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Nominating, Corporate Governance and Compensation Committee Interlocks and Insider Participation
None of the members of the NCG&C Committee is a current executive officer or employee of the
Company or any of its subsidiaries or affiliates. Norman Burmeister was the past President and Chief Executive
Officer of the Company (from July 17, 2003 to June 1, 2005). No other executive officer of the Company is or has
been a director or a member of the compensation committee of another entity having an executive officer who is or
has been a director or a member of the NCG&C Committee of the Board of the Company.
ITEM
11: EXECUTIVE AND DIRECTOR COMPENSATION
Named Executive Officers
“Named Executive Officer” or “NEO” means (a) all individuals who served as Chief Executive Officer of
the Company during the fiscal year ended December 31, 2015, and (b) each of the two most highly compensated
executive officers, or the two most highly compensated individuals acting in a similar capacity, other than the Chief
Executive Officer, at the end of the most recently completed fiscal year; and (c) each individual who would be an
NEO under clause (b) above but for the fact that the individual was neither an executive officer of the Company, nor
acting in a similar capacity, at the end of that fiscal year.
During the fiscal year ended December 31, 2015, the Company had three NEOs: Randall J. Scott, President
and Chief Executive Officer (“CEO”) of the Company; Paul H. Zink, Senior Vice President and Chief Financial
Officer (“CFO”) of the Company; and Jaye T. Pickarts, Chief Operating Officer (“COO”) of the Company.
Compensation Discussion and Analysis
Executive Compensation Program Objectives
The compensation of the Company’s NEOs is determined by the Company’s Board of Directors, with
consideration given to the recommendations of the Company’s NCG&C Committee. The Company’s compensation
program is designed to provide competitive levels of compensation, a significant portion of which is dependent upon
individual and corporate performance and contribution to increasing shareholder value. The Board recognizes the
need to provide a total compensation package that will attract and retain qualified and experienced executives as
well as align the compensation level of each executive to that executive’s level of responsibility and to the best
interests of the Company and its shareholders. In general, an NEO’s compensation is comprised of three
components: (i) cash compensation, consisting of base salary, wages or consulting payments; (ii) stock option
grants; and (iii) a discretionary incentive bonus.
The Company’s NCG&C Committee selected these three components due to standards in the Company’s
industry, the desire to maintain an effective but straightforward compensation program, and the need to reward
executives for past performance while still providing incentive for future performance. The NCG&C Committee
believed that salary and stock options were sufficient to remain competitive with peers and provide incentive for
future performance without adding the burden of administering complex compensation structures in a small,
growing company. In addition, the equity-based compensation aligns the Company’s NEOs’ interests with those of
our shareholders. The limited discretionary incentive bonus permits the Company to reward exemplary past
performance while preserving the Company’s cash for project needs. The objectives and reasons for this system of
compensation are generally to allow the Company to remain competitive among its peers in attracting and retaining
experienced personnel.
Determining Executive Compensation
Executive officers’ compensation is established through the thorough review and comparison of
compensation paid to executives at similar companies as established through a determined peer group as well as
consideration of other market factors and performance criteria at the corporate and individual performance level.
Compensation levels are typically negotiated with the candidate for a position prior to his or her final selection as an
executive officer. Cash compensation levels, comprised of base salary and discretionary incentive bonus, for
executive officers are reviewed annually and adjusted to reflect external factors, such as inflation, as well as overall
corporate performance and the results of internal performance reviews.