UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
NOTICE OF THE ANNUAL MEETING OF STOCKHOLDERS
OF ITERIS, INC.
TO BE HELD NOVEMBER 8, 2017SEPTEMBER 10, 2020
YOUR VOTE IS VERY IMPORTANT REGARDLESS OF THE NUMBER OF SHARES YOU OWN. PLEASE READ THE ATTACHED PROXY STATEMENT CAREFULLY, COMPLETE, SIGN AND DATE THE ENCLOSED PROXY CARD AS PROMPTLY AS POSSIBLE AND RETURN IT IN THE ENCLOSED ENVELOPE.
ITERIS, INC.1700 Carnegie Avenue, Suite 100Santa Ana, California 92705
PROXY STATEMENTFOR THE 2017 ANNUAL MEETING OF STOCKHOLDERSTO BE HELD NOVEMBER 8, 2017
General
These proxy materials and the enclosed proxy card are being furnished in connection with the solicitation of proxies by the Board of Directors of Iteris, Inc., a Delaware corporation ("Iteris," the "Company," "we," "our" and "us"), to be voted at the 2017 Annual Meeting of Stockholders (the "Annual Meeting") to be held on November 8, 2017 and at any adjournment(s) or postponement(s) of the meeting. The Annual Meeting will be held at 10:00 a.m. Pacific Time, at our principal executive offices located at 1700 Carnegie Avenue, Suite 100, Santa Ana, CA 92705. These proxy materials and the form of proxy are expected to be mailed to our stockholders, who are entitled to vote at the Annual Meeting, on or about September 29, 2017.
Purpose of Meeting
The specific proposals to be considered and acted upon at the Annual Meeting are summarized in the accompanying Notice of the Annual Meeting of Stockholders and are described in more detail in this proxy statement.
Internet Availability of Materials
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE STOCKHOLDER MEETING TO BE HELD ON NOVEMBER 8, 2017: The proxy statement, proxy card, and Annual Report on Form 10-K and Form 10-K/A, as amended, for the fiscal year ended March 31, 2017 (the "Annual Report") are available at www.edocumentview.com/ITI, or at www.envisionreports.com/ITI for registered holders (Internet voting included).
Voting Rights
The record date for determining those stockholders who are entitled to notice of, and to vote at, the Annual Meeting has been fixed as September 11, 2017. At the close of business on the record date, 32,628,528 shares of our Common Stock, par value $0.10 per share, were outstanding and no shares of our Preferred Stock were outstanding. Each stockholder is entitled to one vote for each share of Common Stock held by such stockholder as of the record date.
The presence in person or by proxy of the holders of a majority of the outstanding shares of the Common Stock entitled to vote will constitute a quorum for the transaction of business at the Annual Meeting. If a quorum is not present, the Annual Meeting will be adjourned until a quorum is obtained.
In the election of directors under Proposal One, directors will be elected by a plurality of the votes cast at the Annual Meeting, unless cumulative voting is in effect. Pursuant to our bylaws, no stockholder is entitled to cumulate his or her votes for candidates other than those whose names have been placed in nomination prior to the commencement of voting and unless at least one stockholder
has given notice prior to commencement of voting of his or her intention to cumulate votes. If any stockholder has given such notice, then each stockholder may cumulate votes by multiplying the number of shares of common stock the stockholder is entitled to vote by the number of directors to be elected. The number of cumulative votes thus determined may be voted all for one candidate or distributed among several candidates, at the discretion of the stockholder. The candidates receiving the highest number of votes, up to the number of directors to be elected, will be elected. If cumulative voting is in effect, the persons named in the accompanying proxy will vote the shares of common stock covered by proxies received by them (unless authority to vote for directors is withheld) among the named candidates as they determine.
With regard to each of the other proposals, the affirmative vote of the holders of a majority of our common stock present or represented by proxy and entitled to vote at the Annual Meeting is being sought.
If you hold your shares in "street name" (i.e., your shares are held in the name of a brokerage firm, bank or other nominee (each, a "custodian")), your custodian is considered to be the stockholder of record for purposes of voting at the Annual Meeting. Your custodian is required to vote your shares on your behalf in accordance with your instructions. If you do not give instructions to your custodian, your custodian is permitted to vote your shares with respect to "routine" matters, such as the ratification of the appointment of Deloitte & Touche LLP as our independent registered public accounting firm under Proposal Three. However,virtually. Also, if you do not give instructions to your custodian, your custodian will NOT be permitted to vote your shares with respect to "non-routine" matters. All other proposals described in this proxy statement are considered non-routine matters. Accordingly, if you do not give your custodian specific instructions for voting on each of the other proposals, then your shares will be treated as "broker non-votes" with respect to such proposal(s) and will not be voted on the proposal(s) for which you did not provide instructions.
All votes will be tabulated by the inspector of election appointed for the Annual Meeting, who will separately tabulate affirmative and negative votes, abstentions, and broker non-votes. Abstentions and broker non-votes are counted as present for purposes of determining the presence or absence of a quorum for the transaction of business. Abstentions will be counted towards the tabulations of votes cast on proposals presented to the stockholders and will have the same effect as negative votes. Broker non-votes will not be counted for purposes of determining whether a proposal has been approved.
Voting
You may vote by one of the following ways: (i) by mail, (ii) electronically over the Internet or by telephone, or (iii) by ballot in person at the Annual Meeting. If you are a "registered holder" (i.e., your shares are registered in your own name through our transfer agent), you may vote by returning a completed proxy card in the enclosed postage-paid envelope or through the Internet at www.envisionreports.com/ITI. If your shares are held in "street name", in lieu of a proxy card you should receive a voting instruction form from that custodian by mail. The voting instruction form should indicate whether the custodian has a process for beneficial holders to vote over the Internet or by telephone. Stockholders who vote over the Internet or by telephone need not return a proxy card or voting instruction form by mail, but may incur costs, such as usage charges, from telephone companies or Internet service providers. If your voting instruction form does not reference Internet or telephone information, please complete and return the paper voting instruction form in the self-addressed, postage-paid envelope provided.
If you are a registered holder, you may also vote your shares in person at the Annual Meeting. If your shares are held in street name and you wish to vote in person at the meeting, you must obtain a proxy issued in your name from the record holder and bring it with you to the Annual Meeting. We
recommend that you vote your shares in advance as described above so that your vote will be counted if you later decide not to attend the Annual Meeting.
Proxies
Please use the enclosed proxy card to vote by mail. If your shares are held in street name, then in lieu of a proxy card you should receive from that custodian an instruction form for voting by mail, the Internet or by telephone. If you receive more than one proxy card or voting instruction form because your shares are held in multiple accounts or registered in different names or addresses, please be sure to complete, sign, date and returneach proxy card or voting instruction form to ensure that all of your shares are voted. Please note that stockholders who wish to submit questions at the Annual Meeting must do so in advance. You will be voted. Onlyfind instructions for how to submit such questions in this proxy cards and voting instruction forms that have been signed, dated, and timely returned (or otherwise properly voted by Internet statement.
| | YOUR VOTE IS IMPORTANT. EVEN IF YOU PLAN TO ATTEND THE MEETING, PLEASE VOTE BY PROXY PRIOR TO THE MEETING. IF YOU CHOOSE TO VOTE BY MAIL, PLEASE DO SO PROMPTLY TO ENSURE YOUR PROXY ARRIVES IN SUFFICIENT TIME. | | |
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The enclosed proxy also grantsmaterials are first being released to the proxy holders discretionary authority to vote on any other business that may properly come before the Annual Meeting as well as any procedural matters. We have not been notified by any stockholder of an intent to present a stockholder proposal at the Annual Meeting.
If your shares are held in your name, you may revoke or change your vote at any time before the Annual Meeting by filing a notice of revocation or another signed proxy card with a later date with our Secretary at ourCompany’s stockholders is July 27, 2020. Our principal executive offices. If your sharesoffices are heldlocated at 1700 Carnegie Avenue, Suite 100, Santa Ana, California 92705.
| | Important Notice Regarding the Availability of Proxy Materials | | |
| | This Proxy Statement and our Annual Report on Form 10-K for the fiscal year ended March 31, 2020 (the “Annual Report”) is available on the Internet by accessing www.edocumentview.com/ITI, or at www.envisionreports.com/ITI for registered holders. Information on this website does not constitute part of this Proxy Statement and shall not be deemed incorporated by reference therein. | | |
The enclosed proxy is being solicited by our Board of Directors. We Iteris will bear the entire cost of proxy solicitation, including the costs of preparing, assembling, printing and mailing this proxy statement, the proxy card, and any additional material furnished to the stockholders. Copies of the solicitation materials will be furnished to brokerage houses, fiduciaries, and custodiansnominees holding shares in their names that are beneficially owned by others so that they may forward this solicitation material to such beneficial owners. In addition, we may reimburse such persons for their reasonable expenses in forwarding the solicitation materials to the beneficial owners. The original solicitation of proxies by mail may be supplemented by a solicitation by personal contact, telephone, facsimile, e-mail or any other means by our directors, officers, or employees. No additional compensation will be paid to these individuals for any such services.
Proposals | | | Board’s Recommendation | |
1. Election of the Board of Directors. | | | ✓ FOR each nominee | |
2. Approval, by advisory vote, of the compensation of our named executive officers, as described in this proxy statement. | | | ✓ FOR | |
3. Ratification of the appointment of Deloitte & Touche LLP as our independent registered public accounting firm for the fiscal year ending March 31, 2021. | | | ✓ FOR | |
Unless otherwise instructed, the proxy holders will vote the proxies received by them FOR each of the nominees named above.
Stockholder Approval
The six candidates receiving the highest number of votes cast at such meeting.
resignation.
and thought; and the commitment to devote significant time and energy to service on the Board and its committees.
Name | | | Age | | | ||
Current Position(s) with Iteris | | ||||||
J. Joseph | | | | | Chief Executive Officer, President and Director | | |
| | | | Director | |||
| |||||||
Gerard M. | | | | | Director | | |
Thomas L. | | | | | Chairman of the Board | | |
Lucas (“Luke”) P. Schneider(2) | | | 52 | | | Director | |
| | | | Director | | ||
Dennis W. Zank(1) | | | 65 | | | Director | |
science from Stanford University.
member of the Technology and Life Sciences Group of Salomon Brothers Inc. He received a BSc degree in Economics from the University of Kansas; an M.B.A. from the University of Chicago; and an MSc degree in Economics from the London School of Economics. Mr. Deeter is a proven leader who is widely known across entrepreneurial sectors of the agribusiness and agricultural biotech industry.
Gerard M. Mooney retired from International Business Machines Corporation ("IBM"(“IBM”) in March 2014, after serving in a number of senior positions since 2000. Most recently, he served as the Vice President Strategy for IBM'sIBM’s Public Sector from February 2012 until his retirement, as the General Manager, Global Smarter Cities for IBM from November 2011 to February 2012, and as the General Manager, Global Government and Education for IBM from 2008 to November 2011. He served as Vice President of IBM'sIBM’s Venture Capital Group from 2000 to 2008. Before joining IBM, Mr. Mooney held various management positions at Hewlett-Packard Company (“HP”) for six years.years, most recently as General Manager for New Business Initiatives related to technologies developed by HP Labs. Mr. Mooney joined HP from HP’s acquisition of Edge Emitter Technology (ETT), Inc., a development stage company commercializing a solid state print head device, where Mr. Mooney served as President. Mr. Mooney has extensive operational and financial experience across a broad range of technology-based companies, from start-ups to large public companies, and has considerable experience with the major customers in the professionalintelligent transportation systems market. He previously served as a member of the board of directors of the Intelligent Transportation Society of America and is also active in the intelligent search technology, cognitive intelligence, AI, data mining and visualization tools industries. Mr. Mooney currently serves as a director of inno360 and co-foundercofounder of theinnovationexchange,Swarm Intelligence LLC (formerly theinnovationexchange), which offers SaaS cognitive platforms. He received a B.A. degree in Philosophy from Mount Saint Mary'sMary’s College, an M.S. degree in Accounting from Georgetown University and an M.B.A. from Yale University. Mr. Mooney
since 2016. Mr. Thomas L. Thomas is the managing partner of T2 Partners, a private management consulting and investment business which he founded in January 2011. In addition, Mr. Thomas served as the Executive Chairman and CEO of International Decision Systems, a provider of software and solutions for the equipment finance market, from September 2009 to January 2011. From 2004 to July 2008, Mr. Thomas was the President and Chief Operating Officer of Global Exchange Services, a provider of business to business EDI and supply chain management solutions. Prior to that, Mr. Thomas served as the President and CEO at several software, analytics and technology companies, including HAHT Commerce, Ajuba Solutions, and Vantive Corporation, and as the first Chief Information Officer for Dell Computer Corporation and 3Com Corporation. Earlier in his career, Mr. Thomas also held various senior executive management positions at Kraft General Foods, Sara Lee Corporation and W. R. Grace. SinceFrom July 2017 to July 2019, Mr. Thomas has served as Chairman of the Board of Directors of VIP Software Corporation, a provider of software solutions in the insurance industry. Since 2012, Mr. Thomas has served as a director of Accurate Group, which specializes in the appraisal and title services business where technology has been instrumental in redefining the transaction model for the industry. He has also served on the board of directors of infoGroup, Inc. from January 2009 to July 2010, and served as a director on the boards of a wide range of technology companies, including ATL Products, Vantive Corporation, Interwoven, iManage, FrontRange Solutions, IDS International, and Quofore International. Mr. Thomas
Mikel H. Williams hasZank served as the Chief Executive Officer and a director of Targus Cayman Holdco Limited, a leading global supplier that designs, develops and sells products for the mobile worker, including laptop cases, docking stations and accessories for mobile electronic devices, since February 2016. Prior to that, Mr. Williams served as the Chief Executive Officer and a director of JPS
Industries, Inc., a manufacturer of sheet and mechanically formed glass and aramid substrate materials for the electronics, aerospace, ballistics and general industrial applications, from May 2013 until its sale in July 2015. Mr. Williams was the President, Chief Executive Officer and a director of DDi Corp., a leading provider of time-critical, technologically advanced electronics manufacturing services, from November 2005 to May 2012 and a Senior Vice President and Chief Financial Officer of DDi from November 2004 to October 2005. DDi was sold in May of 2012. He has also served in various management positions with several companies in the technology and professional services related industries. Mr. Williams began his career with PricewaterhouseCoopers as a certified public accountant in the State of Maryland. Mr. Williams also serves as Chairman of the board of directors of Centrus Energy Corp. (formerly USEC Inc.). He was added to USEC's board of directors in October 2013 on the recommendation of certain holders of USEC's convertible senior notes as USEC was considering a bankruptcy restructuring, which was successfully initiated and completed in 2014. Since October 2015, Mr. Williams also serves on the board of directors of B. Riley Financial, Inc.the Options Clearing Corporation. He previouslyalso served on the boardsboard of Lightbridge Communicationsdirectors of the National Securities Clearing Corporation, until it was soldfrom 1994 to 1997. Mr. Zank has been actively involved in January 2015, and Tellabs, Inc. until it was sold in December 2013.the Corporate Mentorship Program at the University of South Florida since inception over 25 years ago. Mr. Williams received his B.S.Zank holds a bachelor’s degree in Accountingaccounting from the University of MarylandSouth Florida and ana M.B.A. from the University of Georgetown. Mr. Williams has served as a director of Iteris since April 2011 and provides the Board of Directors with operational and public company experience and valuable strategic insights through his many years of leadership positions in technology-related companies with international operations, as well as valuable knowledge and insights in finance and financial reporting matters.
Tampa.
G
overnanceCORPORATE GOVERNANCE
Code of Ethics and Business Conduct
Our Board of Directors has adopted a Code of Ethics and Business Conduct, which applies to all directors, officers (including our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions) and employees. The full text of our Code of Ethics and Business Conduct is available on the Investor Relations section of our website at www.iteris.com. We intend to disclose future amendments to certain provisions of the Code of Ethics and Business Conduct, and any waivers of provisions of the Code of Ethics required to be disclosed under the rules of the Securities and Exchange Commission ("SEC"), at the same location on our website."Board
Meetings and Committees
Nasdaq.
director served during that period.
financial expert"expert” under applicable SEC rules and regulations governing the composition of the Audit Committee.
The Compensation Committee are to (a) evaluatesevaluate officer and director compensation policies, goals, plans and programs; (b) determinesoversee compensation programs and policies for all employees as they relate to the Company’s risk management; (c) determine the cash and non-cash compensation of our "officers"directors and “executive officers” as defined in the rules promulgated under Section 16 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"“Exchange Act”); (c) reviews(d) review, and makesmake recommendations to the Board with respect to the administration of, our equity-based and other incentive compensation plans for all employees; (d) evaluates(e) evaluate the performance of our executive officers; and (e) assists(f) assist the Board in evaluating potential candidates for executive officer positions with the Company and overseesoversee management succession planning.
planning; and (g) produce the committee report required by the applicable rules and regulations of the SEC and other regulatory bodies for inclusion in our annual proxy statements.
compensation committee currently or during Fiscal 2020.
The primary purposes of the NCG Committee are to assist the Board in (a) identify, screenestablishing the minimum qualifications for director nominees; (b) identifying and review individuals qualified to serve as directors; (b) select or recommendevaluating director nominees; (c) recommending to the Board candidates for the Annual Meeting of Directors the selection of nominees for election at the next annual meeting of stockholders; (c) recommend to the Board of Directors candidatesStockholders or to fill any vacancies on the Board; and (d) oversee the implementationdeveloping and monitoring the effectiveness of ourassessing corporate governance policies and developing and recommendingmaking recommendations related to such policies to the Board.
In connection with their recommendations regardingculture, accurately value transactions, and evaluate operational integration plans.
Years of Tenure | | | Directors | |
0 – 2 years | | | 3 | |
2 – 5 years | | | 2 | |
5+ years | | | 2 | |
No candidates for director nominations were submitted to the NCG Committee by any stockholder in connection with the election of directors at the Annual Meeting.
Finance and Strategy Committee. The current members of the Finance and Strategy Committee are Dr. Daly and Messrs. Cerminara, Mooney and Thomas, and Dr. Daly and serves as the Chairman of this committee. The purpose of the Finance and Strategy Committee is to assist management in identifying, evaluating and negotiating financial transactions and other strategic opportunities for the Company from time to time.
| | Audit Committee | | |
| | • Focuses on financial risk of the Company | | |
| | • Reviews internal controls and the Company’s financial statements with the CEO, CFO and the external and internal auditors. | | |
| | • Oversees risks assessment and risk management (and its applicable processes) by management and our independent auditors relating to key financial, accounting and reporting policies. | | |
| | • Oversees the selection, appointment, retention, compensation, evaluation and performance of the work of the Company’s independent auditors. | | |
| | • Meets quarterly with CEO, CFO and the Company’s external independent auditors in executive session. | | |
| | Compensation Committee | | |
| | • Oversees risks associated with our compensation policies and programs with respect to both executive compensation and compensation for all employees generally. | | |
| | • Utilizes external independent compensation consultant to assist in designing and reviewing compensation policies and programs, including the potential risks created by the policies and programs. | | |
| | • Assists Board in overseeing the Company’s executive management succession planning. | | |
| | • Oversees the process for conducting the annual risk assessment of the Company’s compensation programs and policies, including retaining, from time to time, third party consultants to assess risk. See “Compensation Risk Assessment” below. | | |
| | Nominating and Corporate Governance Committee | | |
| | • Oversees risks relating to certain legal and regulatory compliance risks with respect to the Company’s corporate governance policies and standards. | | |
| | • Oversees compliance and risks related to Board structure, directors and director nominations. | | |
| | • Oversees risks related to compliance matters by reviewing on at least an annual basis issues and developments related to corporate governance. | | |
| | • Oversees risks related to the Company’s compliance with the listing standards and the Sarbanes/Oxley Act. | | |
92705; Attention: Corporate Secretary.
The stockholders are being asked to approve the adoption
Position | | | Annual Retainer | | |||
Chairman of the Board | | | | $ | 65,000 | | |
Non-Employee Director (other than the Chairman) | | | | $ | 35,000 | | |
Position | | | Annual Retainer | | |||
Audit Committee | | | | | | | |
Chair | | | | $ | 12,000 | | |
Member | | | | $ | 6,000 | | |
Compensation Committee | | | | | | | |
Chair | | | | $ | 9,000 | | |
Member | | | | $ | 4,500 | | |
Nominating and Corporate Governance Committee | | | | | | | |
Chair | | | | $ | 4,000 | | |
Member | | | | $ | 2,000 | | |
Finance and Strategy Committee | | | | | | | |
Chair | | | | $ | 9,000 | | |
Member | | | | $ | 4,500 | | |
The Purchase Plan is designed to allow eligible employeesclosing price of the Company and its participating subsidiaries (whether now existing or subsequently established or acquired) to purchase shares ofCompany’s common stock at designated intervals through their accumulated payroll deductions.
on the RSU grant date. Each RSU entitles the holder to receive one share of the Company’s common stock upon vesting of such unit. Each annual RSU generally vests on the date of the first annual stockholder meeting following the date of grant. If a non-employee director joins the Board in between annual stockholder meetings, such director will receive an RSU for a pro rata portion of the annual grant, which typically vests in full on the date of the first annual stockholder meeting following the date of grant.
Name | | | Fees Earned or Paid in Cash ($)(1) | | | Stock Awards ($)(2) | | | Total ($) | | |||||||||
Kevin C. Daly, Ph.D.(3) | | | | $ | 50,500 | | | | | $ | 40,001 | | | | | $ | 90,501 | | |
Scott E. Deeter(4) | | | | | 43,233 | | | | | | 40,001 | | | | | | 83,234 | | |
Gerard M. Mooney | | | | | 49,500 | | | | | | 40,001 | | | | | | 89,501 | | |
Laura L. Siegal | | | | | 38,967 | | | | | �� | 40,001 | | | | | | 78,968 | | |
Thomas L. Thomas | | | | | 79,256 | | | | | | 40,001 | | | | | | 119,257 | | |
Mikel H. Williams(5) | | | | | 36,750 | | | | | | — | | | | | | 36,750 | | |
Dennis W. Zank(6) | | | | | 6,827 | | | | | | 25,683 | | | | | | 32,510 | | |
Administration
The Purchase Plan will be administered by the Compensation Committee of the Board of Directors. Such committee will, as plan administrator, have full authority to adopt administrative rules and procedures and to interpret the provisions of the Purchase Plan.
Securities Subject to the Purchase Plan
The number of shares of the CompanyCompany’s common stock reserved for issuance under the Purchase Plan will initially be 1,000,000 shares. The shares issuable under the Purchase Plan may be made available from authorized but unissued shares of common stock or from shares of common stock repurchased by the Company, including shares repurchased on the open market.
Ingrant date. At the event that any dividend or other distribution (whether inend of Fiscal 2020, the form of cash, common stock, or other property), recapitalization, stock split, reverse stock split, reorganization, merger, consolidation, reincorporation, other reorganization, split-up, spin-off, combination, repurchase, or exchange of common stock or other securities ofabove-listed directors held options for the Company, or other change in the Company's structure affecting the common stock occurs without the Company's receipt of consideration, or should the value of shares of common stock be substantially reduced as a result of a spin-off transaction or an extraordinary dividend or distribution, then the plan administrator will, in such manner as it deems equitable, adjust the maximum number of shares and class of common stock that may be issued under the Purchase Plan, the purchase price per share and thefollowing number of shares of common stock covered by each outstanding option understock: Kevin C. Daly — 55,000; Scott E. Deeter — 0; Gerard M. Mooney — 40,000; Laura L. Siegal — 0; Thomas L. Thomas — 0; Mikel H. Williams — 0; and Dennis W. Zank — 0. At the Purchase Plan, andend of Fiscal 2020, the maximum number of shares purchasable per participant during any offering period.
Offering Periods and Options
Shares of the Company's common stock will be offered for purchase under the Purchase Plan through a series of successive offering periods which will be of such duration (not to exceed 27 months) as determined by the plan administrator. Unless otherwise specified by the plan administrator prior to the start of the applicable offering period, (i) each offering period will have a duration of six (6) months and (ii) offering periods will commence on January 1 and July 1 each year. The initial offering period under the Purchase Plan will commence on January 1, 2018.
On the first trading day of each offering period, each participant will be granted an option to acquire shares of the Company's common stock on the last trading day of that offering period, subject to certain limitations described below.
Eligibility and Participation
Any individual who is employed on a basis under which he or she is regularly expected to work for more than 20 hours per week for more than five months per calendar year in the employ of the Company or any participating subsidiary corporation (whether any such corporation is currently a subsidiary or subsequently acquired or is subsequently established at any time during the term of the Purchase Plan) will be eligible to participate in any offering period implemented under the Purchase Plan.
To participate in a particular offering period, an eligible employee must complete and file the requisite enrollment forms during the enrollment period for that offering period.
As of August 15, 2017, approximately 440 employees, including six executive officers, would have been eligible to participate in the Purchase Plan had it been in effect on such date.
Payroll Deductions and Stock Purchases
Each participant may authorize periodic payroll deductions in any multiple of one percent up to a maximum of 15% of the cash compensation paid to the participantabove listed directors held RSUs for the offering period.
The accumulated contributions will automatically be applied to the acquisition of common stock at six-month intervals. Accordingly, on each such purchase date (the last trading day in July and December each year), each participant's payroll deductions accumulated for the offering period ending on that purchase date will automatically be applied to the purchase of whole shares of common stock at the purchase price in effect for the participant for that purchase date. The first purchase under the Purchase Plan is expected to occur on June 29, 2018.
Purchase Price
The purchase price of the common stock acquired on each semi-annual purchase date will not be less than 85% of the lower of the fair market value per share of the Company's common stock on the first trading day of the offering period or the fair market value on the last trading day of that offering period.
The fair market value per share of the Company's common stock on any particular date under the Purchase Plan will be deemed to be equal to the closing price per share on such date on the stock exchange or national market system on which the shares are listed at that time (or if there is no closing price on such date, then the closing price per share on the last preceding date for which such quotation exists). On September 22, 2017, the fair market value of the Company's common stock determined on such basis was $6.56 per share, the closing price per share on that date as reported by the NASDAQ Capital Market.
Special Limitations
The Purchase Plan imposes certain limitations upon a participant's rights to acquire common stock, including the following limitations:
The plan administrator will have the discretionary authority to increase or decrease the per participant limitation as of the start date of any new offering period under the Purchase Plan, with the new limit to be in effect for that offering period.
Termination of Option
The participant may withdraw from the Purchase Plan at any time up to a number of days prior to the next scheduled purchase date (as specified by the plan administrator), and his or her accumulated payroll deductions for the offering period in which that withdrawal occurs will be refunded promptly.
The participant's option will immediately terminate upon his or her cessation of employment or loss of eligible employee status. Any payroll deductions which the participant may have made for the offering period in which such cessation of employment or loss of eligibility occurs will be refunded or used to purchase shares on the purchase date for that offering period (depending on when such termination or loss of status occurs).
Stockholder Rights
No participant will have any stockholder rights with respect to the shares covered by his or her options until the shares are actually purchased on the participant's behalf and the participant has become a holder of record of the purchased shares. No adjustment will be made for dividends, distributions or other rights for which the record date is prior to the date of such purchase.
Assignability
No options will be assignable or transferable by the participant, and the options will be exercisable only by the participant.
Corporate Transaction
In the event of a corporate transaction, the plan administrator may provide that all outstanding options (i) may be assumed or substituted by the successor corporation, (ii) will automatically be exercised immediately prior to the effective date of such change in control or (iii) will be terminated and accumulated payroll deductions be refunded. The purchase price for any abbreviated offering period will be based on the purchase price formula in effect for the offering period in which such change in control occurs. A corporate transaction means a merger, consolidation, acquisition of property or stock, separation, reorganization or other corporate event described in Section 424 of the Code (defined below).
Share Pro-Ration
Should the total number of shares of common stock: Kevin C. Daly — 8,299; Scott E. Deeter — 8,299; Gerard M. Mooney — 8,299; Laura L. Siegal — 8,299; Thomas L. Thomas — 8,299; Mikel H. Williams — 0; and Dennis W. Zank — 4,855.
Amendment and Termination
The Purchase Plan will terminateBoard or Compensation Committee (or other committee performing equivalent functions) of any entity that has one or more executive officers serving on December 31, 2027, unless terminated earlier by the plan administrator.
The plan administrator may alterour Board or amend the Purchase Plan atCompensation Committee. No interlocking relationship exists between any time. In no event may the plan administrator effect eithermember of the following amendments or revisions to the Purchase Plan without the approvalBoard and any member of the stockholders: (i) increase the numberCompensation Committee (or other committee performing equivalent functions) of sharesany other company.
New Plan Benefits
The Purchase Plan will not become effective unless it is approved by theExchange Act, stockholders at the annual meeting and no options have been granted under the Purchase Plan.
Summary of Federal Income Tax Consequences
The Purchase Plan is intended to be an "employee stock purchase plan" within the meaning of Section 423 of the Internal Revenue Code, as amended (the "Code"). Under a plan which so qualifies, no taxable income will be recognized by a participant, and no deductions will be allowable to the Company, upon either the grant or the exercise of the options. Taxable income will not be recognized until there is a sale or other disposition of the shares acquired under the Purchase Plan or in the event the participant should die while still owning the purchased shares.
If the participant sells or otherwise disposes of the purchased shares within two years after the start date of the offering period in which such shares were acquired or within one year after the purchase date of those shares, then the participant will recognize ordinary income in the year of sale or disposition equal to the amount by which the fair market value of the shares on the purchase date exceeded the purchase price paid for those shares, and the Company will be entitled to an income tax deduction, for the taxable year in which such sale or disposition occurs, equal in amount to such excess.
If the participant sells or disposes of the purchased shares more than two years after the start date of the offering period in which the shares were acquired and more than one year after the purchase date of those shares, then the participant will recognize ordinary income in the year of sale or disposition equal to the lesser of (i) the amount by which the fair market value of the shares on the sale or disposition date exceeded the purchase price paid for those shares or (ii) fifteen percent (15%) of the fair market value of the shares on the start date of that offering period, and any additional gain upon the disposition will be taxed as a long-term capital gain. The Company will not be entitled to an income tax deduction with respect to such sale or disposition.
If the participant still owns the purchased shares at the time of death, then the participant will recognize ordinary income at such time equal to the lesser of (i) the amount by which the fair market value of the shares on the date of death exceeds the purchase price or (ii) fifteen percent (15%) of the fair market value of the shares on the start date of the offering period in which those shares were acquired.
Summary of Accounting Treatment
Pursuant to Accounting Standards Codification Topic 718 of the Financial Accounting Standards Board, the Company's contribution amount will be charged as a direct compensation expense to its reported earnings in the period that the contribution is made.
Vote Required
Approval of the Purchase Plan requires the affirmative vote of (i) a majority of the shares of common stock present in person or represented by proxy and voting at the annual meeting and (ii) a
majority of the shares of common stock required to constitute a quorum. If such stockholder approval not be obtained, then the Purchase Plan will not become effective.
Recommendation of Board of Directors
The Board of Directors recommends that the stockholders vote FOR the approval of the implementation of the Purchase Plan. The Board of Directors believes that it is in the best interests of the Company to provide our employees with the opportunity to acquirevote to approve, on an ownership interest inadvisory basis, the Company throughcompensation of our named executive officers. Commonly known as a “say-on-pay” vote, this proposal gives our stockholders the opportunity to express their participation inviews on our executive compensation policies and programs and the Purchase Plan and thereby encourage themcompensation paid to remain in the Company's employ and more closely align their interests with those of the stockholders.
PROPOSAL THREE:RATIFICATION OF SELECTION OF INDEPENDENTREGISTERED PUBLIC ACCOUNTING FIRM
The accounting firm of Deloitte & Touche LLP was engaged to serve as our independent registered public accounting firm for Fiscal 2017. The Audit Committee of the Board of Directors has selected that firm to continue in this capacity for the fiscal year ending March 31, 2018. We are asking our stockholders to ratify the selection by the Audit Committee of Deloitte & Touche LLP as our independent registered public accounting firm to audit our consolidated financial statements for the fiscal year ending March 31, 2018 and to perform other appropriate services. Stockholder ratificationindicate their support of the selectioncompensation of Deloitte & Touche LLPour named executive officers, as our independent registered public accounting firm is not requireddescribed in this proxy statement by our bylaws or otherwise. Inapproving the event that the stockholders fail to ratify the appointment, the Audit Committee will reconsider its selection. Even if the selection is ratified, the Audit Committee, in its sole discretion, may direct the appointment of a different independent registered public accounting firm at any time during the year if the committee feels that such a change would be in the best interests of us and our stockholders.
A representative of Deloitte & Touche LLP is expected to be presentfollowing resolution at the Annual Meeting, andMeeting:
the Compensation Committee will review and consider the voting results in future decisions regarding executive compensation.
this proposal.
FEES PAID TO INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Audit Fees
Deloitte & Touche LLP was engaged by us as our principal accountant in October 2015, and rendered the audit opinion on our consolidated financial statements for Fiscal 2017.
The audit fees billed by Deloitte & Touche LLP were $905,000 and $525,000 for Fiscal 2017 and Fiscal 2016, respectively. Audit fees consist of fees for professional services rendered in connection with the auditcompensation of our annual consolidated financial statements for the applicable fiscal year and review of the consolidated financial statements included in our quarterly reports on Form 10-Q and other regulatory filings for such fiscal year. There were no other fees billed to us by Deloitte & Touche LLP for Fiscal 2017 or Fiscal 2016.
Audit Committee Pre-Approval Policies and Procedures
All engagements for services by Deloitte & Touche LLP or other independent registered public accountants are subject to prior approval by the Audit Committee; however,de minimis non-audit services may instead be approved in accordance with applicable SEC rules. The prior approval of the Audit Committee was obtained for all services provided by Deloitte & Touche LLP for Fiscal 2017.
The following is the report of the Audit Committee with respect to the audited consolidated financial statements for the fiscal year ended March 31, 2017 of Iteris, Inc. included in its Annual Report on Form 10-K andnamed executive officers as amended on Form 10-K/A for that year.
Review with Management
The Audit Committee has reviewed and discussed the audited consolidated financial statements with the Company's management.
Review and Discussions with Independent Registered Public Accounting Firm
The Audit Committee has discussed with the Company's independent registered public accounting firm, Deloitte & Touche LLP, the matters required to be discussed by Statement on Auditing Standards No. 61, as amended, and Auditing Standard No. 1301, each as adopted by the Public Company Accounting Oversight Board ("PCAOB"), which includes, among other items, matters related to the conduct of the audit of the Company's consolidated financial statements.
The Audit Committee has received the written disclosures and the letter from Deloitte & Touche LLP required by applicable requirements of the PCAOB regarding the independent accountant's communications with the Audit Committee concerning independence, and has discussed with Deloitte & Touche LLP its independence from the Company.
Conclusion
Based on the review and discussions referred to abovedisclosed in this report, the Audit Committee recommended to the Company's Board of Directors that the audited financial statements be included in the Company's Annual Report on Form 10-K as amended on Form 10-K/A for the year ended March 31, 2017 for filing with the SEC.
|
Name | | | Age | | | ||
Capacities in Which Served | | ||||||
J. Joseph | | | | | Chief Executive Officer, President and Director | | |
| | | | | Chief Financial Officer, Senior Vice President of Finance and Secretary | ||
| |||||||
| |||||||
| |||||||
Todd Kreter | | | | | Senior Vice President and General Manager, Roadway Sensors | | |
Ramin Massoumi | | | | | Senior Vice President and General Manager, Transportation Systems | |
”
Thomas N. Blair has served as our Chief Technology Officer, Agriculture and Weather Analytics since August 2017 and prior to that served as our Senior Vice President, Agriculture and Weather Analytics since July 2012. Prior to that, Mr. Blair served as General Manager for Trimble Navigation Limited, a provider of integrated positioning, wireless, and software technology solutions, from 2007 to August 2011, and as Vice President for New Business development at @Road, Inc., a leading provider of mobile resource management solutions, from 2006 to 2007. He also worked as Director of Business and Corporate Development at iAnywhere Solutions, a Sybase company, from 2003 to 2006. Mr. Blair holds a B.S. degree in Management Information Systems from DeVry Institute of Technology and an M.S. degree in Computer Science from Rochester Institute of Technology.
Joseph Boissy has served as our Chief Marketing Officer since January 2017. Prior to that, Mr. Boissy served as Chief Marketing Officer of Vendavo, Inc. (acquired by Francisco Partners in October 2014), a provider of margin and profit optimization solutions, from September 2013 to November 2016. Prior to that, he served as the Chief Marketing Officer at 3VR Inc., a video intelligence solutions provider, from October 2011 to September 2013. From February 2002 to October 2011, he served in various management positions at ILOG, Inc. (acquired by IBM in July 2008), a provider of business rule management systems, most recently as Vice President ILOG Worldwide Marketing, then Program Director, Go-to-Market Strategy and Industry Marketing IBM WebSphere. Mr. Boissy was Vice President Program Management, Credient at SunGard Trading & Risk Systems Inc., a provider of financial software solutions and services, from 2000 to 2002, and from 1997 to 2000, he served in management positions in product development, support and product management, most recently as the Vice President Product Marketing, with Infinity Financial Technology, Inc., a
financial trading and risk management software solutions provider that was acquired by SunGard in October 1997. Prior to Infinity, Mr. Boissy was Director Product Development at Diagram Financial Software, Inc. (now part of Thomson Reuters) from 1993 to 1997. Mr. Boissy holds a B.S. degree in Electrical Engineering from the Lebanese University (Lebanon) and a M.S. degree in Computer Science and Data Analytics from the University of Paris XI (France).
James ChambersDouglas L. Groves has served as our Senior Vice President and General Manager, AgricultureChief Financial Officer, since he joined on December 4, 2019. Mr. Groves has more than 30 years of unique and Weather Analytics since August 2017. Prior to that, Mr. Chambers served as Chief Executive Officer of Observant, Inc. (acquired by Jain Irrigation, Inc. in February 2017), a provider of agricultural in-field hardware and cloud based applications for precision farm water management, from February 2016 to February 2017. From June 2013 to February 2016,highly valuable experience. Most recently, he served as DirectorVice President, Chief Financial Officer and Treasurer of MarketingDucommun, Inc., through June 2019, having joined the company in January 2013. Through December 2012, he held the position of Corporate Vice President and Chief Information Officer at Bayer CropScience,Beckman Coulter, following a series of financial roles at the company specializedbeginning in agriculture, and lifesciences.January 1998. Beckman Coulter was acquired by Danaher Corporation in February 2011. Prior to that,joining Beckman Coulter, Mr. Chambers served in various key management positionsGroves was corporate controller of a privately held civil engineering firm and senior auditor and consultant at divisionsDeloitte & Touche. Mr. Groves holds an M.B.A. from the University of Deere & Company, including John Deere Water (acquired by FIMI Opportunity Funds in June 2014), a provider of integrated Ag water management solutions, most recently as Director of Global Product ManagementSouthern California and Marketing and then as the Director of Global Technology Solutions, from August 2010 to May 2013, and John Deere Agri Services, Inc. (acquired by Constellation Software, Inc. in January 2011), a provider of software solutions for the agricultural supply chain, most recently as the General Manager for the Specialty Crop Business Unit and then as the Director of Marketing, from June 2006 to August 2010. From January 2003 to June 2006, he was Global Business Manager at Valent BioSciences Corporation, a provider of technologies and products for the agricultural, public health, forestry and household markets, and from March 2001 to January 2003, he was Director of Global Sales and Marketing with AgraQuest (acquired by Bayer CropScience in July 2012), a supplier of biological pest management solutions. From 1989 to 2001, Mr. Chambers served in various management positions at Monsanto Company, a provider of agriculture products for farmers, most recently as Business Development Manager and Financial Analyst, then as Marketing Manager Animal Productivity and Market and Sales Manager. Mr. Chambers holds a B.S. degree in Agriculture Business Management and EconomicsAccountancy from The OhioCalifornia State University.University, Long Beach.
related disclosures set forth below. We are eligible to, and have chosen to, comply with the executive compensation disclosure rules applicable to a “smaller reporting company,” as defined in the applicable SEC rules, but we have also voluntarily included additional disclosure about our executive compensation program to help our stockholders understand our executive compensation program. This section discusses the principles underlying our compensation policies for our executive officers who are named in the Summary“Summary Compensation TableTable” below, who we refer to as our "named“named executive officers"officers” or "NEOs"“NEOs” for Fiscal 2017 and who include the following executive officers:2020:
| What We Have | | | What We Do Not Have | |
| + We have approximately 68% of target direct compensation for the chief executive officer (and 53% of the other named executive officers) that is performance-based or is at-risk + We have a performance-based long-term incentive plan commencing in Fiscal 2021 that utilizes PSUs, RSUs, and stock options + We have a clawback policy in place for our annual and long-term incentive plans + We have stock ownership guidelines in place for directors + We have an independent compensation consultant to advise our Compensation Committee + We have ongoing stockholder outreach efforts to obtain input on our compensation practices | | | ✓ We do not provide 280G excise tax gross-ups ✓ We do not provide any pension or supplemental retirement benefits ✓ We do not provide for any “single trigger” equity vesting for equity awards ✓ We prohibit repricing options without shareholder approval ✓ We prohibit granting stock options with an exercise price below 100% of fair market value ✓ We do not provide any perquisites | |
The most recent stockholder advisory vote on executive officer compensation required under the federal securities laws was held on December 15, 2016. Approximately 81.5% of the total votes cast on such proposal (which excluded broker non-votes) were in favor of the compensation of the named executive officers, as that compensation was disclosed in the various compensation tables and narrative that appeared in the Company's proxy statement dated November 21, 2016. Based on that high level of stockholder approval, the Compensation Committee decided not to make any material changes to the Company's compensation philosophies, policies and practices for the 2017 fiscal year compensation of the named executive officers. Based on the voting preference of the Company's stockholders, advisory votes on executive officer compensation will be conducted every three years; accordingly, the next advisory vote will be conducted at the 2019 Annual Meeting of Stockholders. The Compensation Committee will continue to take into account each such advisory vote in order to determine whether any subsequent changes to the Company's executive compensation programs and policies would be warranted to reflect any stockholder concerns reflected in those advisory votes.
Annual Review of Cash and Equity Compensation; Role of Compensation Consultant
determine the appropriate level of each compensation component based in part, but not exclusively, on our retention goals and short-term and long-term objectives.
In setting executive compensation, the Compensation Committee takes into account a number of factors, includingand did not performed any other work for the nature andCompany during Fiscal 2020 beyond its services related to executive compensation. As provided in its charter, the Compensation Committee has the authority to determine the scope of the named executive officer's responsibilities, his or her individual performance levelFW Cook’s services and contribution to the achievement of our corporate objectives, the experience level of the executive, the recommendations of our Chief Executive Officer for each individual's compensation package (other than his own) and the compensation trends in the industry.
may terminate their engagement at any time.
| • Agilysys, Inc. • AutoWeb, Inc. • Clearfield, Inc. • Digi International Inc. • Digital Turbine, Inc. • EMCORE Corporation • Intevac, Inc. • IntriCon Corporation • KVH Industries, Inc. • Majesco • MobileIron, Inc. | | | • Napco Security Technologies, Inc. • OneSpan Inc. • PCTEL, Inc. • Perceptron, Inc. • RealNetworks, Inc. • SeaChange International, Inc. • Telenav, Inc. • TransAct Technologies Incorporated • Upland Software, Inc. • Zix Corporation | |
| | Pay Component | | | | Rationale and Value to Stockholders | | |
| | Base Salary | | | | • Only fixed compensation element in the executive compensation program • Recruit and retain executive talent and provide an element of economic security from year-to-year • Reflects competitive market conditions | | |
| | Performance-Based Cash Bonus (Short-Term Incentive Program) | | | | • Motivates achievement of strategic priorities for the fiscal year as measured by financial and operational metrics • Diversified group of metrics to drive growth and stockholder value | | |
| | Equity Incentive Awards (Options, RSUs and PSUs)(1) | | | | • Encourages focus on long-term stockholder value creation (and PSUs link compensation to achievement of specified corporate financial performance objectives) • Aligns to stockholders interests • Provides long-term retention incentive of our executive talent | | |
plan for Fiscal 2021.
its cash-based bonus plan each year, there is no formal pre-established policy for the allocation of compensation between cash and non-cash components or between short-term and long-term components, and there are no pre-established ratios between the compensation of our Chief Executive Officer and that of the other named executive officers. Instead, our Compensation Committee determines the compensation of each named executive officer annually based on its review of the market data, its subjective analysis of that individual'sindividual’s performance and contribution to our financial performance and the other factors identified in the Compensation Decision-Making Process“Annual Review of Cash and Equity Compensation” section above to determine the appropriate level and balance of total compensation. We believe that this approach allows us to tailor compensation for each named executive officer to attract, retain and motivate that executive officer within the parameters of our compensation philosophy.
Named Executive Officer | | | Fiscal 2020 Annual Base Salary | | |||
J. Joseph (“Joe”) Bergera | | | | $ | 430,000 | | |
Douglas L. Groves(1) | | | | | 400,000 | | |
Andrew Schmidt(2) | | | | | 373,375 | | |
Ramin Massoumi | | | | | 280,000 | | |
Named Executive Officer | Fiscal 2017 Annual Base Salary | |||
---|---|---|---|---|
Joe Bergera | $ | 385,000 | ||
Andrew Schmidt | 336,500 | |||
Thomas N. Blair | 259,000 | |||
Todd Kreter | 265,000 | |||
Ramin Massoumi | 239,200 |
20172020 base salary was set by the Compensation Committee with his commencement of employment.("2007(“2020 Bonus Plan"Plan”). Our named executive officers are eligible to receive an annual cash-based bonus under our 20172020 Bonus Plan. Each year, our Compensation Committee establishes the performance objectives to be attained and the target bonuses payable based on the level of attainment of the specified goals, which generally include the Company'sCompany’s revenues and adjusted operating income for the fiscal year, the revenues and contribution margin of such officer'sofficer’s business unit, and personal objectives set for each officer ("MBOs"(“MBOs”). We define "contribution margin"“contribution margin” as the business unit'sunit’s adjusted operating income without corporate expense allocations. Corporate adjusted operating income and the adjusted operating income of each business unit is calculated on a non-GAAP basis to exclude amortization, depreciation, stock-based compensation, goodwill impairment charge, if any, and such other non-cash items that the Compensation Committee, in its sole discretion, believes are not directly indicative of the performance of the Company and the business units.typically meets duringdetermined Mr. Bergera successfully executed on his MBOs, resulting in a 99% payout of the firstMBOs portion of his fiscal quarter of each year to evaluation the NEO's2020 annual bonus.such performance objectiveshis MBOs, including certain strategic transformation initiatives, talent recruitment and development, succession planning, attainment of certain expense reductions, and certain contributions to strategic financial planning for the Company. The Compensation Committee determined Mr. Groves successfully executed on his MBOs, and determined Mr. Groves earned 100% of the MBOs portion of his fiscal 2020 annual bonuses are typically paid out as soon as practicable thereafter.bonus.
Performance Components | | | No Bonuses At or Below | | | Target | | | Maximum | | | Actual(1) | | | % Attained | | |||||||||||||||
Corporate Revenue | | | | $ | 87,560 | | | | | $ | 109,450 | | | | | $ | 136,813 | | | | | $ | 107,672 | | | | | | 98.4% | | |
Corporate Adjusted Operating Income | | | | | 120 | | | | | | 150 | | | | | | 180 | | | | | | (919) | | | | | | 0.0 | | |
Transportation Systems Revenue | | | | | 43,400 | | | | | | 54,250 | | | | | | 67,813 | | | | | | 51,588 | | | | | | 95.1 | | |
Transportation Systems Contribution Margin | | | | | 5,950 | | | | | | 7,438 | | | | | | 9,298 | | | | | | 8,836 | | | | | | 118.8 | | |
Performance Components | No Bonuses At or Below | Target | Maximum | Actual | % Attained | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Corporate Revenue | $ | 75,101 | $ | 93,876 | $ | 112,651 | $ | 95,982 | 102.2 | % | ||||||
Corporate Operating Income | (4,174 | ) | (3,478 | ) | (2,782 | ) | (3,069) | (1) | 113.3 | |||||||
Roadway Sensors Revenue | 35,021 | 43,776 | 52,531 | 42,270 | 96.3 | |||||||||||
Roadway Sensors Contribution Margin | 7,037 | 8,796 | 10,555 | 9,799 | 111.4 | |||||||||||
Transportation Systems Revenue | 35,543 | 44,429 | 53,315 | 49,270 | 110.9 | |||||||||||
Transportation Systems Contribution Margin | 5,164 | 6,455 | 7,746 | 8,482 | 131.4 | |||||||||||
Agriculture and Weather Analytics Revenue | 4,538 | 5,672 | 6,806 | 4,542 | 0.0 | |||||||||||
Agriculture and Weather Analytics Contribution Margin | (8,346 | ) | (6,955 | ) | (5,564 | ) | (7,389) | (1) | 94.1 |
Named Executive Officer | | | Performance Objectives Allocation (%) | | | 2020 Target Bonus ($) | | | 2020 Actual Bonus ($) | | | % of Target Awarded (%) | | ||||||||||||
Joe Bergera | | | | | | | | | | $ | 322,500 | | | | | $ | 180,155 | | | | | | 56% | | |
Corporate Revenue | | | | | 40% | | | | | | | | | | | | | | | | | | | | |
Corporate Adjusted Operating Income | | | | | 40 | | | | | | | | | | | | | | | | | | | | |
MBOs | | | | | 20 | | | | | | | | | | | | | | | | | | | | |
Douglas L. Groves(1) | | | | | | | | | | | 66,667 | | | | | | 37,334 | | | | | | 56 | | |
Corporate Revenue | | | | | 40 | | | | | | | | | | | | | | | | | | | | |
Corporate Adjusted Operating Income | | | | | 40 | | | | | | | | | | | | | | | | | | | | |
MBOs | | | | | 20 | | | | | | | | | | | | | | | | | | | | |
Ramin Massoumi | | | | | | | | | | | 154,000 | | | | | | 136,531 | | | | | | 89 | | |
Transportation Systems Revenue | | | | | 25 | | | | | | | | | | | | | | | | | | | | |
Transportation Systems Contribution Margin | | | | | 25 | | | | | | | | | | | | | | | | | | | | |
Corporate Revenue | | | | | 15 | | | | | | | | | | | | | | | | | | | | |
Corporate Adjusted Operating Income | | | | | 15 | | | | | | | | | | | | | | | | | | | | |
MBOs | | | | | 20 | | | | | | | | | | | | | | | | | | | | |
Named Executive Officer | Performance Objectives Allocation (%) | 2017 Target Bonus | 2017 Actual Bonus | % of Target Awarded | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Joe Bergera | $ | 300,000 | $ | 354,000 | 118 | % | |||||||
Corporate Revenue | 40 | % | |||||||||||
Corporate Operating Income | 40 | % | |||||||||||
MBOs | 20 | % | |||||||||||
Andrew Schmidt | $ | 134,600 | $ | 161,970 | 120 | % | |||||||
Corporate Revenue | 40 | % | |||||||||||
Corporate Operating Income | 40 | % | |||||||||||
MBOs | 20 | % | |||||||||||
Thomas N. Blair | $ | 142,321 | $ | 91,598 | 64 | % | |||||||
Ag & Weather Analytics Revenue | 30 | % | |||||||||||
Ag & Weather Analytics Contribution Margin | 20 | % | |||||||||||
Corporate Revenue | 15 | % | |||||||||||
Corporate Operating Income | 15 | % | |||||||||||
MBOs | 20 | % | |||||||||||
Todd Kreter | $ | 145,757 | 154,692 | 106 | % | ||||||||
Roadway Sensors Revenue | 25 | % | |||||||||||
Roadway Sensors Contribution Margin | 25 | % | |||||||||||
Corporate Revenue | 15 | % | |||||||||||
Corporate Operating Income | 15 | % | |||||||||||
MBOs | |||||||||||||
Ramin Massoumi | $ | 131,583 | $ | 159,234 | 121 | % | |||||||
Transportation Systems Revenue | 25 | % | |||||||||||
Transportation Systems Contribution Margin | 25 | % | |||||||||||
Corporate Revenue | 15 | % | |||||||||||
Corporate Operating Income | 15 | % | |||||||||||
MBOs | 20 | % |
See 2017 Grant of Plan-Based Awards below for additional information on Fiscal 2017 cash bonuses.
ASC 718 also requires us to recognize the compensation cost of stock-based awards in our income statements over the period that an employee is required to render service in exchange for the award.
Name and Principal Position | | | Fiscal Year | | | Salary | | | Bonus | | | Option Awards(1) | | | Non-Equity Incentive Plan Compensation(2) | | | All Other Compensation(3) | | | Total | | |||||||||||||||||||||
J. Joseph (“Joe”) Bergera Chief Executive Officer and President | | | | | 2020 | | | | | $ | 430,314 | | | | | $ | — | | | | | $ | 634,300 | | | | | $ | 180,155 | | | | | $ | 11,351 | | | | | $ | 1,256,120 | | |
| | | 2019 | | | | | | 412,894 | | | | | | — | | | | | | 421,425 | | | | | | 137,280 | | | | | | 17,118 | | | | | | 988,716 | | | ||
| | | 2018 | | | | | | 396,648 | | | | | | — | | | | | | 649,328 | | | | | | 180,000 | | | | | | 8,848 | | | | | | 1,234,825 | | | ||
Douglas L. Groves Chief Financial Officer, Senior Vice President of Finance and Secretary | | | | | 2020 | | | | | | 121,617(4) | | | | | | — | | | | | | 489,540 | | | | | | 37,333 | | | | | | 4,800 | | | | | | 653,290 | | |
Andrew Schmidt(5) Former Chief Financial Officer, Vice President of Finance and Secretary | | | | | 2020 | | | | | | 307,587 | | | | | | — | | | | | | — | | | | | | — | | | | | | 431,435(6) | | | | | | 738,022 | | |
| | | 2019 | | | | | | 358,670 | | | | | | — | | | | | | 159,205 | | | | | | 71,775 | | | | | | 12,792 | | | | | | 602,442 | | | ||
| | | 2018 | | | | | | 346,138 | | | | | | 15,000(7) | | | | | | 259,731 | | | | | | 94,035 | | | | | | 8,683 | | | | | | 723,587 | | | ||
Ramin Massoumi Senior Vice President and General Manager, Roadway Sensors | | | | | 2020 | | | | | | 279,688 | | | | | | — | | | | | | 177,604 | | | | | | 136,531 | | | | | | 10,262 | | | | | | 604,084 | | |
| | | 2019 | | | | | | 268,306 | | | | | | — | | | | | | 112,380 | | | | | | 70,166 | | | | | | 11,440 | | | | | | 462,293 | | | ||
| | | 2018 | | | | | | 254,932 | | | | | | — | | | | | | 194,799 | | | | | | 127,925 | | | | | | 5,641 | | | | | | 583,297 | | |
Name and Principal Position | Fiscal Year | Salary | Bonus | Stock Awards(1) | Non-Equity Incentive Plan Compensation(2) | All Other Compensation(3) | Total | |||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Joe Bergera(4) | 2017 | $ | 399,816 | $ | — | $ | 328,362 | $ | 354,000 | $ | 3,594 | $ | 1,085,772 | |||||||||
Chief Executive Officer | 2016 | 197,502 | 150,000 | (5) | 1,659,150 | 63,080 | 7,610 | 2,077,342 | ||||||||||||||
and President | 2015 | — | — | — | — | — | — | |||||||||||||||
Andrew Schmidt | 2017 | 346,790 | — | 164,181 | 161,970 | 8,118 | 681,059 | |||||||||||||||
Chief Financial Officer | 2016 | 325,000 | 32,500 | (6) | 91,950 | 40,369 | 9,750 | 499,569 | ||||||||||||||
Vice President of | 2015 | 18,750 | — | 101,821 | — | — | 120,571 | |||||||||||||||
Finance and Secretary | ||||||||||||||||||||||
Thomas N. Blair | 2017 | 266,705 | — | 422,949 | (7) | 91,598 | 8,009 | 789,261 | ||||||||||||||
Senior Vice President, | 2016 | 250,016 | — | 91,950 | 72,977 | 7,650 | 422,593 | |||||||||||||||
Agriculture and Weather | 2015 | 250,549 | — | 53,715 | 47,364 | 7,812 | 359,440 | |||||||||||||||
Analytics | ||||||||||||||||||||||
Todd Kreter | 2017 | 271,745 | — | 164,181 | 154,691 | 8,060 | 598,677 | |||||||||||||||
Senior Vice President | 2016 | 250,016 | — | 91,950 | 85,296 | 7,650 | 434,912 | |||||||||||||||
and GM, Roadway | 2015 | 250,982 | — | 53,715 | 105,000 | 7,949 | 417,646 | |||||||||||||||
Sensors | ||||||||||||||||||||||
Ramin Massoumi | 2017 | 241,522 | — | 164,181 | 159,234 | 7,365 | 569,302 | |||||||||||||||
Senior Vice President | 2016 | 209,248 | — | 24,520 | 35,592 | 6,441 | 275,801 | |||||||||||||||
and GM, Transportation | 2015 | 188,655 | — | 19,940 | 29,580 | 5,237 | 243,412 | |||||||||||||||
Systems |
20172020 Grant of Plan-Based Awards Table
Name | | | Grant Date | | | Compensation Committee Action Date | | | Estimated Future Payouts Under Non-Equity Incentive Plan Awards | | | All Other Option Awards: Number of Securities Underlying Options (#)(2) | | | Exercise or Base Price of Option Awards ($/share) | | | Grant Date Fair Value of Stock and Option Awards ($)(3) | | ||||||||||||||||||||||||||||||
| Threshold ($) | | | Target ($)(1) | | | Maximum ($)(1) | | |||||||||||||||||||||||||||||||||||||||||
Joe Bergera | | | | | — | | | | | | 12/09/2019 | | | | | $ | — | | | | | $ | 322,500 | | | | | $ | 483,750 | | | | | | 250,000 | | | | | $ | 5.10 | | | | | $ | 634,300 | | |
Douglas L. Groves | | | | | 12/04/2019 | | | | | | 11/14/2019 | | | | | | — | | | | | | 66,667 | | | | | | 100,000 | | | | | | 200,000 | | | | | | 4.92 | | | | | | 489,540 | | |
Ramin Massoumi | | | | | — | | | | | | 12/09/2019 | | | | | | — | | | | | | 154,000 | | | | | | 231,000 | | | | | | 70,000 | | | | | | 5.10 | | | | | | 177,604 | | |
| | Estimated Possible Payouts Under Non-Equity Incentive Plan Awards | | | | |||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| | Number of Securities Underlying Options or Stock Units (#) | Per Share Exercise Price of Option Awards ($/share) | | ||||||||||||||||||
| | Grant Date Fair Value of Awards ($)(2) | ||||||||||||||||||||
Name | Grant Date | Threshold ($) | Target ($)(1) | Maximum ($)(1) | ||||||||||||||||||
Joe Bergera | 03/03/2017 | $ | — | $ | 300,000 | $ | 420,000 | 150,000 | $ | 4.91 | $ | 328,362 | ||||||||||
Andrew Schmidt | 03/03/2017 | — | 134,600 | 188,440 | 75,000 | 4.91 | 164,181 | |||||||||||||||
Thomas N. Blair | 03/03/2017 | — | 142,321 | 199,249 | 75,000 | 4.91 | 164,181 | |||||||||||||||
03/22/2017 | 51,140 | — | 258,768 | (3) | ||||||||||||||||||
Todd Kreter | 03/03/2017 | — | 145,757 | 204,060 | 75,000 | 4.91 | 164,181 | |||||||||||||||
Ramin Massoumi | 03/03/2017 | — | 131,583 | 184,216 | 75,000 | 4.91 | 164,181 |
| | | Option Awards(1) | | |||||||||||||||||||||||||||
Name | | | Number of Securities Underlying Outstanding Options (#) Exercisable | | | Number of Securities Underlying Outstanding Options (#) Unexercisable | | | Option Exercise Price ($) | | | Option Grant Date | | | Option Expiration Date | | |||||||||||||||
J. Joseph (“Joe”) Bergera Chief Executive Officer, President and Director | | �� | | | 1,350,000 | | | | | | — | | | | | $ | 2.38 | | | | | | 09/23/15 | | | | | | 09/22/25 | | |
| | | 112,500 | | | | | | 37,500 | | | | | | 4.91 | | | | | | 03/03/17 | | | | | | 03/02/27 | | | ||
| | | 125,000 | | | | | | 125,000 | | | | | | 5.52 | | | | | | 02/16/18 | | | | | | 02/15/28 | | | ||
| | | 56,250 | | | | | | 168,750 | | | | | | 4.16 | | | | | | 12/10/18 | | | | | | 12/09/28 | | | ||
| | | — | | | | | | 250,000 | | | | | | 5.10 | | | | | | 12/09/19 | | | | | | 12/08/29 | | | ||
Douglas L. Groves Chief Financial Officer, Senior Vice President of Finance and Secretary | | | | | — | | | | | | 200,000 | | | | | | 4.92 | | | | | | 12/04/19 | | | | | | 12/03/29 | | |
Andrew Schmidt(2) Former Chief Financial Officer, Vice President of Finance and Secretary | | | | | 100,000 | | | | | | — | | | | | | 1.79 | | | | | | 03/16/15 | | | | | | 03/15/25 | | |
| | | 75,000 | | | | | | — | | | | | | 2.37 | | | | | | 11/02/15 | | | | | | 11/01/25 | | | ||
| | | 56,250 | | | | | | 18,750 | | | | | | 4.91 | | | | | | 03/03/17 | | | | | | 03/02/27 | | | ||
| | | 50,000 | | | | | | 50,000 | | | | | | 5.52 | | | | | | 02/16/18 | | | | | | 02/15/28 | | | ||
| | | 21,250 | | | | | | 63,750 | | | | | | 4.16 | | | | | | 12/10/18 | | | | | | 12/09/28 | | | ||
Ramin Massoumi Senior Vice President and General Manager, Transportation Systems | | | | | 20,000 | | | | | | — | | | | | | 1.87 | | | | | | 11/18/14 | | | | | | 11/17/24 | | |
| | | 20,000 | | | | | | — | | | | | | 2.37 | | | | | | 11/02/15 | | | | | | 11/01/25 | | | ||
| | | 56,250 | | | | | | 18,750 | | | | | | 4.91 | | | | | | 03/03/17 | | | | | | 03/02/27 | | | ||
| | | 37,500 | | | | | | 37,500 | | | | | | 5.52 | | | | | | 02/16/18 | | | | | | 02/15/28 | | | ||
| | | 15,000 | | | | | | 45,000 | | | | | | 4.16 | | | | | | 12/10/18 | | | | | | 12/09/28 | | | ||
| | | — | | | | | | 70,000 | | | | | | 5.10 | | | | | | 12/09/19 | | | | | | 12/08/29 | | |
| Option Awards | ||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Name | Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#) Unexercisable | Option Exercise Price ($) | Option Grant Date(1) | Option Expiration Date | ||||||||
Joe Bergera | 337,500 | 1,012,500 | $ | 2.38 | 09/23/15 | 09/22/25 | |||||||
Chief Executive Officer | — | 150,000 | 4.91 | 03/03/17 | 03/02/27 | ||||||||
Andrew Schmidt | 50,000 | 50,000 | 1.79 | 03/16/15 | 03/15/25 | ||||||||
Chief Financial Officer, Vice President of | 18,750 | 56,250 | 2.37 | 11/02/15 | 11/01/25 | ||||||||
Finance, and Secretary | — | 75,000 | 4.91 | 03/03/17 | 03/02/27 | ||||||||
Tom Blair | 25,000 | 25,000 | 1.87 | 11/18/14 | 11/17/24 | ||||||||
Senior Vice President, | 18,750 | 56,250 | 2.37 | 11/02/15 | 11/01/25 | ||||||||
Agriculture and Weather Analytics | — | 75,000 | 4.91 | 03/03/17 | 03/02/27 | ||||||||
Todd Kreter | 25,000 | — | 2.46 | 02/21/08 | 02/20/18 | ||||||||
Senior Vice President and | 25,000 | — | 1.41 | 05/27/09 | 05/26/19 | ||||||||
GM, Roadway Systems | 30,000 | — | 1.10 | 08/10/11 | 08/09/21 | ||||||||
20,000 | 20,000 | 1.81 | 07/29/13 | 07/28/23 | |||||||||
12,500 | 37,500 | 1.87 | 11/18/14 | 11/17/24 | |||||||||
— | 75,000 | 2.37 | 11/02/15 | 11/01/25 | |||||||||
Ramin Massoumi | 22,500 | 7,500 | 1.81 | 07/29/13 | 07/28/23 | ||||||||
Senior Vice President and | 10,000 | 10,000 | 1.87 | 11/18/14 | 11/17/24 | ||||||||
GM, Transportation Systems | 5,000 | 15,000 | 2.37 | 11/02/15 | 11/01/25 | ||||||||
— | 75,000 | 4.91 | 03/03/17 | 03/02/27 |
2017 Option Exercises and Stock Vesting Table
date of grant. The following table provides information regarding option exercises and vesting of equity awards held by the named executive officers during Fiscal 2017.
| Option Awards | Stock Awards | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Name | Number of Shares Acquired on Exercise (#) | Value Realized on Exercise ($)(1) | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting ($)(2) | |||||||||
Joe Bergera | — | $ | — | — | $ | — | |||||||
Andrew Schmidt | — | — | — | — | |||||||||
Thomas N. Blair | 100,000 | 351,000 | 12,500 | 41,875 | |||||||||
Todd Kreter | 50,000 | 165,250 | — | — | |||||||||
Ramin Massoumi | 20,000 | 76,000 | — | — |
Employment Contracts;heading “Potential Payments upon Termination of Employment and Change in Control” below.
control.
Pursuant to the agreement, Mr. Bergera also received an option grant under our 2007 Omnibus Incentive Plan to purchase up to 1,350,000 shares of our common stock (the "Option"). The Option will vest in equal annual installments over four years and has an exercise price equal to the closing sales price of our common stock on the date of grant of the Option.
Severance Agreement with Andrew Schmidt
We
Director Compensation
Compensation of directors is determined by the Compensation Committee. The Compensation Committee has approved a compensation structure for non-employee directors consisting of a cash retainer, an annual equity award and, for Board members serving on a committee, an additional cash retainer. Directors who are our employees are not compensated for their services as directors.
Board and Committee Retainers
For Fiscal 2017, annual cash compensation for non-employee directors was as follows:
Position | Annual Retainer | |||
---|---|---|---|---|
Chairman of the Board | $ | 65,000 | ||
Non-Employee Director (other than the Chairman) | $ | 35,000 |
Additional retainers for each non-employee director who served on one or more Board committees in Fiscal 2017 were as follows:
Position | Annual Retainer | |||
---|---|---|---|---|
Audit Committee | ||||
Chair | $ | 12,000 | ||
Member | $ | 6,000 | ||
Compensation Committee | ||||
Chair | $ | 9,000 | ||
Member | $ | 4,500 | ||
Nominating and Corporate Governance Committee | ||||
Chair | $ | 4,000 | ||
Member | $ | 2,000 | ||
Finance Committee | ||||
Chair | $ | 9,000 | ||
Member | $ | 4,500 |
All directors are reimbursed for their out-of-pocket expenses incurred in attending meetings of our Board of Directors and its committees, but they do not receive separate meeting fees.
Annual Equity Compensation
Non-employee directors are also eligible to receive periodic restricted stock units ("RSUs") under the Company's equity incentive plan then in effect. Each non-employee director shall be granted an annual RSU upon approval of the grant by the Compensation Committee as soon as reasonably practicable following the annual meeting of stockholders at which such director is re-elected. The annual RSU grant shall be worth $40,000 based on the closing price of the Company's common stock on the RSU grant date. Each RSU entitles the holder to receive shares of the Company's common stock upon vesting of those units. Each annual RSU vests in full upon the director's completion of one year of service measured from the date of the annual stockholders meeting to which the RSU relates. If a non-employee director joins the Board in between annual stockholder meetings, such director would receive an RSU for a pro rata portion of the annual grant, which RSU vests in full on the day before the next annual stockholders meeting.
2017 Director Compensation Table
The following table sets forth a summary of the compensation earned in Fiscal 2017 by each non-employee director during that year:
Name | Fees Earned or Paid in Cash ($)(1) | Restricted Stock Units ($)(2) | Total ($) | |||||||
---|---|---|---|---|---|---|---|---|---|---|
D. Kyle Cerminara | $ | 25,927 | $ | 49,531 | $ | 75,458 | ||||
Richard Char(3) | 27,750 | — | 27,750 | |||||||
Kevin C. Daly, Ph.D | 49,250 | 39,997 | 89,247 | |||||||
Scott E. Deeter | 3,548 | 39,997 | 43,545 | |||||||
Gregory A. Miner(3) | 60,000 | — | 60,000 | |||||||
Gerard M. Mooney | 45,438 | 39,997 | 85,435 | |||||||
Thomas L. Thomas | 64,208 | 39,997 | 104,205 | |||||||
Mikel H. Williams | 50,958 | 39,997 | 90,955 |
Compensation Committee Interlocks and Insider Participation
None of our executive officers serves as a member of the board of directors or compensation committee (or other committee performing equivalent functions) of any entity that has one or more executive officers serving on our Board of Directors or Compensation Committee. No interlocking relationship exists between any member of the Board of Directors and any member of the compensation committee (or other committee performing equivalent functions) of any other company.
Kevin C. Daly, Ph.D, a member of our compensation committee, previously served as our interim Chief Executive Officer from February 2015 to September 2015.
Plan Category | | | (a) Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights | | | (b) Weighted Average Exercise Price of Outstanding Options, Warrants and Rights | | | (c) Number of Securities Remaining Available for Future Issuance Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a)) | | |||||||||
Equity compensation plans approved by security holders | | | | | 6,338,000(1) | | | | | $ | 2.52 | | | | | | 1,691,000(2) | | |
| | | Year Ended March 31, | | |||||||||
Fee Category | | | 2020 | | | 2019 | | ||||||
Audit fees | | | | $ | 990,000 | | | | | $ | 914,000 | | |
Audit related fees | | | | | 107,000 | | | | | | 30,000 | | |
Tax fees | | | | | — | | | | | | — | | |
All other fees | | | | | — | | | | | | — | | |
Total fees | | | | $ | 1,097,000 | | | | | $ | 944,000 | | |
Compensation Committee Report
follows:
O
wnership of CPRINCIPAL STOCKHOLDERS AND COMMON STOCK OWNERSHIPOF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
ertain
Beneficial Owners and Management
| | | Common Stock | | | | | |||||||||
Name and Address of Beneficial Owner(1) | | | Amount and Nature of Beneficial Ownership(2) | | | Percent of Class(2) | | | ||||||||
Black Rock, Inc.(3) | | | | | 2,842,039 | | | | | | 7% | | | | ||
The Vanguard Group(4) | | | | | 2,150,303 | | | | | | 5.29 | | | | ||
Cowen Prime Advisors(5) | | | | | 2,140,092 | | | | | | 5.27 | | | | ||
Joe Bergera(6) | | | | | 1,648,060 | | | | | | 3.88 | | | | ||
Doug L. Groves(7) | | | | | 10,000 | | | | | | * | | | | ||
Ramin Massoumi(8) | | | | | 182,925 | | | | | | * | | | | ||
Andrew Schmidt(9) | | | | | 302,500 | | | | | | * | | | | ||
Anjali Joshi(10) | | | | | 2,181 | | | | | | * | | | | ||
Gerard M. Mooney(11) | | | | | 71,848 | | | | | | * | | | | ||
Luke P. Schneider(12) | | | | | 1,309 | | | | | | * | | | | ||
Laura L. Siegal(13) | | | | | 32,847 | | | | | | * | | | | ||
Thomas L. Thomas(14) | | | | | 165,848 | | | | | | * | | | | ||
Dennis W. Zank(15) | | | | | 4,855 | | | | | | * | | | | ||
All executive officers and directors as a group (10 persons)(16) | | | | | 2,361,923 | | | | | | 5.64% | | | |
| Common Stock | ||||||
---|---|---|---|---|---|---|---|
Name and Address of Beneficial Owner(1) | Amount and Nature of Beneficial Ownership(2) | Percent of Class(2) | |||||
Lloyd I. Miller, III(3) | 4,980,759 | 15.3 | % | ||||
Fundamental Global Investors, LLC and RELM Wireless Corporation(4) | 2,126,948 | 6.5 | |||||
Joe Bergera(14) | 337,500 | 1.0 | |||||
Andrew Schmidt(5) | 87,500 | * | |||||
Thomas N. Blair(9) | 68,750 | * | |||||
Todd Kreter(6) | 141,111 | * | |||||
Ramin Massoumi(7) | 64,175 | * | |||||
D. Kyle Cerminara(4) | 2,137,669 | 6.6 | |||||
Kevin C. Daly, Ph.D(8) | 483,232 | 1.5 | |||||
Scott E. Deeter | — | — | |||||
Gerard M. Mooney(10) | 40,000 | * | |||||
Thomas L. Thomas(11) | 124,000 | * | |||||
Mikel H. Williams(12) | 70,000 | * | |||||
All executive officers and directors as a group (13 persons)(13) | 1,427,019 | 4.3 | % |
held in a trust account. and shared dispositive power with respect to 78,117 shares. The address for Mr. MillerThe Vanguard Group, Inc. is 3300 South Dixie Highway, Suite 1-365, West Palm Beach, Florida 33405.
FGI may be deemed to beneficially own the shares of common stock disclosed as directly owned by FGPP and FGPM. As principals of FGI, Messrs. Cerminara, Johnson and Moglia may be deemed to beneficially own the shares of common stock disclosed as directly owned by FGPP and FGPM. FGI Funds Management, LLC, as the investment manager to FGPP and FGPM as the relying manager to FGI, may be deemed to beneficially own the shares of common stock disclosed as directly owned by FGPP and FGPM. As principals of FGI Funds Management, LLC, Messrs. Cerminara and Johnson may be deemed to beneficially own the shares of common stock disclosed as directly owned by FGPP and FGPM. FGI and its affiliates, as the largest stockholder of RELM, may be deemed to beneficially own the shares of common stock disclosed as directly owned by RELM. As principals of FGI and directors of RELM, Messrs. Cerminara and Johnson may be deemed to beneficially own the shares of common stock disclosed as directly owned by RELM. Messrs. Cerminara, Johnson and Moglia expressly disclaim such beneficial ownership. FGI expressly disclaims beneficial ownership of the shares of common stock held by RELM.
Each of FGPP and FGPM beneficially owns, and has the shared power to direct the voting and disposition of, the shares of common stock disclosed as beneficially owned by it. FGI has the shared power to direct the voting and disposition of the shares of common stock held by FGPP and FGPM. FGI Funds Management, LLC, as the investment manager of FGPP and FGPM as the relying manager to FGI, has the shared power to direct the voting and disposition of the shares of common stock held by FGPP and FGPM. Messrs. Cerminara and Johnson, as principals of FGI Funds Management, LLC, may be deemed to have the shared power to direct the voting and disposition of the shares of common stock held by FGPP and FGPM. Messrs. Cerminara, Johnson and Moglia, as principals of FGI, may be deemed to have the shared power to direct the voting and disposition of the shares of common stock held by FGPP and FGPM. RELM beneficially owns, and has the shared power to direct the voting and disposition of, the shares of common stock disclosed as beneficially owned by it. As principal of FGI and directors of RELM, Messrs. Cerminara and Johnson, and FGI may be deemed to have the shared power to direct the voting and disposition of the shares of common stock held by RELM.
The principal business addresses of the various entities and persons are as follows: (i) RELM and Tactical Capital Investments LLC: 7100 Technology Drive, West Melbourne, Florida 32904;
(ii) FGPP, FGI and Mr. Moglia: 4201 Congress Street, Suite 140, Charlotte, North Carolina 28209; (iii) FGPM: c/o Maples Corporate Services Limited, P.O. Box 309, Ugland House, Grand Cayman, KY1-1104 Cayman Islands; (iv) FGI Funds Management, LLC: 9130 Galleria Court, Third Floor, Naples, Florida 34109; (v) Mr. Cerminara: c/o Fundamental Global Investors, LLC, 4201 Congress Street, Suite 140, Charlotte, North Carolina 28209; c/o Ballantyne Strong, Inc., 11422 Miracle Hills Drive, Suite 300, Omaha, Nebraska 68154; and 131 Plantation Ridge Dr., Suite 100, Mooresville, North Carolina 28117; and (vi) Mr. Johnson: c/o CWA Asset Management Group, LLC, 9130 Galleria Court, Third Floor, Naples, Florida 34109, and c/o Fundamental Global Investors, LLC, 4201 Congress Street, Suite 140, Charlotte, North Carolina 28209.
Equity Compensation Plans
controller, or persons performing similar functions) and employees. The following table provides information as of March 31, 2017 with respect to sharesfull text of our common stock that may be issuedCode of Ethics is available under existing equity compensation plans.
Plan Category | Number of Securities to be Issued Upon Exercise of Outstanding Options | Weighted Average Exercise Price of Outstanding Options | Number of Securities Remaining Available For Future Issuance under Equity Compensation Plans (excluding some securities reflected in first column) | |||||||
---|---|---|---|---|---|---|---|---|---|---|
Equity Compensation Plans Approved by Security Holders | ||||||||||
2007 Omnibus Incentive Plan | 3,035,125 | (1) | $ | 2.15 | (2) | — | ||||
2016 Omnibus Incentive Plan | 972,976 | (3) | $ | 4.92 | (4) | 2,443,382 | ||||
Equity Compensation Plans Not Approved by Security Holders | ||||||||||
None | ||||||||||
Total | 4,008,101 | (1)(3) | $ | 2.76 | (2)(4) | 2,443,382 |
subsequently filed.
If a stockholder wishes to submit a proposal which is not intended to be included in our proxy statement under Rule 14a-8 of the Exchange Act, or wishes to nominate a person as a candidate for election to the Board, the proposal or nomination must be received by us on or between July 11, 2018, 2018May 13, 2021 and August 10, 2018.June 12, 2021. If the date of the 20182021 Annual Meeting of Stockholders is called for a date that is not within 30 days before or after the anniversary date of the 20172020 Annual Meeting of Stockholders, (a situation that we do not anticipate), then the stockholder must submit any such proposal or nomination not later than the close of business of the 10th day following the earlier of (i) the day on which the notice of the meeting was mailed or (ii) public disclosure of the date of such meeting is first made. Stockholders are advised to review our bylaws which contain these advance notice requirements with respect to advance notice of stockholder proposals and director nominations.
The Board of Directors is not aware of any other matter which will be presented for action at the Annual Meeting other than the matters set forth in this proxy statement. If any other matter requiring a vote of the stockholders arise, it is intended that the proxy holders will vote the shares they represent as the Board of Directors may recommend. Discretionary authority with respect to such other matters is granted by the execution of the enclosed proxy card.
Santa Ana, CaliforniaSeptember 25, 2017
Appendix AITERIS, INC. EMPLOYEE STOCK PURCHASE PLAN
1. Purpose. This Iteris, Inc. ("Company") Employee Stock Purchase Plan (the "Plan") is intended to provide employees of the Company and its Participating Subsidiaries with an opportunity to acquire a proprietary interest in the Company through the purchase of shares of Common Stock. The Company intends that the Plan qualify as an "employee stock purchase plan" under Section 423 of the Code and the Plan shall be interpreted in a manner that is consistent with that intent.
2. Definitions.
"Board or Board of Directors" means the Board of Directors of the Company, as constituted from time to time.
"Code" means the U.S. Internal Revenue Code of 1986, as it may be amended from time to time. Any reference to a section of the Code shall be deemed to include a reference to any regulations promulgated thereunder.
"Committee" means the Compensation Committee or other committee appointed by the Board to administer the Plan.
"Common Stock" means the common stock of the Company, par value $0.10 per share.
"Company" means Iteris, Inc., a Delaware corporation, including any successor thereto.
"Compensation" means the fixed salary or base wage paid by the Company or a Participating Subsidiary to a Participant as reported by the Company or a Participating Subsidiary, as applicable, to the United States government for income tax purposes, including bonuses and commissions and an Employee's portion of salary deferral contributions pursuant to Section 401(k) of the Code and any amount excludable pursuant to Section 125 of the Code, overtime, vacation pay, holiday pay, jury duty pay and funeral leave pay, but excluding education or tuition reimbursements, imputed income arising under any group insurance or benefit program, travel expenses, business and relocation expenses, and income received in connection with stock options or other equity-based awards.
"Corporate Transaction" means a merger, consolidation, acquisition of property or stock, separation, reorganization or other corporate event described in Section 424 of the Code.
"Designated Broker" means the financial services firm or other agent designated by the Company to maintain ESPP Share Accounts on behalf of Participants who have purchased shares of Common Stock under the Plan.
"Effective Date" means January 1, 2018, subject to the Plan obtaining stockholder approval in accordance with Section 19.11 hereof.
"Employee" means any person who renders services to the Company or a Participating Subsidiary as an employee pursuant to an employment relationship with such employer. For purposes of the Plan, the employment relationship shall be treated as continuing intact while the individual is on military leave, sick leave or other leave of absence approved by the Company or a Participating Subsidiary that meets the requirements of Treasury Regulation Section 1.421-1(h)(2). Where the period of leave exceeds three (3) months, or such other period of time specified in Treasury Regulation Section 1.421-1(h)(2), and the individual's right to re-employment is not guaranteed by statute or contract, the employment relationship shall be deemed to have terminated on the first day immediately following such three-month period, or such other period specified in Treasury Regulation Section 1.421-1(h)(2).
"Eligible Employee" means an Employee who is customarily employed (and regularly scheduled) for at least twenty (20) hours per week and more than five (5) months in any calendar year.
Notwithstanding the foregoing, the Committee may exclude from participation in the Plan or any Offering Employees who are "highly compensated employees" of the Company or a Participating Subsidiary (within the meaning of Section 414(q) of the Code) or a sub-set of such highly compensated employees.
"Enrollment Form" means an agreement pursuant to which an Eligible Employee may elect to enroll in the Plan, to authorize a new level of payroll deductions, or to stop payroll deductions and withdraw from an Offering Period.
"ESPP Share Account" means an account into which Common Stock purchased with accumulated payroll deductions at the end of an Offering Period are held on behalf of a Participant.
"Exchange Act" means the U.S. Securities Exchange Act of 1934, as amended.
"Fair Market Value" means, as of any date, the value of the shares of Common Stock as determined below. If the shares are listed on any established stock exchange or a national market system, including, without limitation, the NASDAQ Stock Market, the Fair Market Value shall be the closing selling price of a share (or if no sales were reported, the closing price on the date immediately preceding such date) at the close of regular hours trading (i.e., before after-hours trading begins) as quoted on such exchange or system on the day of determination, as reported by the National Association of Securities Dealers (if primarily traded on the Nasdaq Global or Global Select Market) or as officially quoted in the composite tape of transactions on any other Stock Exchange on which the Common Stock is then primarily traded. In the absence of an established market for the shares, the Fair Market Value shall be determined in good faith by the Committee and such determination shall be conclusive and binding on all persons.
"Offering Date" means the first Trading Day of each Offering Period as designated by the Committee.
"Offering" or"Offering Period" means a period of six months beginning each January 1st and July 1st of each year; provided, that, pursuant to Section 5, the Committee may change the duration of future Offering Periods (subject to a maximum Offering Period of twenty-seven (27) months) and/or the start and end dates of future Offering Periods.
"Participant" means an Eligible Employee who is actively participating in the Plan.
"Participating Subsidiaries" means the Subsidiaries that have been designated as eligible to participate in the Plan, and such other Subsidiaries that may be designated by the Committee from time to time in its sole discretion.
"Plan" means this Iteris, Inc. Employee Stock Purchase Plan, as set forth herein, and as amended from time to time.
"Purchase Date" means the last Trading Day of each Offering Period.
"Purchase Price" means an amount equal to the lesser of (1) eighty-five percent (85%) (or such greater percentage as determined by the Committee) of the Fair Market Value on the Offering Date or (2) eighty-five percent (85%) (or such greater percentage as determined by the Committee) of the Fair Market Value on the Purchase Date; provided, that, the Purchase Price per share of Common Stock will in no event be less than the par value of the Common Stock.
"Securities Act" means the Securities Act of 1933, as amended.
"Subsidiary" means any domestic corporation, of which not less than 50% of the combined voting power is held by the Company or a Subsidiary, whether or not such corporation exists now or is hereafter organized or acquired by the Company or a Subsidiary. In all cases, the determination of whether an entity is a Subsidiary shall be made in accordance with Section 424(f) of the Code.
"Trading Day" means any day on which the national stock exchange upon which the Common Stock is listed is open for trading or, if the Common Stock is not listed on an established stock exchange or national market system, a business day, as determined by the Committee in good faith.
3. Administration. The Plan shall be administered by the Committee, which shall have the authority to construe and interpret the Plan, prescribe, amend and rescind rules relating to the Plan's administration and take any other actions necessary or desirable for the administration of the Plan. The Committee may correct any defect or supply any omission or reconcile any inconsistency or ambiguity in the Plan. The Committee shall have the authority and discretion to change the Purchase Price within the parameters set forth above, and if the Committee changes the Purchase Price from one Offering Period to another, the Company will notify Participants of any change in Purchase Price at least fifteen (15) days prior to the beginning of the next Offering Period to which the changed Purchase Price applies. The decisions of the Committee shall be final and binding on all persons. All expenses of administering the Plan shall be borne by the Company.
4. Eligibility. Unless otherwise determined by the Committee in a manner that is consistent with Section 423 of the Code, any individual who is an Eligible Employee as of the Offering Date for a particular Offering Period shall be eligible to participate in such Offering Period, subject to the requirements of Section 423 of the Code.
Notwithstanding any provision of the Plan to the contrary, no Eligible Employee shall be granted an option under the Plan if (i) immediately after the grant of the option, such Eligible Employee (or any other person whose stock would be attributed to such Eligible Employee pursuant to Section 424(d) of the Code) would own capital stock of the Company or hold outstanding options to purchase stock possessing 5% or more of the total combined voting power or value of all classes of stock of the Company or any Subsidiary or (ii) such option would permit his or her rights to purchase stock under all employee stock purchase plans (described in Section 423 of the Code) of the Company and its Subsidiaries to accrue at a rate that exceeds $25,000 of the Fair Market Value of such stock (determined at the time the option is granted) for each calendar year in which such option is outstanding at any time.
5. Offering Periods. The Plan shall be implemented by a series of Offering Periods, each of which shall be six (6) months in duration, with new Offering Periods commencing on or about January 1 and July 1 of each year (or such other times as determined by the Committee). The Committee shall have the authority to change the duration, frequency, start and end dates of Offering Periods.
6. Participation.
6.1 Enrollment; Payroll Deductions. An Eligible Employee may elect to participate in the Plan by properly completing an Enrollment Form, which may be electronic, and submitting it to the Company, in accordance with the enrollment procedures established by the Committee. Participation in the Plan is entirely voluntary. By submitting an Enrollment Form, the Eligible Employee authorizes payroll deductions from his or her pay check in an amount equal to at least 1%, but not more than 15% of his or her Compensation on each pay day occurring during an Offering Period (or such other maximum percentage as the Committee may establish from time to time before an Offering Period begins). Payroll deductions shall commence on the first payroll date following the Offering Date and end on the last payroll date on or before the Purchase Date. The Company shall maintain records of all payroll deductions but shall have no obligation to pay interest on payroll deductions or to hold such amounts in a trust or in any segregated account.
6.2 Election Changes. During an Offering Period, a Participant may decrease or increase his or her rate of payroll deductions applicable to such Offering Period only once. To make such a change, the Participant must submit a new Enrollment Form authorizing the new rate of payroll
deductions and any change shall become effective on the next payroll period that begins no earlier than five (5) business days after the Company's receipt of a new Enrollment Form or such other notice period as may be established by the Compensation Committee from time to time in its sole discretion (to the extent practical under the Company's payroll practices) following delivery of a new Enrollment Form. A Participant may decrease or increase his or her rate of payroll deductions for future Offering Periods by submitting a new Enrollment Form authorizing the new rate of payroll deductions at least fifteen days before the start of the next Offering Period.
6.3 Automatic Re-enrollment. The deduction rate selected in the Enrollment Form shall remain in effect for subsequent Offering Periods unless the Participant (a) submits a new Enrollment Form authorizing a new level of payroll deductions in accordance with Section 6.2, (b) withdraws from the Plan in accordance with Section 10, or (c) terminates employment or otherwise becomes ineligible to participate in the Plan.
7. Grant of Option. On each Offering Date, each Participant in the applicable Offering Period shall be granted an option to purchase, on the Purchase Date, a number of shares of Common Stock determined by dividing the Participant's accumulated payroll deductions by the applicable Purchase Price; provided, however, that in no event shall any Participant purchase more than 5,000 shares of Common Stock during an Offering Period (subject to adjustment in accordance with Section 18 and the limitations set forth in Section 13 of the Plan).
8. Exercise of Option/Purchase of Shares. A Participant's option to purchase shares of Common Stock will be exercised automatically on the Purchase Date of each Offering Period. The Participant's accumulated payroll deductions will be used to purchase the maximum number of whole shares that can be purchased with the amounts in the Participant's notional account. No fractional shares may be purchased but any remaining funds that are not used to purchase Common Stock will carry forward to the next Offering Period, subject to earlier withdrawal by the Participant in accordance with Section 10 or termination of employment in accordance with Section 11.
9. Transfer of Shares. As soon as reasonably practicable after each Purchase Date, the Company will arrange for the delivery to each Participant of the shares of Common Stock purchased upon exercise of his or her option. The Committee may permit or require that the shares be deposited directly into an ESPP Share Account established in the name of the Participant with a Designated Broker and may require that the shares of Common Stock be retained with such Designated Broker for a specified period of time. Participants will not have any voting, dividend or other rights of a shareholder with respect to the shares of Common Stock subject to any option granted hereunder until such shares have been delivered pursuant to this Section 9.
10. Withdrawal.
10.1 Withdrawal Procedure. A Participant may withdraw from an Offering by submitting to the Company a revised Enrollment Form indicating his or her election to withdraw at any time before the Purchase Date, provided that such revised Enrollment Form is received at least ten (10) business days prior to the Purchase Date (or such other period as may be established by the Compensation Committee from time to time in its sole discretion). The accumulated payroll deductions held on behalf of a Participant in his or her notional account (that have not been used to purchase shares of Common Stock) shall be paid to the Participant promptly following receipt of the Participant's Enrollment Form indicating his or her election to withdraw and the Participant's option shall be automatically terminated. If a Participant withdraws from an Offering Period, no payroll deductions will be made during any succeeding Offering Period, unless the Participant re-enrolls in accordance with Section 6.1 of the Plan.
10.2 Effect on Succeeding Offering Periods. A Participant's election to withdraw from an Offering Period will not have any effect upon his or her eligibility to participate in succeeding
Offering Periods that commence following the completion of the Offering Period from which the Participant withdraws, provided the Participant submits a new Enrollment Form in accordance with this Plan.
11. Termination of Employment; Change in Employment Status. Upon termination of a Participant's employment for any reason, including death, disability or retirement, or a change in the Participant's employment status following which the Participant is no longer an Eligible Employee, which in either case occurs at least fifteen days (or such other period as may be established by the Compensation Committee from time to time in its sole discretion) before the Purchase Date, the Participant will be deemed to have withdrawn from the Plan and the payroll deductions in the Participant's notional account (that have not been used to purchase shares of Common Stock) shall be returned to the Participant, or in the case of the Participant's death, to the person(s) entitled to such amounts under Section 17, and the Participant's option shall be automatically terminated. If the Participant's termination of employment or change in status occurs within fifteen days (or such other period as may be established by the Compensation Committee from time to time in its sole discretion) before a Purchase Date, the accumulated payroll deductions shall be used to purchase shares on the Purchase Date.
12. Interest. No interest shall accrue on or be payable with respect to the payroll deductions of a Participant in the Plan.
13. Shares Reserved for Plan.
13.1 Number of Shares. A total of One Million (1,000,000) shares of Common Stock have been reserved as authorized for the grant of options under the Plan. The shares of Common Stock may be newly issued shares, treasury shares or shares acquired on the open market.
13.2 Over-subscribed Offerings. The number of shares of Common Stock which a Participant may purchase in an Offering under the Plan may be reduced if the Offering is over-subscribed. No option granted under the Plan shall permit a Participant to purchase shares of Common Stock which, if added together with the total number of shares of Common Stock purchased by all other Participants in such Offering would exceed the total number of shares of Common Stock remaining available under the Plan. If the Committee determines that, on a particular Purchase Date, the number of shares of Common Stock with respect to which options are to be exercised exceeds the number of shares of Common Stock then available under the Plan, the Company shall make a pro rata allocation of the shares of Common Stock remaining available for purchase in as uniform a manner as practicable and as the Committee determines to be equitable.
14. Transferability.�� No payroll deductions credited to a Participant, nor any rights with respect to the exercise of an option or any rights to receive Common Stock hereunder may be assigned, transferred, pledged or otherwise disposed of in any way (other than by will, the laws of descent and distribution, or as provided in Section 17 hereof) by the Participant. Any attempt to assign, transfer, pledge or otherwise dispose of such rights or amounts shall be without effect.
15. Application of Funds. All payroll deductions received or held by the Company under the Plan may be used by the Company for any corporate purpose to the extent permitted by applicable law, and the Company shall not be required to segregate such payroll deductions or contributions.
16. Statements. Participants will be provided with statements at least annually which shall set forth the contributions made by the Participant to the Plan, the Purchase Price of any shares of Common Stock purchased with accumulated funds, the number of shares of Common Stock purchased, and any payroll deduction amounts remaining in the Participant's notional account.
17. Designation of Beneficiary. A Participant may file, on forms supplied by the Company, a written designation of beneficiary who is to receive any shares of Common Stock and cash in respect of
any fractional shares of Common Stock, if any, from the Participant's ESPP Share Account under the Plan in the event of such Participant's death. In addition, a Participant may file a written designation of beneficiary who is to receive any cash withheld through payroll deductions and credited to the Participant's notional account in the event of the Participant's death prior to the Purchase Date of an Offering Period.
18. Adjustments Upon Changes in Capitalization; Dissolution or Liquidation; Corporate Transactions.
18.1 Adjustments. In the event that any dividend or other distribution (whether in the form of cash, Common Stock, or other property), recapitalization, stock split, reverse stock split, reorganization, merger, consolidation, reincorporation, other reorganization, split-up, spin-off, combination, repurchase, or exchange of Common Stock or other securities of the Company, or other change in the Company's structure affecting the Common Stock occurs without the Company's receipt of consideration, or should the value of shares of Common Stock be substantially reduced as a result of a spin-off transaction or an extraordinary dividend or distribution, then in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan, the Committee will, in such manner as it deems equitable, adjust the number of shares and class of Common Stock that may be delivered under the Plan, the Purchase Price per share and the number of shares of Common Stock covered by each outstanding option under the Plan, and the numerical limits of Section 7 and Section 13.
18.2 Dissolution or Liquidation. Unless otherwise determined by the Committee, in the event of a proposed dissolution or liquidation of the Company, any Offering Period then in progress will be shortened by setting a new Purchase Date and the Offering Period will end immediately prior to the proposed dissolution or liquidation. The new Purchase Date will be before the date of the Company's proposed dissolution or liquidation. Before the new Purchase Date, the Committee will provide each Participant with written notice, which may be electronic, of the new Purchase Date and that the Participant's option will be exercised automatically on such date, unless before such time, the Participant has withdrawn from the Offering in accordance with Section 10.
18.3 Corporate Transaction. In the event of a Corporate Transaction, the Committee may cause each outstanding option to be assumed or an equivalent option substituted by the successor corporation or a parent or Subsidiary of such successor corporation. If the successor corporation does not assume or substitute the option, the Committee may either: (a) shorten the Offering Period with respect to which the option relates and set a new Purchase Date on which the Offering Period will end. The new Purchase Date will occur before the date of the Corporate Transaction. Prior to the new Purchase Date, the Committee will provide each Participant with written notice, which may be electronic, of the new Purchase Date and that the Participant's option will be exercised automatically on such date, unless before such time, the Participant has withdrawn from the Offering in accordance with Section 10; or (b) terminate the Offering Period and refund all accumulated payroll deductions to the Participants.
19. General Provisions.
19.1 Equal Rights and Privileges. Notwithstanding any provision of the Plan to the contrary and in accordance with Section 423 of the Code, all Eligible Employees who are granted options under the Plan shall have the same rights and privileges.
19.2 No Right to Continued Service. Neither the Plan nor any compensation paid hereunder will confer on any Participant the right to continue as an Employee or in any other capacity.
19.3 Rights as Stockholder. A Participant will become a stockholder with respect to the shares of Common Stock that are purchased pursuant to options granted under the Plan when the shares are transferred to the Participant's ESPP Share Account. A Participant will have no rights
as a stockholder with respect to shares of Common Stock for which an election to participate in an Offering Period has been made until such Participant becomes a stockholder as provided above.
19.4 Successors and Assigns. The Plan shall be binding on the Company and its successors and assigns.
19.5 Entire Plan. This Plan constitutes the entire plan with respect to the subject matter hereof and supersedes all prior plans with respect to the subject matter hereof.
19.6 Compliance with Law. The obligations of the Company with respect to payments under the Plan are subject to compliance with all applicable laws and regulations. Common Stock shall not be issued with respect to an option granted under the Plan unless the exercise of such option and the issuance and delivery of the shares of Common Stock pursuant thereto shall comply with all applicable provisions of law, including, without limitation, the Securities Act, the Exchange Act, and the requirements of any stock exchange upon which the shares may then be listed.
19.7 Notice of Disqualifying Dispositions. Each Participant shall give the Company prompt written notice of any disposition or other transfer of shares of Common Stock acquired pursuant to the exercise of an option acquired under the Plan, if such disposition or transfer is made within two years after the Offering Date or within one year after the Purchase Date.
19.8 Term of Plan. The Plan shall become effective on the Effective Date and, unless terminated earlier pursuant to Section 19.9, shall have a term of ten years.
19.9 Amendment or Termination. The Committee may, in its sole discretion, amend, suspend or terminate the Plan at any time and for any reason, provided, however, that in no event may the Committee effect any of the following amendments or revisions to the Plan without the approval of the Company's shareholders: (i) increase the number of shares of Common Stock issuable under the Plan (other than adjustments pursuant to Section 19.1) or (ii) materially modify the requirements for eligibility to participate in the Plan. If the Plan is terminated, the Committee may elect to terminate all outstanding Offering Periods either immediately or once shares of Common Stock have been purchased on the next Purchase Date (which may, in the discretion of the Committee, be accelerated) or permit Offering Periods to expire in accordance with their terms (and subject to any adjustment in accordance with Section 18). If any Offering Period is terminated before its scheduled expiration, all amounts that have not been used to purchase shares of Common Stock will be returned to Participants (without interest, except as otherwise required by law) as soon as administratively practicable.
19.10 Applicable Law. The laws of the State of Delaware shall govern all questions concerning the construction, validity and interpretation of the Plan, without regard to such state's conflict of law rules.
19.11 Stockholder Approval. The Plan shall be subject to approval by the shareholders of the Company within twelve (12) months before or after the date the Plan is adopted by the Board.
19.12 Section 423. The Plan is intended to qualify as an "employee stock purchase plan" under Section 423 of the Code. Any provision of the Plan that is inconsistent with Section 423 of the Code shall be reformed to comply with Section 423 of the Code.
19.13 Withholding. To the extent required by applicable Federal, state or local law, a Participant must make arrangements satisfactory to the Company for the payment of any withholding or similar tax obligations that arise in connection with the Plan.
19.14 Severability. If any provision of the Plan shall for any reason be held to be invalid or unenforceable, such invalidity or unenforceability shall not affect any other provision hereof, and the Plan shall be construed as if such invalid or unenforceable provision were omitted.
19.15 Headings. The headings of sections herein are included solely for convenience and shall not affect the meaning of any of the provisions of the Plan.
PROXY
ITERIS, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
The undersigned stockholder of ITERIS, INC. hereby appoints JOE BERGERA and ANDREW SCHMIDT, and each of them, proxies of the undersigned, each with full power to act without the other and with power of substitution, to represent the undersigned at the Annual Meeting of Stockholders of Iteris to be held at the Company’s principal executive offices located at 1700 Carnegie Avenue, Suite 100,
The undersigned hereby revokes any other proxy to vote at such Annual Meeting and hereby ratifies and confirms all that said proxies, and each of them, may lawfully do by virtue hereof.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN ACCORDANCE WITH THE INSTRUCTIONS INDICATED OR, IF NO INSTRUCTIONS ARE INDICATED, THIS PROXY WILL BE VOTED “FOR” THE ELECTIONJuly 27, 2020
PLEASE MARK, SIGN, DATE, AND RETURN THIS PROXY CARD PROMPTLY USING THE ENCLOSED ENVELOPE.
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A. Proposals - The Board of Directors recommends a vote FOR all of the nominees listed below, and FOR Proposals 2 and 3.
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IF VOTING BY MAIL, YOU MUST COMPLETE SECTIONS A, B and CON BOTH SIDES OF THIS CARD.