Company: OCC
Filing Date: 2025-02-18
Form Type: PRE 14A
Source: 0001437749-25-004188
Chunk: 39

Company: OPTICAL CABLE CORP
Filing Date: 2025-02-18
Form: PRE 14A
Chunk 39
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 her tax withholding liability or pay the tax withholding liability in cash to retain all of the vesting Common Shares, with the latter demonstrating an additional financial commitment by the non-cash director.

The Compensation Committee engages a compensation consultant to assist in establishing appropriate compensation levels for non-employee directors. Such compensation consultant is engaged periodically as determined appropriate by the Compensation Committee—typically annually.

Methodology of Determining Non-Employee Director Compensation

The Compensation Committee engages an outside compensation consultant with a nationally recognized firm to make recommendations regarding appropriate compensation levels for non-employee directors—periodically and most recently during fiscal year 2023.

Prior to any engagement of the compensation consultant, the Compensation Committee and the Company determined that no conflict of interest existed between the Company and its employees and the compensation consultant and its employees. The outside consultant engaged by the Compensation Committee in fiscal year 2023 is also engaged by the Company to assist with benefits administration related to the Company’s 401(k) Plan and with the annual Directors and Officers Insurance renewal.

During fiscal year 2023, the compensation consultant created a revenue-based peer group by considering similar-sized public companies, as well as considering industry and company type (e.g., manufacturing and/or technology companies), which was reviewed and approved by the Compensation Committee. In addition to revenue, other financial factors are considered in evaluating the appropriateness of the peer group including EBITDA, net income, market capitalization, and return on equity.

The peer group contained 12 public companies in addition to OCC. The peer group used by the compensation consultant for recommendations regarding non-employee director compensation is the same peer group used by the compensation consultant for recommendations regarding executive compensation. The compensation consultant provided data regarding ranges of retainers for members of the Board and the committees, retainers for committee chairman, meeting fees, and share-based compensation.

<div align='center'>25</div>

Generally, the Compensation Committee targets non-employee Board member compensation at or about the 25 percentile of the revenue-based peer group recommended by the compensation consultant.

Using this approach, the Compensation Committee decided on recommended non-employee director compensation for fiscal year 2024. The Compensation Committee approved and recommended to the Board for consideration and approval, the dollar amount of the following for non-employee Board members for fiscal year 2024—which was the same dollar amount as the non-employee director compensation approved for fiscal year 2023:

| ● | Annual cash retainer for Board membership, Audit Committee membership, Compensation Committee membership, and Nominating and Corporate Governance Committee