Note 15 - Related Party Transactions
|12 Months Ended|
Dec. 31, 2015
|Notes to Financial Statements|
|Related Party Transactions Disclosure [Text Block]||
RELATED PARTY TRANSACTIONS
Related Party Transactions
Mr. David Centofanti
Mr. David Centofanti serves as the Company’s Vice President of Information Systems. For such position, he received annual compensation of $168,000 and $163,000 in 2015 and 2014, respectively. Mr. Centofanti is the son of the Company’s CEO, President and a Board member, Dr. Louis F. Centofanti.
Robert L. Ferguson
Mr. Robert L. Ferguson serves as an advisor to the Company’s Board and is also a member of the Supervisory Board of PF Medical, a majority-owned Polish subsidiary of the Company. Mr. Ferguson previously served as a Board member for the Company from June 2007 to February 2010 and again from August 2011 to September 2012. As an advisor to the Company’s Board, Mr. Ferguson is paid $4,000 monthly plus reasonable expenses. For such services, Mr. Ferguson received compensation of approximately $58,000 and $56,000 for the years ended December 31, 2015 and 2014, respectively. On August 2, 2013, the Company completed a lending transaction with Messrs. Robert Ferguson and William Lampson (“collectively, the “Lenders”), whereby the Company borrowed from the Lenders the sum of $3,000,000 pursuant to the terms of a Loan and Security Purchase Agreement and promissory note (the “Loan”) (see further details and terms of this Loan in this Note 9 – “Long Term Debt – Promissory Notes and Installment Agreements”).
Mr. John Climaco
On June 2, 2015, Mr. Climaco, a current member of the Company’s Board and a member of the Strategic Advisory Committee of the Board, was elected as the EVP of PF Medical. As EVP of PF Medical, Mr. Climaco receives an annual salary of $150,000 and is not eligible to receive compensation for serving on the Company’s Board.
On October 17, 2014, the Company’s Compensation Committee and the Board, with Mr. Climaco abstaining, approved a consulting agreement with Mr. Climaco. Pursuant to the consulting agreement, Mr. Climaco was responsible to, among other things:
Mr. Climaco was paid $22,000 per month under the consulting agreement, beginning September 2014, until the termination of the consulting agreement effective June 2, 2015, upon Mr. Climaco’s election as EVP of PF Medical. For his services under the consulting agreement, Mr. Climaco received approximately $117,000 and $107,000 in 2015 and 2014, respectively.
Mr. Climaco is also a Director of Digirad Corporation. On July 24, 2015 PF Medical and Digirad entered into a multi-year Tc-99 Supplier Agreement and a Subscription Agreement (see further details of these agreements in this Note 3 – “PF Medical).
Mr. Robert Schreiber, Jr.
During March 2011, we entered into a five-year lease with Lawrence Properties LLC for certain office and warehouse space used and occupied by SYA, a wholly owned subsidiary of the Company until its sale by the Company on July 29, 2014. Lawrence Properties is owned by Robert Schreiber, Jr., the President of SYA until his resignation on July 29, 2014, and Mr. Schreiber’s spouse. Under the lease, which commenced June 1, 2011, we paid monthly rent of approximately $11,400. Rent payment under this lease was approximately $72,000 for the year ended December 31, 2014. In connection with the Company’s sale of SYA, the lease was terminated on July 29, 2014. Mr. Schreiber is a member of the Supervisory Board of PF Medical, a majority-owned Polish subsidiary of the Company.
We have employment agreements (each dated July 10, 2014) with each of Dr. Centofanti (our President and CEO), Ben Naccarato (our CFO), and John Lash (our COO). Each employment agreement provides for annual base salaries, bonuses, and other benefits commonly found in such agreements. In addition, each employment agreement provides that in the event of termination of such officer without cause or termination by the officer for good reason (as such terms are defined in the employment agreement), the terminated officer shall receive payments of an amount equal to benefits that have accrued as of the termination but had not yet been paid, plus an amount equal to one year’s base salary at the time of termination. In addition, the employment agreements provide that in the event of a change in control (as defined in the employment agreements), all outstanding stock options to purchase our Common Stock granted to, and held by, the officer covered by the employment agreement to be immediately vested and exercisable. The Company had an employment agreement dated August 24, 2011 with Mr. James A. Blankenhorn. On March 20, 2014, the Company accepted the resignation of Mr. James A. Blankenhorn, as Vice President and COO of the Company. The resignation was effective March 28, 2014. When Mr. Blankenhorn’s resignation as the COO became effective, his employment agreement also terminated.
The Company has an individual MIP for each of our CEO, CFO and COO, which awards cash compensation based on achievement of certain performance targets for fiscal year 2015. A total of approximately $214,000 (which is expected to be paid during the second quarter of 2016) was accrued under the three MIPs for 2015. See “Subsequent Events” in Note 17 for discussion of the 2016 MIPs.
The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.
Reference 1: http://www.xbrl.org/2003/role/presentationRef