Company: CPSH
Filing Date: 2025-03-17
Form Type: DEF 14A
Source: 0001437749-25-008032
Chunk: 22

Company: CPS TECHNOLOGIES CORP/DE/
Filing Date: 2025-03-17
Form: DEF 14A
Chunk 22
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 during which the Company’s financial performance has supported such awards; such components of compensation are not granted when the Company’s operating results have not been positive and/or the recipients have not achieved specified performance milestones. For fiscal year 2024, no bonuses were granted to our named executive officers. The Company granted stock options to purchase an aggregate 15,000 shares of Common Stock in fiscal year 2024 to each of our Chief Executive Officer and our Chief Financial Officer.

The Company’s named executive officers also participate in the group benefits offered to all employees, such as medical and life insurance and a retirement savings plan.

Base Salary

Base salary levels for the Company’s officers typically are reviewed annually and are tied to the Company’s fiscal year. Among those factors taken into consideration when setting executive officer salaries are individual and corporate performance, level of responsibility, prior experience, breadth of knowledge of the industry, and competitive pay practices. Specific weight is not given to any factor when establishing base salaries, although most weight is typically given for individual performance. In unusual cases salaries may be reviewed more frequently.

Annual Bonuses

We believe that executive performance may be maximized through a system of incentive awards. Toward this end, the Company has established a discretionary cash incentive plan. Bonuses, when paid, are designed to tie awards to the achievement of specific corporate sales and earnings targets; the amount of the bonus award earned depends primarily on the extent to which such performance objectives are achieved. The Compensation Committee establishes the annual sales and earnings objectives for CPS, along with the milestones required to be achieved at each bonus level, and shares them with each individual officer. At year-end, the Compensation Committee evaluates each individual’s performance compared with each individual’s specific goals and makes a determination as to whether the specified milestones have been reached.

Equity Incentives

As with base salary and bonus determinations, equity compensation awards are determined on an annual basis, typically in the first half of each fiscal year. An important objective of this component of compensation is to strengthen the relationship between the long-term value of the Company’s stock price and the potential financial gain for employees, as well as retention of personnel. Historically the Company has awarded stock options to its employees, officers and directors as the equity component of compensation, which provide recipients the opportunity to purchase shares of our Common Stock upon vesting and become valuable only if the trading price of the Common Stock increases. The recipient is therefore motivated to remain with the Company until the options vest and motivated to improve individual performance in support of improved Company performance as