Company: CPSH
Filing Date: 2025-03-17
Form Type: DEF 14A
Source: 0001437749-25-008032
Chunk: 26

Company: CPS TECHNOLOGIES CORP/DE/
Filing Date: 2025-03-17
Form: DEF 14A
Chunk 26
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 year as they relate to the financial plan submitted to and approved by the Board prior to the beginning of the fiscal year. Compensation actually paid to the PEO and Non-PEO NEO reflects the actual salaries and other compensation plus the bonus amount accrued for during the year, but paid early in the following year. The Board elected not to consider shareholder return as a factor in results that would impact compensation.

Tax Considerations

Section 162(m) of the Code generally disallows a tax deduction to public companies for compensation over $1,000,000 paid to certain employees, generally the Chief Executive Officer and the four other most highly compensated executive officers. Prior to the passage of the 2017 Tax Cuts and Jobs Act, qualifying performance-based compensation was generally excluded from the deduction limit if certain requirements were met; as a result of changes in the tax law, this previously available exclusion was no longer available after 2018.

In fiscal year 2024, no compensation paid by the Company was nondeductible as a result of the $1,000,000 limitation. Furthermore, the Board of Directors believes that, given the general range of salaries and bonuses for executive officers of the Company, the $1,000,000 threshold of Section 162(m) of the Code will not be reached by any executive officer of the Company in the foreseeable future. Accordingly, the Board has not formulated a policy to address non-qualifying compensation or the elimination of the performance-based compensation exclusion.

Say on Pay Proposal and Votes

As discussed under Proposal 2 below, stockholders will have the opportunity to cast their vote at the Meeting on the compensation of CPS’s named executive officers as described in this Proxy Statement. The advisory vote will not be binding on the Compensation Committee or the Board. However, the Compensation Committee and the Board will review the voting results and any concerns raised by stockholders will be considered when determining future compensation arrangements and making decisions about future compensation programs and practices. The Board and Compensation Committee also may consult directly with stockholders to better understand any issues and concerns.

Policy for Granting Certain Option Awards

The Company does not have a formal policy regarding the granting of stock options. When granting stock options the Board of Directors takes into consideration any MNPI in the determination of the date on which the options will be granted. In 2024 no options were granted during the four business day-period prior to, or one business day following, the filing of the Company’s periodic reports or the filing or furnishing of a Form 8-K that disc