Click here to close now.

SYS-CON MEDIA Authors: David Sprott, Liz McMillan, tru welu, Blue Box Blog, Kevin Jackson

News Feed Item

ProPhotonix Limited Announces Director Dealing, New Remuneration Policy and 2014 Stock Incentive Plan

SALEM, NH -- (Marketwired) -- 06/10/14 -- ProPhotonix Limited (PINKSHEETS: STKR) (LSE: PPIX) (LSE: PPIR), a designer and manufacturer of LED illumination systems and laser diode modules with operations in Ireland and the United Kingdom, today announces director share option award and new remuneration policy and incentive plan.

Raymond Oglethorpe, Chairman and Non-Executive Director, provides the following information:

The ProPhotonix Governance, Nomination and Remuneration committee, in conjunction with Abbiss Cadres LLP, has been deliberating how the Company's remuneration policy can support the recovery to profitability and the creation of value for stockholders. The committee believes that an effective remuneration policy, closely linked to the Company's objectives, is a vital part of that recovery. Therefore, the committee has implemented a new equity incentive plan and specific performance criteria associated with option grants for its senior management. This communiqué sets out more information on the new equity incentive plan and the remuneration policy ProPhotonix is implementing for its senior management.

Background
The Company previously granted options under its various option plans including the current 2007 Stock Incentive Plan ("2007 Plan"). The 2007 Plan is now exhausted and without the capacity to provide a meaningful equity incentive to the Company's key individuals or provide the desired level of alignment with stockholder interests. Taking account of the cash constraints on the Company, the committee has concluded that share options remain the best way of incentivising and retaining key individuals to drive improvements in stockholder value over the medium to long term. Accordingly, the committee and board have approved and implemented the 2014 Stock Incentive Plan.

2014 Equity Incentive Plan (Summary)

  • A new equity incentive plan to replace the current 2007 Plan that will cease to operate
  • 8,200,000 shares reserved for initial award to key senior management
  • 2,000,000 shares reserved for awards in the future to new hires and other employees
  • 2,000,000 shares (or 5% of the share capital, if less) will become available for equity awards under the Plan in each subsequent year

New remuneration policy for senior management
Summary
In order to incentivise the achievement of its objectives, the Company has implemented a new remuneration policy for its senior management with the following elements:

  • A one-off substantial performance based option grant to key senior management at market value
  • No further grants intended to said senior management through the end of the three-year measurement period
  • Cliff vesting on December 31, 2016 at different levels dependent on achievement against the performance target (zero below 50% up to 100% vesting at 90% attainment)
  • 10 year option term

Performance measure
The performance measure is the driving factor behind the new policy. As Tim Losik, President and CEO, explained in our 2013 annual report, the key to ProPhotonix's future prosperity will be growth in revenue and attainment of positive cash flow leading to net profits. The committee believes that a performance measure linked to positive cash flow over the performance period is a proper performance metric. Broadly, the target is EBITDA equal to 90% of the term debt and lease principal payments, and all interest payments, which are due during the performance period. Such payments would, on the basis of current obligations, amount to approximately $3.0 million in total. Achievement of this objective will result in full vesting. The committee and board believe that achievement of the objective will result in the creation of significant stockholder value.

Director Dealing
The one-off awards of 8,200,000 performance based options granted June 9, 2014 are issued at market value of $0.038 per share. Tim Losik, President and CEO, received 3,500,000 of the awards with the balance of 4,700,000 going to other members of the management team. The amount of option grant takes into account the one-off nature of the grant with no further intended awards to these individuals for the three years of the performance period.

Impact of awards
The maximum potential dilution from all options (including out of the money options of 9.0 million shares June 9, 2014) will increase from 17.3% to 27.1% as result of the one-off award (assuming the performance target is achieved in full). The committee believes the proposed level of grants is both necessary and justifiable, given that vesting fully is dependent on the achievement of targets which, if achieved, should result in the creation of significant stockholder value.

In conclusion, the committee and board considers the new remuneration policy a key part of the Company's path to profitability. By linking the potential rewards under the option grants to the Company's strategy of achieving sustained positive cash flow, the committee believes that it provides a consistent alignment between the senior management team and stockholders.

About ProPhotonix
ProPhotonix Limited, headquartered in Salem, New Hampshire, is an independent designer and manufacturer of diode-based laser modules and LED systems for industry leading OEMs and medical equipment companies. In addition, the Company distributes premium diodes for Oclaro, Osram, QSI, Panasonic, and Sony. The Company serves a wide range of markets including the machine vision, industrial inspection, security, and medical markets. ProPhotonix has offices and subsidiaries in the U.S., Ireland, U.K., and Europe. For more information about ProPhotonix and its innovative products, visit the Company's web site at www.prophotonix.com

Cautionary Statement
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical fact, including without limitation, those with respect to ProPhotonix's goals, plans and strategies set forth herein are forward-looking statements. The following important factors and uncertainties, among others, could cause actual results to differ materially from those described in these forward-looking statements: uncertainty that cash balances may not be sufficient to allow ProPhotonix to meet all of its business goals; uncertainty that ProPhotonix's new products will gain market acceptance; the risk that delays and unanticipated expenses in developing new products could delay the commercial release of those products and affect revenue estimates; the risk that one of our competitors could develop and bring to market a technology that is superior to those products that we are currently developing; and ProPhotonix's ability to capitalize on its significant research and development efforts by successfully marketing those products that the Company develops. Forward-looking statements represent management's current expectations and are inherently uncertain. ProPhotonix undertakes no duty to update any of these forward-looking statements. All Company, brand, and product names are trademarks or registered trademarks of their respective holders.

This information is provided by RNS
The company news service from the London Stock Exchange

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
Cloud and Big Data present unique dilemmas: embracing the benefits of these new technologies while maintaining the security of your organization's assets. When an outside party owns, controls and manages your infrastructure and computational resources, how can you be assured that sensitive data remains private and secure? How do you best protect data in mixed use cloud and big data infrastructure sets? Can you still satisfy the full range of reporting, compliance and regulatory requirements? In...
In this scenarios approach Joe Thykattil, Technology Architect & Sales at TimeWarner / Navisite, presented examples that will allow business-savvy professionals to make informed decisions based on a sound business model. This model covered the technology options in detail as well as a financial analysis. The TCO (Total Cost of Ownership) and ROI (Return on Investment) demonstrated how to start, develop and formulate a business case that will allow both small and large scale projects to achieve...
The move to the cloud brings a number of new security challenges, but the application remains your last line of defense. In his session at 15th Cloud Expo, Arthur Hicken, Evangelist at Parasoft, discussed how developers are extremely well-poised to perform tasks critical for securing the application – provided that certain key obstacles are overcome. Arthur Hicken has been involved in automating various practices at Parasoft for almost 20 years. He has worked on projects including database dev...
Building low-cost wearable devices can enhance the quality of our lives. In his session at Internet of @ThingsExpo, Sai Yamanoor, Embedded Software Engineer at Altschool, provided an example of putting together a small keychain within a $50 budget that educates the user about the air quality in their surroundings. He also provided examples such as building a wearable device that provides transit or recreational information. He then reviewed the resources available to build wearable devices at ...
There has been a lot of discussion recently in the DevOps space over whether there is a unique form of DevOps for large enterprises or is it just vendors looking to sell services and tools. In his session at DevOps Summit, Chris Riley, a technologist, discussed whether Enterprise DevOps is a unique species or not. What makes DevOps adoption in the enterprise unique or what doesn’t? Unique or not, what does this mean for adopting DevOps in enterprise size organizations? He also explored differe...
Storage administrators find themselves walking a line between meeting employees’ demands to use public cloud storage services, and their organizations’ need to store information on-premises for security, performance, cost and compliance reasons. However, as file sharing protocols like CIFS and NFS continue to lose their relevance, simply relying only on a NAS-based environment creates inefficiencies that hurt productivity and the bottom line. IT wants to implement cloud storage it can purchase a...
The emergence of cloud computing and Big Data warrants a greater role for the PMO to successfully manage enterprise transformation driven by these powerful trends. As the adoption of cloud-based services continues to grow, a governance model is needed to orchestrate enterprise cloud implementations and harness the power of Big Data analytics. In his session at Cloud Expo, Mahesh Singh, President of BigData, Inc., discussed how the Enterprise PMO takes center stage not only in developing the app...
Cloud Foundry open Platform as a Service makes it easy to operate, scale and deploy application for your dedicated cloud environments. It enables developers and operators to be significantly more agile, writing great applications and deliver them in days instead of months. Cloud Foundry takes care of all the infrastructure and network plumbing that you need to build, run and operate your applications and can do this while patching and updating systems and services without any downtime.
Are your Big Data initiatives resulting in Big Impact or Big Mess? In her session at Big Data Expo, Penelope Everall Gordon, Emerging Technology Strategist at 1Plug Corporation, shared her successes in improving Big Decision outcomes by building stories compelling to the target audience – and her failures when she lost sight of the plotline, distracted by the glitter of technology and the lure of buried insights. The cast of characters includes the agency head [city official? elected official?...
In their session at @ThingsExpo, Shyam Varan Nath, Principal Architect at GE, and Ibrahim Gokcen, who leads GE's advanced IoT analytics, focused on the Internet of Things / Industrial Internet and how to make it operational for business end-users. Learn about the challenges posed by machine and sensor data and how to marry it with enterprise data. They also discussed the tips and tricks to provide the Industrial Internet as an end-user consumable service using Big Data Analytics and Industrial C...
SYS-CON Events announced today that BMC will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. BMC delivers software solutions that help IT transform digital enterprises for the ultimate competitive business advantage. BMC has worked with thousands of leading companies to create and deliver powerful IT management services. From mainframe to cloud to mobile, BMC pairs high-speed digital innovation with robust...
After a couple of false starts, cloud-based desktop solutions are picking up steam, driven by trends such as BYOD and pervasive high-speed connectivity. In his session at 15th Cloud Expo, Seth Bostock, CEO of IndependenceIT, cut through the hype and the acronyms, and discussed the emergence of full-featured cloud workspaces that do for the desktop what cloud infrastructure did for the server. He also discussed VDI vs DaaS, implementation strategies and evaluation criteria.
We certainly live in interesting technological times. And no more interesting than the current competing IoT standards for connectivity. Various standards bodies, approaches, and ecosystems are vying for mindshare and positioning for a competitive edge. It is clear that when the dust settles, we will have new protocols, evolved protocols, that will change the way we interact with devices and infrastructure. We will also have evolved web protocols, like HTTP/2, that will be changing the very core...
How do APIs and IoT relate? The answer is not as simple as merely adding an API on top of a dumb device, but rather about understanding the architectural patterns for implementing an IoT fabric. There are typically two or three trends: Exposing the device to a management framework Exposing that management framework to a business centric logic Exposing that business layer and data to end users. This last trend is the IoT stack, which involves a new shift in the separation of what stuff happe...
Connected devices and the Internet of Things are getting significant momentum in 2014. In his session at Internet of @ThingsExpo, Jim Hunter, Chief Scientist & Technology Evangelist at Greenwave Systems, examined three key elements that together will drive mass adoption of the IoT before the end of 2015. The first element is the recent advent of robust open source protocols (like AllJoyn and WebRTC) that facilitate M2M communication. The second is broad availability of flexible, cost-effective ...