DEF 14A of Axt Inc
Filed Apr 3, 2025 · FY20240001558370-25-004393
ELECTION OF DIRECTORS
ELECTION OF DIRECTORS We have a classified Board of Directors consisting of two Class I directors, one Class II director and one Class III director, who will serve until the annual meetings of stockholders to be held in 2026, 2027 and 2025, respectively, and until their respective successors are duly elected and qualified. At each annual meeting of stockholders, directors are elected for terms of three years to succeed those directors whose terms expire at the annual meeting dates. The term of the Class III director will expire on the date of the 2025 annual meeting. Accordingly, one nominee is to be elected to serve as the Class III director of the Board of Directors at the 2025 annual meeting. Our Nominating and Corporate Governance Committee of the Board of Directors has recommended to the Board of Directors, and the Board of Directors has nominated, Christine Russell, the current Class III director of the Board of Directors, as the nominee for election by the stockholders to this position. If elected, the nominee will serve as the Class III director until our annual meeting of stockholders in 2028 and until her successor is elected and qualified. If the nominee declines to serve or becomes unavailable for any reason, the proxies may be voted for such substitute nominee as the Board of Directors may designate.
Members of the Board of Directors
Members of the Board of Directors Morris S. Young, Ph.D. co-founded AXT in 1986 and has served as a director since 1989. Dr. Young served as our Chairman of the Board of Directors from February 1998 to May 2004 and as our president and chief executive officer from 1989 to May 2004. From 2004 until his retirement in 2006, Dr. Young served as our chief technology officer. He was reappointed as our chief executive officer on July 16, 2009 and Chairman of the Board of Directors on August 12, 2021. From 1985 to 1989, Dr. Young was a physicist at Lawrence Livermore National Laboratory. Dr. Young has a B.S. degree in metallurgical engineering from National Cheng Kung University, Taiwan, a M.S. degree in metallurgy from Syracuse University, and a Ph.D. in metallurgy from Polytechnic University. The Board has determined that Dr. Young’s long history with the Company, as well as his breadth of experience and on-going, active involvement in the semiconductor industry, make him a valuable asset to the Board. David C. Chang, Ph.D. has served as one of our directors since December 2000. Dr. Chang co-founded The Global Maximum Educational Opportunities, Inc., which provides study abroad programs in China for U.S. undergraduate students, in 2011 and became its Chairman and Chief Executive Officer in August 2013. Dr. Chang has served as president of Polytechnic University in New York (now known as the Tandon School of Engineering, New York University) from 1994 to 2005 and chancellor from 2005 to 2013, and Professor Emeritus at New York University since 2013. Previously, Dr. Chang was dean of the College of Engineering and Applied Sciences at Arizona State University. Dr. Chang served as a director of the NSF/Industry Corporate Research Center for Microwave and Millimeter-Wave Computer Aided Design from 1981 to 1989. Dr. Chang was a member of the board of directors of Time Warner Cable Inc. from 2004 to 2016. Dr. Chang has a M.S. degree and a Ph.D. in applied physics from Harvard University and a B.S. degree in electrical engineering from National Cheng Kung University, Taiwan. The Board has determined that Dr. Chang’s extensive experience in the semiconductor industry allows him to make significant contributions to the strategic direction of the Company. Jesse Chen has served as one of our directors since February 1998 and was our Chairman of the Board of Directors from May 2004 until October 2007, at which time he was appointed our lead independent director. Mr. Chen served as our Chairman of the Board of Directors from March 2009 until August 12, 2021. Since May 1997, Mr. Chen has served as a managing director of Maton Ventures, an investment company. From 1990 to 1996, Mr. Chen served as chief executive officer of BusLogic, Inc., a fabless semiconductor and computer peripherals company. Mr. Chen serves on the board of directors of a private company. Mr. Chen has a B.S. degree in aeronautical engineering from National Cheng Kung University, Taiwan and a M.S. degree in electrical engineering from Loyola Marymount University. The Board has determined that Mr. Chen’s experience as a chief executive officer and his investment background provides him with the experience and knowledge in compensation and governance matters for technology companies to enhance his contributions to the Board and its committees. Christine Russell has served as one of our directors since December 2019. Ms. Russell also serves on the board of directors and as audit committee chair of both QuickLogic Corporation (Nasdaq: QUIK) and eGain Corporation (Nasdaq: EGAN). She is chairman emeritus and a director on the board of SVDX (Silicon Valley Directors Exchange), a professional organization that provides a forum for education, conversation about current issues, and peer interaction for boards of directors of Silicon Valley companies. From 2018 to 2020, Ms. Russell served as chief financial officer of PDF Solutions, Inc. (Nasdaq: PDFS), a provider of yield improvement technologies for the IC manufacturing process life cycle. She previously served as chief financial officer of Uni-Pixel, Inc., a manufacturer of touch sensor films, which was sold to a China-based firm. Other companies include Vendavo, Inc., a SaaS-based pricing optimization software company addressing the Global 2000 and EAG, Inc. (Evans Analytical Group), a global provider of analytical testing for technology companies, including major semiconductor, chemicals and pharmaceuticals firms. Prior to EAG, she served in the roles of both chief financial officer and EVP of business development at Virage Logic Corporation, a Nasdaq-listed semiconductor intellectual property company that was sold to Synopsys, Inc. in 2010. Ms. Russell holds a bachelor’s degree and an MBA from Santa Clara University. The Board has determined that Ms. Russell’s financial expertise, her background and experience in the finance function in a number of companies make her a valuable contributor to the Board and its committees.
Executive Summary
| ● | The Board of Directors continued to link 50% of the annual equity award to a defined financial metric for the coming year and continued to also require four years to fully vest. The “At-Risk” portion of the shares for 2024 were earned because the financial metric relating to our annual revenue for 2024 was achieved and exceeded; |
Executive Summary
| ● | Three of the four quarterly cash bonuses were converted to four-year vesting Restricted Stock Awards. |
Features of Executive Compensation Program
| ● | Pay for Performance. We link pay and performance by establishing corporate financial performance metrics under our Executive Incentive Plan and grant a substantial portion of pay in the form of equity awards that vest over multiple years; |
Features of Executive Compensation Program
| ● | No Guaranteed Bonuses. We did not provide any guaranteed bonuses to our executive officers for fiscal 2024; |
Features of Executive Compensation Program
| ● | Compensation Consultant. The Compensation Committee of the Board (the “Committee”) seeks input from Compensia, an independent compensation consultant retained directly by the Committee in connection with its oversight of the executive compensation program; |
Features of Executive Compensation Program
| ● | Target the 50th percentile. We target compensation to match the 50th percentile of our peer group compensation notwithstanding the deep industry experience of management; |
Features of Executive Compensation Program
| ● | No 280G Tax Gross-ups. We do not provide for any golden parachute tax gross-ups; |
Features of Executive Compensation Program
| ● | No Option Repricings. No option repricings are permitted under our 2015 Equity Incentive Plan; |
Overview of Executive Compensation Program and Philosophy
| ● | Use total cash compensation (salary plus annual cash bonus, payable quarterly) to recognize appropriately each individual officer’s scope of responsibility, role in the organization, experience and contributions; |
Overview of Executive Compensation Program and Philosophy
| ● | providing short-term bonus compensation by establishing a bonus plan to reward achievement at specified levels of Company financial and individual officer performance, with a significant portion of each officer’s goals tied to key financial measures, including Company-specific measures comprising achievement of targeted revenue, gross profit, operating expense, and net income levels, all being line items upon which executive officer performance can have a significant impact and that are linked to beneficial financial performance improvement and, therefore, value to our stockholders. In addition, a portion of each officer’s performance goals is related to individual metrics as determined by the Board of Directors; and |
Overview of Executive Compensation Program and Philosophy
| ● | providing long-term incentives in the form of restricted stock awards, in order to retain those individuals with the leadership and management abilities necessary for increasing long-term stockholder value while more closely aligning the interests of our officers with those of our stockholders. In 2024, we continued our practice of granting 50% of the annual award of long-term incentives to achievement of a specific financial performance metric for the coming year, but still requiring four-year vesting. |
Components of Our Executive Compensation Program
Components of Our Executive Compensation Program There are five major elements that comprise our executive officer compensation program: (i) base salary; (ii) annual cash bonus, payable quarterly and based on performance; (iii) long-term incentives, such as restricted stock awards; (iv) retirement benefits provided under a 401(k) plan; and (v) perquisites and benefit programs that are generally available to all of our employees. We have selected these elements because each is considered useful and/or necessary to meet one or more of the principal objectives of our compensation policies. Base salary is set with the goal of adequately compensating employees on a day-to-day basis for the time spent and the services they perform. Bonus target percentages are set with the goal of rewarding employees for performance at specified levels of Company financial and individual officer achievement. Both salary and bonus target percentages are also set at levels intended to attract and retain employees. Our restricted stock awards are intended to provide an incentive and reward for the achievement of long-term business objectives, including achievement of our financial goals, our growth, business development, market penetration, product development, upgrades to manufacturing, retaining key employees and more. We believe that these elements of compensation, when combined, are effective, and will continue to be effective, in achieving the objectives of our executive compensation program.
Role of Compensation Consultant
Role of Compensation Consultant The Committee has the authority to engage its own independent advisors to assist in carrying out its responsibilities. For a number of years, including 2023 and 2024, the Committee retained Compensia to review our executive compensation practices. Compensia advises the Committee on the principal aspects of executive compensation, including base salaries, bonuses and long-term equity incentives, as well as target total, direct compensation (which consists of salary, target bonus and long-term equity incentives). Compensia also reported on its evaluation of the competitiveness of our executive officer compensation program as compared to peer companies. Compensia provided market information about the competitive framework for executive pay and performance-based incentives. Consistent with the Company’s compensation philosophy, the Committee generally targets the 50th percentile of the peer group determined by Compensia for each key element of compensation, other than our 401(k) plan and perquisites and benefit programs. In 2023 and 2024, representatives of Compensia communicated with the chair of the Committee outside of meetings with the Committee. Compensia reports to the Committee and did not perform services for the Company other than for the Committee. Based on the consideration of the various factors as set forth in the rules of Nasdaq, the Committee does not believe that its relationship with Compensia and the work of Compensia on behalf of the Committee have raised any conflicts of interest.
Peer Group
Peer Group In order to determine each officer’s target total cash compensation (salary and bonuses) in effect at the beginning of fiscal 2024, the Committee reviewed compensation information from a peer group of 16 companies identified by Compensia in August 2023 and reviewed by the Committee, with input from our management. Each company within the peer group is a publicly traded high-technology company. However, given the fact that no U.S. public companies directly compete with AXT, the peer group was composed largely of semiconductor companies, including semiconductor companies that use non-silicon wafer substrates. The peer group consisted of companies that are generally considered “small-cap” companies and included companies with market capitalizations and annual revenues both greater than and less than ours. All are companies in which we believe could compete with us for executive officer talent. The peer group upon which the Committee relied for decisions relating to executive compensation program consisted of the following companies: Alpha & Omega Semiconductor Limited Amtech Systems, Inc. Applied Optoelectronics, Inc. Cambium Networks CEVA, Inc. EMCORE Corporation FARO Technologies GSI Technology, Inc. Intevac, Inc. Iteris Kopin Corporation PCTEL, Inc. Pixelworks Quantum Turtle Beach Vishay Precision Group Data on the compensation practices of the above mentioned peer group was gathered by Compensia through publicly available information. The Committee relied upon Compensia to compare compensation levels of our executive officers against the levels for executive officers in applicable roles at the above peer group companies, generally to ensure that our executive compensation program remained competitive in the market for continuing to recruit, retain, and incentivize our executive officers and to reward them appropriately for performance achieved. The data was gathered by Compensia with respect to base salary, bonuses, target total cash compensation, long-term equity incentives, and target total direct compensation. The peer group data was not used for purposes of setting any generally available benefits, such as 401(k) plans or health care coverage.
Base Salary
The Committee considered current peer group salary data that it received from Compensia in August of 2023. The data showed that both officers’ salary levels were below the 50th percentile of the peer group. However, there were no base salary adjustments for fiscal 2024 for Dr. Young nor Mr. Fischer because of the semiconductor cyclical downturn. The last salary increase occurred on November 1, 2021, when Dr. Young’s salary was increased to $479,000 and Mr. Fischer’s salary was increased to $354,000.
Executive Incentive Plan
Executive Incentive Plan The Executive Incentive Plan is an incentive bonus program for key executive officers that is intended to increase stockholder value and the success of the Company by motivating employees to perform to the best of their abilities and achieve the Company’s objectives. As in previous years, the Executive Incentive Plan for fiscal 2024 included performance metrics to reflect certain of the Company’s business objectives set forth in its operating plan for the fiscal year. In determining the incentive opportunities for our officers under the Executive Incentive Plan, the Committee considered its philosophy to use total cash compensation (salary plus cash bonus) to recognize appropriately each individual officer’s scope of responsibility, role in the organization, experience and contributions. The Committee believes that the terms and target bonus opportunities of the Executive Incentive Plan are consistent with market information provided by Compensia which displays the 50th percentile of the peer group as reviewed by the Committee in Q4 2023. The Executive Incentive Plan is administered by the Committee, provided that the actual bonus payment for our Chief Executive Officer is subject to the approval of the Board. The Committee, in its sole discretion, selects the eligible employees who will be participants for any performance period. Participation in the Executive Incentive Plan is in the sole discretion of the Committee, on a performance period by performance period basis. Dr. Young also presents bonus amounts intended for other executives which are discussed by the Committee. For fiscal 2024, each of our Named Executive Officers participated in the Executive Incentive Plan. Under the Executive Incentive Plan, the Committee, in its sole discretion, establishes a target award for each NEO, which may be a percentage of a participant’s annual base salary as of the beginning or end of the performance period, a fixed dollar amount, or such other amount based on such other formula as the Committee determines. Each performance period, the Committee, in its sole discretion, will establish a bonus pool, which pool may be established before, during or after the applicable performance period. Actual awards will be paid from the bonus pool. The Committee, in its sole discretion, determines the performance goals applicable to any target award. The performance goals are financial targets or other objective goals, but the Executive Incentive Plan also allows subjective criteria to be included. The Committee also has the discretion to increase, decrease or eliminate any award under the Executive Incentive Plan. Each actual award, if any, is paid solely from the general assets of the Company. Payment of each actual award shall be made as soon as practicable after the end of the performance period to which the actual award relates and after the actual award is approved by the Committee, but generally not later than March 15 of the year immediately following completion of the performance period. Each actual award is paid in cash (or its equivalent) in a single lump sum. In establishing the incentive bonus program for fiscal 2024 under the Executive Incentive Plan, the Committee set four quarterly performance periods, coinciding with the quarterly corporate objectives set forth in the Company’s annual operating plan for fiscal 2024 (the “Operating Plan”). The Committee determined that actual awards would be based upon achievement of corporate financial targets (the “Corporate Targets”) and individual performance. Achievement of the Corporate Targets represented 60% of the actual award, and individual performance represented 40% of the actual award. The Operating Plan was approved by the Board to guide and drive the Company’s business for the fiscal year, developed with consideration for the markets in which the Company competes, and designed to result in improved business performance for the Company. Individual performance under the Executive Incentive Plan also was assessed by the Committee based on actual performance as compared to agreed upon performance targets and the Committee’s expectations that the individual will perform at high levels in his roles and responsibilities and make significant contributions individually in achieving the Operating Plan goals and objectives. The Corporate Targets were comprised of the following four financial targets, determined on accounting principles generally accepted in the United States (“GAAP”) basis: (1) total revenue (“Total Revenue Target”), (2) gross profit (“Gross Profit Target”), (3) operating expense (“Operating Expense Target”) and (4) net income (“Net Income Target”). The actual quarterly Corporate Targets were set forth in the Operating Plan, and approved by the Board in February 2024. The Committee made no change to the structure and weighted components used in the previous year. The Corporate Targets were weighted 10% for each of the Total Revenue Target, Gross Profit Target and Operating Expense Target and 30% for the Net Income Target for a total of 60% of the target award. Individual performance targets are both objective, for example penetrating specific new accounts, proper supervision and development of key executives, proper corporate financial reporting and controls, corporate training sessions, progress on the possible IPO in China, and subjective such as corporate leadership, company culture and dedication. The Committee approved threshold, target and maximum levels of performance that were required to be achieved with respect to the Corporate Targets for each of the four quarters in 2024 and their corresponding bonus payout eligibility levels, as follows:
Executive Incentive Plan Corporate Targets for 2024
Executive Incentive Plan Corporate Targets for 2024
Executive Incentive Plan Corporate Targets for 2024
| Corporate Target | Percentage of Achievement Required Under Operating Plan | Payout Upon Applicable Level of Achievement Under Operating Plan | | Net Income Target | Below 70% 70% (threshold) 100% (target) 150% (maximum) | 0% 70% (threshold) 100% (target) 150% (maximum | | Each of: Total Revenue Target, Gross Profit Target and Operating Expense Target | Below 90% 90% (threshold) 100% (target) 150% (maximum) | 0% 90% (threshold) 100% (target) 150% (maximum) |
Executive Incentive Plan Corporate Targets for 2024
For fiscal 2024, for each 1% increase in the performance of a Corporate Target over the threshold, the actual award increased by 1%, up to a maximum of 150%. The Net Income Target was required to be achieved at a minimum of 70% of the Operating Plan for threshold achievement, 100% of the Operating Plan for target achievement, and 150% or greater under the Operating Plan for maximum achievement. The applicable weighted portion of the target award payable for each fiscal quarter could vary from 70% at threshold achievement of the Net Income Target to 150% at maximum achievement of the Net Income Target, with target achievement of the Net Income Target resulting in 100% payout with respect to the portion of the target award attributable to the Net Income Target. Each of the Total Revenue Target, Gross Profit Target, and Operating Expense Target (each, an “Additional Target”) was required to be achieved at a minimum of 90% of the Operating Plan for threshold achievement, 100% of the Operating Plan for target achievement, and 150% or greater under the Operating Plan for maximum achievement. Based on actual performance, the applicable weighted portion of the target award payable for each fiscal quarter could vary from 90% at threshold achievement of the applicable Additional Target to 150% at maximum achievement of the applicable Additional Target, with target achievement of the applicable Additional Target resulting in 100% payout with respect to the portion of the target award attributable to that performance objective. For fiscal 2024 the financial targets for revenue, gross profit, operating expense and net income were as follows:
Executive Incentive Plan Corporate Targets for 2024
| (Plan in thousands) | Year 2024 Operating Plan Key Metrics | | | | Total | | | Q1 | Q2 | Q3 | Q4 | 2024 | | Revenue | $18,128 | $21,384 | $22,372 | $23,116 | $85,000 | | Gross Profit | 1,940 | 2,736 | 3,435 | 4,173 | 12,284 | | Operating Expense | 9,088 | 9,493 | 9,687 | 9,955 | 38,223 | | Net Loss | (6,078) | (5,829) | (5,420) | (5,017) | (22,344) |
Executive Incentive Plan Corporate Targets for 2024
The resulting achievement for the financial targets was as follows:
Executive Incentive Plan Corporate Targets for 2024
| (Actual in thousands) | Year 2024 Operating Plan Key Metrics Achievement | | | | Total | | | Q1 | Q2 | Q3 | Q4 | 2024 | | Revenue | $22,688 | $27,923 | $23,645 | $25,105 | $99,361 | | Gross Profit | 6,094 | 7,652 | 5,682 | 4,408 | 23,836 | | Operating Expense | 9,441 | 9,537 | 9,088 | 10,573 | 38,639 | | Net Loss | (2,083) | (1,516) | (2,937) | (5,088) | (11,624) |
Executive Incentive Plan Corporate Targets for 2024
Individual performance was weighted at 40% of the target award and the individual portion of the award payable was capped at 150% of the individual target award. For fiscal 2024, the Committee made assessments regarding individual performance on a quarterly basis with the assistance of the CEO for the Named Executive Officer other than himself. The determination was based on actual performance as compared to agreed upon performance targets and the Committee’s general assessment of the named executive officer’s roles, responsibilities, and expected contributions individually in achieving the Operating Plan goals and objectives, for the applicable fiscal quarter. The fiscal 2024 annualized target bonus opportunity, expressed in dollar amount as a percentage of the named executive officer’s base salary earned during fiscal 2024 is as set forth below. The target bonus for both Dr. Young and Mr. Fischer, as a percentage of salary , was approximately 8% below the peer group midpoint.
Executive Incentive Plan Corporate Targets for 2024
| | Target Bonus | | | | Opportunity | Target Bonus Opportunity As | | Named Executive Officer | Amount | Percentage of Base Salary | | Morris S. Young | $479,000 | 100.0% | | Gary L. Fischer | $212,400 | 60.0% |
Executive Incentive Plan Corporate Targets for 2024
As displayed above, almost all of the financial metrics were met or exceeded in 2024. However, after consideration and discussion, the Committee and management agreed to forgo cash awards after the first quarter and convert the calculated cash bonus amounts for quarters 2, 3 and 4 into four-year vesting Restricted Stock Awards. The first section of the following chart shows the actual bonus paid out in cash in 2024. The second section of the chart shows the dollar value calculated of which only the First Fiscal Quarter was paid out in cash and the remaining three quarters were converted into Restricted Stock Awards.
Executive Incentive Plan Corporate Targets for 2024
| | | | | | | | Actual Cash Bonus | | | First Fiscal | Second Fiscal | Third Fiscal | Fourth Fiscal | Total | Target | as Percent | | Named Executive Officer | Quarter | Quarter | Quarter | Quarter | Paid in Cash | Bonus | of Target | | Morris S. Young | $140,000 | $0 | $0 | $0 | $140,000 | $479,000 | 29% | | Gary L. Fischer | $63,000 | $0 | $0 | $0 | $63,000 | $212,400 | 30% | | | | | | | | | Actual Calculated Bonus | | | First Fiscal | Second Fiscal | Third Fiscal | Fourth Fiscal | Total | Target | as Percent | | Named Executive Officer | Quarter | Quarter | Quarter | Quarter | Calculated | Bonus | of Target | | Morris S. Young | $140,000 | $123,357 | $54,217 | $71,850 | $389,424 | $479,000 | 81% | | Gary L. Fischer | $63,000 | $54,699 | $32,002 | $31,860 | $181,561 | $212,400 | 85% |
Executive Incentive Plan Corporate Targets for 2024
The Executive Incentive Plan reflects the challenges and difficulties in achieving goals and objectives set forth in the Operating Plan to drive the Company’s performance for the fiscal year. Achievement of either target or maximum payout requires significant efforts by the Named Executive Officers and very high levels of Company performance.
Determination of Target Bonus Amounts for Fiscal 2025
Determination of Target Bonus Amounts for Fiscal 2025 For fiscal 2025, the Committee selected Dr. Young and Mr. Fischer as the participants in the Executive Incentive Plan and divided the fiscal year into four quarterly performance periods. As previously described, achievement of the Corporate Targets represents 60% of the actual award, and achievement of the Individual Targets represents 40% of the actual award. Achievement of the Individual Targets, representing 40% of a participant’s target award, will be determined each quarter by the Committee, pursuant to objectives established by the Committee for each such participant. Each participant’s target award will be based on a percentage of such participant’s annual base salary at the beginning of each quarterly performance period. Due to the current uncertainty resulting from import tariffs in the United States and export permit requirements in China, the Committee has not finalized the Corporate Targets in the Operating Plan or the cash bonus targets for 2025. As explained in the cash bonus portion of this report, after the first quarter no further cash bonuses were paid to the NEOs. Instead, the calculated cash bonuses were converted to four-year vesting Restricted Stock Awards. The conversion price per share was the average price over the recent 30-day closing price of AXTI stock. The conversion price for quarters 2, 3 and 4 were $3.10, $2.46 and $2.16, respectively. The following table shows the shares granted instead of cash;
Determination of Target Bonus Amounts for Fiscal 2025
| | Amount of RSAs issued in lieu of cash: | | | | | Named Executive Officer | Quarter 2 | Quarter 3 | Quarter 4 | Total | | Morris S. Young | 39,792 | 22,003 | 33,264 | 95,059 | | Gary L. Fischer | 17,645 | 13,009 | 14,750 | 45,404 |
Long-Term Incentive Compensation
Long-Term Incentive Compensation Since 2020, we have provided long-term incentive compensation through grants of restricted stock awards that generally vest over four years. Our equity compensation program is intended to align the interests of our officers with those of our stockholders by creating an incentive for our officers to maximize stockholder value. The equity compensation program also is designed to encourage our officers to remain employed with us despite a very competitive labor market. The Committee believes that appropriate equity incentives are critical to attracting and retaining the best employees in the industry, and that stock awards can be an effective tool for meeting our compensation goal of increasing long-term stockholder value by tying the value of the stock awards to our performance in the future. Compensia provides data derived from our peer group of 16 companies and the Committee used this information in granting restricted stock awards and in determining restricted stock to be the type of award. Typically, the Committee and Board provide an annual grant of restricted stock in Q4 of each year. The Board has determined that 50% of the annual award will vest based on achievement of a specific financial performance metric for the upcoming year, in addition to being subject to four-year time vesting. If at least a minimum threshold of the metric is not met, then all of the shares linked to such performance metric are forfeited. Reciprocally, if the threshold is exceeded, additional equity incentives will be earned, still subject to four-year vesting. Historically, we have had strong support from our stockholders regarding our philosophy of linking compensation to performance. We believe our equity incentive program is consistent with the Company’s performance-based pay philosophy and prevalent practices among our peer group. The number of shares of our common stock subject to stock awards the Company grants to each executive officer generally is based initially on a specified award value that the Committee considers when reviewing market data provided by Compensia. Accordingly, the actual number of shares underlying the stock award may vary depending on fluctuations in stock price. The size of the stock awards and the vesting schedule for each grant are determined based on a variety of factors, including the Committee’s goal to increase the proportion of compensation awarded to executive officers as long-term incentive compensation. For fiscal 2024, in determining the stock awards to be granted to our Named Executive Officers, the Committee considered in particular Company and individual performance, and was assisted by the peer group information provided by Compensia to review the award value and appropriateness of the awards based on market practices. Consistent with our award granting practices in fiscal 2024, we granted stock awards in the form of restricted stock to our Named Executive Officers for fiscal 2025. The Company has not granted stock options since 2019 and did not grant stock options to any employees in 2024. On November 8, 2023 the Committee and the Board determined the number of restricted stock awards to be granted for 2024 and 50% of the award was granted on November 10, 2023. The remaining 50% would be performance-based. On February 20, 2024, the Committee and the Board approved the issuance of the target performance-based restricted stock as previously determined with a grant date of February 23, 2024. The financial metric identified was fiscal 2024 total Company revenue, determined in accordance with GAAP, of $85,000,000 (at target achievement). If less revenue or more revenue is achieved, then less or more shares would be earned. The following table shows the targeted range of revenue for fiscal 2024:
Long-Term Incentive Compensation
| If the following revenue growth rate is achieved for fiscal 2024: | …then the percentage of the performance-based restricted stock that will be earned is: | | ≤$72,250,000 | 0% | | $74,800,000 | 20% | | $77,350,000 | 40% | | $79,900,000 | 60% | | $82,450,000 | 80% | | $85,000,000 | 100% | | $87,550,000 | 120% | | $90,100,000 | 140% | | $92,650,000 | 160% | | $95,200,000 | 180% | | ≥$97,750,000 | 200% |
Long-Term Incentive Compensation
The following table shows the performance-based restricted stock awards, target and maximum, available to Dr. Young and Mr. Fischer and represent the second 50% of the awards previously determined for fiscal 2024.
Long-Term Incentive Compensation
| Named Executive Officer | Target Number of Shares Subject to the Performance-Based Restricted Stock Award | Maximum Number of Shares Subject to the Performance-Based Restricted Stock Award | | Morris S. Young | 111,795 | 223,590 | | Gary L. Fischer | 38,800 | 77,600 |
Long-Term Incentive Compensation
Based on review of the peer group data in Q4 2023, the Committee determined that the long-term equity incentive awards for both Dr. Young and Mr. Fischer (based on the target level with respect to the performance-based stock awards) granted in the fourth quarter of 2023 and first quarter of 2024 together approximated the 50th percentile of the peer group. On February 18, 2025, the Committee met and certified that the annual revenue achieved for fiscal 2024, was $99.4 million thus exceeding the maximum required to achieve 200% of the targeted performance-based restricted stock awards.. The evaluation process was repeated in the fall of 2024, looking ahead to the year 2025. Using the data provided by Compensia that was based on our peer group as described above, on November 11, 2024, the Committee and the Board determined the full amount of the restricted stock award to be granted to each Named Executive Officer and the Committee and the Board approved the issuance of 50% of that amount with a grant date of November 11, 2024. Approval for the remaining 50% (the performance-based award) was expected in Q1 2025. The following table shows the equity awards granted to Dr. Young and Mr. Fischer with a grant date of November 11, 2024 and represent 50% of the total awards to be awarded. The shares awarded with a grant date of November 11, 2024 are time-vested, vesting annually over four years subject to continued service:
Long-Term Incentive Compensation
| | Restricted Stock Awards | | Named Executive Officer | Granted November 10, 2023 | | Morris S. Young | 111,795 | | Gary L. Fischer | 38,800 |
Long-Term Incentive Compensation
The following table shows the performance-based equity awards granted to Dr. Young and Mr. Fischer with a grant date of February 18, 2025 and represent the target and maximum amount for the second 50% of the awards determined by the Committee and the Board on November 11, 2024 for fiscal 2025. If the target financial metric is exceeded, additional shares are earned on a linear basis and the maximum additional shares earned is capped at 100% of the target. If the minimum financial metric is not achieved, then these awards are forfeited based upon the pre-determined revenue metric for the year ending December 31, 2024:
Long-Term Incentive Compensation
| Named Executive Officer | Target Number of Shares Subject to the Performance-Based Equity Award Determined November 11, 2024 | Maximum Number of Shares Subject to the Performance-Based Equity Award | | Morris S. Young | 111,795 | 223,590 | | Gary L. Fischer | 38,800 | 77,600 |
Long-Term Incentive Compensation
On some occasions, the Committee and Board may elect to award a special grant in recognition of meritorious efforts and achievements. In fiscal 2024, no special grants were awarded. The Committee typically grants any equity awards to executive officers at its regularly scheduled quarterly meetings. All grants of restricted stock awards or other equity awards to newly hired employees are also made by the Committee at scheduled meetings, unless the Board or the Committee determines that unusual circumstances, such as in the case of retention of an executive officer, directors or other employees, call for consideration of the grant of awards other than at a regular quarterly meeting, in which case consideration of and action with respect to such awards may take place at a special meeting and not by unanimous written consent. In addition, grants for a new employee may sometimes be approved at a special meeting. The Committee has not granted, nor does it intend in the future to grant, equity compensation awards to executives in anticipation of the release of material nonpublic information that is likely to result in changes to the price of our common stock, such as a significant positive or negative earnings announcement. Similarly, the Committee has not timed, nor does it intend in the future to time, the release of material nonpublic information based on equity award grant dates. Further, because equity compensation awards to executive officers typically vest over a four-year period, with the first 25% vesting after one full year, the value to recipients of any immediate increase in the price of our stock following a grant will be attenuated.
Retirement Benefits under the 401(k) Plan, Executive Perquisites and Generally Available Benefit Programs
Retirement Benefits under the 401(k) Plan, Executive Perquisites and Generally Available Benefit Programs We do not maintain a deferred compensation plan, other than our AXT, Inc. Employee Savings and Retirement Plan (the “401(k) Plan”). The 401(k) Plan is available to all full-time U.S. based employees, including the Named Executive Officers. Under the 401(k) Plan, participating employees are eligible to receive matching contributions from us that are subject to certain vesting requirements based on service with us. We do not provide defined benefit pension plans or defined contribution retirement plans to our executives or other employees other than the 401(k) Plan. We also offer a number of other benefits to our U.S. based employees, including the Named Executive Officers, pursuant to benefit programs that provide for broad-based employee participation. These benefit programs include medical, dental and vision insurance, long-term and short-term disability insurance, life and accidental death and dismemberment insurance, health and dependent care flexible spending accounts, wellness programs, relocation/extended travel programs and services, educational assistance and certain other benefits. The 401(k) Plan and other generally available benefit programs allow us to remain competitive for key employees, and we believe that the availability of the benefit programs generally enhances employee productivity and loyalty. The main objectives of our benefit programs are to give our employees access to quality healthcare, assistance in achieving retirement financial goals and enhanced health and productivity. These generally available benefits typically do not specifically factor into decisions regarding an individual executive’s total cash compensation or equity award package.
Change in Control and Severance Benefits
Change in Control and Severance Benefits Employment of each of our Named Executive Officers is on an “at-will” basis. We previously entered into employment agreements with Dr. Young and Mr. Fischer pursuant to which they may become entitled to certain compensation and other benefits in connection with certain terminations of employment, including in connection with a change in control of the Company. The Board and Committee believe that these payments and benefits are important in encouraging our executive management team’s continued attention, dedication and continuity with respect to their roles and responsibilities without the distraction that may arise from the possibility of a change in control of the Company or termination by the Company, and that these payments and benefits provide incentive for the executives to continue employment with the Company. The Committee believes that these severance arrangements are competitive relative to the severance arrangements of similarly situated individuals at peer group companies, as periodically reviewed by the Committee with the assistance of Compensia.
Summary Compensation Table
Summary Compensation Table The following table sets forth information concerning the compensation earned during the fiscal years ended December 31, 2024, 2023 and 2023, by our current Chief Executive Officer and our Chief Financial Officer (together, the “Named Executive Officers”):
Summary Compensation Table
| | | | | | | Non-Equity | | | | | | | | | | Incentive | | | | | | | Cash | Stock | Option | Plan | All Other | | | | | Salary | Bonus | Awards | Awards | Compensation | Compensation | Total | | Name and Principal Position | Year | ($) | ($) | ($)(1) | ($)(1) | ($)(2) | ($) | ($) | | Morris S. Young | 2024 | $479,000 | $— | $404,029 | $— | $— | $37,812(3) | $920,841 | | Chief Executive Officer | 2023 | $479,000 | $— | $221,354 | $— | $— | $37,812(4) | $738,166 | | | 2022 | $479,000 | $— | $514,257 | $— | $385,000 | $37,812(5) | $1,416,069 | | Gary L. Fischer | 2024 | $354,000 | $— | $166,538 | $— | $— | $24,862(6) | $545,400 | | Chief Financial Officer | 2023 | $354,000 | $— | $76,824 | $— | $— | $24,862(7) | $455,686 | | | 2022 | $354,000 | $— | $178,480 | $— | $171,000 | $24,861(8) | $728,341 |
Summary Compensation Table
| (1) Valuation based on the dollar amount recognized for financial statement reporting purposes pursuant to ASC Topic 718, Stock Compensation (“ASC 718”). Amounts shown do not reflect compensation actually received by the Named Executive Officer. Instead, the amounts shown are the value of stock awards calculated based on the grant date fair value as determined pursuant to ASC 718. |
Summary Compensation Table
| (2) Amounts consist of bonuses earned for services rendered in fiscal years 2022 to 2024. Performance‑based bonuses are generally paid under our Executive Incentive Plan and reported as Non-Equity Incentive Plan Compensation. |
Summary Compensation Table
| (3) Includes our matching contribution of $19,160 under the tax-qualified 401(k) Plan and our payment on behalf of Dr. Young of $18,652 in term life insurance premiums. |
Summary Compensation Table
| (4) Includes our matching contribution of $19,160 under the tax-qualified 401(k) Plan and our payment on behalf of Dr. Young of $18,652 in term life insurance premiums. |
Summary Compensation Table
| (5) Includes our matching contribution of $19,160 under the tax-qualified 401(k) Plan and our payment on behalf of Dr. Young of $18,652 in term life insurance premiums. |
Summary Compensation Table
| (6) Includes our matching contribution of $14,160 under the tax-qualified 401(k) Plan, and our payment on behalf of Mr. Fischer of $10,702 in term life insurance premiums. |
Summary Compensation Table
| (7) Includes our matching contribution of $14,160 under the tax-qualified 401(k) Plan, and our payment on behalf of Mr. Fischer of $10,702 in term life insurance premiums. |
Summary Compensation Table
| (8) Includes our matching contribution of $14,160 under the tax-qualified 401(k) Plan, and our payment on behalf of Mr. Fischer of $10,701 in term life insurance premiums. |
Grants of Plan-Based Awards
Grants of Plan-Based Awards The following table sets forth certain information with respect to restricted stock awards and other plan-based awards granted to our Named Executive Officers during the fiscal year ended December 31, 2024:
2024 GRANTS OF PLAN-BASED AWARDS FROM THE 2015 PLAN &
2024 GRANTS OF PLAN-BASED AWARDS FROM THE 2015 PLAN &
Outstanding Equity Awards at Fiscal Year-End
Outstanding Equity Awards at Fiscal Year-End The following table sets forth certain information with respect to the value of all unexercised options previously awarded to our Named Executive Officers as of December 31, 2024.
OUTSTANDING EQUITY AWARDS AS OF December 31, 2024
OUTSTANDING EQUITY AWARDS AS OF December 31, 2024
OUTSTANDING EQUITY AWARDS AS OF December 31, 2024
| | Option Awards | | | | | Stock Awards | | | | | | | | | | Market | | | | Number of | Number of | | | Number of | Value of | | | | Securities | Securities | | | Shares or | Shares or | | | | Underlying | Underlying | | | Units of | Units of | | | | Unexercised | Unexercised | Option | Option | Stock That | Stock That | | | | Options (#) | Options (#) | Exercise | Expiration | Have Not | Have Not | | Name | Grant Date(1) | Exercisable | Unexercisable | Price ($) | Date | Vested(#) | Vested($)(2) | | Morris S. Young | 10/28/2016 | 174,896 | — | $5.21 | 10/28/26 | — | — | | | 10/27/2017 | 89,797 | — | $9.50 | 10/27/27 | — | — | | | 11/05/2018 | 189,990 | — | $5.77 | 11/05/28 | — | — | | | 11/6/2019 | 134,789 | 102,481 | $3.06 | 11/06/29 | — | — | | | 11/5/2020 | — | — | — | — | 18,855 | $40,915 | | | 2/19/2021 | — | — | — | — | 7,500 | $16,275 | | | 2/19/2021 | — | — | — | — | 28,282 | $61,372 | | | 11/10/2021 | — | — | — | — | 28,580 | $62,019 | | | 10/28/2022 | — | — | — | — | 83,846 | $181,946 | | | 11/10/2023 | — | — | — | — | 111,795 | $242,595 | | | 8/20/2024 | — | — | — | — | 39,792 | $86,349 | | | 10/29/2024 | — | — | — | — | 22,003 | $47,747 | | | 11/11/2024 | — | — | — | — | 111,795 | $242,595 | | Gary L. Fischer | 11/02/2015 | 10,280 | — | $2.18 | 11/02/25 | — | — | | | 10/28/2016 | 65,685 | — | $5.21 | 10/28/26 | — | — | | | 10/27/2017 | 34,203 | — | $9.50 | 10/27/27 | — | — | | | 11/05/2018 | 55,500 | — | $5.77 | 11/05/28 | — | — | | | 11/6/2019 | 71,256 | 21,184 | $3.06 | 11/06/29 | — | — | | | 11/5/2020 | — | — | — | — | 6,412 | $13,914 | | | 2/19/2021 | — | — | — | — | 4,000 | $8,680 | | | 2/19/2021 | — | — | — | — | 9,618 | $20,871 | | | 11/10/2021 | — | — | — | — | 8,024 | $17,412 | | | 11/10/2021 | — | — | — | — | 3,000 | $6,510 | | | 10/28/2022 | — | — | — | — | 29,100 | $63,147 | | | 11/10/2023 | — | — | — | — | 38,800 | $84,196 | | | 8/20/2024 | — | — | — | — | 17,645 | $38,290 | | | 10/29/2024 | — | — | — | — | 13,009 | $28,230 | | | 11/11/2024 | — | — | — | — | 38,800 | $84,196 |
OUTSTANDING EQUITY AWARDS AS OF December 31, 2024
| (1) Except as otherwise noted, all option awards granted to Named Executive Officers vest at the rate of (1)/4 of the underlying shares on the first anniversary of the date of grant and (1)/48 of the shares each month thereafter. After four years, the shares become fully vested and exercisable. Restricted stock awards granted to Named Executive Officers vest over a four-year period, at a rate of 25% on each anniversary of the vesting commencement date. |
OUTSTANDING EQUITY AWARDS AS OF December 31, 2024
| (2) The market value of the restricted stock awards that have not vested is calculated by multiplying the number of units that have not vested by the closing price of our common stock on December 31, 2024, which was $2.17. |
Option Exercises and Stock Vested During Last Fiscal Year
Option Exercises and Stock Vested During Last Fiscal Year The following table shows all stock options exercised and value realized upon exercise, and the number of shares acquired on vesting and the value realized on vesting by the Named Executive Officers during the fiscal year ended December 31, 2024:
OPTION EXERCISES AND STOCK VESTED FOR FISCAL 2024
OPTION EXERCISES AND STOCK VESTED FOR FISCAL 2024
OPTION EXERCISES AND STOCK VESTED FOR FISCAL 2024
| | Stock Options | | Restricted Stock | | | | Number of | | Number of | | | | Shares | Value Realized(1) | Shares | Value Realized(2) | | | Acquired on | on Exercise | Acquired on | on Vesting | | Name | Exercise (#) | ($) | Vesting (#) | ($) | | Morris S. Young | — | $— | 121,075 | $271,437 | | Gary L. Fischer | — | $— | 42,942 | $96,323 |
OPTION EXERCISES AND STOCK VESTED FOR FISCAL 2024
| (1) Based on the difference between the market price of our common stock on the date of exercise and the exercise price. |
OPTION EXERCISES AND STOCK VESTED FOR FISCAL 2024
| (2) Reflects the market price of our common stock on the vesting date. |
Potential Payments upon Termination or Change in Control
Potential Payments upon Termination or Change in Control
Chief Executive Officer Pay Ratio
Chief Executive Officer Pay Ratio Under rules adopted pursuant to the Dodd-Frank Act, we are required to calculate and disclose the annual total compensation paid to our median paid employee, as well as the ratio of the annual total compensation paid to the median employee as compared to the annual total compensation paid to our Chief Executive Officer. The paragraphs that follow describe our methodology and the resulting Chief Executive Officer pay ratio.
Methodology and Pay Ratio
Methodology and Pay Ratio After applying our methodology, we identified the median employee. Once the median employee was identified, we calculated the median employee’s annual total compensation in accordance with the requirements of the Summary Compensation Table. Our median employee is located in China, and the annual total compensation as calculated using Summary Compensation Table requirements was $9,540. Our Chief Executive Officer’s annual total compensation as reported in the Summary Compensation Table was $920,841. Therefore, our Chief Executive Officer to median employee pay ratio is 96.5. This information is being provided for compliance purposes. Neither the Compensation Committee nor our management used the pay ratio measure in making compensation decisions.
Pay Versus Performance
Pay Versus Performance As required by Section 953(a) of the Dodd-Frank Act and Item 402(v) of Regulation S-K, the below disclosure provides information regarding the relationship between executive “compensation actually paid” for our Principal Executive Officer (“PEO”) and other Named Executive Officer (“Non-PEO NEO”) and certain financial performance of the Company for the years shown.
Pay Versus Performance
| | | | | | Value of Initial Fixed $100 | | | | Summary | | Average Summary | Average | Investment Based on: | | | | Compensation | Compensation | Compensation | Compensation | Total | Net Income/ | | | Table Total | Actually | Table Total for | Actually Paid to | Shareholder | (Loss) | | Year | for PEO(1) | Paid PEO(2) | Non-PEO NEO(1) | Non-PEO NEO(2) | Return (3) | In ($000s) | | 2024 | $920,841 | $1,080,664 | $545,400 | $594,152 | $22.68 | $(11,624) | | 2023 | $738,166 | $(29,333) | $455,686 | $219,302 | $25.08 | $(17,882) | | 2022 | $1,416,069 | $(977,377) | $728,341 | $836 | $45.77 | $15,811 |
Pay Versus Performance
| (1) Our PEO for each of fiscal years 2024, 2023 and 2022 was Dr. Young. Our Non-PEO NEO for each of such fiscal years was Mr. Fischer. |
Pay Versus Performance
| (2) The following table sets forth the amounts adjusted from the Summary Compensation table total to derive the Compensation Actually Paid for each fiscal year shown. |
Pay Versus Performance
| (3) The amounts shown reflect the Company’s total shareholder return measured based on a fixed $100 investment made on December 31, 2020, the last trading day before the earliest fiscal year shown in the table. |
Pay Versus Performance
| | | | | Add | Change in Yearend | Change in Value | Subtract Value of | | | | | | | Year-end Value | Value of Awards | through Vesting | Awards Granted in | | | | | | | of Awards Granted | Granted in Prior | of Awards Granted | Prior Year that | | | | | Summary | | in Fiscal Year | Year Unvested as | in Prior Year | Failed to Meet | | | | | Compensation | Subtract | Unvested at | of Fiscal | Vested During | Vesting Conditions | Compensation | | | | Table Total | Stock Awards | Fiscal Yearend | Yearend | Fiscal Year | in Fiscal Year | Actually Paid | | Year | Executive | ($) | ($) | ($) | ($) | ($) | ($) | ($) | | 2024 | PEO | 920,841 | (404,029) | 619,285 | (36,290) | (19,143) | — | 1,080,664 | | | Non-PEO NEO | 545,400 | (166,538) | 234,911 | (12,883) | (6,738) | — | 594,152 | | 2023 | PEO | 738,166 | (221,354) | 268,308 | (330,785) | (483,668) | — | (29,333) | | | Non-PEO NEO | 455,686 | (76,824) | 93,120 | (119,105) | (133,575) | — | 219,302 | | 2022 | PEO | 1,416,069 | (514,257) | 489,662 | (1,288,940) | (1,079,912) | — | (977,377) | | | Non-PEO NEO | 728,341 | (178,480) | 169,944 | (384,373) | (334,596) | — | 836 |
Pay Versus Performance
NOTE: There were no awards granted and vesting in the same fiscal year.
Relationship Between Compensation Actually Paid and Performance Measures
Relationship Between Compensation Actually Paid and Performance Measures The chart below highlights the alignment between “compensation actually paid” to our Named Executive Officers and our total shareholder return performance for the past three fiscal years. The chart below highlights the alignment between “compensation actually paid” to our Named Executive Officers and our net income performance for the past three fiscal years.
Compensation of Directors
Compensation of Directors Directors who are also our employees do not receive any additional compensation for their services as directors. Non-employee directors are paid a cash retainer and retainers for service on committees of the Board of Directors. In addition, each non-employee director was granted a restricted stock award in 2024 equal to such number of shares of common stock determined by dividing the sum of $80,000 by the closing price of our common stock on The Nasdaq Global Select Market on the date of grant, which resulted in an award of 23,323 shares of restricted stock to each of our non-employee directors. Each of these awards vests on the anniversary of the date of grant, conditioned upon the recipient’s continued service as a member of the Board, employee or other consultant until the relevant vesting date. In 2024, each of our non-employee directors received the following fees for Board and committee meeting attendance.
Compensation of Directors
| HIDDEN_ROW | | | | Board cash retainer: | • | $45,000 per annum ($10,000 per quarter) | | Annual Equity Grant | • | A restricted stock award valued at $80,000, based upon the closing stock price on the date of the grant, and vesting on the anniversary of the date of grant. | | Annual cash retainers for committee service: | • | Audit: $10,000 | | | • | Compensation: $5,300 | | | • | Nominating and Corporate Governance: $5,000 | | Annual cash retainers for committee chairs: | • | Audit: $20,000 | | | • | Compensation: $13,000 | | | • | Nominating and Corporate Governance: $10,000 | | Lead Independent Director: | • | Annual cash retainer of $13,000 |
Compensation of Directors
Director Compensation for Fiscal Year Ended December 31, 2024 The following table sets forth information concerning the compensation earned during the last fiscal year by each individual who served as a director at any time during the fiscal year ended December 31, 2024:
Compensation of Directors
| | Fees Earned | Restricted | Non-Equity | | | | | or Paid | Stock | Incentive Plan | All Other | | | Name | in Cash ($) | Awards ($) (1) | Compensation ($) | Compensation ($) | Total ($) | | Jesse Chen (2) | $83,300 | $80,000 | $— | $— | $163,300 | | David C. Chang (2) | $73,000 | $80,000 | $— | $— | $153,000 | | Christine Russell (2) | $75,300 | $80,000 | $— | $— | $155,300 |
Compensation of Directors
| (1) Valuation based on the dollar amount recognized for financial statement reporting purposes pursuant to ASC 718. The grant date fair value of each restricted stock award is measured based on the closing price of our common stock on The Nasdaq Global Select Market on the date of grant. The grant date fair value of the restricted stock awards granted to the non-employee directors on May 16, 2024, the date of the 2024 annual meeting of stockholders, was $3.43 per share. Amounts shown do not reflect compensation actually received by the non-employee director. Instead, the amounts shown are the value of stock awards calculated based on the grant date fair value as determined pursuant to ASC 718. |
Compensation of Directors
| (2) On December 31, 2024, each of Jesse Chen, David C. Chang and Christine Russell held a restricted stock award for 23,323 shares of common stock. |
Compensation of Directors
In addition, each non-employee director is reimbursed for reasonable expenses incurred. At a meeting of Compensation Committee held on October 26, 2021, the Compensation Committee adopted a stock retention policy for non-employee directors as follows:
Compensation of Directors
| ● | Each non-employee director’s ownership of our common stock must be two times the average of the annual restricted stock award grants granted on May 20, 2021 and May 21, 2020. |
Compensation of Directors
| ● | The transition period for the new policy shall be four years. |