Company: OCC
Filing Date: 2025-02-18
Form Type: PRE 14A
Source: 0001437749-25-004188
Chunk: 50

Company: OPTICAL CABLE CORP
Filing Date: 2025-02-18
Form: PRE 14A
Chunk 50
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Annual Short-term Incentive Opportunity

The Compensation Committee together with the CEO (other than for himself and the CFO), generally each year establish a Senior Leadership Team Annual Bonus Criteria (the “SLT ABC”) for the members of the senior leadership team. The SLT ABC generally sets forth quantitative corporate and team goals based on consolidated sales and EBITDA, as well as other goals based on certain team members’ areas of responsibility, and a return on equity target for the CEO. Payment of any compensation under the SLT ABC is subject to a minimum financial performance trigger, and achievement of certain levels of financial performance for the goals established. Compensation earned is levered up or down based on performance relative to the quantitative corporate and team goals, and qualitative goals compared to the bonus criteria.

The quantitative corporate and team goals are established by the Compensation Committee based on an annual budget approved by the Board of Directors. The Board tends to set what it considers to be stretch goals in the budget for purposes of a member of the leadership team earning his or her target annual short-term incentive compensation.

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Based on the Company’s performance, no short-term incentive bonus was paid to either Mr. Wilkin or Ms. Smith for fiscal years 2024, 2023 or 2022.

Long-term Equity Incentive Compensation

The Compensation Committee considers long-term equity incentive grants under the 2017 Plan (or predecessor stock incentive plans) based on recommendations by the compensation consultant. The Compensation Committee designs share-based compensation to align the financial interests of the leadership team with the interests of the shareholders and to attract and retain key employees. Share-based compensation may be a mix of performance-based vesting and time-based vesting compensation. Share-based compensation awarded for fiscal year 2024 was granted on August 7, 2024 and was exclusively performance-based vesting compensation.

The Compensation Committee sets a dollar amount of long-term equity incentive compensation for each executive. Then, in accordance with the Optical Cable Corporation Amended and Restated Policy for the Timing of Equity Compensation Grants Under Stock Incentive Plans, the actual number of Common Shares issued to an executive in an equity incentive award is generally calculated by using the average closing price per share during the 20 trading dates immediately preceding the first business day after January 15, divided by the dollar value of the long-term equity incentive compensation to be received. The Compensation Committee, upon recommendation of the CEO, determined that the average closing price per share for the period from March 4,