Company: ELSE
Filing Date: 2025-03-19
Form Type: DEF 14A
Source: 0000897101-25-000161
Chunk: 15

Company: ELECTRO SENSORS INC
Filing Date: 2025-03-19
Form: DEF 14A
Chunk 15
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 strategic goals were primarily related to initiatives related to strategic business
development. The Company allocated 40% of the potential bonus to financial performance, 50% to strategic initiatives, and 10% was
discretionary. If the Company achieved the specified goals, the incentive cash payment to Mr. Klenk would have been approximately
19% of his base salary. Furthermore, the Committee retained discretion under the 2024 Plan to make incentive plan cash payments
in amounts higher or lower than would otherwise be required under the 2024 Plan. Although the Company did not achieve specified
revenue levels, Mr. Klenk worked extensively on business development. The Compensation Committee approved a discretionary $20,000
bonus to Mr. Klenk under the 2024 Plan.

2025 Management Incentive Bonus Plan

On January 9, 2025,
the Compensation Committee approved the 2025 Management Incentive Plan (the “2025 Plan”) for Mr. Klenk. The 2025 Plan
has both annual financial performance and strategic goals. The financial performance goals are primarily based on the achievement
of specified revenue levels, with additional amounts available for exceeding certain levels. The strategic goals are primarily
related to initiatives related to strategic business development. The 2025 Plan allocates 40% of the potential bonus to financial
performance, 50% to strategic initiatives, and 10% is discretionary. If the Company achieves the specified goals, the incentive
cash payment to Mr. Klenk will equal approximately 18% of his base salary. Furthermore, the Committee retains discretion under
the 2025 Plan to make incentive plan cash payments in amounts higher or lower than would otherwise be required under the 2025 Plan.

Policies and Practices Related to the Grant of Equity Awards Close in Time to the Release of Material Nonpublic Information

We do not grant new
awards of stock options, stock appreciation rights, or similar option-like instruments within four business days before or one
business day after the release of a Form 10-Q, 10-K, or 8-K that discloses material nonpublic information. If we grant new
awards of such options, the Board will evaluate the appropriate steps to take in relation to the foregoing.

Pay Versus Performance

| Year |            Summary 
 Compensation Table 
          Total for 
                PEO 
                ($) |     Compensation 
 actually paid to 
              PEO 
              ($) | Average            
 Summary            
 compensation       
 table total