same consideration as other proposed candidates.

  11. DIRECTOR COMPENSATION

    DIRECTOR COMPENSATION The following table sets forth certain information regarding the compensation earned by or awarded to each of our non-employee directors who served on our Board during the fiscal year ended December 31, 2023. Mr. Febbo, our Chief Executive Officer, received no compensation for his service as a director, and is not included in the table below.

  12. DIRECTOR COMPENSATION

    | Name | Fees Earned or Paid in Cash ($) | Stock Awards ($)(1) | Total ($) | | Gus D. Halas | 99,000 | 150,010 | 249,010 | | James Lang | 54,000 | 150,010 | 204,010 | | Patrick Spangler | 65,000 | 150,010 | 215,010 | | Lynn O’Connor Vos | 58,000 | 150,010 | 208,010 | | Gregory D. Wasson | 45,000 | 150,010 | 195,010 | | Catherine Klema(2) | — | — | — |

  13. DIRECTOR COMPENSATION

    ____________ (1) For each of our non-employee directors, the amount represents the grant date fair value computed in accordance with FASB ASC Topic 718 for stock awards granted during fiscal 2023. We calculated the estimated fair value of the stock awards issued to our non-employee directors using the closing price per share of our common stock on the grant date. See also Notes 2 and 11 of the audited financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023. As of December 31, 2023, the aggregate number of unvested restricted stock units held by each of our non-employee directors was as follows: Gus D. Halas–10,061; James Lang–10,061; Patrick Spangler–10,061; Lynn O’Connor Vos–10,061; Gregory D. Wasson–10,061; Catherine Klema–0. (2) Ms. Klema was appointed to serve as a director of the Company in January 2024. Accordingly, she received no compensation from the Company during 2023.

  14. Narrative Disclosure to the Director Compensation Table

    Narrative Disclosure to the Director Compensation Table 2023 Director Compensation Program. Our director compensation program is designed to provide competitive compensation to attract and retain high-quality non-employee directors. Directors that are also employees of our Company do not receive additional compensation for serving on the Board. Our Compensation Committee periodically reviews and makes recommendations to the Board regarding director compensation. As part of this review, the Compensation Committee may solicit the input of outside compensation consultants. During 2022, the Compensation Committee asked Pearl Meyer & Partners, LLC, an independent compensation consultant (“Pearl Meyer”), to provide a competitive analysis of the compensation we provide to our directors. As a result of that review and the Compensation Committee’s discussion, changes were made to our non-employee director compensation program in 2022. Other than the issuing a single grant of restricted stock units with a grant date value of approximately $150,000 (rather than issuing two grants of restricted stock units with an aggregate grant date value of approximately $150,000), no additional changes were made to our non-employee director compensation program for 2023. Accordingly, our non-employee director compensation program in fiscal 2023 included the following components: • an annual cash retainer of $40,000; • an annual equity grant with a grant date value of approximately $150,000; • an additional annual cash retainer of $40,000 for the Chairman of the Board; • an additional annual cash retainer of $20,000 for the Audit Committee Chair; • an additional annual cash retainer of $10,000 for each Audit Committee Member; • an additional annual cash retainer of $10,000 for the Compensation Committee Chair; • an additional annual cash retainer of $5,000 for each Compensation Committee Member; • an additional annual cash retainer of $8,000 for the Nominating & Governance Committee Chair; and • an additional annual cash retainer of $4,000 for each Nominating & Governance Committee Member. Our non-employee director compensation program is subject to an annual aggregate limit on compensation, which provides that the cash fees paid during any calendar year and the value of equity awards as determined on the date of grant for each non-employee director may not exceed $750,000, with a $1,000,000 limit as to any new non-employee director for the calendar year in which the non-employee director is first elected or appointed to the Board.

  15. Elements of Executive Compensation

    | Compensation Element | Purpose | | Base Salary | • Provides a fixed level of compensation that is competitive with the external market and reflects each executive’s contributions, experience, responsibilities and potential to contribute to our future success | | Annual Incentives | • Aligns officers’ efforts with the near-term corporate goals of the Company through competitive annual incentive opportunities • Rewards achievement of qualitative or quantitative performance measures • The amount earned will vary relative to the targeted level based on our actual results and/or the individual’s performance | | Discretionary Cash Bonuses | • To reward an executive for significant contributions to the Company or when the executive has performed at a level above what was expected, or other similar circumstances • A discretionary bonus may also be used to attract a new hire | | Long-Term Equity Incentive Compensation | • Aligns executives’ interests with the long-term interests of our stockholders • Motivates and rewards the achievement for stock price growth • Promotes executive retention and stock ownership, and focuses executives on enhancing stockholder value | | Benefits | • Promotes health and wellness • Provides financial protection in the event of disability or death • Provides tax-beneficial ways for executives to save towards their retirement, and encourages savings through matches to executives’ retirement savings |

  16. Competitive Market Pay Information

    Competitive Market Pay Information Our Compensation Committee reviews competitive market data to ensure that our executive compensation program offers competitive compensation opportunities. The primary frame of reference for market-based analysis is a peer group of comparable public companies collectively reviewed by the Compensation Committee and Pearl Meyer, and ultimately selected by the Compensation Committee, using a balanced approach that focuses on companies of similar size (revenue, market capitalization and/or valuation) and in the same or adjacent sectors (health care technology/software). As needed, the Compensation Committee may reference published market survey data as an additional reference point. The peer group for setting 2022 compensation decisions consisted of the following companies:

  17. Competitive Market Pay Information

    | CareCloud, Inc. | iCAD, Inc. | ShotSpotter, Inc. | | Castlight Health, Inc. | Ideanomics, Inc. | Simulations Plus, Inc. | | Computer Programs and Systems, Inc. | Intelligent Systems Corporation | Smith Micro Software, Inc. | | Evolent Health, Inc. | NantHealth, Inc. | Tabula Rasa HealthCare, Inc. | | Health Catalyst, Inc. | Phreesia, Inc. | Vocera Communications, Inc. | | HealthStream, Inc. | | |

  18. Competitive Market Pay Information

    The Compensation Committee believes that the compensation data related to companies in our peer group and compensation survey data constituted appropriate guidelines for it to compare proposed pay levels for our named executive officers with those of other companies. The purpose of using this data was to assist the Compensation Committee in assessing whether our proposed executive compensation was competitive. The Compensation Committee considered these data only as a guidepost to their evaluation of proposed compensation amounts, and there was no mandate that any actual compensation paid must fall within any set range. Our Compensation Committee and the Board believe that using the market comparative data in this manner was useful in establishing an appropriate and competitive compensation structure. The Compensation Committee relied on this 2022 competitive market data in setting 2023 compensation for our named executive officers.

  19. Annual Cash Compensation

    ____________ (1) In connection with the Merger, Mr. Silvestro was appointed President on October 24, 2023 and his base salary was increased to $400,00 per annum. Annual Incentive Awards. All of our named executive officers were participants in the OptimizeRx Corporation 2022 Cash Bonus Plan, or the “Cash Bonus Plan” during 2023. The Cash Bonus Plan was adopted in February 2022 by the Compensation Committee. The purpose of the Cash Bonus Plan is to align officers’ and other employees’ efforts with the strategic goals of the Company through competitive annual incentive opportunities. The Cash Bonus Plan is administered by the Compensation Committee. The Compensation Committee has the power to grant awards under the Cash Bonus Plan, to determine the amount of cash to be paid pursuant to each award and the terms and conditions of each award. Awards may provide for payment in installments, or upon the satisfaction of qualitative performance standards or quantitative performance standards, on an individual, divisional or Company-wide basis, as determined by the Compensation Committee. Each participant in the Cash Bonus Plan is entitled to receive payment of the award only after certification by the Compensation Committee that the targets associated with the award have been satisfied. The Compensation Committee meets and certifies the results prior to March 15th of each fiscal year. Final payments with respect to awards vary based on the level of achievement measured against the pre-determined performance measures. The Compensation Committee has the discretion to reduce or eliminate the amount otherwise payable to a participant if it determines that such a reduction or elimination is in the best interests of the Company. The annual cash bonus for 2023 under the Cash Bonus Plan for all of our named executive officers was based on (i) a revenue goal, and (ii) an Adjusted EBITDA goal. Each performance goal was assigned a weighting—75% for revenue, and 25% for Adjusted EBITDA. For purposes of the 2023 bonus awards, we defined EBITDA as net income (loss), as determined under GAAP, before interest, taxes, depreciation and amortization and Adjusted EBITDA as EBITDA further adjusted to exclude stock-based compensation. In addition, the Compensation Committee, at its discretion, may eliminate (i) extraordinary, unusual, and/or nonrecurring items of gain or loss; (ii) gains or losses on the disposition of a business; (iii) dividends declared on the Company’s stock; (iv) changes in tax or accounting principles, regulations or laws; (v) expenses incurred in connection with a merger, acquisition or similar transaction; or (vi) such other effects that the Committee may approve to be eliminated. In 2023, the Compensation Committee eliminated asset impairment charges, severance charges, income related to the sale of certain customer contract assets and liabilities related to the Company’s access and patient engagement technologies, and acquisition/transaction expenses. For 2023, our Compensation Committee set threshold, target, and maximum performance-based cash bonus award levels based on our annual operating budget. There would be no annual performance-based cash bonus payout under the Cash Bonus Plan with respect to any Company performance metric for which actual Company performance did not meet the threshold level. Payout at threshold would be at 50% of target. Achievement between specified Company performance levels would result in a payout based on linear interpolation. In addition, the annual performance-based cash bonus award had a cap of 200% of the target annual incentive opportunity for such performance measure as a maximum award level for each of our named executive officers. The Company performance metrics operate independently. Each named executive officer’s target annual incentive opportunity is based on a number of factors, including the individual’s role and responsibilities within the Company, the individual’s experience and expertise, pay levels in the marketplace for similar positions, and performance of the individual and the Company as a whole. For 2023, the Compensation Committee set the target performance-based cash awards, as a percentage of base salary, for each of our named executive officers as follows:

  20. Annual Cash Compensation

    ____________ (1) Mr. Silvestro’s target is based on a base salary of $387,500 which amount is based on 10 months of a $385,000 base salary and two months of a $400,000 base salary in 2023. Due to the delay in our 2023 audit, the Compensation Committee utilized preliminary, unaudited financial results to determine whether the performance measures had been achieved. The Company’s preliminary, unaudited revenue exceeded the performance goal target; however, performance goal threshold for Adjusted EBITDA was not met. For 2023, based on the preliminary, unaudited revenue results, the Compensation Committee determined that $337,500, $159,375, and $174,375 were payable to each of Messrs. Febbo, Stelmakh and Silvestro, respectively, pursuant to the Cash Bonus Plan. Adjusted EBITDA results were below threshold and no payout was made to any of the named executive officers based on the Adjusted EBITDA performance measure. The Compensation Committee determined to pay half of such bonus amounts in cash and half in equity. The equity portion was issued in the form of restricted stock units pursuant to the 2021 Equity Plan. The number of shares issued to each named executive officer was determined by dividing the cash value of the bonus earned by such named executive officer by the Company’s trailing 24-day average closing stock price as of the grant date, February 15, 2024. Such annual bonuses were paid in the first quarter of 2024. Discretionary Cash Bonuses. In addition to the performance-based bonuses described above, the Compensation Committee has the authority to award discretionary cash bonuses. This type of bonus may be used to reward executive officers for exemplary performance during the year and to attract and recruit qualified candidates. The Compensation Committee considers the following factors in determining the amount of discretionary bonus payable to an executive officer, if any: the Company’s overall performance in light of economic conditions experienced during the fiscal year, the executive’s contribution to the Company’s annual and long-term strategic objectives, the quality of the executive’s work, as well as the officer’s contribution to specific strategic initiatives as may be measured in ways different from the performance criteria identified above. The Compensation Committee believes that it is important to have the flexibility to grant discretionary awards if the Company does not achieve one or more specific financial metrics in the event that the Compensation Committee determines that management’s overall performance during the year otherwise merits recognition. Discretionary bonus amounts, if any, are paid in the first quarter of the year following the year in which the bonus was earned. In February 2024, the Compensation Committee approved discretionary bonuses for each of the named executive officers in recognition of the officer’s individual performance and contributions towards the Company’s annual and long-term strategic objectives not reflected in the Company’s Cash Bonus Plan, including the work they performed in connection with the Merger, as follows: Mr. Febbo ($112,500), Mr. Stelmakh ($53,125) and Mr. Silvestro ($58,125). The Compensation Committee determined to pay half of such bonus amounts in cash and half in equity. The equity portion was issued in the form of restricted stock units pursuant to the 2021 Equity Plan. The number of shares issued to each named executive officer was determined by dividing the cash value of bonus awarded to such named executive officer by the Company’s trailing 24-day average closing stock price as of the grant date, February 15, 2024. Such annual bonuses were paid in the first quarter of 2024.

  21. Equity Awards

    Equity Awards We view long-term incentive compensation in the form of equity awards as a critical element of our executive compensation program. The realized value of these equity awards bears a direct relationship to our stock price, and, therefore, these awards are an incentive for our executive officers to create value for our stockholders. Equity awards also help us retain qualified executive officers in an increasingly competitive market. Long-term incentive awards are granted to our executive officers under the 2021 Equity Plan. As with other elements of compensation, in issuing equity awards, the Compensation Committee takes into consideration individual performance and experience of each executive, internal pay equity, expected future contributions of each executive, historical compensation levels and peer comparisons. We provide our executive officers with long-term incentive awards in the form of stock options and grants of restricted stock units (RSUs). Stock options are a key aspect of our pay-for-performance culture, by providing a return to our executive officers only if the market price of our common stock appreciates over the stock option term. RSU awards provide a return based on the market price of our common stock; if our share price declines, RSU awards correspondingly decline in value but still maintain value, and therefore, a mix of RSU awards and stock options aligns executive officers’ interests with those of stockholders by minimizing incentive for short-term risk-taking at the expense of realizing long-term value. The time-based element of such equity awards also serves as an incentive for continued employment. On April 18, 2023, Mr. Febbo forfeited the performance-based RSU award which was granted to him in October 2021 (the “2021 Febbo Grant”). The 2021 Febbo Grant had an aggregate grant date value equal to $12.5 million, which RSUs were to be earned over a five-year period in three tranches with each one-third portion earned when the stock price exceeded pre-established stock price milestones. The 2021 Febbo Grant had been expected to be Mr. Febbo’s equity award from the Company for a five year period (in lieu of any additional annual grants); however, the Compensation Committee could in its sole discretion reconsider additional grants. In light of Mr. Febbo’s forfeiture of the 2021 Febbo Grant, the Compensation Committee granted Mr. Febbo a grant of stock options and RSUs with an aggregate grant date value of $2.5 million (50% in options and 50% in RSUs). In December 2023, the Compensation Committee granted Messrs. Stelmakh and Silvestro a mix of stock options and RSU awards. The purpose of these awards was to recognize and reward high performance and to promote retention. All stock option and RSU awards granted in 2023 vest in three equal annual installments beginning on the first anniversary of the date of grant. The table below shows the number of RSUs and stock options awarded to each of our named executive officers during 2023.

  22. Equity Awards

    | Name | Grant Date | Number of RSUs Granted | Number of Options Granted | | William J. Febbo | April 18, 2023 | 86,685 | 161,698 | | Edward Stelmakh | December 19, 2023 | 15,711 | 15,711 | | Stephen L. Silvestro | December 19, 2023 | 19,639 | 19,639 |

  23. Equity Awards

    As discussed above, a portion of the bonus (i) earned by each named executive officer pursuant to the Cash Bonus Plan and (ii) awarded to each named executive officer as a discretionary bonus, was paid to such named executive officers in equity. Accordingly, on February 15, 2024 the Compensation Committee granted RSUs to each named executive officer as follows: Mr. Febbo (15,000), Mr. Stelmakh (7,083) and Mr. Silvestro (7,750).

  24. Employment Agreements in Effect During 2023

    Employment Agreements in Effect During 2023 William J. Febbo. Mr. Febbo joined the Company as Chief Executive Officer on February 22, 2016. On February 25, 2019, we entered into an amended employment agreement with Mr. Febbo, which was further amended as of March 2020, September 2020 and September 2021. Mr. Febbo’s employment agreement, as amended, is referred to as the “Febbo Agreement” and the material terms of this agreement are summarized below. The Febbo Agreement provides for at-will employment and does not have a specific term. Pursuant to the Febbo Agreement, Mr. Febbo’s annual base salary was set at $450,000. Mr. Febbo’s total compensation, including his base salary, will be reviewed by the Compensation Committee annually and adjusted at its discretion. The Febbo Agreement also provides that Mr. Febbo is eligible to participate in (i) the Company’s executive bonus plan, with a target bonus of 100% of his annual salary, and (ii) the Company’s health and welfare benefit programs and other benefit programs for which other Company employees are generally eligible. The Febbo Agreement also calls for (x) Mr. Febbo to be reimbursed $4,000 per year for a separate term life insurance policy, and (y) the issuance of the 2021 Febbo Grant. Additionally, the Febbo Agreement contains provisions that provide for the following payments upon termination of employment as a result of death, disability, without “cause,” or for “good reason”: (i) a lump sum payment in an amount equal to twelve months of his then applicable base pay, (ii) an amount equal to his annual target bonus based on his then applicable base pay, and (iii) twelve months of Company provided benefits, including health, dental, vision, life, and disability, as well as Company retirement plan contributions. In the event of a “change in control” of the Company, Mr. Febbo will receive (i) eighteen months of his then applicable base pay, (ii) an amount equal to his target bonus associated with such final base pay, calculated as 1.5 times the annual target amount, (iii) eighteen months of Company provided benefits including health, dental, vision, life, and disability insurance, as well as Company retirement plan contributions, and (iv) if the Company’s equity awards are assumed in the change in control, accelerated vesting of his unvested stock options. Mr. Febbo’s employment agreement further provides that in the event that there is an excise tax imposed with respect to any payment described above or pursuant to any other plan, arrangement or agreement as a result of or in connection with a change of control or termination, Mr. Febbo will be paid an additional tax gross-up payment to offset the effect of the excise tax. The Febbo Agreement also includes standard confidentiality, invention assignment and non-compete provisions typically included in agreements of this type. On March 8, 2023, the Company entered into a fourth addendum to the Febbo Agreement (the “Fourth Addendum”) to provide that if three months prior to, or 24 months following, a Change in Control, Mr. Febbo is terminated without Cause or resigns for Good Reason, in addition to other amounts payable to Mr. Febbo pursuant to the Febbo Agreement, Mr. Febbo will be paid a lump sum payment equal to 4.0 times his then current base salary. Terms not otherwise defined herein have the meanings assigned to them in the Fourth Addendum. The Company and Mr. Febbo entered into an amended and restated employment letter agreement in April 2024 to, among other things, eliminate the single trigger cash severance which was payable to Mr. Febbo in connection with a change in control and remove the Company’s 280G tax gross-up payment obligation afforded to Mr. Febbo under the Febbo Agreement, see “—Post-2023 Compensation Actions—Will Febbo’s Employment Agreement.” Mr. Febbo’s severance and/or change in control benefits are no longer set forth in his employment agreement and are now set forth in full in the Amended Severance Plan (as defined below), see “—Post-2023 Compensation Actions—Amended Executive Severance Plan.” Edward Stelmakh. Mr. Stelmakh joined the Company as Chief Financial Officer & Chief Operations Officer on October 11, 2021. In connection with Mr. Stelmakh’s appointment as Chief Financial Officer & Chief Operations Officer, the Company entered into an offer letter with Mr. Stelmakh. The offer letter provides that Mr. Stelmakh’s employment will be on an at-will basis and provides Mr. Stelmakh an annual base salary of $425,000. Mr. Stelmakh’s annual compensation will be reviewed by the Compensation Committee annually and adjusted at its discretion. In addition, the offer letter provides that Mr. Stelmakh will: (i) be eligible to participate in the Company’s executive bonus plan, with a target annual bonus equal to 50% of his base salary; (ii) receive a one-time equity grant valued at $3.0 million on the grant date; (iii) be eligible to participate in the Company’s annual equity grant program; and (iv) be entitled to participate in various Company benefit programs offered to employees and be eligible to participate in the Company’s flexible paid time off policy. Mr. Stelmakh’s offer letter also provides that if his employment is terminated without cause, Mr. Stelmakh will receive, as severance pay, twelve months of his then applicable base salary. In addition, assuming Mr. Stelmakh makes a timely election to continue his medical and dental insurance benefits pursuant to COBRA, medical, dental and vision insurance will be available to Mr. Stelmakh for the twelve month period following termination (until he obtains alternative health insurance) to the same extent that such insurance is provided to persons who are employed by the Company, including the Company’s payment of the employer portion of premiums, and Mr. Stelmakh’s contribution to premiums, the latter of which will be deducted from the severance pay. The Company’s obligation to pay or to provide the above benefits are conditioned on Mr. Stelmakh executing a waiver and release in favor of the Company. The agreement also includes standard confidentiality, invention assignment and non-compete provisions typically included in agreements of this type. In February 2024, the Compensation Committee approved an increase to Mr. Stelmakh’s bonus target, see “—Post-2023 Compensation Actions—Edward Stelmakh’s Bonus Target.”

  25. Employment Agreements in Effect During 2023

    Stephen Silvestro. Mr. Silvestro joined the Company as Chief Commercial Officer on April 29, 2019. On March 18, 2019, we entered into an employment agreement with Mr. Silvestro, which was further amended in March 2020, January 2021, and February 2022. Mr. Silvestro’s employment agreement, as amended, is referred to as the “Silvestro Agreement” and the material terms of this agreement are summarized below. The Silvestro Agreement provides for at-will employment and does not have a specific term. Pursuant to the Silvestro Agreement, Mr. Silvestro’s annual base salary was set at $350,000, with such base salary subject to increase but not decrease from time to time by the Compensation Committee. In connection with the Merger, Mr. Silvestro was appointed President on October 24, 2023 and his base salary was increased to $400,00 per annum. In addition, the Silvestro Agreement provides that Mr. Silvestro (i) shall be eligible to receive annual cash bonuses under the Company’s 2022 Cash Plan/or any other cash incentive plan maintained by the Company, as determined by the Compensation Committee in its sole discretion, and (ii) may receive grants of awards under the Company’s 2021 Equity Plan and/or any other equity-related incentive plan maintained by the Company, as determined by the Compensation Committee in its sole discretion. The Silvestro Agreement also provides that Mr. Silvestro is eligible to participate in various Company benefit programs generally offered to employees, such as a 401(k) plan, group medical and dental insurance, and short and long-term disability benefits. Additionally, the Silvestro Agreement contains provisions providing for twelve months of severance if he is terminated without cause. Such severance will be paid out on normal payroll dates for the twelve months following termination. The Silvestro Agreement further provides that in the event that there is an excise tax imposed with respect to any payment described above or pursuant to any other plan, arrangement or agreement as a result of or in connection with a change of control or termination, Mr. Silvestro will be paid an additional tax gross-up payment to offset the effect of the excise tax. The Silvestro Agreement also includes standard confidentiality, invention assignment and non-compete provisions typically included in agreements of this type. The Company and Mr. Silvestro entered into an amended and restated employment letter agreement in April 2024 to, among other things, remove the Company’s 280G tax gross-up payment obligation afforded to Mr. Silvestro under the Silvestro Agreement, see “—Post-2023 Compensation Actions—Steven Silvestro’s Employment Agreement.”

  26. Executive Severance Plan

    Executive Severance Plan On March 8, 2023, the Compensation Committee adopted the OptimizeRx Corporation Executive Severance Plan (the “Severance Plan”) to provide severance benefits to certain eligible employees of the Company. Each of the Company’s named executive officers, other than Mr. Febbo, was designated a participant in the Severance Plan. The Severance Plan provides that if either Mr. Stelmakh or Mr. Silvestro is terminated without Cause or resigns for Good Reason, such officer will be paid (i) an amount equal to 1.0 times his base salary, paid in installments over 12 months, (ii) an amount equal to his target annual bonus in effect at the time of termination, paid in a lump sum, and (iii) payment by the Company of COBRA premiums for such officer and his spouse and eligible dependents for up to 12 months following termination (the payments in (i), (ii) and (iii) collectively referred to as “Severance Benefits”). In addition, if either Mr. Stelmakh or Mr. Silvestro is terminated without Cause or resigns for Good Reason three months prior to or 24 months following a Change in Control, in addition to the Severance Benefits, such officer will be paid a lump sum payment equal to 2.0 times his then current base salary. The Severance Plan also provides that if either Mr. Stelmakh or Mr. Silvestro is terminated due to death or Disability, such officer (or the officer’s estate) will be paid an amount equal to his target annual bonus in effect at the time of termination, paid in a lump sum. Terms not otherwise defined herein have the meanings assigned to them in the Severance Plan. Unless otherwise stated in a participant’s individual employment agreement, if any payments or benefits under the Severance Plan would be considered “parachute payments” under Section 280G of the Code, and would be subject to the excise tax imposed by Section 4999 of the Code, then such payments will either be (i) reduced so than no portion of the payments is subject to the excise tax, or (ii) delivered in full, whichever of the foregoing results in the participant receiving a greater amount on a net after-tax basis, taking into account all federal, state and local taxes and the excise tax imposed by Section 4999 of the Code. The Severance Plan provides that in no event will any participant receive the severance benefits provided for in the Severance Plan in addition to severance benefits provided for under any other severance arrangement. Rather, if a participant is covered by any other severance arrangement, such participant will receive as severance the greater of (x) the payments and benefits set forth in the Severance Plan and (y) the payments and benefits set forth in, and subject to the terms, conditions and restrictions of, the other severance arrangement. In April 2024, the Company amended the Executive Severance Plan, see “—Post-2023 Compensation Actions—Amended Executive Severance Plan.”

  27. Say-on-Pay

    Say-on-Pay The Compensation Committee and the Board appreciate and value the views of our stockholders. Following the result of our say-on-pay vote at our 2023 annual meeting, we spoke with our stockholders to hear their concerns with respect to our executive compensation program, and to address them. As a result, we made the following changes to our executive compensation practices: (i) eliminated all 280G tax gross-up benefits from Mr. Febbo’s and Mr. Silvestro’s employment agreements, and (ii) eliminated the single trigger change in control benefits under Mr. Febbo’s employment agreement. Consequently, we are no longer obligated to provide any executive officers with a “gross-up” or other reimbursement payment for any tax liability that he or she may owe as a result of the application of Sections 280G or 4999 in the event of a change in control of the Company and none of our executives has a single trigger change in control provision in his or her employment agreements. The Compensation Committee will continue to evaluate our compensation programs to ensure that the management team’s interests are aligned with our shareholders’ interests to support long-term value creation.

  28. Post-2023 Compensation Actions

    Post-2023 Compensation Actions William Febbo’s Employment Agreement. On April 12, 2024, the Company entered into an amended and restated employment letter agreement with William J. Febbo (the “Febbo Employment Agreement”) which updates and supersedes in its entirety the Febbo Agreement to, among other things, eliminate the single trigger cash severance which was payable to Mr. Febbo in connection with a change in control, remove the Company’s 280G tax gross-up payment obligation afforded to Mr. Febbo under the Febbo Agreement, and provide for an equity grant to Mr. Febbo of 60,000 restricted stock units which vest over three years. In connection with the Febbo Employment Agreement, the Compensation Committee amended the OptimizeRx Corporation Executive Severance Plan to make Mr. Febbo a participant of such plan (as described below). As a result, all of Mr. Febbo’s prior rights to severance and change in control benefits under the Febbo Agreement were removed from the Febbo Employment Agreement. Mr. Febbo’s amended severance and/or change in control benefits are now set forth in full in the Amended Severance Plan (as defined below). Stephen Silvestro’s Employment Agreement. On April 12, 2024, the Company entered into an amended and restated employment letter agreement with Stephen Silvestro (the “Silvestro Employment Agreement”) which updates and supersedes in its entirety Silvestro Agreement to, among other things, remove the Company’s 280G tax gross-up payment obligation afforded to Mr. Silvestro under the Silvestro Agreement. Amended Executive Severance Plan. On April 12, 2024, the Compensation Committee amended the OptimizeRx Corporation Executive Severance Plan (the “Amended Severance Plan”) to include Mr. Febbo as a participant in the Amended Severance Plan, to remove former and add new executive management team members, and to increase the Severance Benefits (as defined below) payable to Mr. Silvestro. The Amended Severance Plan provides that if Mr. Febbo or Mr. Silvestro is terminated without cause or resigns for Good Reason, he will be paid (i) an amount equal to 1.5 times his base salary, paid in installments over 18 months, (ii) an amount equal to his target annual bonus in effect at the time of termination, paid in a lump sum, and (iii) payment by the Company of COBRA premiums for such executive and his spouse and eligible dependents for up to 12 months following termination (the payments in (i), (ii) and (iii) collectively referred to as “Severance Benefits”). The Amended Severance Plan also provides Change in Control termination and death benefits to executive management team members. Mr. Silvestro’s benefits under such provisions were not changed in connection with the Amended Severance Plan. The Amended Severance Plan provides that if Mr. Febbo is terminated without cause or resigns for Good Reason three months prior to or 24 months following a Change in Control, in addition to the Severance Benefits, Mr. Febbo will be paid a lump sum payment equal to 5.0 times his then current base salary. The Severance Plan also provides that if Mr. Febbo is terminated due to death or disability, he (or his estate) will be paid an amount equal to his target annual bonus in effect at the time of termination, paid in a lump sum. Terms not otherwise defined herein have the meanings assigned to them in the Amended Severance Plan. Edward Stelmakh’s Bonus Target. In February 2024, the Compensation Committee approved an increase to Mr. Stelmakh’s bonus target for 2024 from 50% of base salary to 55% of base salary.

  29. 2024 Comparator Peer Group

    2024 Comparator Peer Group The Compensation Committee, with the recommendation of Pearl Meyer, approved a revised peer group of comparable public companies to use when determining competitive pay information for 2024. In selecting peer companies, we generally use a balanced approach that focuses on companies of similar size (revenue, market capitalization and/or valuation) and in the same or adjacent sectors (health care technology/software). We determined to adjust the peer group to reflect the decrease in our market cap. The updated peer group’s median valuation is 1/3 of that of the prior peer group from 2021 utilized by the Compensation Committee ($225 million vs $606 million). The Compensation Committee believes that this group, when taken in aggregate, represents a reasonable market reference when determining the competitiveness of our pay programs for 2024.

  30. 2024 Comparator Peer Group

    | American Well Corporation | Domo, Inc. | Phreesia, Inc. | | Arteris, Inc. | Health Catalyst, Inc. | Simulations Plus, Inc. | | Augmedix, Inc. | HealthStream, Inc. | Smith Micro Software, Inc. | | CareCloud, Inc. | iCAD, Inc. | SoundThinking, Inc. | | Computer Programs and Systems, Inc. | Intellicheck, Inc. | Viant Technology Inc. | | CoreCard Corporation | Kaltura, Inc. | |

  31. Summary Compensation Table for Fiscal 2023

    Summary Compensation Table for Fiscal 2023 The table below summarizes all compensation awarded to, earned by, or paid to our named executive officers for all services rendered in all capacities to us and our subsidiaries during the fiscal years noted below:

  32. Summary Compensation Table for Fiscal 2023

    | Name and Principal Position | Year | Salary ($) | Bonus ($)(1) | Stock Awards ($)(2) | Option Awards ($)(3) | Non-Equity Incentive Plan Compensation ($)(5) | All Other Compensation ($)(6) | Total ($) | | William J. Febbo | 2023 | 450,000 | 56,250 | 963,189(4) | 963,189(4) | 337,500 | 19,400 | 2,789,528 | | Chief Executive Officer | 2022 | 450,000 | 225,000 | — | — | 0 | 19,400 | 694,400 | | Edward Stelmakh | 2023 | 425,000 | 26,563 | 200,000 | 102,988 | 159,375 | 15,800 | 929,726 | | Chief Financial Officer & Chief Operations Officer | 2022 | 425,000 | 106,250 | 750,000 | 750,000 | 0 | 15,800 | 2,047,050 | | Stephen L. Silvestro | 2023 | 384,583 | 29,063 | 250,000 | 128,736 | 174,375 | 3,600 | 970,357 | | President, Former Chief Commercial Officer(7) | 2022 | 330,000 | 105,000 | 550,017 | 550,020 | 0 | 3,600 | 1,558,6371 |

  33. Summary Compensation Table for Fiscal 2023

    ____________ (1) Represents discretionary cash bonuses paid after the fiscal year with respect to that fiscal year’s performance to our named executive officers. (2) Represents the grant date fair value of awards determined in accordance with FASB ASC Topic 718. Stock awards granted in 2023 consisted of time-based restricted stock units. We calculated the estimated fair value of the time-based restricted stock unit awards using the closing price per share of our common stock on the grant date. See also Notes 2 and 11 of the audited financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023. The stock awards granted in 2023 are subject to vesting conditions described under “– Equity Awards.” (3) Represents the grant date fair value of option awards determined in accordance with FASB ASC Topic 718. We calculated the grant date fair value of option awards using the Black-Scholes option pricing model using assumptions set forth in Note 2 of the audited financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023. The option awards granted in 2023 are subject to vesting conditions described under “– Equity Awards.” (4) On April 18, 2023, the Compensation Committee approved a grant to Mr. Febbo of 86,685 RSUs and 161,698 stock options with an aggregate grant date fair value of $2.5 million to vest over a three year period. Concurrently, the CEO forfeited the Febbo 2021 Grant of 182,398 market-based restricted stock units. The forfeiture and accompanying grant were considered an equity modification according to ASC 718, See Note 11 “– Equity Award Modification” of the audited financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023. (5) Represents annual performance-based bonuses paid after the fiscal year with respect to that fiscal year’s performance to our named executive officers. All annual performance-based bonus awards issued in fiscal 2023 to our named executive officers were issued pursuant to our Cash Bonus Plan. The Compensation Committee decided to pay 50% of the annual performance-based bonus in equity. See “– Annual Cash Compensation” and “– Equity Awards.” (6) The “All Other Compensation” column for the fiscal year ended December 31, 2023 includes the following compensation items.

  34. Summary Compensation Table for Fiscal 2023

    | Named Executive Officer | Contribution to 401(k) Plan ($) | Technology Reimbursement | Total ($) | | William J. Febbo | 12,200 | 7,200 | 19,400 | | Edward Stelmakh | 12,200 | 3,600 | 15,800 | | Stephen L. Silvestro(1) | — | 3,600 | 3,600 |

  35. Summary Compensation Table for Fiscal 2023

    (7) Mr. Silvestro served as Chief Commercial Officer prior to becoming President effective October 24, 2023.

  36. Outstanding Equity Awards at Fiscal Year-End

    Outstanding Equity Awards at Fiscal Year-End The following table sets forth for each of our named executive officer’s information regarding unexercised options and unvested stock awards outstanding at December 31, 2023.

  37. Outstanding Equity Awards at Fiscal Year-End

    | | | Option Awards | | | | Stock Awards | | | Name | Grant Date | Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#) Unexercisable(1) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#)(2) | Market Value of Shares or Units of Stock that Have Not Vested ($)(3) | | William J. Febbo | 01/07/2021 | — | — | — | — | 9,628 | 137,777 | | | 04/18/2023 | — | — | — | — | 86,685 | 1,240,462 | | | 04/18/2023 | — | 161,698 | 14.42 | 04/17/2028 | — | — | | Edward Stelmakh | 10/11/2021 | 16,794 | 8,397 | 81.09 | 10/11/2026 | — | — | | | 10/11/2021 | — | — | — | — | 8,222 | 117,657 | | | 10/03/2022 | 32,545 | 65,092 | 15.04 | 10/02/2027 | — | — | | | 10/03/2022 | — | — | — | — | 33,245 | 475,736 | | | 12/19/2023 | — | 15,711 | 12.73 | 12/18/2028 | — | — | | | 12/19/2023 | — | — | — | — | 15,711 | 224,824 | | Stephen L. Silvestro | 05/02/2019 | — | — | — | — | 90,000 | 1,287,900 | | | 01/07/2021 | 25,674 | 12,837 | 37.50 | 01/07/2026 | — | — | | | 03/01/2022 | 3,908 | 7,818 | 43.24 | 03/01/2027 | — | — | | | 03/01/2022 | — | — | — | — | 3,855 | 55,165 | | | 10/03/2022 | 13,018 | 26,037 | 15.04 | 10/02/2027 | — | | | | 10/03/2022 | — | — | — | — | 13,298 | 190,294 | | | 12/19/2023 | — | 19,639 | 12.73 | 12/18/2028 | — | — | | | 12/19/2023 | — | — | — | — | 19,639 | 281,034 |

  38. Outstanding Equity Awards at Fiscal Year-End

    ____________ (1) All options set forth in this column vest in three equal annual installments beginning on the first anniversary of the date of grant. (2) All restricted stock units in this column, other than the 05/02/2019 restricted stock unit award to Mr. Silvestro, vest in three equal annual installments beginning on the first anniversary of the date of grant. The 05/02/2019 restricted stock unit award to Mr. Silvestro cliff vests on the fifth anniversary of the date of grant. (3) Calculated by multiplying the closing price per share of the Company’s common stock on December 29, 2023, $14.31, by the number of shares.

  39. Pay versus Performance

    Pay versus Performance The following table shows (i) the total compensation for our principal executive officer (PEO), and on an average basis, our other named executive officers (NEOs) as set forth in the summary compensation tables set forth in the Company’s proxy statements for 2023, 2022 and 2021(“SCT”); (ii) the “compensation actually paid” to our PEO and, on an average basis, our other named executive officers (in each case, as determined under applicable SEC rules); (iii) our total shareholder return, and (iv) our net income. Compensation actually paid, as determined under SEC requirements, does not reflect the actual amount of compensation earned by or paid to our named executive officers during a covered year. No dividends were paid or accrued on stock awards for the years presented.

  40. Pay versus Performance

    | Year | SCT Total Compensation for PEO(1) ($) | Compensation Actually Paid to PEO(1)(3) ($) | Average SCT Total Compensation for Other NEOs(2)(3) ($) | Average Compensation Actually Paid to Other NEOs(2)(3) ($) | Value of Initial Fixed $100 Investment Based On Total Shareholder Return(4) ($) | Net Income (Loss)(5) ($) | | 2023 | 2,789,528 | 2,298,481 | 950,042 | 322,486 | 45.92 | (17,565,866) | | 2022 | 694,400 | (7,300,454) | 1,802,844 | (1,536,360) | 53.92 | (11,438,440) | | 2021 | 14,619,576 | 10,775,969 | 2,823,520 | 2,270,492 | 199.33 | 378,079 |

  41. Pay versus Performance

    ____________ (1) Mr. Febbo, our PEO, served as chief executive officer for each of the three years presented in the table. (2) The other NEOs included for purposes of calculating the average amounts in each applicable year are as follows: for 2023 and 2022, Stephen L. Silvestro and Edward Stelmakh; and (ii) for 2021, Marion K. Odence-Ford and Edward Stelmakh. (3) SEC rules require certain adjustments be made to the SCT total compensation to determine “compensation actually paid” for purposes of the Pay versus Performance Table, which are detailed for 2023 in the table below. Neither our PEO nor our other NEOs participated in a defined benefit plan; therefore, no adjustment for pension benefits is included in the table below.

  42. Pay versus Performance

    | Year | | Reported SCT Total Compensation | [Less] Reported Grant Date Value of Equity Awards (a) | [Plus/Minus] Equity Award adjustments (b) | [Equals] Compensation Actually Paid | | 2023 | PEO | $2,789,528 | $1,926,378 | $1,435,331 | $2,298,481 | | | Other NEOs Average | $950,042 | $340,862 | $(286,693) | $322,486 |

  43. Pay versus Performance

    _________ (a) Represents the grant date fair value of equity awards reported in the “Stock Awards” and “Option Awards” columns of the SCT for 2023. (b) The equity award adjustments include the addition (or subtraction, as applicable) of the following: (i) the year-end fair value of any equity awards granted in the applicable year that are outstanding and unvested as of the end of the year; (ii) the amount of change as of the end of the applicable year (from the end of the prior fiscal year) in fair value of any awards granted in prior years that are outstanding and unvested as of the end of the applicable year; (iii) for awards that are granted and vest in same applicable year, the fair value as of the vesting date; (iv) for awards granted in prior years that vest in the applicable year, the amount equal to the change as of the vesting date (from the end of the prior fiscal year) in fair value; and (v) for awards granted in prior years that are determined to fail to meet the applicable vesting conditions during the applicable year, a deduction for the amount equal to the fair value at the end of the prior fiscal year. The valuation methodologies and assumptions used to calculate fair values did not materially differ from those disclosed at the time of grant. The amounts deducted or added in calculating the equity award adjustments are as follows:

  44. Pay versus Performance

    | Year | Position | [Plus] Fair Value at Fiscal Year-End of Outstanding and Unvested Option Awards and Stock Awards Granted in Fiscal Year | [Plus] Change in Fair Value of Outstanding and Unvested Option Awards and Stock Awards Granted in Prior Fiscal Years | [Plus] Fair Value at Vesting of Option Awards and Stock Awards Granted in Fiscal Year that Vested During Fiscal Year | [Plus] Change in Fair Value as of Vesting Date of Option Awards and Stock Awards Granted in Prior Fiscal Years for Which Applicable Vesting Conditions Were Satisfied During Fiscal Year | [Less] Fair Value as of Prior Fiscal Year-End of Option Awards and Stock Awards Granted in Prior Fiscal Years that Failed to Meet Applicable Vesting Conditions During Fiscal Year | Total Equity Award Adjustments | | 2023 | PEO | $2,356,399 | $(23,975) | $0 | $11,072 | $(908,165) | $1,435,331 | | | Other NEOs | $389,375 | $(352,243) | $0 | $(323,826) | $0 | $(286,693) |

  45. Pay versus Performance

    (4) TSR is determined based on the value of an initial fixed investment of $100 in the Company’s common stock at December 31, 2020. (5) The dollar amounts reported represent the amount of net income (loss) reflected in the Company’s audited financial statements for the applicable year.

  46. Non-Employee Director Compensation Limit

    Non-Employee Director Compensation Limit The 2021 Equity Plan provides that the value of all awards awarded under the 2021 Equity Plan and all other cash and non-cash compensation paid by the Company or any affiliate to any non-employee director in any calendar year may not exceed $750,000, with a $1,000,000 limit as to any new non-employee director for the calendar year in which the non-employee director is first elected or appointed to the Board. For purposes of the non-employee director limits, the value of any award will be valued based on the grant date fair value as determined by the Company for financial statement purposes and all other non-cash compensation will be valued at fair market value as reasonably determined by the Compensation Committee.