No fee required
26, 2021
By order of the Board of Directors |
26, 2021:
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Only stockholders and persons holding proxies from stockholders may
to attend.
Abstentions
Attending the Annual Meeting and Other Matters
at the Annual Meeting will be tabulated by the inspector of elections.
Whether or not you plan to attend the Annual Meeting, we urge you to vote and submit your proxy in advance of the Annual Meeting.You may also vote in person at the Annual Meeting. Votes in person will replace any previous votes you have made. The Company will provide a ballot to registered stockholders who request one at the meeting. Shares of Common Stock held in your name as the stockholder of record may be voted on that ballot. Shares of Common Stock held beneficially in street name may be voted on a ballot only if you bring a legal proxy from the broker, trust, bank or other nominee that holds your shares giving you the right to vote the shares. Attendance at the Annual Meeting without voting or revoking a previous proxy in accordance with the voting procedures will not in and of itself revoke a proxy.
Your vote is very important. Whether or not you plan to attend the Annual Meeting, please take the time to vote that your shares will be represented at the Annual Meeting.
Beneficial Owner | Amount and Nature of Beneficial Ownership | Percent of Class | ||||||
Howard Brod Brownstein | 14,898 | (1) | * | |||||
Jeffrey D. Franklin | 5,520 | (1)(2)(3) | * | |||||
Richard A. Horowitz | 1,362,436 | (3)(4) | 36.1 | % | ||||
Joseph A. Molino, Jr. | 148,199 | (3)(5) | 4.0 | % | ||||
Richard P. Randall | 5,088 | (1)(3)(6) | * | |||||
Kenneth M. Scheriff | 4,620 | (1)(2)(3) | * | |||||
Mitchell A. Solomon | 5,520 | (1)(2)(3) | * | |||||
FMR LLC | 449,417 | (7) | 12.5 | % | ||||
Grace Horowitz | 232,611 | (8) | 6.5 | % | ||||
Lawndale Capital Management, LLC | 407,233 | (9) | 11.3 | % | ||||
All directors and executive officers as a group (7 persons) | 1,546,125 | (10) | 39.7 | % |
Beneficial Owner | | | Amount and Nature of Beneficial Ownership | | | Percent of Class | | ||||||
Howard Brod Brownstein | | | | | 20,648(1) | | | | | | * | |
Jeffrey D. Franklin | | | 10,748(1) | | | | | | * | | |
Richard A. Horowitz | | | 1,366,306(2) | | | | | | 42.5% | | |
Joseph A. Molino, Jr | | | 177,295(3) | | | | | | 5.4% | | | ||
Richard P. Randall | | | | | 10,838(1)(4) | | | | | | * | | |
Kenneth M. Scheriff | | | | | 9,848(1) | | | | | | * | | |
Mitchell A. Solomon | | | | | 10,748(1) | | | | | | * | | |
Grace Horowitz | | | | | 217,471(5) | | | | | | 6.8% | | |
Lawndale Capital Management, LLC | | | | | 303,110(6) | | | | | | 9.5% | | |
All directors and executive officers as a | | | | | 1,606,431(7) | | | | | | 48.7% | | |
and Effect
Name | | | Age | | | Served as Director Continuously Since | | ||||||
Nominees to Continue in Office until the 2024 Annual Meeting of Stockholder: | | | | | | | | | | | | | |
Jeffrey D. Franklin | | | | | 67 | | | | | | 2004 | | |
Richard P. Randall | | | | | 83 | | | | | | 2012 | | |
Directors to Serve in Office Until the 2022 Annual Meeting of Stockholders: | | | | | | | | | | | | | |
Howard Brod Brownstein | | | | | 70 | | | | | | 2010 | | |
Richard A. Horowitz | | | | | 71 | | | | | | 1975 | | |
Directors to Serve in Office Until the 2023 Annual Meeting of Stockholders | | | | | | | | | | | | | |
Kenneth M. Scheriff | | | | | 71 | | | | | | 2005 | | |
Mitchell A. Solomon | | | | | 61 | | | | | | 2004 | | |
Name | Age | Served as Director Continuously Since | ||
Nominees to Continue in Office until the 2019 Annual Meeting of Stockholder: | ||||
Howard Brod Brownstein | 65 | 2010 | ||
Richard A. Horowitz | 66 | 1975 | ||
Directors to Serve in Office Until the 2017 Annual Meeting of Stockholders: | ||||
Kenneth M. Scheriff | 66 | 2005 | ||
Mitchell A. Solomon | 56 | 2004 | ||
Director to Serve in Office Until the 2018 Annual Meeting of Stockholders: | ||||
Jeffrey D. Franklin | 62 | 2004 | ||
Richard P. Randall | 78 | 2012 |
Richard A. Horowitz has been Chairman of the Board of Directors and Chief Executive Officer of the Company since November 1995 and has been President of the Company since 1986. Mr. Horowitz brings valuable insight and knowledge about the Company to the Board of Directors due to his extensive experience as an executive officer of the Company, his perspective as a long-standing significant Company stockholder, and his many years of oversight of the businesses which the Company operates.
The Company’s independent directors hold annually at least two formal meetings independent from management.or executive sessions of the Board of Directors without management present. In 2015,2020, the Company’s independent directors held four such meetings.meetings or sessions. The Lead Independent Director, or in his absence, another independent director chosen by the independent directors, presides at such non-management sessions of the Board of Directors.meetings or sessions. The role of the Lead Independent Director is discussed in greater detail under “Board Leadership Structure” below.
Name of Director | | | Cash fees ($)(1) | | | Stock awards ($)(2) | | | Total compensation ($) | | |||||||||
Howard Brod Brownstein | | | | | 40,500 | | | | | | 6,425 | | | | | | 46,925 | | |
Jeffrey D. Franklin | | | | | 45,500 | | | | | | 6,425 | | | | | | 51,925 | | |
Richard P. Randall | | | | | 39,250 | | | | | | 6,425 | | | | | | 45,675 | | |
Kenneth M. Scheriff | | | | | 31,500 | | | | | | 6,425 | | | | | | 37,925 | | |
Mitchell A. Solomon | | | | | 30,500 | | | | | | 6,425 | | | | | | 36,925 | | |
Name of Director | Cash fees ($)(1) | Stock awards ($)(2) | Total compensation ($) | |||||||||
Howard Brod Brownstein | 37,500 | 8,630 | 46,130 | |||||||||
Jeffrey D. Franklin | 47,500 | 8,630 | 56,130 | |||||||||
Richard P. Randall | 40,500 | 8,630 | 49,130 | |||||||||
Kenneth M. Scheriff | 33,500 | 8,630 | 42,130 | |||||||||
Mitchell A. Solomon | 32,500 | 8,630 | 41,130 |
Upon initial election to the Board of Directors, each Non-Employee Director receives an option to purchase 2,000 shares of Common Stock. Each Non-Employee Director in office received 1,0001,250 restricted shares of Common Stock in May 2015 and it is anticipated that an additional 1,000 restricted shares will be granted to each Non-Employee Director in office following the Annual Meeting.2020. The Company may consider changing the fees paid to the Company’s non-management directors and/or granting additional restricted stock, options, or other forms of equity-basedequity- based compensation to such directors.directors in the future; however, the Company does not expect to grant additional restricted shares to the Non-Employee Directors immediately following the Annual Meeting as it did in 2020. Directors who are also officers of the Company are not compensated for their duties as directors.
| | | 2020 | | | 2019 | | ||||||
Audit Fees | | | | $ | 280,200 | | | | | $ | 274,000 | | |
Audit-Related Fees | | | | | 26,500 | | | | | | 21,000 | | |
Tax Fees | | | | | -0- | | | | | | -0- | | |
All Other Fees | | | | | 15,967 | | | | | | 10,011 | | |
| | | | $ | 322,667 | | | | | $ | 305,011 | | |
2015 | 2014 | |||||||
Audit Fees | $ | 259,000 | $ | 299,000 | ||||
Audit-Related Fees | 34,500 | -0- | ||||||
Tax Fees | -0- | -0- | ||||||
All Other Fees | 33,500 | 19,050 | ||||||
$ | 327,000 | $ | 318,050 |
Audit fees include fees billed for the audit of P&F Industries, Inc. and its subsidiaries, the review of quarterly financial information, and attendance at Audit Committee meetings.
testing and other internal control matters as well as certain accounting related consultations.
2019.
and Effect
2021 STOCK INCENTIVE PLAN)
“RESOLVED, that thedeductible compensation paid to the Company’s namedcovered employees); and (iv) in the event that the payment, exercisability or vesting of any award is accelerated because of a change in ownership (as defined in Code Section 280G(b)(2)), and such payment of an award, either alone or together with any other payments made to certain participants, constitute parachute payments under Code Section 280G, then subject to certain exceptions, a portion of such payments would be nondeductible to the Company and the participant would be subject to a 20% excise tax on such portion of the payment.
As described in greater detail under “Compensation Philosophy and Agreements with Named Executive Officers,” our compensation programs are designed to motivate our executives to createnot including a successful company. We believe that our compensation program rewards sustained performance that is linked to long-term stockholder interests. Stockholders are encouraged to read the “Compensation Philosophy and Agreements with Named Executive Officers,” the accompanying compensation tables, and the related narrative disclosure included“New Plan Benefits” table in this Proxy Statement.
This non-binding advisory vote on executive compensation
Name | | Age | | | Title | | |
Richard A. Horowitz | | 71 | | | Chairman of the Board, President, Chief Executive Officer and Assistant Treasurer | | |
Joseph A. Molino, Jr. | | 57 | | | Vice President, Chief Operating Officer, Chief Financial Officer, Secretary and Treasurer | |
Name and Principal Position | | | Year | | | Salary ($) | | | Bonus ($) | | | Stock Awards ($) | | | Option Awards ($) | | | Non-Equity Plan Compensation ($)(1) | | | All other Compensation ($)(2)(3) | | | Total ($) | | ||||||||||||||||||||||||
Richard A. Horowitz Chairman of the Board, President and Chief Executive Officer (Principal Executive Officer) | | | | | 2020 | | | | | | 775,000 | | | | | | -0- | | | | | | -0- | | | | | | -0- | | | | | | -0- | | | | | | 65,330 | | | | | | 840,330 | | |
| | | 2019 | | | | | | 775,000 | | | | | | -0- | | | | | | -0- | | | | | | -0- | | | | | | 850,000 | | | | | | 67,406 | | | | | | 1,692,406 | | | ||
Joseph A. Molino, Jr. Vice President, Chief Operating Officer and Chief Financial Officer (Principal Financial Officer) | | | | | 2020 | | | | | | 400,000 | | | | | | -0- | | | | | | -0- | | | | | | -0- | | | | | | -0- | | | | | | 51,475 | | | | | | 451,475 | | |
| | | 2019 | | | | | | 400,000 | | | | | | -0- | | | | | | -0- | | | | | | -0- | | | | | | 175,000 | | | | | | 59,412 | | | | | | 634,412 | | |
Name and Principal Position | Year | Salary ($) | Bonus ($) | Stock Awards ($)(1) | Option Awards ($) | Non-Equity Plan Compensation ($)(2) | All other Compensation ($)(3)(4) | Total ($) | |||||||||||||||||||||||||||
Richard A. Horowitz Chairman of the Board, President and Chief Executive Officer (Principal Executive Officer) | 2015 | 700,000 | -0- | -0- | -0- | 712,000 | 116,723 | 1,528,723 | |||||||||||||||||||||||||||
2014 | 700,000 | -0- | -0- | -0- | 732,900 | 147,790 | 1,580,690 | ||||||||||||||||||||||||||||
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Joseph A. Molino, Jr. Vice President, Chief Operating Officer and Chief Financial Officer (Principal Financial Officer) | 2015 | 375,000 | -0- | 17,150 | -0- | 172,000 | 58,906 | 623,056 | |||||||||||||||||||||||||||
2014 | 375,000 | -0- | -0- | -0- | 153,000 | 52,459 | 580,459 | ||||||||||||||||||||||||||||
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On April 2, 2015, the Company issued 2,500 restricted shares toor Mr. Molino in accordance with the Molino Employment Agreement described below, under the Company’s 2012 Stock Incentive Plan (the “2012 Plan”). These shares vest as to one-third on the first, second and third anniversaries of the date of grant; provided, however, that 100% of the then unvested portion of the shares shall vest in the event of Mr. Molino’s death2020 or termination due to disability or upon a Change in Control (as defined in the 2012 Plan).
2020
| | | Option Awards | | | Stock Awards | | ||||||||||||||||||||||||||||||
Name | | | Number of Securities Underlying Unexercized Options (#) Exercisable | | | Number of Securities Underlying Unexercized Options (#) Unexercisable | | | Option Exercise Price ($) | | | Option Expiration Date | | | Number of Shares or Units of Stock that have not Vested (#) | | | Market Value of Shares or Units of Stock that have not Vested ($) | | ||||||||||||||||||
Richard A. Horowitz Chairman of the Board, President and Chief Executive Officer (Principal Executive Officer) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | -0- | | | | | | -0- | | |
| | | 30,000 | | | | | | -0- | | | | | | 7.09 | | | | | | 9/4/2027 | | | | | ||||||||||||
Joseph A. Molino, Jr. Vice President, Chief Operating Officer and Chief Financial Officer (Principal Financial Officer) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | -0- | | | | | | -0- | | |
| | | 41,809 | | | | | | -0- | | | | | | 4.74 | | | | | | 6/21/2022 | | | | | ||||||||||||
| | | 15,678 | | | | | | -0- | | | | | | 7.86 | | | | | | 4/10/2023 | | | | | ||||||||||||
| | | 25,000 | | | | | | -0- | | | | | | 7.09 | | | | | | 9/4/2027 | | | | | | | | | | | | | | |
Option Awards | Stock Awards | |||||||||||||||||||||||||
Name | Number of Securities Underlying Unexercized Options (#) Exercisable | Number of Securities Underlying Unexercized Options (#) Unexercisable | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock that have not vested (#) | Market Value of Shares or Units of Stock that have not Vested ($) | ||||||||||||||||||||
Richard A. Horowitz Chairman of the Board, President and Chief (Principal Executive Officer) | 25,000 | 11.20 | 6/18/2017 | |||||||||||||||||||||||
145,000 | 4.16 | 6/23/2018 | ||||||||||||||||||||||||
Joseph A. Molino, Jr. Vice President, Chief Operating Officer and Chief Financial Officer (Principal Financial Officer) | 20,000 | 11.20 | 6/18/2017 | 2,500 | (2) | 22,100 | (3) | |||||||||||||||||||
25,000 | 4.16 | 6/23/2018 | ||||||||||||||||||||||||
15,000 | 4.56 | 5/15/2021 | ||||||||||||||||||||||||
40,000 | 4.95 | 6/21/2022 | ||||||||||||||||||||||||
10,000 | 8.21 | 4/10/2023 | ||||||||||||||||||||||||
5,000 | (1) | 8.21 | 4/10/2023 |
On May 6, 2015, Mr. Molino exercised an option to purchase 15,000 shares of Common Stock with an exercise price of $3.05 per share. The closing market price of the Common Stock on such date was $6.66 per share.
The named executive officers
The Compensation Committee approved the terms of the Horowitz Employment Agreement after a multi-month process in which it and the independent directors of the Board evaluated Mr. Horowitz’s performance, Mr. Horowitz’s value to the Company and appropriate market comparables. In doing so,comparables, and consultation with the independent members of the Board of Directors, and the subsequent approval of such independent members. The Compensation Committee utilized the services of Steven Hall & Partners, an independent compensationCompensation consulting firm, as well as the services of special legal counsel to the Compensation Committee.
Mr. Horowitz’s 2020 and 2019 compensation were governed by the Horowitz Employment Agreement.
In the event Mr. Horowitz’s employment is terminated by the Company without Cause (as defined in the Horowitz Employment Agreement), or Mr. Horowitz resigns for Good Reason (as defined in the Horowitz Employment Agreement), then subject to his execution of a general release, (i) he will continue to receive his base salary for 2024 months, (ii) he will receive payments for accrued but unpaid salary, prior period bonus and eligible unreimbursed expenses, (iii) he will receive a pro rata bonusPro Rata Bonus for the year of termination, (the “Pro Rata Bonus”), and (iii)(iv) the Company will pay him monthly an amount equal to the difference in his COBRA premium and the active employee contribution for medical coverage until the earlier of (a) 1836 months from the date of termination, (b) his becoming eligible for medical benefits from a subsequent employer, or (c) his becoming ineligible for COBRA.
Code of 1986, as amended) if such amount would result in a higher after-tax net payment to Mr. Horowitz.
if the Company did not achieve its performance goals or at the discretion of the Compensation Committee. However, asBonus. As a result of the Company’s performance exceedinguncertainties due to the performanceCOVID-19 global pandemic, the Compensation Committee did not adopt any specific bonus targets for 2015 and other factors, including Mr. Horowitz’s roleHorowitz in 2015 in2020. Furthermore, largely due to the implementationimpact of the Company’s strategic plan established by the Board of Directors to dispose ofCOVID-19 pandemic on the Company’s Nationwide Industries, Inc. subsidiary (which disposition was consummatedresults of operations in 2016),2020, the Compensation Committee did not award Mr. Horowitz received a bonus of $712,000 for 2015.
2020.
Board of Directors. The Compensation Committee approved the terms of the Molino Employment Agreement after a process in which it and the independent directors of the Board evaluated Mr. Molino’s performance, Mr. Molino’shis value to the Company, and appropriate market comparables. In doing so, the Compensation Committee utilized the services of Steven Hall & Partners, an
Mr. Molino’s 2020 and 2019 compensation were governed by the Molino Employment Agreement.
expenses.
installments. Notwithstanding the foregoing, in the event an Excise Tax (as defined in the Molino Employment Agreement) would otherwise be incurred by Mr. Molino, amounts paid to Mr. Molino upon a Change in Control will be reduced to 2.99 times his “base amount” (as(as determined in accordance with Sections 280G of the Internal Revenue Code of 1986, as amended).
2020.
Prior Horowitz Employment Agreement. On December 29, 2011, the Company and Richard A. Horowitz entered into an Executive Employment Agreement (the “Prior Horowitz Employment Agreement”“Bonus Plan”), effective as of January 1, 2012. The Prior Horowitz Employment Agreement provided for Mr. Horowitz to serve as the Company’s President and Chief Executive Officer and, if elected by the Board, ChairmanApril 22, 2021 date of the Board, for a term expiring on December 31, 2014, unless sooner terminated pursuant to the provisions of the Prior Horowitz Employment Agreement. Pursuant to the Prior Horowitz Employment Agreement, Mr. Horowitz received a minimum annual base salary of $650,000. Mr. Horowitz’s base salary was reviewed annuallyits approval by the Board of Directors and could have been increased, but not decreased, from time to time. Pursuant to a 2014 amendment to the Prior Horowitz Employment Agreement, the Compensation Committee increased Mr. Horowitz’s annual base salary rate to $700,000 as of January 1, 2014. Mr. Horowitz was eligible for an annual incentive payment in accordance with the terms and conditions of the 162(m)Directors. The Bonus Plan (or a successor plan) with performance goals to be set byreplaced the Compensation Committee in its sole discretion (after discussions with Mr. Horowitz), with a target of 50% of his then-current base salary, and a maximum bonus based on exceeding performance targets as established by the Compensation Committee of 150% of his then-current base salary. Pursuant to the 2014 amendment, the target and maximum bonus amounts were increased to 55% and 165%, respectively, for 2014.
The Prior Horowitz Employment Agreement further provided that Mr. Horowitz would also receive (i) senior executive level employee benefits, (ii) continuation of the annual payment of approximately $45,000 relating to premiums on a life insurance policy, (iii) a Company-provided automobile and the payment of certain related expenses and (iv) payment and/or reimbursement of certain legal and consultants’ fees. Mr. Horowitz received no equity grants in connection with the Prior Horowitz Employment Agreement.
In the event Mr. Horowitz’s employment
Pursuant to the Prior Horowitz Employment Agreement, during term of his employment and for a period of twelve months after termination of his employment, Mr. Horowitz was prohibited from (i) competingcomply with the Company, (ii) soliciting or hiring the Company’s employees, representatives or agents, or (iii) soliciting any of the Company’s customers. The Prior Horowitz Employment Agreement also prohibited Mr. Horowitz from using or disclosing any of the Company’s non-public, proprietary or confidential information.
Severance Agreement with Mr. Molino. In 2014, the Company did not have an employment agreement with Mr. Molino who was deemed“qualified performance-based compensation exception” to be an employee “at will”. However, the Company and Mr. Molino entered into a Severance Agreement (the “Severance Agreement”), effective as of June 22, 2012, which agreement provided that in the event Mr. Molino’s employment was terminated by the Company without Cause (as defined in the Severance Agreement) on or prior to December 31, 2014 and a Change in Control (as defined in the Severance Agreement) had not occurred, then subject to his execution of a general release, he would continue to receive his base salary for 12 months (the “Severance Amount”).
Pursuant to the Severance Agreement, in the event Mr. Molino’s employment was terminated by the Company without Cause or he resigns for Good Reason (as defined in the Severance Agreement) within two years following a Change in Control (as defined in the Severance Agreement) that occurred prior to December 31, 2014, then subject to his execution of a general release (i) he would receive the Severance Amount either in whole or in part in a lump sum depending on whether the Change in Control constitutes a “change in control event” within the meaning of Section 409A of the Internal Revenue Code, (ii) he would receive an amount equal to his target annual bonus for the fiscal year such termination occurs, and (iii) the Company would pay him monthly an amount equal to the difference in his COBRA premium and the active employee contribution for medical coverage until the earlier of (a) 12 months from the date of termination, (b) his becoming eligible for medical benefits from a subsequent employer, or (c) his becoming ineligible for COBRA. Notwithstanding the foregoing, in the event an Excise Tax (as defined in the Severance Agreement) would otherwise be incurred by Mr. Molino, amounts paid to Mr. Molino upon a Change in Control will be reduced to 2.99 times his “base amount” (as determined in accordance with Sections 280G of the Internal Revenue Code).
In the event of a termination of Mr. Molino’s employment due to his death or by the Company due to his disability (i) he would receive a pro rata bonus for the year of termination and (ii) the Company would pay him or his estate monthly an amount equal to the difference in his COBRA premium and the active employee contribution for medical coverage until the earlier of (a) one year from the date of termination, (b) Mr. Molino or his dependents becoming ineligible for COBRA or (c) in the case of a termination due to disability, his ceasing to have a physical or mental disability that would prevent him from performing his material duties for the Company.
Pursuant to the Severance Agreement, during the term of his employment and for a period of twelve months after termination of his employment, Mr. Molino was prohibited from (i) competing with the Company, (ii) soliciting or hiring the Company’s employees, representatives or agents, or (iii) soliciting any of the Company’s customers. The Severance Agreement also prohibited Mr. Molino from using or disclosing any of the Company’s non-public, proprietary or confidential information.
In March 2016, the Compensation Committee designated that Mr. Horowitz and Mr. Molino would each be participating in the 162(m) Bonus Plan for 2016, and set forth the maximum bonus for 2016 for each such named executive officer, based on the achievement of certain target levels of Company profit, calculated based upon the level of earnings before taxes, depreciation and amortization to be achieved by the Company for fiscal 2016 with certain adjustments, which is subject to reduction by the Compensation Committee in its discretion, after reviewing narrower earnings-based achievement standards and other factors.
The 162(m) Bonus Plan was approved by the Compensation Committee, the Board of Directors and the stockholders in 2011, and re-adopted by such committee, the Board of Directors and the stockholders in 2015. Section 162(m) of the Internal Revenue Code (“Section 162(m)”) prohibits a corporation from taking a tax deduction in any tax year for compensation it pays to the chief executive officer and certain other named executive officers in excess of $1 million unless such compensation qualifies as performance based and satisfies certain requirements. The Company maintains the 162(m) Bonus Plan to permit, when appropriate, annual incentive award to qualify as performance based compensation and, to the extent they qualify, be deductible for income tax purposes under Section 162(m) of the Internal Revenue Code. Similarly, the Company, which exception has provisions in the 2012 Plan to permit certain equity grants, when appropriate, to qualify as performance based compensation. The Compensation Committee considers the application of Section 162(m) when structuring awards. Section 162(m) regulations are complicated and subject to change. In addition, a number of requirements must be met in order for particular compensation to qualify as deductible under the section. Accordingly, there can be no assurance that the compensation intended to qualify for deductibility under Section 162(m) awarded or paid by the Company will be fully deductible.
been repealed.
Change of Control Provisions. The Company’s 2012 Plan provides that unless otherwise determined by the Compensation Committee at the time of grant, awards subject to vesting and/or restrictions will not accelerate and vest or cause the lapse of restrictions upon a change in control (as defined in the 2012 Plan). Instead, such awards will be, in the discretion of the Compensation Committee, either (i) assumed and continued or substituted in accordance with applicable law; (ii) purchased by the Company for an amount equal to the excess of the price of the Company’s Common Stock paid in a change in control over the exercise price of the award(s) (such purchase price not to exceed the fair market value of the Common Stock at the time of purchase), or (iii) cancelled if the price of the Common stock paid in a change in control is less than the exercise price of the award. The Committee may also, in its sole discretion, provide for accelerated vesting or lapse of restrictions of an award at any time.
In the event of a merger or consolidation in which the Company is not the surviving corporation or in the event of a transaction that results in the acquisition of all or substantially all of the Company’s Common Stock or assets, the Compensation Committee may elect to terminate all outstanding exercisable awards granted under the 2012 Plan, provided that during the period from notification of such termination to the date
of consummation of the relevant transaction (which must be at least 20 days) each participant shall have the right to exercise all of his or her exercisable awards in full (without regard to any restrictions on exercisability), contingent on the consummation of such transaction.
The Company’s 2002 Stock Incentive Plan provides that in the event of a change in control, notwithstanding any vesting schedule with respect to an award of options or restricted stock, such option shall become immediately exercisable with respect to 100% of the shares subject to such option, and the restricted period shall expire immediately with respect to 100% of such shares of restricted stock. The 2002 Stock Incentive Plan further provides that in the event of a change in control, all other awards shall become fully vested and/or payable to the fullest extent of any award or portion thereof that has not then expired, and any restrictions with respect thereto shall expire.
Plan category | | | Number of securities to be issued upon exercise of outstanding options, warrants and rights | | | Weighted-average exercise price of outstanding options, warrants and rights | | | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column) | | |||||||||
Equity compensation plans approved by security holders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | | | | | 200,878 | | | | | $ | 6.59 | | | | | | 58,658 | | |
Equity compensation plans not approved by security holders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | | | | | — | | | | | | — | | | | | | — | | |
TOTAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | | | | | 200,878 | | | | | $ | 6.59 | | | | | | 58,658 | | |
Plan category | Number of securities to be issued upon exercise of outstanding options, warrants and rights | Weighted-average exercise price of outstanding options, warrants and rights | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column) | |||||||||
Equity compensation plans approved by security holders | 457,000 | $ | 6.15 | 183,267 | ||||||||
Equity compensation plans not approved by security holders | — | — | — | |||||||||
TOTAL | 457,000 | $ | 6.15 | 183,267 |
Section 16(a) of the Exchange Act requires the Company’s directors and executive officers, and persons who own more than 10% of a registered class of the Company’s equity securities, to file with the SEC initial reports of ownership and reports of changes in ownership of Common Stock and other equity securities of the Company. Officers, directors and greater than 10% stockholders are required by the SEC to furnish the Company with copies of all Section 16(a) forms they file.
To the Company’s knowledge, based solely on a review of the copies of such reports furnished to the Company or written representations that no other reports were required, all Section 16(a) filing requirements applicable to its officers, directors and greater than 10% beneficial owners were complied with during, or in respect of, the fiscal year ended December 31, 2015 and prior periods.
P&F INDUSTRIES, INC.