On January 31, 2019, the Compensation Committee of our Board of Directors (our “Board”) adopted an Amended and RestatedNon-Employee Director Annual Compensation Program (the “Program”), which became effective as of February 1, 2019 and supersedes our priorNon-Employee Director Annual Compensation Program. Pursuant to the Program, beginning with fiscal year 2020, eachnon-employee director will automatically receive a grant of restricted stock on the date of theirre-election to our Board. The number of whole shares to be granted will be equal to the number calculated by dividing the stock component of the director compensation amount determined by the Compensation Committee for that year by the fair market value of our stock on that day. The value of the restricted stock award for our fiscal year 2020 is $60,000. To account for the partial year beginning on February 1, 2019 and continuing through our 2019 annual meeting and thereby provide for the alignment of the timing of annual grants of restricted stock under the Program with the election of directors at the annual meeting, on February 1, 2019, eachnon-employee director was granted shares of restricted stock with a fair market value of $18,000. Other than the shares granted on February 1, 2019, which will vest on June 1, 2019, shares of restricted stock granted under the Program will become vested on the first anniversary of the date of grant, conditioned upon the recipient’s continued service on our Board through that date. In the event of the death or disability of anon-employee director, or a Change in Control (as that term is defined in our 2018 Equity Incentive Plan) of the Company, the shares of restricted stock will immediately vest and no longer be subject to restrictions on transfer. Other than as part of a Change in Control of the Company and except in the case of economic hardship of a particularnon-employee director, as determined by the Compensation Committee, while anon-employee director is serving on our Board he or she may not sell or otherwise dispose of any of our stock received in connection with his or her service on our Board (whether that stock was granted under the Program, any predecessor program or otherwise) if thatnon-employee director has not satisfied the requirements of any stock ownership guidelines established for directors by the Board or if the transfer would cause him or her to be out of compliance with any such guidelines.
Pursuant to the Program, eachnon-employee director will also receive cash payments for their service on our Board and its committees. The amounts of those payments for fiscal year 2020 will be:
| | |
Position Covered | | Fiscal Year 2020 Annual Payment |
Service on the Board | | $45,000 |
Audit Committee Chairman | | $10,000 |
Compensation Committee Chairman | | $8,000 |
Nominating and Governance Committee Chairman | | $6,000 |
Committee Member (other than Chairman) | | $3,000 |
Cash payments will be made tonon-employee directors in four equal tranches on the dates of the Board’s regular quarterly meetings.
All shares of restricted stock issued pursuant to the Program will be issued under and subject in all respects to our 2018 Equity Incentive Plan.
The foregoing summary of the Program does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Program, a copy of which is attached hereto as Exhibit 10.1 and the terms of which are incorporated herein by reference.
