PRSS 2018 Proxy Statement

18 the last completed fiscal year, who are Phillip L. Milliner, Robert D. Barton and Ekumene M. Lysonge. all of whom we collectively refer to in this Proxy Statement as the named executive officers, were base salary, cash incentive compensation, equity-based compensation and severance. Robert D. Barton resigned from his position as Chief Operating Officer on March 9, 2018. We do not have a policy on the division of compensation between the primary components. Base Salary With regards to base salary, each named executive officer entered into an at-will employment agreement or offer letter with us at the time of his hire that provides for his initial base salary, and the Board reviews the base salaries annually. All compensation terms in the offer letters other than standard employee benefits have since been superseded. Cash Incentive Compensation With regards to cash incentive compensation, each member of our senior management team was eligible to receive cash awards under our 2017 cash bonus plan upon achievement of certain financial goals. For 2017, the financial goals for our named executive officers were entirely based on achievement of corporate targets (specifically, Adjusted EBITDA). Payouts under the 2017 Bonus Plan will be earned by achievement of payout targets, with 50% payable upon the achievement of certain minimum target levels, and 200% payable upon the achievement of certain maximum target levels. The bonus payout percentage was set at 75%, 50%, 50% and 40% of base salary for Mr. Durham, Mr. Milliner, Mr. Barton, and Mr. Lysonge, respectively. For each of Mr. Durham, Mr. Milliner, Mr. Barton and Mr. Lysonge, the target business metrics used are based on the Company’s Adjusted EBITDA performance: Named Executive Officer Target Payout (% of base salary) Fred E. Durham, III 75% Phillip L. Milliner 50% Robert D. Barton 50% Ekumene M. Lysonge 40% For the year ended December 31, 2017, as to our financial targets, we did not achieve our minimum Adjusted EBITDA target, and thus, each of Messrs. Durham, Milliner, Barton and Lysonge did not receive a cash bonus payout. Additionally, in February 2018, the compensation committee approved a 2018 cash bonus plan, whereby our executive officers and certain other non-executive officers, may be eligible to receive a cash bonus. Payouts under this plan for named executive officers will be expressed as a percentage of their base salary in the event the Company achieves certain Adjusted EBITDA goals. The 2018 cash bonus plan is filed as an exhibit to our Current Report on Form 8-K filed on March 5, 2018. Long-Term Incentives (Equity Based Compensation) The objective of the Company’s long-term incentive compensation program is to support the entrepreneurial mindset desired of management by the Board of Directors by providing an opportunity to earn significant equity in the Company for achieving significant performance improvements and providing continued service to the Company over time. The long-term incentive compensation program is formally called the Executive Equity Incentive Program (“EEIP”). The purpose of the EEIP is to provide the participants with a long- term incentive program, which is market-competitive and provides long-term incentives on a regular, predictable, and annual basis. Eligible participants (as determined by the compensation committee) may be members of our senior executive team and such other executives and key contributors as the compensation committee may designate from time to time. No individual has an automatic right to participate in the EEIP. In fiscal year 2017, our EEIP included grants of time-based restricted stock units (“RSUs”), nonstatutory stock options (“NSOs”) and performance-based restricted stock units (“PSUs”). Our named executive officers were granted RSUs and NSOs subject to time-based vesting over a four-year period from January 1, 2017 through December 31, 2020, and PSUs based upon the Company achieving certain key performance metrics over a 36-month period from January 1, 2017 through December 31, 2019. Each NSO was assigned an exercise price equal to the Company’s closing stock price on the grant date. The maximum number of PSUs that may be earned during the performance period is 100%. At the end of the performance period, the compensation committee will review performance achieved on each performance measure that was established at the beginning of the performance period. The goals are intended to be challenging, but achievable with strong management performance. The earn-out for each performance metric is determined by a curve. Achievement between points is interpolated. The holder must generally remain in our service through the end of