Proxy Statement (Form DEF 14A)
SECURITIES AND EXCHANGE COMMISSION
________________
SCHEDULE 14A
(Rule 14a-101)
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INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. _____)
| Filed by the Registrant | ☒ | |
| Filed by a Party other than the Registrant | ☐ |
Check the appropriate box:
| ☐ | Preliminary Proxy Statement | |
| ☐ | Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) | |
| ☒ | Definitive Proxy Statement | |
| ☐ | Definitive Additional Materials | |
| ☐ | Soliciting Material Pursuant to §240.14a-12 |
_______________________________________
(
_________________________________________________________________
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Payment of Filing Fee (Check all boxes that apply):
| ☒ | No fee required | |
| ☐ | Fee paid previously with preliminary materials | |
| ☐ | Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11 |
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
Dear Stockholder:
You are cordially invited to attend the annual meeting of stockholders of
| 1. | To elect to the Board of Directors the seven nominees for director named in this proxy statement, to hold office until the 2026 annual meeting of our stockholders. | |
| 2. | To approve, on a non-binding advisory basis, the compensation of our named executive officers for fiscal year 2025 ("say-on-pay"). | |
| 3. | To approve, on a non-binding advisory basis, the frequency of an advisory vote on the compensation of our named executive officers ("say-on-frequency"). | |
| 4. | To ratify the selection of |
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| 5. | To conduct any other business properly brought before the meeting. |
These items of business are more fully described in the proxy statement accompanying this Notice.
In addition, the proxy statement contains other important information about
Your vote is very important. Whether or not you plan to attend the annual meeting in person, please complete and retuthe enclosed proxy card.
| Sincerely yours, | |
| /s/ |
|
| General Counsel, Chief Legal Officer and Secretary |
You are cordially invited to attend the meeting in person. Whether or not you expect to attend the meeting, please vote over the internet or by telephone, or, if you requested to receive printed proxy materials, by mailing a proxy or voting instruction card, as promptly as possible in order to ensure your representation at the meeting. Voting instructions are provided in the Notice of Internet Availability of Proxy Materials, or, if you receive a proxy card by mail, the instructions are printed on your proxy card and included in the accompanying proxy statement. Even if you have voted by proxy, you may still vote in person if you attend the meeting. Please note, however, that if your shares are held of record by a broker, bank or other nominee and you wish to vote at the meeting, you must obtain a proxy issued in your name from that record holder.
TABLE OF CONTENTS
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PROXY STATEMENT
FOR 2025 ANNUAL MEETING OF STOCKHOLDERS
To Be Held on
This proxy statement contains information about the 2025 annual meeting of stockholders ("2025 Annual Meeting") of
This proxy statement is furnished in connection with the solicitation of proxies by our Board of Directors for use at the 2025 Annual Meeting and at any adjournment of that meeting. All proxies will be voted in accordance with the instructions they contain. If you do not specify your voting instructions on your proxy, it will be voted in accordance with the recommendations of our Board of Directors.
These proxy materials, together with our annual report to stockholders for our 2024 fiscal year, are first being made available to
QUESTIONS AND ANSWERS ABOUT THE 2025 ANNUAL MEETING AND VOTING
Why did I receive a notice regarding the availability of proxy materials on the internet?
Pursuant to rules adopted by the
We intend to mail the Notice on or about
What is the purpose of the annual meeting?
At our 2025 Annual Meeting, stockholders will consider and vote on the following matters:
| 1. | To elect to the Board of Directors the seven nominees for director named in this proxy statement, to hold office until the 2026 annual meeting of our stockholders. | |
| 2. | To approve, on a non-binding advisory basis, the compensation of our named executive officers for fiscal 2025 ("say-on-pay"). | |
| 3. | To approve, on a non-binding advisory basis, the frequency of an advisory vote on the compensation of our named executive officers ("say-on-frequency"). | |
| 4. | To ratify the selection of |
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| 5. | To conduct any other business properly brought before the meeting. |
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Who can vote?
You may vote if you were a stockholder of
How many votes do I have?
Each share of our common stock that you own on the record date entitles you to one vote on each matter subject to a vote. There is no cumulative voting.
Directors and executive officers of
How do I vote?
If you are the record holder of your shares, meaning that you own your shares in your own name and not through a bank or brokerage firm, you may vote as follows:
| 1. | You may vote by mail. You may vote by completing and signing the proxy card enclosed with this proxy statement (or by requesting a paper copy of the materials if you only received an electronic version) and promptly mailing it in the enclosed postage-prepaid envelope. You do not need to put a stamp on the enclosed envelope if you mail it from |
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| 2. | You may vote by Internet. You may vote over the Internet as instructed on the proxy card enclosed with this proxy statement and accessing www.iproxydirect.com/PAYS. The shares you own will be voted according to your instructions on the proxy card submitted electronically. If you do not give any instructions on a particular matter described in this proxy statement, the shares you own will be voted in accordance with the recommendations of our Board of Directors. Your vote will not be counted unless you vote electronically prior to the 2025 Annual Meeting. | |
| 3. | You may vote in person. If you attend the meeting, you may vote by delivering your completed proxy card in person or by completing a ballot. Ballots will be available at the meeting. |
How does the Board of Directors recommend that I vote on the proposals?
The Board of Directors recommends that you vote:
FOR the election to the Board of Directors of each of the seven nominees to serve as directors until our 2026 annual meeting of stockholders.
FOR the approval, on a non-binding advisory basis, of the compensation of our named executive officers for fiscal 2025.
FOR the approval, on a non-binding advisory basis, of holding the advisory vote on the compensation of our named executive officers every three years.
FOR the ratification of the selection of
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Is my vote important?
Your vote is important no matter how many shares you own. Please take the time to vote. Take a moment to read the instructions in this proxy statement. Choose the way to vote that is the easiest and most convenient for you and cast your vote as soon as possible.
What if I retua proxy card but do not make specific choices?
Any proxy card returned without directions given will be voted (1) "FOR" the election of directors presented in this proxy statement to the Board of Directors, (2) "FOR" the approval, on a non-binding advisory basis, of the compensation of our named executive officers for fiscal 2025, (3) "FOR" the approval, on a non-binding advisory basis, of holding the advisory vote on the compensation of our named executive officers every three years, (4) "FOR" the ratification of the selection of
Will my shares be voted if I do not provide my proxy?
Your shares may be voted if they are held in the name of a brokerage firm, even if you do not provide the brokerage firm with voting instructions. Brokerage firms have the authority to vote shares for which their customers do not provide voting instructions on certain "routine" matters.
The proposal to ratify the selection of
Can I change my vote after I have mailed my proxy card or after I have voted my shares?
Yes. You can change your vote and revoke your proxy at any time before the polls close at the meeting by doing any one of the following things:
| · | signing another proxy with a later date; | |
| · | giving our Corporate Secretary, |
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| · | voting again prior to the time at which the Internet voting facilities close by following the procedures applicable to that method of voting, as directed on the enclosed proxy card; or | |
| · | voting in person at the meeting. |
How can I access the proxy materials over the internet?
You may view and also download our proxy materials, including our Form 10-K for the year ended
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Who pays for the solicitation of Proxies?
The solicitation of proxies in the enclosed form is made on behalf of the Board of Directors. We pay all costs to solicit these proxies. Our officers, directors, and employees may solicit proxies but will not be additionally compensated for such activities. We are also working with brokerage houses and other custodians, nominees, and fiduciaries to forward solicitation materials to the beneficial owners of shares held of record by such institutions and persons. We will reimburse their reasonable expenses.
What is the quorum requirement?
A quorum of stockholders is necessary to hold a valid meeting. A quorum will be present if more than 50% of the outstanding shares entitled to vote are represented by stockholders present at the meeting or by proxy. On the record date, there were 53,747,674 shares of common stock outstanding. Thus, 26,873,837 shares must be represented by stockholders present at the meeting or by proxy to have a quorum.
Your shares will be counted towards the quorum only if you submit a valid proxy (or one is submitted on your behalf by your broker, bank, or other nominee) or if you vote in person at the meeting. Abstentions and broker non-votes will be counted towards the quorum requirement. If a quorum is not present, the meeting will be adjourned until a quorum is obtained.
What vote is required for each item to pass?
Election of Directors. Directors are elected by a plurality of the votes cast by the holders of shares entitled to vote in the election. There are seven nominees and seven positions to be filled; this means that the seven individuals receiving the most "for" votes will be elected. Votes to "withhold" and broker non-votes will not be relevant to the outcome.
Say-on-Pay. The advisory vote on the compensation of our named executive officers is non-binding, but our Board of Directors will consider the input of stockholders based on a majority of votes case for the Say-on-Pay proposal.
Say-on-Frequency. The advisory vote on the frequency of future of non-binding votes on the compensation of our named executive officers is non-binding, but our Board of Directors will consider the input of stockholders.
Ratification of Independent Registered Public Accounting Firm. The votes cast "for" must exceed the votes cast "against" in order to ratify the selection of
If your shares are held in street name and you do not provide voting instructions to your broker, bank, or other nominee, your broker is entitled to vote your shares with respect to the proposal to ratify the selection of
Who will count the votes?
We will appoint an Inspector of Election for the 2025 Annual Meeting who will not be an officer, director, or nominee.
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What is "householding"?
If you would like to receive your own set of our proxy statement and related materials now or in the future, or if you share an address with another
How and when may I submit a stockholder proposal for next year's annual meeting?
Stockholder Proposals to be Considered for Inclusion in our Proxy Materials. In order for proposals of stockholders to be considered for inclusion in the Company's proxy materials related to the 2026 annual meeting, such proposals must, pursuant to Rule 14a-8 of the Securities Exchange Act of 1934, as amended, or the Exchange Act, be submitted in writing to the Corporate Secretary of
Other Stockholder Proposals. In addition, a stockholder proposal that is not intended for inclusion in our proxy statement and form of proxy under Rule 14a-8 (including director nominations) shall be considered "timely" as calculated in accordance with Rule 14a-4(c) under the Exchange Act, and may be brought before the 2026 annual meeting of stockholders provided that we receive information and notice of the proposal addressed to our Corporate Secretary of
In order for stockholders to give timely notice of nominations for directors for inclusion on a universal proxy card, notice must be submitted by the same advance notice deadlines disclosed above, and such stockholders must comply with the additional requirements of Rule 14a-19(b) of the Exchange Act.
You are also advised to review our bylaws, which contain additional requirements about advance notice of stockholder proposals and director nominations.
Where can I find the voting results?
We will report the voting results on a Current Report on Form 8-K within four (4) business days after the end of our 2025 Annual Meeting of stockholders. If final voting results are not available to us in time to file a Current Report on Form 8-K within four (4) business days after the 2025 Annual Meeting, we intend to file a current report on Form 8-K to publish preliminary results and, within four (4) business days after the final results are known to us, file an additional Current Report on Form 8-K to publish the final results.
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PROPOSAL NO. 1
ELECTION OF DIRECTORS
Our Board of Directors, or "Board," has nominated seven persons (the "Nominees") to be elected at the 2025 Annual Meeting to serve until the 2026 annual meeting of stockholders and until their respective successors are elected and qualified. Our Board currently has seven members, and each Nominee already serves on our Board. Each Nominee has agreed to serve on the Board, if elected.
Directors are elected by a plurality of the votes of the holders of shares present in person or represented by proxy and entitled to vote on the election of directors. The seven nominees receiving the highest number of affirmative votes will be elected. Proxies cannot vote for a greater number of persons than the number of nominees named.
Set forth below is information regarding the Nominees, as of
Nominees
| Age | Position | Director Since | ||||
| 59 | Chief Executive Officer, President, Chairman, Director | |||||
| 58 | Chief Payments Officer, Director | |||||
| 68 | Executive Vice President, Director | |||||
| 77 | Independent Director | |||||
| 70 | Independent Director | |||||
| 59 | Independent Director | |||||
| 78 | Independent Director |
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None of the directors or executive officers share any familial relationship with any other executive officer or key employee.
None of the directors or executive officers have been involved in any legal proceedings as listed in Regulation S-K, Sections 103(c)(2) and 401(f).
THE BOARD OF DIRECTORS RECOMMENDS A VOTE IN FAVOR OF EACH NAMED NOMINEE.
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INFORMATION REGARDING CORPORATE GOVERNANCE
Independence of Board of Directors
Our Board has reviewed the materiality of any relationship that each of our directors has with the Company, either directly or indirectly. Based upon this review, our Board has determined that all of our presently serving directors other than
In making such determinations, our Board considered the relationships that each such non-employee director or director nominee has with our company and all other facts and circumstances our Board deemed relevant in determining their independence, including the beneficial ownership of our capital stock by each non-employee director. In considering the independence of our directors, our Board considered the association each such non-employee director has with us and all other facts and circumstances our Board deemed relevant in determining independence.
Board Leadership Structure
The Company does not have a policy with respect to whether the positions of Chairman of the Board ("Chairman") and Chief Executive Officer ("CEO") should be held by the same person or two separate individuals and believes that it is in the best interest of the Company to consider that question from time to time in the context of succession planning. At this time, the Board believes that it is in the best interest of the Company and an appropriate leadership structure to have the CEO also serve as Chairman. Combining the CEO and Chairman roles provides an efficient and effective leadership model that promotes unambiguous accountability and alignment on corporate strategy.
Role of the Board in Risk Oversight
Management is responsible for the day-to-day management of risk and for identifying our risk exposures and communicating such exposures to our Board. Our Board is responsible for designing, implementing, and overseeing our risk management processes. The Board does not have a standing risk management committee but administers this function directly through the Board as a whole. The whole Board considers strategic risks and opportunities and receives reports from its officers regarding risk oversight in their areas of responsibility as necessary. We believe our Board's structure facilitates the division of risk management oversight responsibilities and enhances the Board's efficiency in fulfilling its oversight function with respect to different areas of our business risks and our risk mitigation practices.
Meetings of the Board
During 2024, there were four meetings of the Board. Each of the directors attended at least 75% of the aggregate number of meetings of the Board and the committees of the Board on which he or she served during the year ended
We do not have a formal policy requiring members of the Board to attend the annual meeting of stockholders, although all directors are strongly encouraged to attend. All of our board members at the time attended our 2024 annual meeting of stockholders.
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Executive Sessions of Non-Management Directors
Pursuant to our corporate governance principles or as required by
Committees of the Board
The Board has established three standing committees: the Audit Committee, the Compensation Committee, and the
The following chart sets forth the directors who currently serve as members of each of the Board committee as of the date of this proxy statement.
| Directors |
Audit Committee |
Compensation Committee |
Nominating Committee |
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| X | C | |||||||||||
| C | X | |||||||||||
| X | C | |||||||||||
| X | X |
_______________________
"C" Denotes member and chair of committee
"X" Denotes member
Audit Committee Functions
We have a separately designated standing Audit Committee established in accordance with Section 3(a)(58)(a) of the Exchange Act. The Audit Committee met four times in 2024. The members of the Audit Committee are
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Compensation Committee Functions
The Compensation Committee met five times in 2024.
Nominating and Corporate Governance Committee Functions
Director Nomination Process
The Nominating Committee, is responsible for, among other things, selection of candidates for the annual slate of directors. When identifying and evaluating candidates, the Nominating Committee first determines whether there are any evolving needs of the Board that require an expert in a particular field. The Nominating Committee may retain a third-party search firm to assist it in locating qualified candidates that meet the needs of the Board at that time. The search firm would provide information on a number of candidates, which the Nominating Committee discusses. The Nominating Committee chair and some or all of the members of the Nominating Committee, and the Chief Executive Officer, will interview potential candidates that the Nominating Committee deems appropriate. If the Nominating Committee determines that a potential candidate meets the needs of the Board, has the qualifications, and meets the independence standards required by Nasdaq rules, it will recommend the nomination of the candidate to the Board. It is the Nominating Committee's policy to consider director candidates recommended by stockholders, if such recommendations are properly submitted to the Company. Stockholders wishing to recommend persons for consideration by the Nominating Committee as nominees for election to the Board can do so by writing to the Corporate Secretary of
The Nominating Committee's nomination process is designed to ensure that the Nominating Committee fulfills its responsibility to recommend candidates who are properly qualified to serve the Company for the benefit of all of its stockholders, consistent with the standards established by the Nominating Committee under our corporate governance principles. The Nominating Committee did not receive any director nominee recommendations from stockholders for the 2025 Annual Meeting.
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Communication with the Board
The Board and management encourage communication from our stockholders. Stockholders who wish to communicate with our management or directors should direct their communication to the Corporate Secretary of the Company,
Code of Ethics
We have adopted a Code of Ethics that sets forth various policies and procedures to promote ethical behavior and that applies to all our directors, officers, and employees. The Code of Ethics is publicly available on our website at www.paysign.com. Amendments to the Code of Ethics and any grant of a waiver from a provision of the Code of Ethics requiring disclosure under applicable
Anti-Hedging Practices
Although we do not have a formal policy related to hedging transactions, we discourage our management and directors from engaging in hedging and monetization transactions in connection with our securities. Further, any such transactions would need to comply with our insider trading policy, as applicable.
Insider Trading Policies and Procedures
We have adopted an Insider Trading Policy governing the purchase, sale, and/or other disposition of our securities by our directors, officers, and employees. We believe that our Insider Trading Policy is reasonably designed to promote compliance with insider trading laws, rules, and regulations and the exchange listing standards applicable to us. A copy of our Insider Trading Policy is filed as Exhibit 19.1 to our Annual Report on Form 10-K for the year ended
Policies with Respect to Transactions with Related Persons
The Code of Ethics describes our policy on conflicts of interest. All transactions between us and our officers, directors, principal stockholders, and their affiliates are subject to approval by the Board according to the terms of our written Code of Ethics.
The executive officers and the Board are also required to complete a questionnaire on an annual basis that requires them to disclose any related person transactions and potential conflicts of interest. The responses to these questionnaires are reviewed by outside corporate counsel, and, if a transaction is reported by an independent director or executive officer, the questionnaire is submitted to the Chairperson of the Audit Committee for review. If necessary, the Audit Committee will determine whether the relationship is material and will have any effect on the director's independence. After making such determination, the Audit Committee will report its recommendation on whether the transaction should be approved or ratified by the entire Board.
Certain Relationships and Related Transactions
In 2024, we did not participate in any transactions in which any of the Company directors, executive officers, any beneficial owner of more than 5% of our common stock, nor any of their immediate family members, had a direct or indirect material interest.
Our Audit Committee Charter requires that members of the Audit Committee, all of whom are independent directors, conduct an appropriate review of, and be responsible for the oversight of, all related party transactions on an ongoing basis. There were no related party material transactions during the fiscal year ended
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Criteria
In considering whether to recommend any candidate for inclusion in the Board's slate of recommended director nominees, the Nominating Committee will apply the criteria set forth in governance guidelines. These criteria include the candidate's integrity, business acumen, age, experience, commitment, diligence, conflicts of interest, and the ability to act in the interests of all stockholders. Our guidelines specify that the value of diversity on the Board should be considered by the Nominating Committee in the director identification and nomination process. The Nominating Committee seeks nominees with a broad diversity of experience, professions, skills, geographic representation, and backgrounds. The Nominating Committee does not assign specific weights to particular criteria, and no particular criteria is necessarily applicable to all prospective nominees. We believe that the backgrounds and qualifications of the directors, considered as a group, should provide a significant composite mix of experience, knowledge, and abilities that will allow the Board to fulfill its responsibilities. Nominees are not discriminated against on the basis of race, religion, national origin, sexual orientation, disability, or any other basis proscribed by law.
Report of the Audit Committee
The Audit Committee is responsible for providing independent, objective oversight of
Based upon the review and discussions referred to above, the Audit Committee recommended to our Board of Directors that the audited financial statements of
By the Audit Committee of the Board of Directors of
Director Compensation
The following table details the total compensation earned by our non-employee directors during the year ended
| Fees Earned or Paid in Cash ($) |
Restricted Stock Awards ($) |
Option Awards ($) |
Non-Equity Incentive Plan Compensation ($) |
Total
($) (1) |
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| 21,000 | 84,600 | - | - | 105,600 | ||||||||||||||||
| 21,000 | 84,600 | - | - | 105,600 | ||||||||||||||||
| 21,000 | 84,600 | - | - | 105,600 | ||||||||||||||||
| 21,000 | 84,600 | - | - | 105,600 | ||||||||||||||||
_______________________
| (1) | Excludes business travel expense reimbursements. |
We also reimburse our directors for reasonable travel and other related expenses. Independent Board members are paid an annual fee of
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EQUITY COMPENSATION PLAN INFORMATION
The following table provides information as of
| Plan Category |
Number of securities to be issued upon exercise of outstanding options, warrants |
Weighted- average exercise price of outstanding options, warrants and rights (b) |
Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (c) |
|||||||||
| Equity compensation plans approved by security holders | ||||||||||||
| 2018 Incentive Compensation Plan (1) | 2,613,000 | $ | 2.46 | - | ||||||||
| 2023 Equity Incentive Plan (3) | 581,000 | $ | 3.44 | 4,335,000 | ||||||||
| Equity compensation plans not approved by security holders | ||||||||||||
| 2018 Option issued to Director (2) | 1,350,000 | $ | 1.34 | - | ||||||||
| Total | 4,544,000 | $ | 2.25 | 4,335,000 | ||||||||
_______________________
| (1) | In |
|
| (2) | In |
|
| (3) | In 2023, the Board approved the Company's 2023 Equity Incentive Plan, and reserved 5,000,000 shares for issuance under the plan. As of |
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EXECUTIVE OFFICERS OF THE COMPANY
The following table sets forth information regarding our executive officers as of
| Age | Title | |||
| 59 | President and Chief Executive Officer | |||
| 46 | General Counsel, Chief Legal Officer, and Secretary | |||
| 54 | Chief Financial Officer and Treasurer | |||
| 58 | Chief Payments Officer |
The biographies of Messrs. Newcomer and Lanford are included above under the section titled "Proposal No. 1 - Election of Directors."
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EXECUTIVE COMPENSATION
Our named executive officers, or "NEOs," consisting of our principal executive officer, or "PEO," during the last completed fiscal year and our two most highly compensated executive officers as of
| · | ||
| · | ||
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Summary Compensation Table
| Year | Salary $ |
Bonus $(1) |
Stock Awards $ (2)(3)(4) |
All Other Compensation $ (5) |
Total $ |
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| 2024 | $ | 1,042,308 | $ | 301,954 | $ | - | $ | 3,296 | $ | 1,347,558 | ||||||||||||
| 2023 | $ | 950,000 | $ | 254,365 | $ | - | $ | 3,294 | $ | 1,207,659 | ||||||||||||
| 2024 | $ | 467,308 | $ | 226,903 | $ | - | $ | 3,346 | $ | 697,557 | ||||||||||||
| 2023 | $ | 375,000 | $ | 194,132 | $ | - | $ | 2,885 | $ | 572,017 | ||||||||||||
| 2024 | $ | 467,308 | $ | 226,934 | $ | - | $ | 4,800 | $ | 699,042 | ||||||||||||
| 2023 | $ | 375,000 | $ | 194,152 | $ | - | $ | 5,500 | $ | 574,652 | ||||||||||||
_______________________
| (1) | Bonuses paid in 2024 and 2023 were discretionary bonuses determined by the Board and not based on the fulfillment of any formula, criteria, or fulfillment of any performance target, goal, or condition. | |
| (2) | In |
|
| (3) | In |
|
| (4) | In |
|
| (5) | All Other Compensation is comprised of 401(k)-employer matching and profit-sharing plan contributions for |
The Company did not grant any stock appreciation rights to our named executive officers in the last fiscal year. The Company did not reprice any options or stock appreciation rights during the last fiscal year. The Company did not waive or modify any specified performance target, goal, or condition to payout with respect to any amount included in any incentive plan compensation included in the summary compensation table.
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Narrative to Summary Compensation Table
The Board is responsible for creating and reviewing the compensation of our executive officers, as well as overseeing our compensation and benefit plans and policies and administering our equity incentive plans. The following describes our 2024 executive compensation program and explains our compensation philosophy, policies, and practices, focusing primarily on the compensation of our named executive officers, or NEOs. It is intended to be read in conjunction with the tables that follow, which provide detailed historical compensation information for our NEOs.
Compensation Philosophy
The Company believes in providing a competitive total compensation package to its executives through a combination of base salary, benefits, annual performance bonuses, and long-term equity awards. The executive compensation program is designed to achieve the following objectives:
| · | provide competitive compensation that will help attract, retain, and reward qualified executives; | |
| · | align executives' interests with our success by making a portion of the executive's compensation dependent upon corporate performance; and | |
| · | align executives' interests with the interests of stockholders by including long-term equity incentives. |
The Board believes that our executive compensation program should include annual and long-term components, including cash and equity-based compensation, and should reward consistent performance that meets or exceeds expectations. The Board evaluates both performance and compensation to make sure that the compensation provided to executives remains competitive relative to compensation paid by companies of similar size and stage of development operating in the payment processing industry and taking into account our relative performance and strategic objectives.
The Board has not used compensation consultants in the past but reserves the right to do so in the future.
Employment Contracts of Named Executive Officers
There are no agreements or understandings between the Company and any NEO that guarantees continued employment or any level of compensation, including incentive or bonus payments, to the NEO. The Company is an at-will employer.
Potential Payments Upon Termination or Change-in-Control
We do not have any agreements with our NEOs that contain provisions requiring that we make payments to the named executive officer at, following, or in connection with the resignation, retirement, or other termination of the named executive officer, or a change in control of us, or a change in the named executive officer's responsibilities following a change in control.
Employee
The Company sponsors a 401(k)-retirement plan in which NEO's participate on the same basis as other employees. Effective
Pension Benefits
None of our NEOs are covered by a pension plan or similar benefit plan that provides for payment or other benefits at, following, or in connection with retirement.
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Nonqualified Deferred Compensation
None of our NEOs are covered by a deferred contribution or other plan that provides for the deferral of compensation on a basis that is not tax-qualified.
Option Exercises in 2024
There were no stock option exercises by NEOs during the 2024 fiscal year.
Clawback Policy
In 2023, we adopted an Executive Officer Clawback Policy that complies with new
PAY VERSUS PERFORMANCE
The following table and accompanying description set forth information for the past three fiscal years regarding compensation as calculated under
Pay Versus Performance Table
| Year (1) | Summary Compensation Table Total for PEO ($)(2) | Compensation Actually Paid to PEO ($)(3) | Average Summary Compensation Table Total for non-PEO named executive officers ($)(4) | Average Compensation Actually Paid to non-PEO named executive officers ($)(5) | Value of initial fixed |
Net Income ($) | ||||||
| 2024 | 3,815,907 | |||||||||||
| 2023 | 1,207,659 | 1,240,659 | 573,335 | 631,415 | 109 | 6,458,727 | ||||||
| 2022 | 2,518,237 | 1,738,237 | 1,139,410 | 977,910 | 161 | 1,027,775 |
| (1) | We are a smaller reporting company pursuant to Rule 405 of the Securities Act of 1933, as amended (the "Securities Act"), and as such, we are only required to include information for the past three fiscal years in this table for this proxy statement. | |
| (2) | The dollar amounts reported in this column represent the amount of total compensation reported for |
|
| (3) | The dollar amounts reported in this column represent the amount of the "compensation actually paid" to |
| Adjustments to Determine Compensation Actually Paid to PEO | 2024 | 2023 | 2022 | |||||||||
| Deduction for stock award amount reported in Summary Compensation Table | $ | - | $ | - | $ | (1,357,500 | ) | |||||
| Increase for fair value of awards granted during year that remain unvested during that year | - | - | 577,500 | |||||||||
| Increase/(decrease) for change in fair value from prior year-end to current year-end of awards granted prior to year that were outstanding and unvested as of year-end | 99,000 | 132,000 | - | |||||||||
| Increase/(decrease) for change in fair value from prior year-end to vesting date of awards granted prior to year that vested during year | 379,500 | (99,000 | ) | - | ||||||||
| Total Adjustments | $ | 478,500 | $ | 33,000 | $ | (780,000 | ) | |||||
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| (4) | The dollar amounts reported in this column for our named-executive officers as a group (excluding |
|
| (5) | The dollar amounts reported in this column for our Non-PEO NEOs as a group in each appliable year, represent averages of the "compensation actually paid" to the Non-PEO NEOs. The dollar amounts do not reflect the actual average amount of compensation earned by or paid to the Non-PEO NEOs during the applicable year. In accordance with the requirements of Item 402(v) of Regulation S-K, the adjustments made to the average total compensation for the Non-PEO NEOs for each year to determine the average compensation actually paid are shown in the table below: |
| Adjustments to Determine Average Compensation Actually Paid to Non-PEO NEOs |
2024 | 2023 | 2022 | |||||||||
| Deduction for amount reported in Summary Compensation Table | $ | - | $ | - | $ | (579,200 | ) | |||||
| Increase for fair value of awards granted during year that remain unvested during that year | - | - | 246,400 | |||||||||
| Increase/(decrease) for change in fair value from prior year-end to current year-end of awards granted prior to year that were outstanding and unvested as of year-end | 55,440 | 76,120 | 137,200 | |||||||||
| Increase/(decrease) for change in fair value from prior year-end to vesting date of awards granted prior to year that vested during year | 169,420 | (18,040 | ) | 34,100 | ||||||||
| Total Adjustments | $ | 224,860 | $ | 58,080 | $ | (161,500 | ) | |||||
Description of Relationship Between Compensation Actually Paid and Cumulative Total Shareholder Return
As presented in the table above, compensation actually paid to our PEO, along with the average compensation actually paid to our Non-PEO NEOs are not directly correlated with total shareholder return. Total compensation actually paid to our PEO increased by approximately
Description of Relationship Between Compensation Actually Paid and Net Income
We have reported a net income in both 2023 and 2024, which decreased by
All information provided above under the "Pay Versus Performance" heading will not be deemed to be incorporated by reference into any filing of the company under the Securities Act or the Exchange Act whether made before or after the date hereof and irrespective of any general incorporation language in any such filing, except to the extent we specifically incorporate such information by reference.
| 18 |
Policies and Practices Related to the Grant of Certain Equity Awards
We do not have any formal policies and practices regarding the timing of equity awards in relation to the disclosure of material nonpublic information. Our
The timing of any equity awards to executive officers in connection with new hires, promotions, or other non-routine grants is generally tied to the event giving rise to the award, such as an executive officer's commencement of employment or promotion effective date. As a result, the timing of the equity award of options occurs independent of the release of any material nonpublic information.
There were no equity awards that were issued to our NEOs in fiscal 2024 during any period beginning four business days before the filing or furnishing of a periodic report or current report disclosing material nonpublic information and ending one business day after the filings or furnishing of such report with the
| 19 |
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END 2024
The following table sets forth information regarding all outstanding equity awards held by NEOs at
| Stock Awards | ||||||||||||||||
| Number of Shares or Units of Stock that have not Vested (#) |
Market Value of Shares or Units of Stock that have not Vested (1) ($) |
Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights that have not Vested (#) |
Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or other Rights that have not Vested (1) ($) |
|||||||||||||
| 450,000 | 1,359,000 | - | - | |||||||||||||
| 312,000 | 942,240 | - | - | |||||||||||||
| 192,000 | 579,840 | - | - | |||||||||||||
_______________________
| (1) | The value of the unearned awards is based upon the closing price of our common stock on |
|
| (2) | The restricted stock grant consisted of 750,000 shares granted in |
|
| (3) | The restricted stock grant consisted of 300,000 shares granted in |
|
| (4) | The restricted stock grant consisted of 320,000 shares granted in |
| 20 |
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of
The number of shares beneficially owned by each five percent (5%) stockholder, director, or executive officer is determined under the rules of the
| Amount and Nature of Beneficial Ownership |
Percent of Class (1) |
|||||||
| 9,011,886 | 16.7% | |||||||
| 218,669 | * | |||||||
| 824,743 | 1.5% | |||||||
| 259,811 | * | |||||||
| 134,731 | * | |||||||
| 1,430,000 | 2.6% | |||||||
| 238,500 | * | |||||||
| 30,000 | * | |||||||
| 230,000 | * | |||||||
| 4,295,000 | 8.0% | |||||||
| 4,695,000 | 8.7% | |||||||
| 5,336,146 | 9.9% | |||||||
| All Officers and Directors as a Group(3) (9 people) | 12,378,340 | 22.4% | ||||||
_______________________
| * | Less than 1% of the outstanding shares of Common Stock. | |
| (1) | Based upon 53,747,674 shares of Common Stock issued and outstanding as of |
|
| (2) | The address for the shareholder is |
|
| (3) | Includes the following number of shares of our common stock either (a) issuable upon exercise of stock options granted to our named executive officers and directors that are exercisable within 60 days after |
| Directors and Executive Officers | Options Exercisable/Shares Issuable within 60 days | |||||
| 75,000 | ||||||
| - | ||||||
| 25,000 | ||||||
| 50,000 | ||||||
| 25,000 | ||||||
| 1,350,000 | ||||||
| - | ||||||
| - | ||||||
| - | ||||||
| All executive officers and directors as a group | 1,525,000 |
| (4) | Includes 75,000 options in the name of |
|
| (5) | Based on the Form 4 filed with the |
|
| (6) | The address for the shareholder is |
|
| (7) | Based on the Form 4 filed with the |
| 21 |
DELINQUENT SECTION 16(a) REPORTS
Section 16(a) of the Exchange Act requires directors, executive officers, and persons who own more than 10% of a registered class of our securities to file with the
Based solely upon our review of the copies of such forms that we received during the year ended
TRANSACTIONS WITH RELATED PERSONS
Related-Person Transaction Policies and Procedures
All transactions between us and our officers, directors, principal stockholders, and their affiliates are subject to approval by the Board according to the terms of our written Code of Ethics.
Certain Related-Person Transactions
None.
| 22 |
PROPOSAL NO. 2
ADVISORY VOTE ON EXECUTIVE COMPENSATION ("SAY-ON-PAY")
We are asking our stockholders to approve an advisory resolution on the compensation of our named executive officers as reported in this proxy statement, commonly referred to as the "say-on-pay" vote. Although the say-on-pay vote is advisory and therefore non-binding, our
| · | Provide competitive compensation that will help attract, retain, and reward qualified executives. | |
| · | Align executives' interests with our success by making a portion of the executive's compensation dependent upon corporate performance. | |
| · | Align executives' interests with the interests of stockholders by including long-term equity incentives. |
We encourage stockholders to read the "Executive Compensation" section of this proxy statement, which provides an overview of our executive compensation policies and procedures. The Summary Compensation Table and other related compensation tables and narratives provide detailed information on the compensation of our named executive officers. Our
In accordance with Section 14A of the Exchange Act and as a matter of good corporate governance, we are asking stockholders to approve the following advisory resolution at the 2025 Annual Meeting:
"RESOLVED, that the Company's stockholders approve, on a non-binding advisory basis, the compensation of the named executive officers as disclosed pursuant to Item 402 of Regulation S-K in the Company's proxy statement for the 2025 annual meeting of stockholders."
As an advisory vote, this proposal is not binding on us or our Board or Compensation Committee. The outcome of this advisory vote does not overrule any decision by us or our Board or Compensation Committee, nor will it create or imply any change to our fiduciary duties or those of our Board or Compensation Committee. However, our
THE BOARD OF DIRECTORS RECOMMENDS A VOTE IN FAVOR OF PROPOSAL 2.
| 23 |
PROPOSAL NO. 3
ADVISORY VOTE ON DETERMINING THE FREQUENCY OF SAY-ON-PAY ("SAY-ON-FREQUENCY")
As required by Section 14A of the Securities Exchange Act, this proposal, commonly referred to as the "say-on-frequency" vote, provides our stockholders with the opportunity to vote on how frequently they would like to cast an advisory vote on executive compensation. In casting their advisory vote, stockholders may choose among four options: (1) an annual vote, (2) a vote every two years (biennial), (3) a vote every three years (triennial) or (4) abstain from voting on this proposal.
Our Board has considered the advantages and disadvantages of the frequency of the say-on-pay vote. Based on its analysis, the Board believes that a triennial vote on executive compensation would be the most appropriate for the Board and the Compensation Committee and best serve the interests of our company and stockholders.
Like the advisory vote on executive compensation, the advisory vote on the frequency of such vote is non-binding on our
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "THREE YEARS" ON THE PROPOSAL TO DETERMINE THE FREQUENCY OF SAY-ON-PAY.
| 24 |
PROPOSAL NO. 4
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
The Board has selected
Neither our bylaws nor other governing documents or law require stockholder ratification of the selection of
The affirmative vote of the holders of a majority of the shares present in person or represented by proxy and entitled to vote on the matter at the 2025 Annual Meeting will be required to ratify the appointment of
Principal Accountant Fees and Services
The following table presents fees for professional audit services and other services rendered to the Company by
| Fiscal Year | Fiscal Year | |||||||
| 2024 | 2023 | |||||||
| Audit Fees (1) | $ | 324,994 | $ | 346,209 | ||||
| Audit-Related Fees (2) | - | - | ||||||
| Tax Fees (3) | - | - | ||||||
| All Other Fees (4) | - | - | ||||||
| Total Fees | $ | 324,994 | $ | 346,209 | ||||
_______________________
| (1) | Audit Fees. Audit services and related expenses include work performed for the audit of our financial statements and the review of financial statements included in our quarterly reports, as well as work that is normally provided by the independent registered public accounting firm in connection with statutory and regulatory filings. | |
| (2) | Audit-Related Fees. Audit-Related Fees are for assurance and related services that are reasonably related to the performance of the audit or review of our financial statements and are not covered above under "audit services." | |
| (3) | Tax Fees. Tax fees include all services performed by the independent registered public accounting firm's tax personnel for tax compliance, tax advice, and tax planning. | |
| (4) | All Other Fees. All other fees are those services and/or travel expenses not described in the other categories. |
The Audit Committee has reviewed the fees billed by
| 25 |
Pre-Approval Policy and Procedures
Our Audit Committee has adopted policies and procedures which set forth the manner in which the Audit Committee will review and approve all services to be provided by the independent auditor before the auditor is retained to provide such services. The policy requires Audit Committee pre-approval of the terms and fees of the annual audit services engagement, as well as any changes in terms and fees resulting from changes in audit scope or other items. The Audit Committee also pre-approves, on an annual basis, other audit services, and audit-related and tax services set forth in the policy, subject to estimated fee levels, on a project basis and aggregate annual basis, which have been pre-approved by the Audit Committee.
All other services performed by the auditor that are not prohibited non-audit services under
Our Chief Financial Officer reports quarterly to the Audit Committee on the status of pre-approved services, including projected fees. All of the services reflected in the above table were approved by the Audit Committee in fiscal 2024 and fiscal 2023.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE IN FAVOR OF PROPOSAL 4.
| 26 |
VOTING PROCEDURES
Election of Directors. Directors are elected by a plurality of the votes cast by the holders of shares entitled to vote in the election. There are seven nominees and seven positions to be filled; this means that the seven individuals receiving the most "for" votes will be elected. Votes to "withhold" and broker non-votes will not be relevant to the outcome.
Say-on-Pay. The advisory vote on the compensation of our named executive officers is non-binding, but our Board will consider the input of stockholders based on a majority of votes case for the Say-on-Pay proposal.
Say-on-Frequency. The advisory vote on the frequency of future of non-binding votes on the compensation of our named executive officers is non-binding, but our Board will consider the input of stockholders.
Ratification of Independent Registered Public Accounting Firm. The votes cast "for" must exceed the votes cast "against" in order to ratify the selection of
We will appoint an Inspector of Election for the 2025 Annual Meeting who will not be an officer, director, or nominee. If your shares are held in street name and you do not provide voting instructions to your broker, bank, or other nominee, your broker is entitled to vote your shares with respect to the proposal to ratify the selection of
HOUSEHOLDING OF PROXY MATERIALS
The
This year, a number of brokers with account holders who are
OTHER MATTERS
The Board knows of no other matters that will be presented for consideration at the 2025 Annual Meeting. If any other matters are properly brought before the meeting, it is the intention of the persons named in the accompanying proxy to vote on such matters in accordance with their best judgment.
| 27 |
|
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS annual meeting OF STOCKHOLDERS - |
||||||
| CONTROL ID: | ||||||
| REQUEST ID: | ||||||
| The undersigned appoints |
||||||
| (CONTINUED AND TO BE SIGNED ON REVERSE SIDE.) | ||||||
| VOTING INSTRUCTIONS | ||||||
| If you vote by phone, fax or internet, please DO NOT mail your proxy card. | ||||||
| MAIL: | Please mark, sign, date, and retuthis Proxy Card promptly using the enclosed envelope. | |||||
| FAX: | Complete the reverse portion of this Proxy Card and Fax to 202-521-3464. | |||||
| INTERNET: | https://www.iproxydirect.com/PAYS | |||||
| PHONE: | 1-866-752-VOTE(8683) | |||||
| ANNUAL MEETING OF THE STOCKHOLDERS OF |
PLEASE COMPLETE, DATE, SIGN AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE:ý |
|||||||||
| PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS | ||||||||||
| Proposal 1 | à | FOR ALL |
WITHHOLD ALL |
FOR ALL EXCEPT |
||||||
| Election of Directors: | ¨ | ¨ | ||||||||
| ¨ | ||||||||||
| ¨ | ControlID: | |||||||||
| ¨ | REQUEST ID: | |||||||||
| ¨ | ||||||||||
| ¨ | ||||||||||
| ¨ | ||||||||||
|
¨ |
||||||||||
| Proposal 2 | à | FOR | AGAINST | ABSTAIN | ||||||
|
A proposal to approve, on a non-binding advisory basis, the compensation of our named executive officers for fiscal 2025. The Board of Directors recommends a vote "FOR" this proposal. |
¨ | ¨ | ¨ | |||||||
| Proposal 3 | à | 1 YEAR | 2 YEARS | 3 YEARS | ABSTAIN | |||||
|
A proposal to approve, on a non-binding advisory basis, the frequency of an advisory vote on the compensation of our named executive officers. The Board of Directors recommends a vote of "Three Years" for this proposal. |
¨ | ¨ | ¨ | ¨ | ||||||
| Proposal 4 | à | FOR | AGAINST | ABSTAIN | ||||||
| A proposal to ratify the selection of |
¨ | ¨ | ¨ | |||||||
| MARK "X" HERE IF YOU PLAN TO ATTEND THE MEETING:¨ | ||||||||||
| THIS PROXY WILL BE VOTED AS DIRECTED. IF NO DIRECTION IS INDICATED FOR THE PROPOSALS, EACH PROPOSAL WILL BE VOTED "FOR" THE PROPOSAL. |
MARK HERE FOR ADDRESS CHANGE ¨ New Address (if applicable): ____________________________ IMPORTANT: Please sign exactly as your name or names appear on this Proxy. When shares are held jointly, each holder should sign. When signing as executor, administrator, attorney, trustee or guardian, please give full title as such. If the signer is a corporation, please sign full corporate name by duly authorized officer, giving full title as such. If signer is a partnership, please sign in partnership name by authorized person. Dated: ________________________, 2025 |
|||||||||
| (Print Name of Stockholder and/or Joint Tenant) | ||||||||||
| (Signature of Stockholder) | ||||||||||
| (Second Signature if held jointly) | ||||||||||
Attachments
Disclaimer
Geico will open Tampa campus, adding 1,000 jobs
Proxy Statement (Form DEF 14A)
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