Item 1.01. Entry into a Definitive Agreement
The information contained in Items 5.02 (Management Incentive Plans) and 8.01 (Board Compensation) are incorporated herein by reference.
Item 5.02 - Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Principal Officers.
Management Incentive Plans ("MIPs")
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The performance compensation payable under each MIP for the CEO, CFO, EVP of Strategic Initiatives and EVP of Waste Treatment Operations is based upon meeting certain corporate revenue, earnings before interest, taxes, depreciation and amortization ("EBITDA"), health and safety, and environmental compliance (permit and license violations) targets and objectives during fiscal year 2021 from our operations, with such targets and objectives approved by the Company's Board. The performance compensation payable under the MIP for the EVP of Nuclear and Technical Services is based upon meeting certain corporate revenue, EBITDA, health and safety, and cost performance index ("CPI") (a metric used in measuring project performance) The Compensation Committee believe performance compensation payable under each of the MIPs should be based on achievement of EBITDA, a non-GAAP ("Generally Accepted Accounting Principles") financial measurement, as the Company believes that this target provides a better indicator of operating performance as it excludes certain non-cash items. EBITDA has certain limitations as it does not reflect all items of income or cash flows that affect the Company's financial performance under GAAP.
Performance compensation is to be paid on or about 90 days after year-end, or sooner, based on finalization of our audited financial statements for 2021.
The Compensation Committee retains the right to modify, change or terminate each MIP and may adjust the various target amounts described below, at any time and for any reason.
The total to be paid to the CEO, CFO, EVP of Strategic Initiatives, EVP of Nuclear and Technical Services and EVP of Waste Treatment Operations shall not exceed 50% of the Company's pre-tax net income prior to the calculation of performance compensation.
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Each MIP is briefly described below, and the descriptions contained herein are qualified by reference to the respective MIPs attached as exhibits 99.1 to 99.5 to this Report.
CEO MIP:
CEO performance compensation for 2021 is based upon meeting corporate revenue, EBITDA, health and safety, and environmental compliance (permit and license violations) objectives for fiscal year 2021, all with respect to the Company's operations. At achievement of 60% to 110% of each of the revenue and EBITDA targets, the potential performance compensation is payable at 5% to 50% of the CEO's 2021 base salary, weighted 60% based on the EBITDA goal, 10% on the revenue goal, and 15% on the number of health and safety claim incidents that occur during fiscal 2021, with the remaining 15% on the number of notices alleging environmental, health or safety violations under our permit or licenses that occur during the fiscal 2021. Upon achievement of 111% to 150%+ of each of the revenue and EBITDA targets, the potential performance compensation is payable at 75% to 150% of the CEO's 2021 base salary, based on the four objectives noted above, with the payment of such performance compensation being weighted more heavily toward the EBITDA objective. Each of the revenue and EBITDA components is based on our Board-approved revenue target and EBITDA target. The 2021 target performance incentive compensation for our CEO is as follows:
Annualized Base Pay:$ 344,400
Performance Incentive Compensation Target (at 100% of MIP):
$ 516,600 CFO MIP:
CFO performance compensation for fiscal 2021 is based upon meeting corporate revenue, EBITDA, health and safety, and environmental compliance (permit and license violations) objectives for fiscal 2021, all with respect to the Company's operations. At achievement of 60% to 110% of each of the revenue and EBITDA targets, the potential performance compensation is payable at 5% to 50% of the 2021 base salary, weighted 75% based on EBITDA goal, 10% on the revenue goal, and 7.5% on the number of health and safety claim incidents that occur during fiscal 2021, with the remaining 7.5% on the number of notices alleging environmental, health or safety violations under our permits or licenses that occur during the fiscal 2021. Upon achievement of 111% to 150%+ of each of the revenue and EBITDA targets, the potential performance compensation is payable at 65% to 100% of the CFO's 2021 base salary, based on the four objectives noted above, with the payment of such performance compensation being weighted more heavily toward the EBITDA objective. Each of the revenue and EBITDA components is based on the Board-approved revenue target and EBITDA target. The 2021 target performance incentive compensation for the CEO is as follows:
Annualized Base Pay:$ 280,000
Performance Incentive Compensation Target (at 100% of Plan):
$ 420,000
EVP of Strategic Initiatives MIP:
EVP of Strategic Initiatives performance compensation for fiscal 2021 is based upon meeting corporate revenue, EBITDA, health and safety, and environmental compliance (permit and license violations) objectives for fiscal 2021, all with respect to the Company's operations. At achievement of 60% to 110% of each of the revenue and EBITDA targets, the potential performance compensation is payable at 5% to 50% of the 2021 base salary, weighted 75% based on EBITDA goal, 10% on the revenue goal, and 7.5% on the number of health and safety claim incidents that occur during fiscal 2021, with the remaining 7.5% on the number . . .
Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.
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The text of the new Article XV is included in the Second Amended and Restated Bylaws attached to this Report as Exhibit 3(ii). The description of the Amendment contained in this Report is qualified in its entirety by reference to the full text of Article XV as set forth in Exhibit 3(ii).
Item 8.01 - Other Events. Board Compensation
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? each director is to be paid a quarterly fee of
from$7,500 ; ? the Chairman of the Audit Committee is to be paid an additional quarterly fee of$6,250 from$5,500 ; ? the Chairman of each of the Compensation Committee, the Corporate Governance
and Nominating Committee (the "Nominating Committee"), and the Strategic
Advisory Committee (the "Strategic Committee") is to receive
quarterly fee. No such quarterly fee was previously paid. The Chairman of the
Board is not eligible to receive a quarterly fee for serving as the Chairman of
any the aforementioned Committees; ? each Audit Committee member (excluding the Chairman of the Audit Committee) is to receive$1,250 in quarterly fee; and ? each member of the Compensation Committee, the Nominating Committee, and the
Strategic Committee is to receive a quarterly fee of
payable if the member does not serve as the Chairman of the Audit Committee, or
the Nominating Committee, or the Strategic Committee or as the Chairman of the
Board.
Each non-employee Board member will continue to receive
Pursuant to the Company's 2003 Outside Directors Stock Plan ("Outside Directors Stock Plan"), each non-employee director shall receive at the director's option, either 65% or 100% of his director's fee in the Company's common stock. If a non-employee director elects to receive 65% of his director's fee in common stock, then he will receive (1) the number of shares of common stock determined by dividing 65% of his director's fee by 75% of the fair market value of one share of the Company's common stock and (2) 35% in cash. If the non-employee director elects to receive 100% of his fee in the Company's common stock, he will receive the number of shares of common stock determined by dividing his director's fee by 75% of the fair market value of one share of the Company's common stock. For purposes of calculating the foregoing, the fair market value of one share of the Company's common stock will be the closing price for one share of the Company's common stock on the business day immediately preceding the date that the director's fee is due.
Board Committees
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Zach P. WampMark A. Zwecker
Lieutenant (Lt.) General (Ret.)
Zach P. Wamp
Lt. General (Ret.)
No changes were made to the composition of the Audit Committee and the Strategic Advisory Committees.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits. Exhibit Description 3(ii) Second Amended and Restated Bylaws ofPerma-Fix Environmental Services , as amended effectiveJanuary 21, 2021 . 4(i) Incorporated by reference to Exhibit 3(ii), above. 99.1 2021 Management Incentive Plan for Chief Executive Officer, approvedJanuary 21, 2021 , but effectiveJanuary 1, 2021 . 99.2 2021 Management Incentive Plan for Chief Financial Officer, approvedJanuary 21, 2021 , but effectiveJanuary 1, 2021 . 99.3 2021 Management Incentive Plan for EVP of Strategic Initiatives, approvedJanuary 21, 2021 , but effectiveJanuary 1, 2021 . 99.4 2021 Management Incentive Plan for EVP of Nuclear and Technical Services, approvedJanuary 21, 2021 , but effectiveJanuary 1, 2021 . 99.5 2021 Management Incentive Plan for EVP of Waste Treatment Operations, approvedJanuary 21, 2021 , but effectiveJanuary 1, 2021 . 6
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