UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
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Perma-Fix Environmental Services, Inc.
(Name of Registrant as Specified In Its Charter)
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PERMA-FIX ENVIRONMENTAL SERVICES, INC.
8302 Dunwoody Place, Suite 250
Atlanta, Georgia 30350
NOTICE OF ANNUAL MEETING
To Be HeldSeptember 18, 2014July 28, 2016
To the Stockholders of Perma-Fix Environmental Services, Inc.:
Notice is hereby given that the 20142016 Annual Meeting of Stockholders (the “Meeting”) of Perma-Fix Environmental Services, Inc. (the “Company”) will be held at the CrownCrowne Plaza Hotel, Atlanta Airport, 1325 Virginia Avenue, Atlanta, Georgia 30344, on Thursday, September 18, 2014,July 28, 2016, at 11:00 a.m. (EDST), for the following purposes:
1. | To elect |
2. | To ratify the appointment of Grant Thornton, LLP as the independent registered public accounting firm of the Company for the |
3. | To approve, on an advisory basis, the |
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| To transact such other business as may properly come before the meeting and at any adjournments thereof. |
Only stockholders of record at the close of business on July 31, 2014,June 9, 2016, will be entitled to notice of, and to vote at, the Meeting or at any postponement or adjournment thereof.
This Notice of Annual Meeting of Stockholders, our Annual Report for 20132015 and the accompanying Proxy Statement and Proxy Card are being first mailed to stockholders on or about August 13, 2014.June 23, 2016.
The Company’s Annual Report for 20132015 is enclosed for your reference.
By the order of the Board of Directors
Ben Naccarato
Secretary
Atlanta, Georgia
August 13, 2014June 23, 2016
It is important that your shares be represented at the Meeting.Whether or not you plan to attend the Meeting, we urge you to vote your shares over the internet as described in the proxy material, or you may sign, date and mail the enclosed proxy card in the pre-paid envelope provided. If you decide to attend the Meeting, you may, if so desired, revoke the Proxy and vote in person.
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
8302 Dunwoody Place, Suite 250
Atlanta, Georgia 30350
PROXY STATEMENT
FOR THE
20142016 ANNUAL MEETING OF STOCKHOLDERS
Why am I receiving this Proxy Statement?
You are receiving this Proxy Statement from us because you were a stockholder of record of the common stock, par value $.001 (the “Common Stock”), of Perma-Fix Environmental Services, Inc. (the(“Perma-Fix”, the “Company”, “we”, “our”, or “us”) at the close of business on July 31, 2014June 9, 2016 (the “Record Date”). This Proxy Statement is furnished in connection with the solicitation on behalf of the Board of Directors of the Company (the “Board of Directors” or the “Board”) of proxies to be used in voting at the 20142016 Annual Meeting of Stockholders to be held at the Crowne Plaza Hotel, Atlanta Airport, 1325 Virginia Avenue, Atlanta, Georgia, 30344, on Thursday, September 18, 2014,July 28, 2016, at 11:00 a.m. (EDST), and any adjournments thereof (the “Meeting”). By use of a proxy, you may vote whether or not you plan to attend the Meeting. This Proxy Statement describes the matters on which the Board would like you to vote, and provides information on those matters, so that you can make an informed decision.
Who is entitled to vote at the Meeting?
Only the holders of our Common Stock at the close of business on the Record Date will have the right to receive notice of, and be entitled to vote at, the Meeting. At the close of business on the Record Date, 11,448,89411,574,331 shares of Common Stock (which excludes 7,642 treasury shares) were outstanding. Each stockholder of record, as of the Record Date, is entitled to one vote for each share of Common Stock that the stockholder owned as of the Record Date on each matter to be voted upon at the Meeting.
What vote is required to approve the matters being considered?
● | Directors are elected by a plurality of the shares present in person or represented by proxy and entitled to vote at the Meeting. |
● | The ratification of the appointment of Grant Thornton LLP as the independent registered public accounting firm requires the affirmative vote of a majority of the shares present in person or represented by proxy and entitled to vote at the Meeting. |
● | The approval of the |
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Are abstentions counted?
If your proxy indicates an abstention from voting on the proposal, the shares represented will be counted as present for the purpose of determining a quorum, but they will not be voted on any matter at the annual meeting. Because abstentions represent shares entitled to vote, if you abstain from voting on a proposal, your abstention (a) will have no effect on the election of directors, (b) will have the effect of a vote against the ratification of the appointment of the independent registered public accounting firm, and (c) will have the effect of a vote against the resolution on executive compensation (d) will have the effect of a vote against the approval to amend the Company’s Certificate of Incorporation, and (e) will have the effect of a vote against the approval of the Third Amendment to the Company’s 2003 Outside Directors Stock Plan.compensation.
How do I cast my vote?
If you are a stockholder whose shares are registered in your name, you may vote your shares in person at the meeting or by one of the two following methods:
● | Vote by Internet, by going to the web addresswww.cstproxyvote.com and following the instructions for Internet voting. |
● | Vote by Proxy Card, by completing, signing, dating and mailing the enclosed proxy card in the envelope provided. If you vote by Internet, please do not mail your proxy card. |
If your shares are held in “street name” (through a broker, bank or other nominee), you may receive a separate voting instruction form with this Proxy Statement, or you may need to contact your broker, bank or other nominee to determine whether you will be able to vote electronically using the Internet.
Whether or not you plan to attend the 20142016 Annual Meeting of Stockholders, please submit your vote either by internet or by written proxy card.
Can I change my mind after I vote?
Yes, you may change your mind at any time before the polls close at the Meeting. You can change your vote by:
● | executing and submitting a revised proxy; |
● | providing a written revocation to the Secretary of the Company; or |
● | voting in person at the Meeting. |
What constitutes a quorum?
A majority of all of the outstanding shares of Common Stock entitled to notice of, and to vote at, the Meeting, represented in person or by proxy, will constitute a quorum for the holding of the Meeting. The failure of a quorum to be represented at the Meeting will necessitate adjournment and will subject the Company to additional expense. If your proxy indicates an abstention from voting on a proposal, the shares represented will nonetheless be counted as present for the purpose of determining a quorum.
Will my shares be voted if I do not provide my proxy?
No. If your shares are registered in your name, they will not be voted, unless you submit your proxy or vote in person at the Meeting. If you hold your shares directly in your own name, you must vote, either by completing, signing and delivering a proxy, voting by the internet, or attending the Meeting and voting at the Meeting.
Who votes shares held in “street name”?
If your shares of Common Stock are held by a bank, broker or other nominee as custodian on your behalf, you are considered a “beneficial” stockholder of those shares, which are said to be held in “street name.” As a beneficial stockholder, youmust provide voting instructions to your broker, bank, or other nominee by the deadline provided in the proxy materials you receive from your broker, bank, or other nominee to ensure your shares are voted in the way you would like. If you do not provide voting instructions to your broker, bank, or other nominee, whether your shares can be voted on your behalf depends on the type of item being considered for vote. The NYSE has rules that govern brokers who have record ownership of listed company stock (including stock such as ours that is listed on The NASDAQ Capital Market) held in brokerage accounts for their clients who beneficially own the shares. Under these rules, brokers who do not receive voting instructions from their clients have the discretion to vote uninstructed shares on certain matters (“routine matters”), but do not have the discretion to vote uninstructed shares as to certain other matters (“non-routine matters”). A “broker non-vote” occurs when a broker has not received voting instructions from a beneficial owner on a non-routine matter and therefore cannot vote such beneficial owner’s shares on the matter. In these cases, the broker can register your shares as being present at the Meeting for purposes of determining the presence of a quorum, but will not be able to vote on these non-discretionary matters for which specific authorization is required. Under NYSE interpretations, Proposal 1 (election of directors), and Proposal 3 (advisory vote on executive compensation), and Proposal 5 (Third Amendment to the Company’s 2003 Outside Directors Stock Plan) are considered non-routine matters. However, since broker non-votes are not counted in any vote requiring a plurality of votes cast (Proposal 1) or a majority of the votes present in person or represented by proxy and entitled to vote (Proposal 3 and Proposal 5)3), broker non-votes will have no effect on the outcome of any of these proposals. We believe that Proposal 2 (ratification of the selection of the independent registered public accounting firm for 2014) and Proposal 4 (approval to amend the Certificate of Incorporation to reduce the number of shares of Common Stock the Company2015) is authorized to issue from 75,000,000 to 30,000,000) are considered a routine mattersmatter and, thus, we do not expect to receive any broker non-votes on these proposals.this proposal.
Who will count the votes?
All votes will be tabulated by the inspector of election appointed for the Meeting, who will separately tabulate affirmative and negative votes and abstentions.
Where can I find the voting results of theMeeting?
We will announce the voting results at the Meeting and publish final results in a Form 8-K to be filed with the Securities and Exchange Commission within four business days after the Meeting.
Who is paying the cost of this solicitation?
The Company will pay the cost of preparing, printing, assembling, and mailing this Proxy Statement and the Proxy Card. In addition to solicitation by use of the mail, certain of the Company’s officers and employees may, without receiving additional compensation therefore, solicit the return of proxies by telephone, telegrame-mail or personal interview. We also have retained The Proxy Advisory Group, LLC to assist us in the solicitation of votes described above. We will pay The Proxy Advisory Group, LLC a fee of $9,500, which includes a base fee and customary costs and expenses for this service. The Company will reimburse brokerage houses and custodians, nominees, and fiduciaries for their reasonable out-of-pocket expenses in forwarding soliciting materials to their principals, the beneficial owners of Common Stock.
Is the stockholder list available for review?
A list of stockholders entitled to vote at the Meeting will be open to the examination of any stockholder for any purpose germane to the Meeting during ordinary business hours commencing 10 days before the Meeting. Prior to the Meeting, the list will be maintained at our principal executive offices located at 8302 Dunwoody Place, Suite 250, Atlanta, Georgia 30350.
PROPOSAL 1 - ELECTION OF DIRECTORS
The Company’s Certificate of Incorporation provides that each member of the Board of Directors shall hold office until the next Annual Meeting of Stockholders and their successors have been elected and qualified or until their earlier resignation or removal. Successors to those directors whose terms have expired are required to be elected by stockholder vote. The existing Board of Directors may fill vacancies for an unexpired term and any newly created directorships created by the Board of Directors’ action.
The eightseven nominees for membership on our Board of Directors named below were recommended by our Corporate Governance and Nominating Committee to serve as members of the Board of Directors. All nominees are incumbent directors. All incumbent directors and nominees meet the qualifications for membership on our Board of Directors as set forth in the Company’s Amended and Restated Bylaws, as amended (the “Bylaws”).
The Company’s Bylaws provide that the number of the Company’s directors shall be at least three and no more than eight, as may be determined from time to time by resolution adopted by affirmative vote of a majority of the entire Board of Directors. The Board of Directors has set the size of the Board at eightseven members.
Nominees for Directors
The following biographical information includes a discussion of the specific experience, qualifications, attributes or skills that led to the conclusion by our Corporate Governance and Nominating Committee that each of the nominees is qualified to serve as one of our Directors:
Dr. Louis F. Centofanti
Age: | Dr. Centofanti | ||
As founder of | |
John M. Climaco, Director Age: | Mr. Climaco has been a director of the Company since October 2013. Effective June 2, 2015, Mr. Climaco was named the Executive Vice President (“EVP”) of PF Medical. From 2012 through 2015, Mr. Climaco served as an independent consultant to a variety of healthcare
Mr. Climaco’s extensive legal and operational experience, including strategic planning and business development, | ||
Dr. Gary Kugler, Director Age: | Dr. Gary Kugler, a director since September 2013, served as the
Dr. Kugler’s extensive career in the nuclear industry, both nationally and internationally, brings valuable insight and knowledge to the Company as it expands its business | ||
Jack Lahav, Age: 67
| Jack Lahav, a director since September 2001, is a private investor and entrepreneur, specializing in launching and growing sophisticated technological businesses. Mr. Lahav is a philanthropist, devoting much of his time to charitable activities, serving as
Having launched a number of successful businesses, Mr. Lahav has established a record of success in developing and growing | ||
Age: | Mr. Reeder, a director since April 2003, served as the Shareholder-in-Charge of the Mid-Atlantic Region (1999-2008) for Greenberg Traurig LLP, one of the nation's largest law firms, with
Mr. Reeder has a distinguished career in solving and overseeing solutions to complex issues involving both domestic and | ||
Larry M. Shelton Board Chairman Age: | Mr. Shelton, a director since July 2006, has also held the position of Chairman of the Board of the Company since December 16, 2014. Mr. Shelton currently is the
With his years of accounting experience as | ||
Age: |
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| Mark Zwecker, a director since the Company's inception in January 1991, currently serves as the |
As a director of the Company since our inception, Mr. Zwecker’s understanding of our business provides valuable insight to the Board. With years of experience in operations and finance for various companies, including a number of waste management companies, Mr. Zwecker combines extensive knowledge of accounting principles, financial reporting rules and regulations, the ability to evaluate financial results, and understanding of financial reporting processes. He has an extensive background in operating complex organizations. Mr. Zwecker’s experience and background position him well to serve as a member of our Board. These factors led the Board to conclude that he should serve as a director. |
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE “FOR” THE ELECTION OF THE EIGHTSEVEN NOMINEES AS THE COMPANY’S DIRECTORS.
Board Independence
The Board of Directors has determined that each of Messrs.director, other than Dr. Centofanti and Mr. John Climaco, Kugler, Lahav, Reeder, Shelton, Young, and Zwecker is an “independent director”“independent” within the meaning of the applicable NASDAQ rules. The Board considered the Company’s use of Mr. Reeder’s law firm from time to time in considering his independence, and determined that he should be deemed an independent director since the amount paid to Mr. Reeder’s law firm was a nominal amount.
Dr. Centofanti is not considereddeemed to be an “independent director” because he servesof his employment as a senior executive of the Company. The Board determined that Mr. Climaco does not currently qualify as an “independent director” because of his employment, effective June 2, 2015, as EVP of PF Medical, a majority-owned Polish subsidiary of the Company, and because he is also a director of Digirad Corporation, with which PF Medical entered into a supplier agreement and a subscription agreement (together, the “Digirad Agreement”) on July 24, 2015 (see “John Climaco” under “Certain Relationships and Related Transactions – Related Party Transactions” for further discussion of his position with PF Medical and a description of the Digirad Agreement).
Board Leadership Structure
Dr. Louis Centofanti,We currently separate the Company’s President and Chief Executive Officer, also holds the positionroles of the Chairman of the Board.Board and CEO. The CompanyBoard believes suchthat its current leadership structure, currently promotes the best interests ofwith Dr. Centofanti serving as President and CEO and Mr. Shelton serving as our stockholders. Dr. Centofanti’s extensive knowledgeindependent non-executive Chairman of the history ofBoard, is appropriate for the Company its customers,at this time, as this structure promotes balance between the Board’s independent authority to oversee our business, and the CEO and his background in our complex and unique nuclearmanagement team, who manage the business enables him to provide guidance to our Board with day to day and long-term strategic business recommendations and decisions which ultimately enhance shareholder value.on a day-to-day basis.
AlthoughThe Company does not have a written policy with respect to the Company’s Amended and Restated Bylaws do not formally require the designationseparation of an independent Lead Director in instances where the positions of Chairman of the Board and Chief Executive Officer are held byCEO. The Company believes it is important to retain its flexibility to allocate the same person, Mr. Mark Zwecker was appointed by our Boardresponsibilities of Directors as the independent Lead Directoroffices of the Chairman and CEO in February 2010, and has served in such capacity since such time. The Board believesany way that the Lead Director enhances the Board’s ability to fulfill its responsibilities independentlyis in the best interests of the Company at a given point in time; therefore, the Company’s stockholders.leadership structure may change in the future as circumstances may dictate.
Mr. Mark Zwecker, a current member of our Board, continues to serve as the Independent Lead Director, a position he has held since February 2010. The Lead Director’s role includes:
● | convening and chairing meetings of the non-employee directors as necessary from time to time and Board meetings in the absence of the Chairman of the Board; |
● | acting as liaison between directors, committee chairs and management; |
● | serving as information sources for directors and management; and |
● | carrying out responsibilities as the Board may delegate from time to time. |
Meetings and Committees of the Board of Directors
During 2013,2015, the Board of Directors held nine meetings, which included five telephonicfour meetings. No director attended fewer than 75% of the aggregate number of meetings held by the Board of Directors and the committees on which he served during 2013.2015. The Company does not currently have a policy with respect to the attendance of its directors at annual meetings; however, the Company encourages each of its directors to attend whenever possible. All members of our Board of Directors attended our 20132015 Annual Meeting of Stockholders with the exception of Mr. Lahav.Stockholders. The Board of Directors has a standing Audit Committee, Compensation and Stock Option Committee, Corporate Governance and Nominating Committee, Research and Development Committee, and Strategic Advisory Committee.
Audit Committee:
The Audit Committee assists the Board of Directors in monitoring the integrity of the financial statements of the Company, the independent auditor’s qualifications and independence, the performance of the Company’s internal audit function and independent auditor, and the Company’s compliance with legal and regulatory requirements. In carrying out these purposes, the Audit Committee, among other things:
● | appoints, evaluates, and approves the compensation of the Company’s independent auditor; |
● | pre-approves all auditing services and permitted non-audit services; |
● | annually considers the qualifications and independence of the independent auditors; |
● | reviews recommendations of independent auditors concerning the Company’s accounting principles, internal controls, and accounting procedures and practices; |
● | reviews and approves the scope of the annual audit; |
● | reviews and discusses with the independent auditors the audited financial statements; and |
● | performs such other duties as set forth in the Audit Committee Charter. |
The Audit Committee was established in accordance with the requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the listing requirements of the NASDAQ, and is governed by an Audit Committee Charter. A copy of the Audit Committee Charter is available on our website atwww.perma-fix.com. The Audit Committee has established procedures for the receipt, retention, and treatment of complaints received by the Company regarding accounting, internal accounting controls or auditing matters, and the confidential, anonymous submission of concerns by employees of the Company regarding accounting or auditing matters.
The Audit Committee members during 20132015 were Mark A. Zwecker (Chairman)(Chairperson), Larry M. Shelton, and Jack Lahav, who replaced Dr. Charles E. Young. Effective December 13, 2013,Gary G. Kugler as a member of the Audit Committee consists of the following members: Mark A. Zwecker (Chairman), Larry M. Shelton, and John M. Climaco.effective September 17, 2015. The Board of Directors has determined that each member of the Audit Committee is/was an “audit committee financial expert” as defined by Item 407(d)(5)(ii) of Regulation S-K of the Exchange Act. The Audit Committee meets at least quarterly and at such additional times as necessary or advisable. The Audit Committee held twelveeight meetings during 2013.2015. Each member of the Audit Committee in 20132015 was "independent"“independent,” as that term is defined by the current NASDAQ listing standards, and each current member of the Audit Committee is “independent” under such definition.
Compensation and Stock Option Committee:
The Compensation and Stock Option Committee (“Compensation Committee”) reviews and recommends to the Board of Directors the compensation and benefits of all of the Company’s officers and reviews general policy matters relating to compensation and benefits of the Company’s employees. The Compensation Committee also administers the Company’s stock option plans. The Compensation Committee has the sole authority to retain and terminate a compensation consultant, as well as to approve the consultant’s fees and other terms of engagement. It also has the authority to obtain advice and assistance from internal or external legal, accounting or other advisors. No compensation consultant was employed during 2013. The members2015. Members of the Compensation Committee during 20132015 were Jack Lahav (Chairman)Dr. Gary G. Kugler (who became a member effective September 17, 2015 and who also replaced Larry Shelton as Chairperson of the Compensation Committee effective September 17, 2015), Larry M. Shelton, Joe R. Reeder, and Dr. Charles E. Young. Effective December 13, 2013, the Compensation Committee consists of the following members: Larry M. Shelton (Chairman), Joe R. Reeder,Mark A. Zwecker. Dr. Charles E. Young was also a member of the Compensation Committee until his departure from the Board effective September 17, 2015. Dr. Young elected not to stand for re-election at the Company’s 2015 Annual Meeting of Stockholders due to personal reasons and Mark A. Zwecker.not due to any disagreement with the Company’s operations, policies or practices. The Compensation Committee held fivefour meetings in 2013.2015. All members of the Compensation Committee in 20132015 were "independent" as that term is defined by the current NASDAQ listing standards, and each current member of the Compensation Committee is “independent” under such definition.
The Board of Directors has adopted a written charter for the Compensation Committee thatis governed by the Company’s Compensation and Stock Option Committee Charter, which is available on our website atwww.perma-fix.com and is attached as Exhibit “C” to this Proxy Statement..
Corporate Governance and Nominating Committee:
The Corporate Governance and Nominating Committee (“Nominating Committee”) recommends to the Board of Directors candidates to fill vacancies on the Board and the nominees for election as directors at each Annual Meeting of Stockholders. In making such recommendation, the Corporate Governance and Nominating Committee takes into account information provided to them from the candidate, as well as the Corporate Governance and Nominating Committee’s own knowledge and information obtained through inquiries to third parties to the extent the Corporate Governance and Nominating Committee deems appropriate. The Company’s Amended and Restated Bylaws sets forth certain minimum director qualifications to qualify for nomination for elections as a Director.director. To qualify for nomination or election as a director, an individual must:
● | be an individual at least 21 years of age who is not under legal disability; |
● | have the ability to be present, in person, at all regular and special meetings of the Board of Directors; |
● | not serve on the boards of more than three other publicly held companies; |
● | satisfy the director qualification requirements of all environmental and nuclear commissions, boards or similar regulatory or law enforcement authorities to which the Corporation is subject so as not to cause the Corporation to fail to satisfy any of the licensing requirements imposed by any such authority; |
● | not be affiliated with, employed by or a representative of, or have or acquire a material personal involvement with, or material financial interest in, any “Business Competitor” (as defined); |
● | not have been convicted of a felony or of any misdemeanor involving moral turpitude; and |
● | have been nominated for election to the Board of Directors in accordance with the terms of the |
In addition to the minimum director qualifications as mentioned above, each candidate’s qualifications are also reviewed to include:
● | standards of integrity, personal ethics and value, commitment, and independence of thought and judgment; |
● | ability to represent the interests of the Company’s stockholders; |
● | ability to dedicate sufficient time, energy and attention to fulfill the requirements of the position; and |
● | diversity of skills and experience with respect to accounting and finance, management and leadership, business acumen, vision and strategy, charitable causes, business operations, and industry knowledge. |
The Corporate Governance and Nominating Committee does not assign specific weight to any particular criteria and no particular criterion is necessarily applicable to all prospective nominees. The Corporate Governance and Nominating Committee does not have a formal policy for the consideration of diversity in identifying nominees for directors. However, the Company believes that the backgrounds and qualifications of the directors, considered as a group, should provide a significant composite mix of experience, knowledge, and abilities that will allow the Board to fulfill its responsibilities.
Stockholder Nominees
The Corporate Governance and Nominating Committee will consider properly submitted stockholder nominations for candidates for membership on the Board of Directors from stockholders who meet each of the requirements set forth in the Amended and Restated Bylaws, including, but not limited to, the requirements that any such stockholder own at least 1% of the Company’s shares of the Common Stock entitled to vote at the meeting on such election, has held such shares continuously for at least one full year, and continuously holds such shares through and including the time of the annual or special meeting. Nominations of persons for election to the Board of Directors may be made at any Annual Meeting of Stockholders, or at any Special Meeting of Stockholders called for the purpose of electing directors. Any stockholder nomination (“Proposed Nominee”) must comply with the requirements of the Company’s Amended and Restated Bylaws and the Proposed Nominee must meet the minimum qualification requirements as discussed above. For a nomination to be made by a stockholder, such stockholder must provide advance written notice to the Corporate Governance and Nominating Committee, delivered to the Company’s principal executive office address (i) in the case of an Annual Meeting of Stockholders, no later than the 90th day nor earlier than the 120th day prior to the anniversary date of the immediately preceding Annual Meeting of Stockholders; and (ii) in the case of a Special Meeting of Stockholders called for the purpose of electing directors, not later than the 10th day following the day on which public disclosure of the date of the Special Meeting of Stockholders was made.
The Corporate Governance and Nominating Committee will evaluate the qualification of the Proposed Nominee and the Proposed Nominee’s disclosure and compliance requirements in accordance with the Company’s Amended and Restated Bylaws. If the Board of Directors, upon the recommendation of the Corporate Governance and Nominating Committee, determines that a nomination was not made in accordance with the Amended and RestatedCompany’s Bylaws, the Chairman of the Meeting shall declare the nomination defective and it will be disregarded.
Members of the Corporate Governance and Nominating Committee during 20132015 were Joe R. Reeder (Chairman)(Chairperson), Jack Lahav, and Larry M. Shelton. Effective December 13, 2013, the Corporate Governance and Nominating Committee consists of the following members: Joe R. Reeder (Chairman), Jack Lahav, Dr. Gary Kugler, andG. Kugler. Dr. Charles E. Young.Young also served on the Nominating Committee until his departure from the Board effective September 17, 2015. The Corporate Governance and Nominating Committee meets at least quarterly and at such times as necessary or advisable and held four meetings in 2013.2015. The Corporate Governance and Nominating Committee is governed by a Corporate Governance and Nominating Committee Charter, which is available on our website at www.perma-fix.com.www.perma-fix.com. All members of the Corporate Governance and Nominating Committee in 20132015 were "independent" as that term is defined by the current NASDAQ listing standards, and each current member of the Corporate Governance and Nominating Committee is “independent” under such definition.
Research and Development Committee:
Effective December 13, 2013, we re-established theThe Research and Development Committee (the “R&D Committee”), which had been disbanded effective September 13, 2012. From that time to December 13, 2013, when the committee was re-established, Dr. Louis Centofanti, Board Chairman and Chief Executive Officer, led a R&D management team in carrying out the functions of the R&D Committee.
The R&D Committee, which consists of Dr. Gary Kugler and Dr. Louis Centofanti, outlines the structures and functions of the Company’s research and development strategies, the acquisition and protection of the Company’s intellectual property rights and assets, and provides its perspective on such mattermatters to the Board of Directors. Members of the R&D Committee during 2015 were Dr. Gary Kugler and Dr. Louis Centofanti. The R&D Committee held four meetings in 2015. The R&D Committee does not have a charter.
Strategic Advisory Committee:
On December 13, 2013,The primary functions of the Board of Directors formed a new Strategic Advisory Committee (“Strategic Committee”). The primary functions of the Strategic Committee are to investigate and evaluate strategic alternatives available to the Company and to work with management on long-range strategic planning and identifying potential new business opportunities. The members of the Strategic Advisory Committee areduring 2015 were John M. Climaco (Chairperson), Joe R. Reeder, Mark A. Zwecker, and Larry M. Shelton.Shelton.The Strategic Committee held four meetings in 2015. The Strategic Advisory Committee does not have a charter.
Risk Oversight by Our Board
The Board is responsible for understanding the risks the Company faces, what steps management is taking to manage those risks and if the steps taken are effective in managing those risks. It is also important that the Board understands what level of risk is appropriate for the Company. While the Board of Directors has the ultimate oversight responsibility for the risk management process, certain committees play an integral part in fulfilling the Board’s oversight responsibilities in certain areas of risk.In particular, the Audit Committee focuses on financial and enterprise risk exposures, including internal controls. The Audit Committee reviews and discusses with management and internal audit our major financial risk exposures, including risks related to fraud, liquidity and regulatory compliance, our policies with respect to risk assessment and risk management, and the steps management has taken to monitor and control such exposures at least quarterly and whenever warranted. The Compensation and Stock Option Committee strives to create incentives that do not encourage excessive risk-taking beyond the Company’s ability to effectively identify and manage risk. To monitor such risks, the Board receives regular updates from management of higher risk activities that we face, such as our closure policies and status of our pending litigation. Each of our directors has access to our named executive officers and any other members of our management to discuss and monitor potential risks.
Code of Ethics
We have adopted a Code of Ethics that applies to all our executive officers, including our principal executive officer, principal financial officer, and controller. Our Code of Ethics is available on our website at www.perma-fix.com.www.perma-fix.com. If any amendments are made to the Code of Ethics or any grants of waivers are made to any provision of the Code of Ethics to any of our executive officers, we will promptly disclose the amendment or waiver and nature of such amendment of waiver on our website.
Compensation of Directors
Directors who are employees receive no additional compensation for serving on the Board of Directors or its committees. In 2013,2015, we provided the following annual compensation to each of our directors who are not employees:
● |
|
● | a quarterly director fee of $8,000; |
● | an additional quarterly fee of $5,500 and $7,500 to the |
● | a fee of $1,000 for each board meeting attendance and a $500 fee for each telephonic conference call attendance. |
Each director may elect to have either 65% or 100% of such fees payable in Common Stock under the 2003 Outside Directors Stock Plan, with the balance payable in cash.
Effective June 2, 2015, Mr. John Climaco, a current director of the Company, was named the EVP of PF Medical, the Company’s majority-owned Polish subsidiary. As the EVP of PF Medical, Mr. Climaco is provided an annual salary of $150,000 from PF Medical. As a result of Mr. Climaco’s employment with PF Medical effective June 2, 2015, he was no longer eligible to receive compensation for his service as a director of the Company after such date.
The table below summarizes the director compensation expenses recognized by the Company for the director option and stock awards (resulting from fees earned) awards for the year ended December 31, 2013.2015. The terms of the 2003 Outside Directors Stock Plan are further described below under “2003 Outside Directors Stock Plan.” Compensation noted below for Mr. Climaco was earned as a director of the Company prior to becoming the EVP of PF Medical.
Director Compensation
Name | Fees Earned or Paid In Cash | Stock Awards | Option Awards | Non-Equity Incentive Plan Compensation | Change in Pension Value and Nonqualified Deferred Compensation Earnings | All Other Compensation | Total | Fees Earned or Paid In Cash | Stock Awards | Option Awards | Non-Equity Incentive Plan Compensation | Change in Pension Value and Nonqualified Deferred Compensation Earnings | All Other Compensation | Total | ||||||||||||||||||||||||||||
| ($)(1) | ($)(2) | ($)(3) | ($) | ($) | ($) | ($) | ($) (1) | ($) (2) | ($)(3) | ($) | ($) | ($) | ($) | |||||||||||||||||||||||||||||
John M. Climaco | 3,059 | 7,573 | 14,220 | — | — | — | 24,852 | 6,475 | 16,032 | — | — | — | 117,000 | (4) | 139,507 | |||||||||||||||||||||||||||
Dr. Gary Kugler(4) | 4,266 | 10,564 | 11,760 | — | — | — | 26,590 | |||||||||||||||||||||||||||||||||||
Dr. Gary G. Kugler | 12,775 | 31,635 | 6,823 | — | — | — | 51,233 | |||||||||||||||||||||||||||||||||||
Jack Lahav | — | 49,999 | 4,704 | — | — | — | 54,703 | — | 46,669 | 6,823 | — | — | — | 53,492 | ||||||||||||||||||||||||||||
Joe R. Reeder | 12,950 | 32,067 | 4,704 | — | — | — | 49,721 | 3,150 | 43,801 | 6,823 | — | — | — | 53,774 | ||||||||||||||||||||||||||||
Larry M. Shelton | 13,475 | 33,367 | 4,704 | — | — | — | 51,546 | 23,275 | 57,633 | 6,823 | — | — | — | 87,731 | ||||||||||||||||||||||||||||
Dr. Charles E. Young | 12,950 | 32,065 | 4,704 | — | — | — | 49,719 | 9,229 | 22,855 | — | — | — | — | 32,084 | ||||||||||||||||||||||||||||
Mark A. Zwecker | 21,175 | 52,430 | 4,704 | — | — | — | 78,309 | 20,475 | 50,698 | 6,823 | — | — | — | 77,996 | ||||||||||||||||||||||||||||
(1) | Under the 2003 Outside Directors Stock Plan, each director elects to receive 65% or 100% of the director’s fees in shares of our Common Stock. The amounts set forth above represent the portion of the director’s fees paid in cash and excludes the value of the director’s fee elected to be paid in Common Stock under the 2003 Outside Directors Stock Plan, which value is included under “Stock Awards.” |
(2) | The number of shares of Common Stock comprising stock awards granted under the 2003 Outside Directors Stock Plan is calculated based on 75% of the closing market value of the Common Stock as reported on the NASDAQ on the business day immediately preceding the date that the quarterly fee is due. Such shares are fully vested on the date of grant. The value of the stock award is based on the market value of our Common Stock at each quarter end times the number of shares issuable under the award. The amount shown is the fair value of the Common Stock on the date of the award. |
(3) | Options granted under the Company’s 2003 Outside Directors Stock Plan resulting from re-election |
Options | ||||
Outstanding | ||||
as of | ||||
Name | December 31, | |||
John M. Climaco | 8,400 | |||
Dr. Gary G. Kugler | 4,800 | |||
Jack Lahav | 24,000 | |||
Joe R. Reeder | 24,000 | |||
Larry M. Shelton | ||||
| ||||
Mark A. Zwecker | 24,000 | |||
Total | 112,800 |
(4) |
|
(5) | Elected |
See “John Climaco” under “Certain Relationships and Related Transactions” for further information on Mr. Climaco.
2003 Outside DirectorsStockPlan
We believe that it is important for our directors to have a personal interest in our success and growth and for their interests to be aligned with those of our stockholders. Therefore,stockholders; therefore, under our 2003 Outside Directors Stock Plan, as amended (“2003 Outside Directors Stock Plan”), each outside director is granted a 10-year option to purchase up to 30,0006,000 shares of Common Stock on the date such director is initially elected to the Board, of Directors, and receives on each re-election date an option to purchase up to another 12,0002,400 shares of our Common Stock, with the exercise price being the fair market value of the Common Stock preceding the option grant date. No option granted under the 2003 Outside Directors Stock Plan is exercisable until after the expiration of six months from the date the option is granted and no option shall be exercisable after the expiration of ten years from the date the option is granted. As of the date of this Proxy Statement, options to purchase 153,543163,200 shares of Common Stock are outstanding under the 2003 Outside Directors Stock Plan.
As a management director, Dr. Centofanti is not eligible to participate inmember of the 2003 Directors Plan. At the Meeting, we are proposing to reduce the number of automatic option awards as described above, to reflect the 1-for-5 reverse stock split effected in October 2013 (see “PROPOSAL 5 – APPROVAL OF THE THIRD AMENDMENT TO THE 2003 OUTSIDE DIRECTORS STOCK PLAN”). If the proposal is approved, new directors will receive an automatic grant of options to purchase 6,000 shares of Common Stock, and re-elected directors will receive an automatic grant of options to purchase 2,400 shares of Common Stock.
Additionally, under the 2003 Directors Plan,Board, each director who receives directors’ fees may elect to receive either 65% or 100% of his feesthe director's fee in shares of our Common Stock. The number of shares received by each director is calculated based on 75% of the fair market value of the Common Stock determined on the business day immediately preceding the date that the quarterly fee is due. The balance of each director’s fee, if any, is payable in cash. In 2013,2015, the fees earned by our outside directors totaled approximately $286,000.$345,000. Reimbursements of expenses for attending meetings of the Board are paid in cash at the time of the applicable Board meeting. As a management director, Dr. Centofanti is not eligible to participate in the 2003 Outside Directors Stock Plan. Although Dr. Centofanti is not compensated for his services provided as a director, Dr. Centofanti is compensated for his services rendered as an officer of the Company. See “EXECUTIVE COMPENSATION — Summary Compensation Table.” Effective June 2, 2015, Mr. John Climaco, a current director, became ineligible to participate in the 2003 Outside Directors Stock Plan upon becoming the EVP of PF Medical, a majority-owned Polish subsidiary of the Company. As the EVP of PF Medical, Mr. Climaco is provided an annual salary of $150,000 from PF Medical.
As of the date of this Proxy Statement, we have issued 341,898461,335 shares of our Common Stock in payment of director fees and from option exercise since the inception of the 2003 Outside Directors Stock Plan.
In the event of a “change of control” (as defined in the 2003 Outside Directors Stock Plan), each outstanding stock option and stock award shall immediately become exercisable in full notwithstanding the vesting or exercise provisions contained in the applicable stock option agreement.
Communications with the Board
The Company’s Board of Directors believes that it is important for the Company to have a process that enables stockholders to send communications to the Board. Accordingly, stockholders who wish to communicate with the Board of Directors or a particular director may do so by sending a letter to the Secretary of the Corporation, at 8302 Dunwoody Place, Suite 250, Atlanta, Georgia 30350. The mailing envelope must clearly indicate that the enclosed letter is a “Stockholder-Board Communication” or “Stockholder-Director Communication.” All such letters must identify the author as a stockholder and clearly state whether the intended recipients are all members of the Board of Directors or only certain specified individual directors. The Secretary of the Corporation will make copies of all such letters and circulate them to the appropriate director or directors.
Compensation Committee Interlocks and Insider Participation
During 2013, the Compensation Committee of our Board of Directors was composed of Jack Lahav (Chairperson), Joe R. Reeder, and Dr. Charles E. Young. Effective December 13, 2013, the Compensation Committee consists of the following members: Larry M. Shelton (Chairman), Joe R. Reeder, Dr. Charles E. Young, and Mark A. Zwecker. None of the members of the Compensation Committee has been an officer or employee of the Company or has had any relationship with the Company requiring disclosure under applicable Securities and Exchange Commission regulations in 2013.
Family Relationships
There are no family relationships between any of the Company’s existing directors, executive officers, or persons nominated or chosen to become a director or executive officer. Dr. Centofanti isand John Climaco are the only directordirectors who is a Company employee.are employees of the Company.
Certain Relationships and Related Transactions
Audit Committee Review
Our Audit Committee Charter provides for the review by the Audit Committee of any related party transactions, other than transactions involving an employment relationship with the Company, which are reviewed by the Compensation Committee. Although we do not have written policies for the review of related party transactions, the Audit Committee reviews transactions between the Company and its directors, executive officers, and their respective immediate family members. In reviewing a proposed transaction, the Audit Committee takes into account, among other factors it deems appropriate:
(1) | the extent of the related person’s interest in the transaction; |
(2) | whether the transaction is on terms generally available to an unaffiliated third-party under the same or similar circumstances; |
(3) | the cost and benefit to the Company; |
(4) | the impact or potential impact on a director’s independence in the event the related party is a director, an immediate family member of a director or an entity in which a director is a partner, stockholder or executive officer; |
(5) | the availability of other sources for comparable products or services; |
(6) | the terms of the transaction; and |
(7) | the risks to the Company. |
Related party transactions are reviewed by the Audit Committee prior to the consummation of the transaction. With respect to a related party transaction arising between Audit Committee meetings, the Chief Financial OfficerCFO may present it to the Audit Committee Chairman,Chairperson, who will review and may approve the related party transaction subject to ratification by the Audit Committee at the next scheduled meeting. Our Audit Committee shall approve only those transactions that, in light of known circumstances are not inconsistent with the Company’s best interests.
Related Party Transactions
Mr. Robert Schreiber, Jr.During March 2011, we entered into a lease with Lawrence Properties LLC, a company jointly owned by Robert Schreiber, Jr., the President of Schreiber, Yonley and Associates, and Mr. Schreiber’s spouse. Mr. Schreiber is a member of our executive management team. The lease is for a term of five years starting June 1, 2011. Under the lease, we pay monthly rent of approximately $11,400, which we believe is lower than costs charged by unrelated third party landlords. Additional rent will be assessed for any increases over the new lease commencement year for property taxes or assessments and property and casualty insurance premiums.
Mr. David Centofanti.Mr. David Centofanti serves as our Directorthe Company’s Vice President of Information Services.Systems. For such services,position, he received totalannual compensation of $168,000 in 2013 of approximately $163,000.2015. Mr. David Centofanti is the son of our Chief Executive Officer and Chairman of our Board, Dr. Louis F. Centofanti.Centofanti, our CEO, President and a Board member. We believe the compensation received by Mr. Centofanti for histhe technical expertise which he provides to the Company is competitive and comparable to compensation we would have to pay to an unaffiliated third party with the same technical expertise.
Christopher LeichtweisMr. Robert L. Ferguson.The CompanyMr. Robert L. Ferguson serves as an advisor to the Company’s Board and is obligated to make lease payments of approximately $29,000 per month through June 2018, pursuant toalso a Lease Agreement, dated June 1, 2008 (the “Lease”), between Leichtweis Enterprises, LLC, as lessor, and Safety and Ecology Holdings Corporation (“SEHC”), as lessee. Leichtweis Enterprises, LLC, is owned by Mr. Christopher Leichtweis (“Leichtweis”), who was a Senior Vice Presidentmember of the Company and PresidentSupervisory Board of Safety and Ecology Corporation (“SEC”), an indirect, wholly ownedPF Medical, a majority-owned Polish subsidiary of the Company. Mr. Ferguson previously served as a Board member for the Company priorfrom June 2007 to his voluntary terminationFebruary 2010 and retirementagain from August 2011 to September 2012. As an advisor to the Company’s Board, Mr. Ferguson is paid $4,000 monthly plus reasonable expenses. For such services, Mr. Ferguson received compensation of approximately $58,000 for the year ended December 31, 2015.On August 2, 2013, the Company completed a lending transaction with Messrs. Robert Ferguson and William Lampson (“collectively, the “Lenders”), whereby the Company borrowed from the Lenders the sum of $3,000,000 pursuant to the terms of a Loan and Security Purchase Agreement and promissory note (the “Loan”). The proceeds from the Loan were used for general working capital purposes. The promissory note is unsecured, with a term of three years with interest payable at a fixed interest rate of 2.99% per annum. The promissory note provides for monthly payments of accrued interest only during the first year of the Loan with the first interest payment due September 1, 2013 and monthly payments of $125,000 in principal plus accrued interest for the second and third year of the Loan. As consideration for the Company effective May 24, 2013.receiving the Loan, we issued warrants to each Lender to purchase up to 35,000 shares of the Company’s Common Stock at an exercise price of $2.23 per share, which was based on the closing price of the Company’s Common Stock at the closing of the transaction. The Lease covers SEC’s principal officeswarrants are exercisable six months from August 2, 2013 and expire on August 2, 2016. As further consideration for the Loan, the Company issued an aggregate 90,000 shares of the Company’s Common Stock, with each Lender receiving 45,000 shares. The 90,000 shares of Common Stock and 70,000 Common Stock purchase warrants were issued in Knoxville, Tennessee.a private placement and bear a restrictive legend against resale except in a transaction registered under the Securities Act or in a transaction exempt from registration thereunder.
UnderMr. John Climaco.On June 2, 2015, Mr. Climaco, a current member of the Company’s Board and a member of the Strategic Committee of the Board, was elected as the EVP of PF Medical. As EVP of PF Medical, Mr. Climaco receives an annual salary of $150,000 and is not eligible to receive additional compensation for serving on the Company’s Board.
On October 17, 2014, the Company’s Compensation Committee and the Board, with Mr. Climaco abstaining, approved a consulting agreement with Mr. Climaco. Pursuant to the consulting agreement, Mr. Climaco was responsible to, among other things:
● | Review the Company’s operations to restructure costs to render the Company more competitive; |
● | Evaluate all functions, including but not limited to sales, marketing, accounting, operations, and executive management as well as cost structures for each facility; |
● | Assist in the development of the Company’s strategy opportunity and other initiatives, including but not limited to the development of the Company’s medical isotope technology; and |
● | Other assignments as determined by the Board. |
Mr. Climaco was paid $22,000 per month under the consulting agreement, beginning September 2014, until the termination of indemnitythe consulting agreement effective June 2, 2015, upon Mr. Climaco’s election as EVP of PF Medical. For his services under the consulting agreement, Mr. Climaco received approximately $117,000 in 2015.
Mr. Climaco is also a director of Digirad Corporation, a Delaware corporation (“IndemnificationDigirad”), Nasdaq: DRAD. On July 24, 2015, PF Medical and Digirad entered into a multi-year Tc-99m Supplier Agreement (the “Supplier Agreement”) and a Series F Stock Subscription Agreement (the “Subscription Agreement”), SEC, Leichtweis and his spouse (“Leichtweis Parties”), jointly and severally, agreed to indemnify(together, the individual surety with respect to contingent liabilities that may be incurred by the individual surety under certain of SEC’s bonded projects. In addition, SEC agreed to indemnify the Leichtweis Parties against judgments, penalties, fines, and expense associated with those SEC performance bonds that Leichtweis Parties have agreed to indemnify in the event SEC cannot perform, which has an aggregate bonded amount of approximately $10,900,000 (which has been released/expired)“Digirad Agreements”). The IndemnificationSupplier Agreement provided by SEC tobecame effective upon the Leichtweis Parties also provides for compensating the Leichtweis Parties at a rate of 0.75% of the value of bonds (60% having been paid previously and the balance at substantial completion of the contract)Subscription Agreement. Pursuant to the terms of the Digirad Agreements,Digirad purchased, in a private placement, 71,429 shares of PF Medical’s restricted Series F Stock for an aggregate purchase price of $1,000,000. The 71,429 share investment made by Digirad constituted approximately 5.4% of the outstanding common shares of PF Medical. As a result of this transaction, the Company’s ownership interest in PF Medical was diluted from approximately 64.0% to 60.5%. On February 14, 2013, the Company entered into a Settlement and ReleaseThe Supplier Agreement and Amendment to Employment Agreement (the “Leichtweis Settlement”), in final settlementprovides, among other things, that upon PF Medical’s commercialization of certain claims made by us against Leichtweis relatingTc99m generators, Digirad will purchase agreed upon quantities of Tc-99m for its nuclear imaging operations either directly or in conjunction with its preferred nuclear pharmacy supplier and PF Medical will supply Digirad, or its preferred nuclear pharmacy supplier, with Tc-99m at a preferred pricing, subject to our acquisition of SEC on October 31, 2011. The Leichtweis Settlement terminated our obligation to pay the Leichtweis Parties a fee under the Indemnification Agreement.certain conditions.
Employment Agreements
During 2013, we had.We have an employment agreements,agreement (each dated July 10, 2014) with each dated August 24, 2011, withof Dr. Centofanti (our President and Chief Executive Officer)CEO), Ben Naccarato (our Chief Financial Officer)CFO), and James A. Blankenhorn, Vice President and Chief Operating Officer of the Company until his resignation on March 20, 2014.John Lash (our COO). Each employment agreement providedprovides for annual base salaries, bonuses (including Management Incentive Plans as approved by our Boards), and other benefits commonly found in such agreements. In addition, each employment agreement providedprovides that in the event of termination of such officer without cause or termination by the officer for good reason (as such terms are defined in the employment agreement), the terminated officer shall receive payments of an amount equal to benefits that have accrued as of the termination but had not yet been paid, plus an amount equal to one year’s base salary at the time of termination. In addition, the employment agreements providedprovide that in the event of a change in control (as defined in the employment agreements), all outstanding stock options to purchase our Common Stock granted to, and held by, the officer covered by the employment agreement wouldto be immediately vested and exercisable. When Mr. Blankenhorn’s resignation as the COO became effective, his employment agreement also terminated. On July 10, 2014, the Company entered into new employment agreements, on substantially the same terms as described above, with Dr. Centofanti, Mr. Naccarato and John Lash, who was hired as the Company’s new Chief Operating Officer on March 20, 2014.
The Company also had an employment agreement with Christopher Leichtweis (the “Leichtweis Employment Agreement”), containing substantially the terms described above with respect to the employment agreements of Messrs. Centofanti, Naccarato and Blankenhorn. On May 14, 2013, the Company entered into a Separation and Release Agreement with Mr. Leichtweis, which terminated Mr. Leichtweis’ employment with the Company and his position as an officer of the Company effective May 24, 2013, and voided the Leichtweis Employment Agreement (except for the “Confidentiality of Trade Secrets and Business Information (“Section 7”) clause). Leichtweis’ termination was not “for cause” by the Company nor “for good reason” by Mr. Leichtweis (as defined in the Leichtweis Employment Agreement). See “EXECUTIVE COMPENSATION--Employment Agreements” elsewhere in this Proxy Statement for further information on termination of the Leichtweis Employment Agreement.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act, and the regulations promulgated thereunder require our executive officers and directors and beneficial owners of more than 10% of our Common Stock to file reports of ownership and changes of ownership of our Common Stock with the Securities and Exchange Commission, and to furnish us with copies of all such reports. Based solely on a review of the copies of such reports furnished to us and written information provided to us, we believe that during 20132015 none of our executive officers, directors, or beneficial owners of more than 10% of our Common Stock failed to timely file reports under Section 16(a)., except for Mr. Jack Lahav, who inadvertently failed to timely file two Form 4s to report two transactions.
Audit Committee Report
The Audit Committee is responsible for providing independent objective oversight of the Company’s accounting functions and internal controls. In accordance with rules adopted by the Securities and Exchange Commission, the Audit Committee of the Company states that:
● | The Audit Committee has reviewed and discussed with management the Company’s audited financial statements for the fiscal year ended December 31, |
● | The Audit Committee has discussed with |
● | The Audit Committee has received the written disclosures and the letter from |
In connection with the Audit Committee’s discussion with BDO USA,Grant Thornton LLP, as described above, the Audit Committee discussed and considered the nature and scope of the non-auditaudit services performed by BDO USA,Grant Thornton LLP for the year ended December 31, 2013,2015, and determined that the audit and non-audit services provided by BDO USA,Grant Thornton LLP were compatible with maintaining the independence of BDO USA,Grant Thornton LLP.
Based upon the review and discussions referred to above, the Audit Committee recommended to the Board of Directors that the Company’s audited financial statements be included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2013,2015, for filing with the Securities and Exchange Commission. The Audit Committee has appointed Grant Thornton, LLP as the Company’s independent registered public accounting firm for 2014 (see “PROPOSAL 2 – RATIFICATION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM”).2016.
This report is submitted on behalf of the members of the Audit Committee:
Mark A. Zwecker | |
Larry M. Shelton | |
|
The Report of the Audit Committee shall not be deemed to be “soliciting material” or to be “filed” with the Securities and Exchange Commission, nor shall it be incorporated by any general statement incorporating by reference this Proxy Statement into any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except to the extent that the Company specifically incorporates this information by reference and shall not otherwise be deemed filed under such Acts.
EXECUTIVE OFFICERS
The following table sets forth, as of the date hereof, information concerning our executive officers:
NAME | AGE | POSITION |
Dr. Louis |
|
|
Mr. Ben Naccarato |
|
|
Mr. |
| COO, Vice President |
Mr. |
|
|
Dr. LouisF.Centofanti
See “Election of Directors”Directors – Dr. Louis F. Centofanti” for further information on Dr. Centofanti.
Mr. Ben Naccarato
Mr. Naccarato has served as the Chief Financial OfficerCFO since February 26, 2009. Mr. Naccarato joined the Company in September 2004 and served as Vice President, Finance of the Company’s Industrial Segment until May 2006, when he was named Vice President, Corporate Controller/Treasurer. Prior to joining the Company in September 2004, Mr. Naccarato was the Chief Financial OfficerCFO of Culp Petroleum Company, Inc., a privately held company in the fuel distribution and used waste oil industry from December 2002 to September 2004. In July 2015, Mr. Naccarato was named the CFO of PF Medical, the Company’s majority-owned Polish subsidiary involved in the research and development of a new medical isotope technology. Effective December 22, 2015, Mr. Naccarato was appointed to the Management Board of PF Medical. Mr. Naccarato is a graduate of University of Toronto having received a Bachelor of Commerce and Finance Degree and is a Chartered Professional Accountant, (CPA, CMA).
Mr. Robert Schreiber, Jr.
Mr. Schreiber has served as President of SYA since the Company acquired the environmental engineering firm in 1992. Mr. Schreiber co-founded the predecessor of SYA, Lafser & Schreiber in 1985, and held several executive roles in the firm until our acquisition of SYA. From 1978 to 1985, Mr. Schreiber was the Director of Air programs and all environmental programs for the Missouri Department of Natural Resources. Mr. Schreiber provides technical expertise in wide range of areas including the cement industry, environmental regulations and air pollution control. In April 2014, Mr. Schreiber was appointed to the Board of Directors of Perma-Fix Medical Corporation, an indirect subsidiary of the Company involved in the development and manufacturing of medical isotopes. Mr. Schreiber has a B.S. in Chemical Engineering from the University of Missouri – Columbia.Certified Management Accountant.
Mr. John Lash
On April 3, 2014,Mr. Lash has served as the Company’s Board of Directors approved the appointment by the Company onCOO since March 20, 2014 of Mr. John Lash as the Chief Operating Officer.Mr.2014.Mr. Lash previously served as Senior Vice President (“SVP”) of Operations of the Company’s Treatment Segment for over ten years. Mr. Lash has over 20 years of experience in the nuclear industry, with specific experience in managing remedial activities, as well as decontamination and disposal of radioactive materials from commercial and government operating facilities. As Senior Vice PresidentSVP of Operations, Mr. Lash was responsible for all treatment and remediation activities. Prior to joining Perma-Fixthe Company in 2001, Mr. Lash served as Broad Spectrum Manager for Waste Control Specialists in Dallas, TX where his responsibilities included contract management of DOEU.S. Department of Energy (“DOE”) nationwide procurement for mixed waste treatment services, business development activities, and technology development. Prior to that, he worked for ten years at Chem-Nuclear Systems where he held various managerial positions including manager of the Chem-Nuclear Consolidation Facility. Mr. Lash received his education and qualification from the U.S. Navy Nuclear Power Program, where he served for 8 years prior to working in the commercial and nuclear industry.
Resignation of Chief Operating OfficerMr. Mark Duff
On March 20, 2014,May 15, 2016, the Board appointed Mr. Mark Duff to the position of Executive Vice President, effective June 13, 2016. Mr. Duff brings additional experience and leadership to the Company acceptedand will join the resignationmanagement team to support and help accelerate anticipated revenue growth and profitability. Mr. Duff has 30 years of management and technical experience in the DOE and U.S. Department of Defense environmental and construction markets as a corporate officer, senior project manager, co-founder of a consulting firm, and federal employee. For the past five years, Mr. James A. BlankenhornDuff has been responsible for the successful completion of over 70 performance-based projects at the Paducah Gaseous Diffusion Plant (“PGDP”) in Paducah, KY. At the PGDP, he served as Vice Presidentthe Project Manager for the Paducah Remediation Contract, which was a five-year project with a total value of $458 million. Prior to the PGDP project, Mr. Duff was a senior manager supporting Babcock and Chief Operating OfficerWilcox (“B&W”), leading several programs that included building teams to solve complex technical problems. These programs included implementation of the Company. The resignation was effective March 28, 2014.American Recovery and Reinvestment Act (“ARRA”) at the DOE Y-12 facility with a $245 million budget for new cleanup projects completed over a two year period. During this period, Mr. Blankenhorn’s resignation was not dueDuff served as project manager leading a team of senior experts in support of Toshiba Corporation in Tokyo, Japan to a disagreementintegrate United States technology in the recovery of the Fukushima Daiichi Nuclear Reactor disaster. This project included arriving in Japan within three weeks after the earthquake to coordinate technologies associated with water treatment, radiation protection and shielding. Prior to joining B&W, Mr. Duff served as the Company.president of Safety and Ecology Corporation (“SEC”). As President of SEC, he helped grow the company from $50 million to $80 million in annual revenues with significant growth in infrastructure, marketing, and client diversification. Mr. Duff has an MBA from the University of Phoenix and received his B.S. from the University of Alabama.
EXECUTIVE COMPENSATION
Summary Compensation
The following table summarizes the total compensation paid to or earned by each of the named executive officersofficer (“NEOs”NEO”) for the fiscal years ended December 31, 20132015 and 2012.2014.
Name and Principal Position | Year | Salary | Bonus | Option Awards | Non-Equity Incentive Plan Compensation | All other Compensation | Total Compensation | |||||||||
| ($) | ($) | ($) | ($)(2) | ($)(3) | ($) | |||||||||||
Dr. Louis Centofanti | 2013 | 271,115 | — | — | — | 26,141 | 297,256 | |||||||||
Chairman of the Board, | 2012 | 271,115 | — | — | — | 25,893 | 297,008 | |||||||||
President and Chief | ||||||||||||||||
Executive Officer | ||||||||||||||||
Ben Naccarato | 2013 | 214,240 | — | — | — | 33,135 | 247,375 | |||||||||
Vice President and Chief | 2012 | 214,240 | — | — | — | 31,918 | 246,158 | |||||||||
Financial Officer | ||||||||||||||||
Jim Blankenhorn(4) | 2013 | 252,350 | — | — | — | 33,135 | 285,485 | |||||||||
Vice President and Chief | 2012 | 252,350 | — | — | — | 31,918 | 284,268 | |||||||||
Operating Officer | ||||||||||||||||
Robert Schreiber, Jr. | 2013 | 203,821 | — | — | — | 31,488 | 235,309 | |||||||||
President of SYA | 2012 | 203,821 | — | — | — | 31,694 | 235,515 | |||||||||
Christopher Leichtweis(1) | 2013 | 157,894 | — | — | — | 6,484 | 164,378 | |||||||||
Senior Vice President and | 2012 | 324,480 | — | — | — | 15,547 | 340,027 | |||||||||
SEC President | ||||||||||||||||
Name and Principal Position | Year | Salary | Bonus | Option Awards | Non-Equity Incentive Plan Compensation | All other Compensation | Total Compensation | |||
($) | ($) | ($) (4) | ($) (5) | ($)(6) | ($) | |||||
Dr. Louis Centofanti(1) | 2015 | 271,115 | — | — | 82,691 | 31,446 | 385,252 | |||
President and CEO | 2014 | 271,115 | — | — | — | 26,141 | 297,256 | |||
Ben Naccarato | 2015 | 214,240 | — | — | 65,343 | 37,710 | 317,293 | |||
Vice President and CFO | 2014 | 214,240 | — | — | — | 33,135 | 247,375 | |||
John Lash(2) | 2015 | 215,000 | — | — | 65,575 | 26,863 | 307,438 | |||
Vice President and COO | 2014 | 201,770 | 25,000 | (3) | 129,739 | — | 23,372 | 379,881 |
(1) |
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(2) | Named as COO effective March 20, 2014. Previously, Mr. Lash served as SVP of Operations for the Company’s Treatment Segment. The salary noted for 2014 reflects prorated amount earned as SVP of Operations for the Treatment Segment and prorated amount earned as the COO. |
(3) | Represents a sign-on bonus upon becoming as COO of the Company on March 20, 2014. |
(4) | Reflects the aggregate grant date fair value of awards computed in accordance with ASC 718, “Compensation – Stock Compensation.” No options were granted to any NEO in 2015. No options were granted to any NEO in 2014 with the exception of Mr. Lash. |
(5) | Represents performance compensation earned under the Company’s |
| The amount shown includes a monthly automobile allowance |
Insurance | Auto Allowance or | |||||||||||||||
Name | Premium | Company Car | 401(k) match | Total | ||||||||||||
Dr. Louis Centofanti | $ | 17,028 | $ | 9,000 | $ | 5,418 | $ | 31,446 | ||||||||
Ben Naccarato | $ | 24,039 | $ | 9,000 | $ | 4,671 | $ | 37,710 | ||||||||
John Lash | $ | 17,028 | $ | 6,000 | $ | 3,835 | $ | 26,863 | ||||||||
Insurance | Auto Allowance or | |||||||||||
Name | Premium | Company Car | Total | |||||||||
Dr. Louis Centofanti | $ | 17,141 | $ | 9,000 | $ | 26,141 | ||||||
Ben Naccarato | $ | 24,135 | $ | 9,000 | $ | 33,135 | ||||||
Jim Blankenhorn | $ | 24,135 | $ | 9,000 | $ | 33,135 | ||||||
Robert Schreiber, Jr. | $ | 24,135 | $ | 7,353 | $ | 31,488 | ||||||
Christopher Leichtweis | $ | 6,484 | ¾ | $ | 6,484 | |||||||
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Outstanding Equity Awards at Fiscal Year-End
The following table sets forth unexercised options held by the NEOs as of the fiscal year-end.
Outstanding Equity Awards at December 31, 20132015
Option Awards | Option Awards | ||||||||||||||||||||||||||
Name | Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#)(1) Unexercisable | Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) | Option Exercise Price ($) | Option Expiration Date | Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#)(1) Unexercisable | Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) | Option Exercise Price ($) | Option Expiration Date | |||||||||||||||||
Dr. Louis Centofanti | 30,000 | — | — | 11.40 | 8/5/2014 | — | — | — | — | — | |||||||||||||||||
Ben Naccarato | 4,000 | — | — | 7.20 | 10/28/2014 | — | — | — | — | ||||||||||||||||||
| 8,000 | — | — | 11.40 | 8/5/2014 | |||||||||||||||||||||||
| 15,000 | — | 7.10 | 2/26/2015 | ||||||||||||||||||||||||
Jim Blankenhorn(3) | 40,000 | 20,000 | (2) | — | 7.85 | 7/25/2017 | |||||||||||||||||||||
Robert Schreiber, Jr. | 5,000 | — | — | 11.40 | 8/5/2014 | ||||||||||||||||||||||
John Lash | 15,000 | 30,000 | (2) | — | 5.00 | 7/10/2020 | |||||||||||||||||||||
(1) | In the event of a change in control (as defined in the 2010 Stock Option Plan) of the Company, each outstanding option and award shall immediately become exercisable in full notwithstanding the vesting or exercise provisions contained in the stock option agreement. |
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None of the Company’s NEOs exercised options during 2013.2015.
Employment Agreements
Each of our CEO, COO, and CFO (each is an NEO) has an employment dated July 10, 2014 with the Company. The Company entered into employment agreements ondated July 10, 2014 with our CEO, COO, and CFO which were approved byare collectively referred to as the Compensation Committee“Employment Agreements” and Board.each as an “Employment Agreement.” These agreements provideEmployment Agreements provided that (a) Dr. Centofanti, CEO, iswas entitled to receive an annual base salary of $271,115; (b) Mr. Lash, COO, iswas entitled to receive an annual base salary of $215,000; and (c) Mr. Naccarato, CFO, iswas entitled to receive an annual base salary of $214,240. The base salary is subject to adjustment as determined by the Compensation Committee. In addition to base salary,each of these executive officers is entitled to participate in the Company's broad-based benefits plans and to any performance compensation payable under an individual MIP for the CEO, CFO, and COO (see “2013 MIPs” and “2014 MIPs,”further detail of each MIP below under the heading “Management“2015 Management Incentive Plans (“MIPs”)”). The employment agreements dated July 10, 2014 with our CEO, COO, and CFO are collectively referred to as the “New Employment Agreements.”
The Company had previously entered into employment agreement on August 24, 2011 with each Dr. Centofanti, Ben Naccarato, and James Blankenhorn, our previous COO. On March 20, 2014, the Company accepted the resignation of Mr. Blankenhorn, as Vice President and COO of the Company. The resignation was effective March 28, 2014. When Mr. Blankenhorn’s resignation as the COO became effective, his employment agreement, dated August 24, 2011 also terminated. Mr. Blankenhorn’s employment agreement provided for an annual base salary and eligibility to participate in theCompany's benefits plans and any performance compensation payable under an individual MIP for the COO. Upon Mr. Blankenhorn’s resignation, he was paid all his accrued salary, vacation, and any benefits under the employee’s benefit plan to March 28, 2014. Both of the August 24, 2011 employment agreements with Dr. Centofanti and Ben Naccarato were terminated effective July 10, 2014.
Each of the New Employment Agreements is effective for three years. Each New Employment Agreement may be terminated prior to its expiration by the Company with or without “cause” (as defined below) or by the executive officer for “good reason” (as defined below) or any other reason. If the NEO’s employment is terminated due to death, disability or for cause, we will pay to the NEO or to his estate a lump sum equal to the sum of any unpaid base salary through the date of termination and any benefits otherwise due at that time under any employee benefit plan, excluding any severance program or policy (the “Accrued Amounts”).
If the NEO terminates his employment for “good reason” or is terminated without cause, we will pay the NEO a sum equal to the total Accrued Amounts, plus one year of full base salary. If the NEO terminates his employment for a reason other than for good reason, we will pay to him the amount equal to the Accrued Amounts. If there is a Change in Control (as defined below), all outstanding stock options to purchase common stock held by the NEO will immediately become vested and exercisable in full. The amounts payable with respect to a termination (other than base salary and amounts otherwise payable under any Company employee benefit plan) are payable only if the termination constitutes a “separation from service” (as defined under Treasury Regulation Section 1.409A-1(h)).
“Cause” is generally defined in each of the New Employment Agreements as follows:
● | the ultimate conviction (after all appeals have been decided) of the executive by a court of competent jurisdiction, or a plea of nolo |
● | willful or gross misconduct or gross neglect of duties by the executive, which is injurious to the Company. Failure of the executive to perform his duties due to disability shall not be considered gross misconduct or gross neglect of duties; |
● | act of fraud or embezzlement against the Company; and |
● | willful breach of any material provision of the |
“Good reason” is generally defined in each of the New Employment Agreements as follows:
● | assignment to the executive of duties inconsistent with his responsibilities as they existed during the 90-day period preceding the date of the employment agreement, including status, office, title, and reporting requirement; |
● | any other action by the Company which results in a reduction in (i) the compensation payable to the executive, or (ii) the executive’s position, authority, duties, or other responsibilities without the executive’s prior approval; |
● | the relocation of the executive from his base location on the date of the |
● | any purported termination by the Company of the executive’s employment otherwise than as permitted by the agreement; and |
● | any material breach by the Company of any provision of the |
“Change in Control” is generally defined in each of the Employment Agreements as follows:
● | a transaction in which any person, entity, corporation, or group (as such terms are defined in Sections 13(d)(3) and 14(d)(2) of the Exchange (other than the Company, or a profit sharing, employee ownership or other employee benefit plan sponsored by the Company or any subsidiary of the Company): (i) will purchase any of the Company’s voting securities (or securities convertible into such voting securities) for cash, securities or other consideration pursuant to a tender offer, or (ii) will become the “beneficial owner” (as such term is defined in Rule 13d-3 under the Exchange Act, directly or indirectly (in one transaction or a series of transactions), of securities of the Company representing 50% or more of the total voting power of the then outstanding securities of the Company ordinarily having the right to vote in the election of directors; or |
● | a change, without the approval of at least two-thirds of the Board |
● | the Company’s execution of an agreement for the sale of all or substantially all of the Company’s assets to a purchaser which is not a subsidiary of the Company; or |
● | the Company’s adoption of a plan of dissolution or liquidation; or |
● | the Company’s closure of the facility where the executive works; or |
● | the Company’s execution of an agreement for a merger or consolidation or other business combination involving the Company in which the Company is not the surviving corporation, or, if immediately following such merger or consolidation or other business combination, less than fifty percent (50%) of the surviving corporation’s outstanding voting stock is held by persons who are stockholders of the Company immediately prior to such merger or consolidation or other business combination; or |
● | such event that is of a nature that is required to be reported in response to Item 5.01 of Form 8-K. |
In connection with the closing of our acquisition of Safety and Ecology Holdings Corporation and its subsidiaries (collectively known as Safety and Ecology Corporation or “SEC”) on October 31, 2011,we entered into an employment agreement with Mr. Christopher Leichtweis (“Leichtweis Employment Agreement), which was approved bythe Compensation Committee and Board. Mr. Leichtweis, who prior to the acquisition was an officer and director of SEC’s former parent company (Homeland Security Capital Corporation now known as Timios National Corporation or “TNC”), was appointed as the SEC President and a senior vice president. Mr. Leichtweis’ employment agreement provided that he was entitled to receive an annual base salary of $324,480 and was entitled to participate in the Company’s benefits plans and any performance compensation payable under an individual MIP for the SEC President. The base salary was subject to adjustment as determined by the Compensation Committee.
On February 14, 2013, the Company entered into a Settlement and Release Agreement and Amendment to Employment Agreement (the “Leichtweis Settlement), in final settlement of certain claims made by us against Mr. Leichtweis in connection with the acquisition of SEC. The Leichtweis Settlement amended Mr. Leichtweis Employment Agreement which reduced the base salary of Mr. Leichtweis by $30,000 per year commencing on the earlier of (i) the date the Company filed its 2012 Form 10-K with the Securities and Exchange Commission, or (ii) April 1, 2013, and continuing for a period of three years from such date (or, if the Mr. Leichtweis’s Employment Agreement is earlier terminated, through the date of such earlier termination). The Company filed its Form 10-K on March 22, 2013.
On May 14, 2013, the Company entered into a Separation and Release Agreement (“Agreement”) with Mr. Leichtweis. Pursuant to the Agreement:
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In connection with the Agreement, the Company also entered into a Consulting Services Agreement (“Consulting Agreement”) with Mr. Leichtweis, dated May 24, 2013 and terminating on July 23, 2014, unless sooner terminated by either party with prior 30 days’ written notice. The Consulting Agreement provides for compensation at an hourly rate of $135 and reasonable travel and other expenses. Pursuant to the Consulting Agreement, Mr. Leichtweis will be subject to a fourteen months confidentiality and non-compete agreement (as defined) from date of execution of the Consulting Agreement. On June 1, 2013, Leichtweis provided the Company with written notice of termination of the Consulting Agreement.
Potential Payments upon Termination of Employment or Change in Control
The following table sets forth the potential (estimated) payments and benefits to which our NEOs, would be entitled under the Employment Agreements upon termination of employment or following a Change in Control, assuming each circumstance described below occurred on December 31, 2013.
The following table sets forth the potential (estimated) payments and benefits to which Dr. Centofanti, Mr. Jim Blankenhorn,Lash, and Mr. Naccarato, would be entitled upon termination of employment or following a Change in Control of the Company, as specified under each employment agreementEmployment Agreement with the Company, assuming each circumstance described below occurred on December 31, 2013,2015, the last day of our fiscal year.
Executive for Good | ||||||||||||||||||||||||
Disability, | Reason or by | |||||||||||||||||||||||
Name and Principal Position | Death, | Company Without | Change in Control | |||||||||||||||||||||
Potential Payment/Benefit | or For Cause | Cause | of the Company | |||||||||||||||||||||
Name and Principal Position Potential Payment/Benefit | Disability, Death, or For Cause | Termination by Executive for Good Reason or by Company Without Cause | Change in Control of the Company | |||||||||||||||||||||
Dr. Louis Centofanti | ||||||||||||||||||||||||
Chairman of the Board, | ||||||||||||||||||||||||
President and Chief Executive | ||||||||||||||||||||||||
Officer | ||||||||||||||||||||||||
President, CEO and Director | ||||||||||||||||||||||||
Severance | $ | — | $ | 271,115 | $ | — | $ | ── | $ | 271,115 | $ | ── | ||||||||||||
Stock Options | $ | — | (1) | $ | — | (1) | $ | — | (2) | $ | ── | (1) | $ | ── | (1) | $ | ── | (1) | ||||||
Ben Naccarato | ||||||||||||||||||||||||
Chief Financial Officer | ||||||||||||||||||||||||
CFO | ||||||||||||||||||||||||
Severance | $ | — | $ | 214,240 | $ | — | $ | ── | $ | 214,240 | $ | ── | ||||||||||||
Stock Options | $ | — | (1) | $ | — | (1) | $ | — | (2) | $ | ── | (1) | $ | ── | (1) | $ | ── | (1) | ||||||
Jim Blankenhorn(3) | ||||||||||||||||||||||||
Chief Operating Officer | ||||||||||||||||||||||||
John Lash | ||||||||||||||||||||||||
COO | ||||||||||||||||||||||||
Severance | $ | — | $ | 252,350 | $ | — | $ | ── | $ | 215,000 | $ | ── | ||||||||||||
Stock Options | $ | — | (1) | $ | — | (1) | $ | — | (2) | $ | ── | (2) | $ | ── | (2) | $ | ── | (3) | ||||||
(1) | No stock option outstanding as of December 31, 2015. |
(2) | Benefit is estimated to be zero since the number of stock options vested that were in-the-money as of December 31, |
| Benefit is estimated to be zero since the number of stock options outstanding that were in-the-money as of December 31, |
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No performance compensation under the NEO’s MIP would have been payable at December 31, 20132015 under any of the circumstances described in the table above. Pursuant to each MIP, if the participant’s employment with the Company is voluntarily or involuntarily terminated prior to the annual payment of the MIP compensation payment period, no MIP payment is payable. The payment is otherwise payable under each MIPto be paid on or about 90 days after year-end, or sooner,the end of the preceding fiscal year, based on finalization of our financial statements for year-end. See “2013 MIPs,“2015 Management Incentive Plans (“MIPs”)” below.
The amounts payable with respect to a termination (other than base salary and amounts otherwise payable under any Company employee benefit plan) are payable only if the termination constitutes a “separation from service” (as defined under Treasury Regulation Section 1.409A-1(h)).
20132015 Executive Compensation Components
For the fiscal year ended December 31, 2013,2015, the principal components of compensation for executive officers were:
● | base salary; |
● | performance-based incentive compensation; |
● | long term incentive compensation; |
● | retirement and other benefits; and |
● | perquisites. |
Based on the amounts set forth in the Summary Compensation Table,table, during 2013,2015, salary accounted for 89.4%approximately 69% of the total compensation of our NEOs, while equity option awards, bonus, MIP compensation, and other compensation accounted for approximately 10.6%31% of the total compensation of the NEOs.
Base Salary
The NEOs, other executive officers, and other employees of the Company receive a base salary during the fiscal year. Base salary ranges for executive officers are determined for each executive based on his or her position and responsibility by using market data and comparisons to other companies within the Peer Group.industry segments in which the Company operates.
During its review of base salaries for executives, the Compensation Committee primarily considers:
● | market data and |
● | internal review of the executive’s compensation, both individually and relative to other officers; and |
● | individual performance of the executive. |
Salary levels are typically considered annually as part of the performance review process as well as upon a promotion or other change in job responsibility. Merit based salary increases for executives are based on the Compensation Committee’s assessment of the individual’s performance. The base salary and potential annual base salary adjustments for the CEO, COO, and CFO and the SEC President are/wereare set forth in their respective Employment Agreements.
Performance-Based Incentive Compensation
The Compensation Committee has the latitude to design cash and equity-based incentive compensation programs to promote high performance and achievement of our corporate objectives by directors and the NEOs, encourage the growth of stockholder value and enable employees to participate in our long-term growth and profitability. The Compensation Committee may grant stock options and/or performance bonuses. In granting these awards, the Compensation Committee may establish any conditions or restrictions it deems appropriate. In addition, the CEO has discretionary authority to grant stock options to certain high-performing executives or officers, subject to the approval of the Compensation Committee.
The exercise price for each stock options granted is at or above the market price of our Common Stock on the date of grant. Stock options may be awarded to newly hired or promoted executives at the discretion of the Compensation Committee. Grants of stock options to eligible newly hired executive officers are generally made at the next regularly scheduled Compensation Committee meeting following the hire date.
2015Management Incentive Plans (“MIPs”MIPs”)
2013 MIPs
On June 6, 2013,April 17, 2015, the Compensation Committee approved individual MIPs for our CEO, COO, and CFO. The MIPs were effective as of January 1, 2013.2015. Each MIP provided guidelines for the calculation of annual cash incentive based compensation, subject to Compensation Committee oversight and modification. Each MIP awardsawarded cash compensation based on achievement of performance thresholds (as discussed below), with the amount of such compensation established as a percentage of base salary. The potential target performance compensation ranged from 50%5% to 87%100% or $135,558$13,556 to $237,224$271,115 of the 20132015 base salary for the CEO, 50%5% to 87%100% or $126,175$10,750 to $220,808$215,000 of the 20132015 base salary for the COO, and 25%5% to 44%100% or $53,560$10,712 to $93,731$214,240 of the 20132015 base salary for the CFO.
Performance compensation wasunder the Company’s MIPs is to be paid on or about 90 days after year-end, or sooner,the end of the preceding fiscal year, based on finalization of our audited financial statements for 2013.the immediately preceding fiscal year on which the MIP is based. If the MIP participant’s employment with the Company wasis voluntarily or involuntarily terminated prior to a regularly scheduled MIP compensation payment date, no MIP payment would have beenis payable for and after such period.
Payment of amounts earned under the 2015 MIPs have been deferred, but is expected to be made no later than the end of the third quarter of 2016.
The Compensation Committee retainedretains the right to modify, change or terminate each MIP and may adjust the various target amounts described below, at any time and for any reason.
The total performance compensation paid to the CEO, COO, and CFO as a group under the 2015 MIPs was subject to a ceiling of 50% of the Company’s pre-tax net income (exclusive of PF Medical) prior to the calculation of performance compensation.
The following describes the principal terms of each MIP:
CEO:
20132015 CEO performance compensation was based upon meeting corporate revenue, earnings before interest, taxes, depreciation and amortization (“EBITDA”), health and safety, and environmental compliance (permit and license violations) objectives during fiscal year 20132015 from our continuing operations. Ofoperations (excluding PF Medical). The Compensation Committee believes performance compensation payable under each of the total2015 MIPs as discussed herein and below should be based on achievement of EBITDA target as this target provides a better indicator of operating performance as it excludes certain non-cash items. EBITDA has certain limitations as it does not reflect all items of income or cash flows that affect the Company’s financial performance under GAAP. At achievement of 70% to 119% of the Revenue and EBITDA targets, the potential performance compensation 55%was payable at 5% to 50% of the base salary, of which 60% was based on EBITDA goal, 15%10% on revenue goal, 15% on the number of health and safety claim incidents that occurred during fiscal year 2013,2015, and the remaining 15% on the number of notices alleging environmental, health or safety violations under our permits or licenses that occurred during the fiscal year 2013.2015. Upon achievement of over 119% of the Revenue and EBITDA targets, with potential performance compensation payable at over 50% to 100% of the base salary, the amount of total performance compensation payable was based on the four objectives noted above, with the payment of such performance compensation being weighted more heavily toward the EBITDA objective. Each of the revenue and EBITDA components was based on our board approved Revenue Target and EBITDA Target. The 20132015 target performance incentive compensation for our CEO was as follows:
Annualized Base Pay: | $ | 271,115 |
Performance Incentive Compensation Target (at 100% of MIP): | $ | 135,558 |
Total Annual Target Compensation (at 100% of MIP): | $ | 406,673 |
The Performance Incentive Compensation Target was based on the schedule below.
| Target Objectives | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Performance Target Thresholds | TARGET | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Weights | 85-100% | 101-120% | 121-130% | 131-140% | 141-150% | 151-160% | 161%+ | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue Target | $ | 42,500,000 | $ | 59,500,000 | $ | 72,250,000 | $ | 85,000,000 | $ | 102,000,000 | $ | 119,000,000 | $ | 136,000,000 | ||||||||||||||||||||||||||||||||||||||||||||||
EBITDA Target | $ | 4,080,000 | $ | 5,712,000 | $ | 6,936,000 | $ | 8,160,000 | $ | 9,792,000 | $ | 11,424,000 | $ | 13,056,000 | ||||||||||||||||||||||||||||||||||||||||||||||
Threshold % Of Target | 50 | % | 70 | % | 85 | % | 100 | % | 120 | % | 140 | % | 160 | % | ||||||||||||||||||||||||||||||||||||||||||||||
Bonus % Awarded | 0 | % | 10 | % | 50 | % | 100 | % | 130 | % | 170 | % | 200 | % | ||||||||||||||||||||||||||||||||||||||||||||||
% of Target Achieved | 50%-69 | % | 70%-84 | % | 85%-99 | % | 100%-119 | % | 120%-139 | % | 140%-159 | % | 160% | + | ||||||||||||||||||||||||||||||||||||||||||||||
Revenue | 15% | $ | 20,334 | $ | 24,400 | $ | 26,434 | $ | 28,467 | $ | 30,500 | $ | 32,534 | $ | 35,584 | $ | - | $ | 1,356 | $ | 6,778 | $ | 13,556 | $ | 19,365 | $ | 27,112 | $ | 32,921 | |||||||||||||||||||||||||||||||
EBITDA | 55% | 74,556 | 89,467 | 96,922 | 104,378 | 111,833 | 119,289 | 130,472 | - | 8,134 | 40,667 | 81,334 | 116,192 | 162,669 | 197,526 | |||||||||||||||||||||||||||||||||||||||||||||
Health & Safety | 15% | 20,334 | 24,400 | 26,434 | 28,467 | 30,500 | 32,534 | 35,584 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Health and Safety | - | 2,033 | 10,167 | 20,334 | 20,334 | 20,334 | 20,334 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Permit & License Violations | 15% | 20,334 | 24,400 | 26,434 | 28,467 | 30,500 | 32,534 | 35,584 | - | 2,033 | 10,167 | 20,334 | 20,334 | 20,334 | 20,334 | |||||||||||||||||||||||||||||||||||||||||||||
| $ | - | $ | 13,556 | $ | 67,779 | $ | 135,558 | $ | 176,225 | $ | 230,449 | $ | 271,115 | |||||||||||||||||||||||||||||||||||||||||||||||
| $ | 135,558 | $ | 162,667 | $ | 176,224 | $ | 189,779 | $ | 203,333 | $ | 216,891 | $ | 237,224 | |||||||||||||||||||||||||||||||||||||||||||||||
1) | Revenue was defined as the total consolidated third party top line revenue from continuing operations as publicly reported in the Company’s financial statements. The percentage achieved was determined by comparing the actual consolidated revenue from continuing operations to the Board approved Revenue Target from continuing operations, which was |
2) | EBITDA was defined as earnings before interest, taxes, depreciation, and amortization from continuing |
3) | The Health and Safety Incentive Target was based upon the actual number of Worker’s Compensation Lost Time Accidents, as provided by the Company’s Worker’s Compensation carrier. The Corporate |
Worker's Compensation | Performance | ||||||
Claim Number | Target | ||||||
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COO:
2013 COO performance compensation was based upon meeting corporate revenue, EBITDA, health, safety, and environmental compliance objectives during fiscal year 2013 from our continuing operations. Of the total potential performance compensation, 55% was based on EBITDA goal, 15% on revenue goal, 15% on the number of health and safety claim incidents that occurred during fiscal year 2013, and the remaining 15% on the number of notices alleging environmental, health or safety violations under our permits or licenses that occurred during the fiscal year 2013. Each of the revenue and EBITDA components was based on our board approved Revenue Target and EBITDA Target. The 2013 target compensation for our COO was as follows:
Annualized Base Pay: | $ | 252,350 | ||
Performance Incentive Compensation Target (at 100% of Plan): | $ | 126,175 | ||
Total Annual Target Compensation (at 100% of Plan): | $ | 378,525 |
The Performance Incentive Compensation Target was based on the schedule below.
Target Objectives | ||||||||||||||||||||||||||||||||
Performance Target Thresholds | ||||||||||||||||||||||||||||||||
Weights | 85-100 | 101-120 | 121-130 | 131-140 | 141-150 | 151-160 | 161%+ | |||||||||||||||||||||||||
Revenue | 15% | $ | 18,926 | $ | 22,712 | $ | 24,604 | $ | 26,497 | $ | 28,389 | $ | 30,282 | $ | 33,121 | |||||||||||||||||
EBITDA | 55% | 69,397 | 83,277 | 90,216 | 97,156 | 104,096 | 111,036 | 121,445 | ||||||||||||||||||||||||
Health & Safety | 15% | 18,926 | 22,712 | 24,604 | 26,497 | 28,389 | 30,282 | 33,121 | ||||||||||||||||||||||||
Permit & License Violations | 15% | 18,926 | 22,712 | 24,604 | 26,497 | 28,389 | 30,282 | 33,121 | ||||||||||||||||||||||||
| $ | 126,175 | $ | 151,413 | $ | 164,028 | $ | 176,647 | $ | 189,263 | $ | 201,882 | $ | 220,808 | |||||||||||||||||||
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4) | Permits or License Violations incentive was earned/determined according to the scale set forth below: An “official notice of non-compliance” was defined as an official communication from a local, state, or federal regulatory authority alleging one or more violations of an otherwise applicable Environmental, Health or Safety requirement or permit provision, which resulted in a facility’s implementation of corrective action(s). |
Permit and | Performance | ||||||
License Violations | Target | ||||||
6 | 70%-84% | ||||||
5 | 85%-99% | ||||||
4 | 100%-119% | ||||||
3 | 120%-139% | ||||||
2 | 140%-159% | ||||||
1 | 160% + | ||||||
5) | No performance incentive compensation was payable for achieving the health and safety, permit and license violation, and revenue targets unless a minimum of 70% of the EBITDA Target was achieved. |
COO MIP:
2015 COO performance compensation was based upon meeting corporate revenue, EBITDA, health and safety, and environmental compliance (permit and license violations) objectives during fiscal year 2015 from our continuing operations (excluding PF Medical). At achievement of 70% to 119% of the Revenue and EBITDA targets, the potential performance compensation was payable at 5% to 50% of the base salary, of which 60% was based on EBITDA goal, 10% on revenue goal, 15% on the number of health and safety claim incidents that occurred during fiscal year 2015, and the remaining 15% on the number of notices alleging environmental, health or safety violations under our permits or licenses that occurred during the fiscal year 2015. Upon achievement of over 119% of the Revenue and EBITDA targets, with potential performance compensation payable at over 50% to 100% of the base salary, the amount of performance compensation payable was based on the four objectives noted above, with the payment of such performance compensation being weighted more heavily toward the EBITDA objective. Each of the revenue and EBITDA components was based on our board approved Revenue Target and EBITDA Target. The 2015 target performance incentive compensation for our COO was as follows:
Annualized Base Pay: |
| $ | 215,000 |
|
Performance Incentive Compensation Target (at 100% of MIP): |
| $ | 107,500 |
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Total Annual Target Compensation (at 100% of MIP): |
| $ | 322,500 |
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TARGET | ||||||||||||||||||||||||||||
Revenue Target | $ | 42,500,000 | $ | 59,500,000 | $ | 72,250,000 | $ | 85,000,000 | $ | 102,000,000 | $ | 119,000,000 | $ | 136,000,000 | ||||||||||||||
EBITDA Target | $ | 4,080,000 | $ | 5,712,000 | $ | 6,936,000 | $ | 8,160,000 | $ | 9,792,000 | $ | 11,424,000 | $ | 13,056,000 | ||||||||||||||
Threshold % Of Target | 50 | % | 70 | % | 85 | % | 100 | % | 120 | % | 140 | % | 160 | % | ||||||||||||||
Bonus % Awarded | 0 | % | 10 | % | 50 | % | 100 | % | 130 | % | 170 | % | 200 | % | ||||||||||||||
% of Target Achieved | 50%-69 | % | 70%-84 | % | 85%-99 | % | 100%-119 | % | 120%-139 | % | 140%-159 | % | 160% | + | ||||||||||||||
Revenue | $ | - | $ | 1,074 | $ | 5,374 | $ | 10,750 | $ | 15,357 | $ | 21,500 | $ | 26,107 | ||||||||||||||
EBITDA | - | 6,450 | 32,250 | 64,500 | 92,143 | 129,000 | 156,643 | |||||||||||||||||||||
Health and Safety | - | 1,613 | 8,063 | 16,125 | 16,125 | 16,125 | 16,125 | |||||||||||||||||||||
Permit & License Violations | - | 1,613 | 8,063 | 16,125 | 16,125 | 16,125 | 16,125 | |||||||||||||||||||||
| $ | - | $ | 10,750 | $ | 53,750 | $ | 107,500 | $ | 139,750 | $ | 182,750 | $ | 215,000 | |||||||||||||||
1) | Revenue was defined as the total consolidated third party top line revenue from continuing operations as publicly reported in the Company’s financial statements. The percentage achieved was determined by comparing the actual consolidated revenue from continuing operations to the Board approved Revenue Target from continuing operations, which was $85,000,000. The Board reserved the right to modify or change the Revenue Targets as defined herein in the event of the sale or disposition of any of the assets of the Company or in the event of an acquisition. |
2) | EBITDA was defined as earnings before interest, taxes, depreciation, and amortization from continuing operations, excluding PF Medical. The percentage achieved was determined by comparing the actual EBITDA to the Board approved EBITDA Target, which was $8,160,000. The Board reserved the right to modify or change the EBITDA Targets as defined herein in the event of the sale or disposition of any of the assets of the Company or in the event of an acquisition. |
3) | The Health and Safety Incentive Target was based upon the actual number of Worker’s Compensation Lost Time Accidents, as provided by the Company’s Worker’s Compensation carrier. The Corporate Controller submitted a report on a quarterly basis documenting and confirming the number of Worker’s Compensation Lost Time Accidents, supported by the AIG Worker’s Compensation Loss Report. Such claims were identified on the loss report as “indemnity claims.” The following number of Worker’s Compensation Lost Time Accidents and corresponding Performance Target Thresholds were established for the annual Incentive Compensation Plan calculation for 2015. |
Worker's Compensation | Performance | ||||||
Claim Number | Target | ||||||
6 | |||||||
| |||||||
5 | 85%-99% | ||||||
4 | 100-119% | ||||||
3 | 120%-139% | ||||||
2 | 140%-159% | ||||||
1 | 160% + |
4) | Permits or License Violations incentive was earned/determined according to the scale set forth below: An “official notice of non-compliance” was defined as an official communication from a local, state, or federal regulatory authority alleging one or more violations of an otherwise applicable Environmental, Health or Safety requirement or permit provision, which resulted in a facility’s implementation of corrective action(s). |
Permit and | Performance | |
License Violations | Target | |
6 | 70%-84% | |
5 | 85%-99% | |
4 | 100%-119% | |
3 | 120%-139% | |
2 | 140%-159% | |
1 | 160% + |
5) | No performance incentive compensation was payable for achieving the health and safety, permit and license violation, and revenue targets unless a minimum of 70% of the EBITDA Target was achieved. |
CFO MIP:
2015 CFO performance compensation was based upon meeting corporate revenue, EBITDA, health and safety, and environmental compliance (permit and license violations) objectives during fiscal year 2015 from our continuing operations (excluding PF Medical). At achievement of 70% to 119% of the Revenue and EBITDA targets, the potential performance compensation was payable at 5% to 50% of the base salary, of which 60% was based on EBITDA goal, 10% on revenue goal, 15% on the number of health and safety claim incidents that occurred during fiscal year 2015, and the remaining 15% on the number of notices alleging environmental, health or safety violations under our permits or licenses that occurred during the fiscal year 2015. Upon achievement of over 119% of the Revenue and EBITDA targets, with potential performance compensation payable at over 50% to 100% of the total salary, the amount of performance compensation payable was based on the four objectives noted above, with the payment of such performance compensation being weighted more heavily toward the EBITDA objective. Each of the revenue and EBITDA components was based on our board approved Revenue Target and EBITDA
Target. The 2015 target performance incentive compensation for our CFO was as follows:
Annualized Base Pay: |
| $ | 214,240 |
|
Performance Incentive Compensation Target (at 100% of MIP): |
| $ | 107,120 |
|
Total Annual Target Compensation (at 100% of MIP): |
| $ | 321,360 |
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TARGET | ||||||||||||||||||||||||||||
Revenue Target | $ | 42,500,000 | $ | 59,500,000 | $ | 72,250,000 | $ | 85,000,000 | $ | 102,000,000 | $ | 119,000,000 | $ | 136,000,000 | ||||||||||||||
EBITDA Target | $ | 4,080,000 | $ | 5,712,000 | $ | 6,936,000 | $ | 8,160,000 | $ | 9,792,000 | $ | 11,424,000 | $ | 13,056,000 | ||||||||||||||
Threshold % Of Target | 50 | % | 70 | % | 85 | % | 100 | % | 120 | % | 140 | % | 160 | % | ||||||||||||||
Bonus % Awarded | 0 | % | 10 | % | 50 | % | 100 | % | 130 | % | 170 | % | 200 | % | ||||||||||||||
% of Target Achieved | 50%-69 | % | 70%-84 | % | 85%-99 | % | 100%-119 | % | 120%-139 | % | 140%-159 | % | 160% | + | ||||||||||||||
Revenue | $ | - | $ | 1,071 | $ | 5,356 | $ | 10,712 | $ | 15,303 | $ | 21,424 | $ | 26,015 | ||||||||||||||
EBITDA | - | 6,427 | 32,136 | 64,272 | 91,817 | 128,544 | 156,089 | |||||||||||||||||||||
Health and Safety | - | 1,607 | 8,034 | 16,068 | 16,068 | 16,068 | 16,068 | |||||||||||||||||||||
Permit & License Violations | - | 1,607 | 8,034 | 16,068 | 16,068 | 16,068 | 16,068 | |||||||||||||||||||||
| $ | - | $ | 10,712 | $ | 53,560 | $ | 107,120 | $ | 139,256 | $ | 182,104 | $ | 214,240 | |||||||||||||||
1) | Revenue was defined as the total consolidated third party top line revenue from continuing operations as publicly reported in the Company’s financial statements. The percentage achieved was determined by comparing the actual consolidated revenue from continuing operations to the Board approved Revenue Target from continuing operations, which was $85,000,000. The Board reserved the right to modify or change the Revenue Targets as defined herein in the event of the sale or disposition of any of the assets of the Company or in the event of an acquisition. |
2) | EBITDA was defined as earnings before interest, taxes, depreciation, and amortization from continuing operations, excluding PF Medical. The percentage achieved was determined by comparing the actual EBITDA to the Board approved EBITDA Target, which was $8,160,000. The Board reserved the right to modify or change the EBITDA Targets as defined herein in the event of the sale or disposition of any of the assets of the Company or in the event of an acquisition. |
3) | The Health and Safety Incentive Target was based upon the actual number of Worker’s Compensation Lost Time Accidents, as provided by the Company’s Worker’s Compensation carrier. The Corporate Controller submitted a report on a quarterly basis documenting and confirming the number of Worker’s Compensation Lost Time Accidents, supported by the AIG Worker’s Compensation Loss Report. Such claims were identified on the loss report as “indemnity claims.” The following number of Worker’s Compensation Lost Time Accidents and corresponding Performance Target Thresholds were established for the annual Incentive Compensation Plan calculation for 2015. |
Worker's Compensation | Performance | |
Claim Number | Target | |
6 | 70%-84% | |
5 | 85%-99% | |
4 | 100%-119% | |
3 | 120%-139% | |
2 | 140%-159% | |
1 | 160% + |
4) | Permits or License Violations incentive was earned/determined according to the scale set forth below: An “official notice of non-compliance” was defined as an official communication from a local, state, or federal regulatory authority alleging one or more violations of an otherwise applicable Environmental, Health or Safety requirement or permit provision, which resulted in a facility’s implementation of corrective action(s). |
Permit and | Performance | |
License Violations | Target | |
6 | 70%-84% | |
5 | 85%-99% | |
4 | 100%-119% | |
3 | 120%-139% | |
2 | 140%-159% | |
1 | 160% + |
5) | No performance incentive compensation was payable for achieving the health and safety, permit and license violation, and revenue targets unless a minimum of 70% of the EBITDA Target was achieved. |
CFO:
The CFO’s 2013 performance compensation was based upon achievement of EBITDA and administrative expense objectives. The performance compensation also provided for a discretionary incentive payment component, subject to approval by the Company’s Compensation Committee. Of the total potential performance compensation, 25% was based on maintaining or reducing our targeted administrative expense, 50% was based on EBITDA goal, with the remaining 25% subjected to approval by the Compensation Committee. Each of the EBITDA and administrative expense component was based on our board approved 2013 EBITDA Target and Administrative Expense Target. The 2013 target compensation for our CFO was as follows:
Annualized Base Pay: | $ | 214,240 | ||
Performance Incentive Compensation Target (at 100% of Plan): | $ | 53,560 | ||
Total Annual Target Compensation (at 100% of Plan): | $ | 267,800 |
The Performance Incentive Compensation Target was based on the schedule below.
Target Objectives | ||||||||||||||||||||||||||||||||
Performance Target Thresholds | ||||||||||||||||||||||||||||||||
Weights | 100%+ | 98-99% | 96-97% | 94-95% | 92-93% | 90-91% | 88-89% | |||||||||||||||||||||||||
Administrative | 25% | $ | 13,390 | $ | 16,068 | $ | 17,407 | $ | 18,746 | $ | 20,085 | $ | 21,424 | $ | 23,433 | |||||||||||||||||
Performance Target Thresholds | ||||||||||||||||||||||||||||||||
Weights | 85-100% | 101-120% | 121-130% | 131-140% | 141-150% | 151-160% | 161%+ | |||||||||||||||||||||||||
EBITDA | 50% | $ | 26,780 | $ | 32,136 | $ | 34,814 | $ | 37,492 | $ | 40,170 | $ | 42,848 | $ | 46,865 | |||||||||||||||||
Discretionary | 25% | 13,390 | 16,068 | 17,407 | 18,746 | 20,085 | 21,424 | 23,433 | ||||||||||||||||||||||||
| $ | 53,560 | $ | 64,272 | $ | 69,628 | $ | 74,984 | $ | 80,340 | $ | 85,696 | $ | 93,731 | |||||||||||||||||||
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20132015 MIP Targets
As discussed above, 20132015 MIPs approved for the CEO, COO, and CFO by the Compensation Committee awardsaward cash compensation based on achievement of performance targets which includedinclude Revenue and EBITDA and Administrative ExpensesTargets as approved by our Board. The Revenue Target of $126,190,000,$85,000,000 and EBITDA Target of $9,567,000, and the Administrative Expense Target of $13,390,000$8,160,000 set forth in the 20132015 MIPs were based on our boardBoard approved 2013 budget.2015 budget subject to certain adjustments by the Board. In formulating the Revenue Target of $126,190,000,$85,000,000, the Board considered 20122014 results, current economic conditions, and forecasts for 20132015 government (Department(U.S. Department of Energy or DOE) spending under continuing resolution and the sequestration.“DOE”) spending. The Compensation Committee believed the performance targets were likely to be achieved, but not assured.
2014Compensation Earned Under 2015 MIPs
The following table sets forth the MIP compensation earned by the CEO, CEO, and CFO for fiscal year 2015 under each MIP. Payment of amounts earned under the 2015 MIPs have been deferred, but is expected to be made no later than the end of the third quarter of 2016.
CEO MIP: | |||||
Performance Target | MIP Compensation | ||||
Target Objectives: | Range Achieved | Earned | |||
Revenue | 70%-84% | $ | 1,356 | ||
EBITDA | 85%-99% | 40,667 | |||
Health & Safety | 160%+ | 20,334 | |||
Permit & License Violations | 160%+ | 20,334 | |||
Total Performance Compensation | $ | 82,691 |
COO MIP: | |||||
Performance Target | MIP Compensation | ||||
Target Objectives: | Range Achieved | Earned | |||
Revenue | 70%-84% | $ | 1,075 | ||
EBITDA | 85%-99% | 32,250 | |||
Health & Safety | 160%+ | 16,125 | |||
Permit & License Violations | 160%+ | 16,125 | |||
Total Performance Compensation | $ | 65,575 |
CFO MIP: | |||||
Performance Target | MIP Compensation | ||||
Target Objectives: | Range Achieved | Earned | |||
Revenue | 70%-84% | $ | 1,071 | ||
EBITDA | 85%-99% | 32,136 | |||
Health & Safety | 160%+ | 16,068 | |||
Permit & License Violations | 160%+ | 16,068 | |||
Total Performance Compensation | $ | 65,343 |
2016 MIPs
On July 10, 2014,February 4, 2016, the Compensation Committee approved individual MIPs for our CEO, COO, and CFO. The MIPs are effective as of January 1, 2014.2016. Each MIP provides guidelines for the calculation of annual cash incentive based compensation, subject to Compensation Committee oversight and modification. Each MIP awards cash compensation based on achievement of performance thresholds (as discussed below), with the amount of such compensation established as a percentage of base salary. The potential target performance compensation ranges from 50%5% to 87%100% or $135,558$13,962 to $237,224$279,248 of the 20142016 base salary for the CEO, 50%5% to 87%100% or $107,500$10,750 to $188,127$215,000 of the 20142016 base salary for the COO, and 50%5% to 87%100% or $107,120$11,033 to $187,458$220,667 of the 20142016 base salary for the CFO.
Performance compensation is to be paid on or about 90 days after year-end, or sooner,the end of the preceding fiscal year, based on finalization of our audited financial statements for 2013.2016. If the MIP participant’s employment with the Company is voluntarily or involuntarily terminated prior to a regularly scheduled MIP compensation payment date, no MIP payment will be payable for and after such period.
The Compensation Committee retains the right to modify, change or terminate each MIP and may adjust the various target amounts described below, at any time and for any reason.
The total performance compensation payablepaid to the CEO, COO, and CFO as a group willis not to exceed 50% of the Company’s pretaxpre-tax net income (exclusive of PF Medical) prior to the calculation of the performance compensation.
The following describes the principal terms of each MIP:
CEO:CEO MIP:
20142016 CEO performance compensation is based upon meeting corporate revenue, EBITDA, health and safety, and environmental compliance (permit and license violations) objectives during fiscal year 20132016 from our continuing operations. Ofoperations (excluding PF Medical). The Compensation Committee believes performance compensation payable under each of the total2016 MIPs as discussed herein and below should be based on achievement of EBITDA Target, as this target provides better indicator of operating performance as it excludes certain non-cash items. EBITDA has certain limitations as it does not reflect all items of income or cash flows that affect the Company’s financial performance under GAAP. At achievement of 70% to 119% of the Revenue and EBITDA Targets, the potential performance compensation 55%is payable at 5% to 50% of the base salary, of which 60% is based on EBITDA goal, 15%10% on revenue goal, 15% on the number of health and safety claim incidents that occur during fiscal year 2014,2016, and the remaining 15% on the number of notices alleging environmental, health or safety violations under our permits or licenses that occur during the fiscal year 2014.2016. Upon achievement of over 119% of the Revenue and EBITDA Targets, with potential performance compensation payable at over 50% to 100% of the base salary, the amount of total performance compensation payable is based on the four objectives noted above, with the payment of such performance compensation being weighted more heavily toward the EBITDA objective. Each of the revenue and EBITDA components is based on our boardBoard approved Revenue Target and EBITDA Target. The 20142016 target performance incentive compensation for our CEO is as follows:
Annualized Base Pay: | $ | 271,115 |
| $ | 279,248 |
| ||
Performance Incentive Compensation Target (at 100% of MIP): | $ | 135,558 |
| $ | 139,624 |
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Total Annual Target Compensation (at 100% of MIP): | $ | 406,673 |
| $ | 418,872 |
|
The Performance Incentive Compensation Target is based on the schedule below.
Target Objectives | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Performance Target Thresholds | TARGET | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Weights | 85-100% | 101-120% | 121-130% | 131-140% | 141-150% | 151-160% | 161%+ | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue Target | <$56,000,000 | $ | 56,000,000 | $ | 68,000,000 | $ | 80,000,000 | $ | 96,000,000 | $ | 112,000,000 | $ | 128,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||
EBITDA Target | <$6,370,000 | $ | 6,370,000 | $ | 7,735,000 | $ | 9,100,000 | $ | 10,920,000 | $ | 12,740,000 | $ | 14,560,000 | |||||||||||||||||||||||||||||||||||||||||||||||
% of Performance Incentive Target | 0 | % | 10 | % | 50 | % | 100 | % | 130 | % | 170 | % | 200 | % | ||||||||||||||||||||||||||||||||||||||||||||||
% of Target Achieved | <70% | 70%-84 | % | 85%-99 | % | 100%-119 | % | 120%-139 | % | 140%-159 | % | 160% | + | |||||||||||||||||||||||||||||||||||||||||||||||
Revenue | 15% | $ | 20,334 | $ | 24,400 | $ | 26,434 | $ | 28,467 | $ | 30,500 | $ | 32,534 | $ | 35,584 | $ | - | $ | 1,397 | $ | 6,981 | $ | 13,962 | $ | 19,945 | $ | 27,924 | $ | 33,908 | |||||||||||||||||||||||||||||||
EBITDA | 55% | 74,556 | 89,467 | 96,922 | 104,378 | 111,833 | 119,289 | 130,472 | - | 8,377 | 41,887 | 83,774 | 119,678 | 167,549 | 203,452 | |||||||||||||||||||||||||||||||||||||||||||||
Health & Safety | 15% | 20,334 | 24,400 | 26,434 | 28,467 | 30,500 | 32,534 | 35,584 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Health and Safety | - | 2,094 | 10,472 | 20,944 | 20,944 | 20,944 | 20,944 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Permit & License Violations | 15% | 20,334 | 24,400 | 26,434 | 28,467 | 30,500 | 32,534 | 35,584 | - | 2,094 | 10,472 | 20,944 | 20,944 | 20,944 | 20,944 | |||||||||||||||||||||||||||||||||||||||||||||
| $ | - | $ | 13,962 | $ | 69,812 | $ | 139,624 | $ | 181,511 | $ | 237,361 | $ | 279,248 | |||||||||||||||||||||||||||||||||||||||||||||||
| $ | 135,558 | $ | 162,667 | $ | 176,224 | $ | 189,779 | $ | 203,333 | $ | 216,891 | $ | 237,224 | |||||||||||||||||||||||||||||||||||||||||||||||
1) | Revenue is defined as the total consolidated third party top line revenue from continuing operations as publicly reported in the Company’s financial statements. The percentage achieved is determined by comparing the actual consolidated revenue from continuing operations to the Board approved Revenue Target from continuing operations, which is |
2) | EBITDA is defined as earnings before interest, taxes, depreciation, and amortization from continuing |
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| 3) | The Health and Safety Incentive Target is based upon the actual number of Worker’s Compensation Lost Time Accidents, as provided by the Company’s Worker’s Compensation carrier. The Corporate |
Claim Number | Target | |
6 | 70%-84% | |
5 | 85%-99% | |
4 | 100%-119% | |
3 | 120%-139% | |
2 | 140%-159% | |
1 | 160% + |
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4) | Permits or License Violations incentive is earned/determined according to the scale set forth below: An “official notice of non-compliance” is defined as an official communication from a local, state, or federal regulatory authority alleging one or more violations of an otherwise applicable Environmental, Health or Safety requirement or permit provision, which results in a facility’s implementation of corrective action(s). |
Permit and | Performance | ||||||
License Violations | Target | ||||||
6 | |||||||
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5 | 85%-99% | ||||||
4 | 100%-119% | ||||||
3 | 120%-139% | ||||||
2 | 140%-159% | ||||||
1 | 160% + | ||||||
5) | No performance incentive compensation will be payable for achieving the health and safety, permit and license violation, and revenue targets unless a minimum of 70% of the EBITDA Target is |
COO:COO MIP:
20142016 COO performance compensation is based upon meeting corporate revenue, EBITDA, health and safety, and environmental compliance (permit and license violations) objectives during fiscal year 20142016 from our continuing operations. Ofoperations (excluding PF Medical). At achievement of 70% to 119% of the totalRevenue and EBITDA Targets, the potential performance compensation 55%is payable at 5% to 50% of the base salary, of which 60% is based on EBITDA goal, 15%10% on revenue goal, 15% on the number of health and safety claim incidents that occur during fiscal year 2014,2016, and the remaining 15% on the number of notices alleging environmental, health or safety violations under our permits or licenses that occur during the fiscal year 2014.2016. Upon achievement of over 119% of the Revenue and EBITDA Targets, with potential performance compensation payable at over 50% to 100% of the base salary, the amount of total performance compensation payable is based on the four objectives noted above, with the payment of such performance compensation being weighted more heavily toward the EBITDA objective. Each of the revenue and EBITDA components is based on our boardBoard approved Revenue Target and EBITDA Target. The 20142016 target performance incentive compensation for our COO is as follows:
Annualized Base Pay: | $ | 215,000 | ||
Performance Incentive Compensation Target (at 100% of Plan): | $ | 107,500 | ||
Total Annual Target Compensation (at 100% of Plan): | $ | 322,500 |
Annualized Base Pay: |
| $ | 215,000 |
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Performance Incentive Compensation Target (at 100% of MIP): |
| $ | 107,500 |
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Total Annual Target Compensation (at 100% of MIP): |
| $ | 322,500 |
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TARGET | ||||||||||||||||||||||||||||
Revenue Target | <$56,000,000 | $ | 56,000,000 | $ | 68,000,000 | $ | 80,000,000 | $ | 96,000,000 | $ | 112,000,000 | $ | 128,000,000 | |||||||||||||||
EBITDA Target | <$6,370,000 | $ | 6,370,000 | $ | 7,735,000 | $ | 9,100,000 | $ | 10,920,000 | $ | 12,740,000 | $ | 14,560,000 | |||||||||||||||
% of Performance Incentive Target | 0 | % | 10 | % | 50 | % | 100 | % | 130 | % | 170 | % | 200 | % | ||||||||||||||
% of Target Achieved | <70% | 70%-84 | % | 85%-99 | % | 100%-119 | % | 120%-139 | % | 140%-159 | % | 160% | + | |||||||||||||||
Revenue | $ | - | $ | 1,074 | $ | 5,374 | $ | 10,750 | $ | 15,357 | $ | 21,500 | $ | 26,107 | ||||||||||||||
EBITDA | - | 6,450 | 32,250 | 64,500 | 92,143 | 129,000 | 156,643 | |||||||||||||||||||||
Health and Safety | - | 1,613 | 8,063 | 16,125 | 16,125 | 16,125 | 16,125 | |||||||||||||||||||||
Permit & License Violations | - | 1,613 | 8,063 | 16,125 | 16,125 | 16,125 | 16,125 | |||||||||||||||||||||
| $ | - | $ | 10,750 | $ | 53,750 | $ | 107,500 | $ | 139,750 | $ | 182,750 | $ | 215,000 | |||||||||||||||
The Performance Incentive Compensation Target is based on the schedule below.
Target Objectives | ||||||||||||||||||||||||||||||||
Performance Target Thresholds | ||||||||||||||||||||||||||||||||
Weights | 85-100% | 101-120% | 121-130% | 131-140% | 141-150% | 151-160% | 161%+ | |||||||||||||||||||||||||
Revenue | 15% | $ | 16,125 | $ | 19,350 | $ | 20,963 | $ | 22,575 | $ | 24,188 | $ | 25,800 | $ | 28,219 | |||||||||||||||||
EBITDA | 55% | 59,125 | 70,951 | 76,863 | 82,775 | 88,687 | 94,600 | 103,470 | ||||||||||||||||||||||||
Health & Safety | 15% | 16,125 | 19,351 | 20,962 | 22,576 | 24,188 | 25,801 | 28,219 | ||||||||||||||||||||||||
Permit & License Violations | 15% | 16,125 | 19,351 | 20,962 | 22,576 | 24,188 | 25,801 | 28,219 | ||||||||||||||||||||||||
| $ | 107,500 | $ | 129,003 | $ | 139,750 | $ | 150,502 | $ | 161,251 | $ | 172,002 | $ | 188,127 | |||||||||||||||||||
1) | Revenue is defined as the total consolidated third party top line revenue from continuing operations as publicly reported in the Company’s financial statements. The percentage achieved is determined by comparing the actual consolidated revenue from continuing operations to the Board approved Revenue Target from continuing operations, which |
2) | EBITDA is defined as earnings before interest, taxes, depreciation, and amortization from continuing |
| 3) | The Health and Safety Incentive |
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Claim Number | Target | ||||||
6 | |||||||
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5 | 85%-99% | ||||||
4 | 100%-119% | ||||||
3 | 120%-139% | ||||||
2 | 140%-159% | ||||||
1 | 160% + | ||||||
4) | Permits or License Violations incentive is earned/determined according to the scale set forth below: An “official notice of non-compliance” is defined as an official communication from a local, state, or federal regulatory authority alleging one or more violations of an otherwise applicable Environmental, Health or Safety requirement or permit provision, which results in a facility’s implementation of corrective action(s). |
Permit and | Performance | ||||||
License Violations | Target | ||||||
6 | |||||||
| |||||||
5 | 85%-99% | ||||||
4 | 100%-119% | ||||||
3 | 120%-139% | ||||||
2 | 140%-159% | ||||||
1 | 160% + | ||||||
As discussed above,
Long-Term Incentive Compensation
Employee Stock Option The
The
Stock option award levels are determined based on market data, vary among participants based on their positions with us and are granted generally at the Compensation Committee’s regularly scheduled August or September meeting. Newly hired or promoted executive officers who are eligible to receive options are generally awarded such options at the next regularly scheduled Compensation Committee meeting following their hire or promotion date.
Options are awarded with an exercise price equal to or not less than the closing price of the Company’s Common Stock on the date of the grant as reported on the NASDAQ. In certain limited circumstances, the Compensation Committee may grant options to an executive at an exercise price in excess of the closing price of the Company’s Common Stock on the grant date. In 2015, no options were granted to any employees.
In the event of a “change of control” (as defined in the
Accounting for Stock-Based Compensation We account for stock-based compensation in accordance with ASC 718, “Compensation – Stock Compensation.” ASC 718 establishes accounting standards for entity exchanges of equity instruments for goods or services. It also addresses transactions in which an entity incurs liabilities in exchange for goods or services that are based on the fair value of the entity’s equity instruments or that may be settled by the issuance of those equity instruments. ASC 718 requires all stock-based payments to employees, including grants of employee stock options, to be recognized in the income statement based on their fair values. The Company uses the Black-Scholes option-pricing model to determine the fair-value of stock-based awards which requires subjective assumptions. Assumptions used to estimate the fair value of stock options granted include the exercise price of the award, the expected term, the expected volatility of the Company’s stock over the option’s expected term, the risk-free interest rate over the option’s expected term, and the expected annual dividend yield.
We recognize stock-based compensation expense using a straight-line amortization method over the requisite period, which is the vesting period of the stock option grant. As ASC 718 requires that stock-based compensation expense be based on options that are ultimately expected to vest, our stock-based compensation expense is reduced at an estimated forfeiture rate. Our estimated forfeiture rate is generally based on historical trends of actual forfeitures. Forfeiture rates are evaluated, and revised as necessary. Retirement and Other Benefits
401(k) Plan We adopted the Perma-Fix Environmental Services, Inc. 401(k) Plan (the “401(k) Plan”) in 1992, which is intended to comply with Section 401 of the Internal Revenue Code and the provisions of the Employee Retirement Income Security Act of 1974. All full-time employees who have attained the age of 18 are eligible to participate in the 401(k) Plan. Eligibility is immediate upon employment but enrollment is only allowed during four quarterly open periods of January 1,
Perquisites and Other Personal Benefits The Company provides executive officers with limited perquisites and other personal benefits (health/disability/life insurance) that the Company and the Compensation Committee believe are reasonable and consistent with its overall compensation program to better enable the Company to attract and retain superior employees for key positions. The Compensation Committee periodically reviews the levels of perquisites and other personal benefits provided to executive officers. The executive officers are provided an auto
Consideration of Stockholder Say-On-Pay Advisory Vote. At our Appointment of Mr. Mark Duff, Executive Vice President On May 15, 2016, the Board appointed Mr. Mark Duff to the position of Executive Vice President, effective June 13, 2016. The terms of Mr. Duff’s compensation are as follows:
Equity Compensation Plans The following table sets forth information as of December 31,
Compensation Risk Assessment In reviewing our executive compensation program, the Company considers whether the program encourages unnecessary or excessive risk taking and has concluded that its compensation policies do not create risks that are reasonably likely to have a material adverse effect on the Company. This conclusion was based on the assessment performed by the Company, with input from the Company’s executive management and its outside securities counsel. The Company’s assessment included consideration of Item 402(s) as discussed between the Company’s management following in depth discussions of Item 402(s) with our outside securities counsel. In conducting the Company’s risk assessment, numerous factors were considered, including:
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATEDSTOCKHOLDER MATTERS
Security Ownership of Certain Beneficial Owners The table below sets forth information as to the shares of Common Stock beneficially owned as of
(2) This information is based on the Schedule
Additionally, another institutional holder, Capital Bank—GRAWE Gruppe AG (“Capital Bank”), which owns of record as of
Notwithstanding the previous paragraph, if Capital Bank's representations to us described above are incorrect or if Capital Bank's investors are acting as a group, then Capital Bank or a group of Capital Bank's investors could be a beneficial owner of more than 5% of our voting securities. If Capital Bank is deemed the beneficial owner of such shares, the following table sets forth information as to the shares of voting securities that Capital Bank may be considered to beneficially own on
(*)This calculation is based upon
(+) This amount is the number of shares that Capital Bank has represented to us that it holds of record as nominee for, and as an agent of, certain of its accredited investors. As of the date of this report, Capital Bank has no warrants or options to acquire, as agent for certain investors, additional shares of our Common Stocks. Although Capital Bank is the record holder of the shares of Common Stock described in this note, Capital Bank has advised us that it does not believe it is a beneficial owner of the Common Stock or that it is required to file reports under Section 16(a) or Section 13(d) of the Exchange Act. Because Capital Bank (a) has advised us that it holds the Common Stock as a nominee only and that it does not exercise voting or investment power over the Common Stock held in its name and that no one investor of Capital Bank for which it holds our Common Stock holds more than 4.9% of our issued and outstanding Common Stock and (b) has not nominated, and has not sought to nominate, and does not intend to nominate in the future, any person to serve as a member of our Board,
Security Ownership of Management The following table sets forth information as to the shares of voting securities beneficially owned as of
*Indicates beneficial ownership of less than one percent (1%).
(1) See footnote (1) of the table under “Security Ownership of Certain Beneficial Owners.”
(2) The business address of each person, for the purposes hereof, is c/o Perma-Fix Environmental Services, Inc., 8302 Dunwoody Place, Suite 250, Atlanta, Georgia 30350.
(4)Mr. Climaco has sole voting and investment power over these shares which include: (i)
(5)Dr. Kugler has sole voting and investment power over these shares which include: (i)
(6)Mr. Lahav has sole voting and investment power over these shares which include: (i)
(7)Mr. Reeder has sole voting and investment power over these shares which include: (i)
(8)Mr. Shelton has sole voting and investment power over these shares which include: (i)
(9)
PROPOSAL 2 - RATIFICATION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Audit Committee of the Company’s Board of Directors appointed Grant Thornton LLP (“Grant Thornton”)
During the Company’s
Stockholder ratification of the selection of Grant Thornton as the Company’s independent registered public accounting firm is not required by the Company’s Bylaws. However, the Company is submitting the selection of Grant Thornton to the stockholders for ratification as a matter of good corporate
The following table reflects the aggregate fees
(1)Audit fees Exchange Commissions.
The Audit Committee of the Company's Board of Directors has considered whether
Engagement of the Independent Auditor The Audit Committee approves in advance all engagements with the Company’s independent accounting firm to perform audit or non-audit services for us. All services under the headings Audit Fees
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE “FOR” RATIFICATION OFGRANT THORNTON LLP AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM. As previously disclosed by the Company, on June 25, 2014, the Audit Committee approved the dismissal of BDO USA, LLP (“BDO”) as the Company’s independent registered accounting firm. The primary reason for the dismissal of BDO was due to the Company’s desire to reduce its overall cost of the external audit function. The audit reports of BDO on the consolidated financial statements of the Company as of December 31, 2013, contained no adverse opinion or disclaimer of opinion, and were not qualified or modified as to uncertainty, audit scope, or accounting principles, except the audit report of BDO on the Company’s financial statements for the fiscal year ended December 31, 2013, raised substantial doubt about the Company’s ability to continue as a going concern, noting that the Company had suffered declining revenues, recurring losses from operations and had a net working capital deficiency that raised substantial doubt about its ability to continue as a going concern. During the Company’s fiscal year ended December 31, 2013, and through June 25, 2014, there were no disagreements, as defined in Item 304(a)(1)(iv) of Regulation S-K, between the Company and BDO on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedures that, if not resolved to BDO’s satisfaction, would have caused BDO to make reference to the matter in connection with its report on the Company’s consolidated financial statements for the relevant periods. Additionally, during the Company’s fiscal year ended December 31, 2013, and through June 25, 2014, there have been no reportable events, as described in Item 304(a)(1)(v) of Regulation S-K. The Company requested that BDO furnish the Company with a letter addressed to the Commission stating whether or not it agrees with the above statement. A copy of such letter, dated June 30, 2014, was filed as Exhibit 16.1 to our Form 8-K filed with the Commission on July 1, 2014.
PROPOSAL 3 – APPROVAL, BY AN ADVISORY (NON-BINDING) VOTE, OF THE
In accordance with the requirements of Section 14A of the Securities Exchange Act of 1934 (“Exchange Act”), we are providing stockholders with an advisory (non-binding) vote on the approval of the
“RESOLVED, that the stockholders of the Company approve, on an advisory basis, the compensation paid to the Company’s named executive officers in
As described in this Proxy Statement, our executive compensation programs are designed to enable us to attract, motivate, and retain executive talent, who are critical to our success. Our compensation is centered around a pay-for-performance philosophy. We believe that our executive compensation program, with its balance of cash incentives designed to reward achievement of key performance goals set for the year and longer-term equity based incentives, compensates our executives for performance directly linked to stockholder value creation.
The vote on this Proposal 3 is not intended to address any specific element of compensation and is advisory, which means that the vote is not binding on the Company, our Board of Directors, and the Compensation Committee. However, our Board of Directors and our Compensation Committee value the opinions of our stockholders and will review the voting results in connection with their ongoing evaluation of the Company’s compensation program and will consider the outcome of the vote when making future compensation decisions.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE “FOR” THE APPROVAL, BY ADVISORY (NON-BINDING) VOTE, OF THE
STOCKHOLDER PROPOSALS FOR THE
In order to be considered for inclusion in our proxy materials, you must submit proposals for next year's annual meeting in writing to our Secretary at our executive offices at 8302 Dunwoody Place, Suite 250, Atlanta, Georgia 30350, on or prior to
In accordance with our
OTHER MATTERS Other Business The Board of Directors has no knowledge of any business to be presented for consideration at the Meeting other than as described above. Should any such matters properly come before the Meeting or any adjournment thereof, the persons named in the enclosed Proxy Card will have discretionary authority to vote such proxy in accordance with their best judgment on such matters and with respect to matters incident to the conduct of the Meeting.
Annual Report on Form 10-K A copy of the Company’s
Important Notice Regarding the Availability of Proxy Materials fortheAnnual Meeting of Stockholders to beheld
Our 201 http://www.cstproxy.com/perma-fix/
In order to assure the presence of the necessary quorum at the Meeting, please sign and mail the enclosed Proxy Card promptly in the envelope provided. No postage is required if mailed within the United States. The signing of the Proxy Card will not prevent your attending the Meeting and voting in person, should you so desire.
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