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Note 7 - Employment Agreements
6 Months Ended
Jun. 30, 2016
Notes to Financial Statements  
Postemployment Benefits Disclosure [Text Block]
Note 7. Employment Agreements
 
Pursuant to the Company’s respective employment agreements with Michael Long, Chairman, and Louis Hoch, President, Chief Executive Officer, and Chief Operating Officer, as amended, in the event of change in control, termination without cause, or non-renewal of the employment agreement the Company will be liable for separation payments, equaling an amount of (a) 2.95 the respective base salary and bonus payments, plus (b) a pro rata portion of the respective annual bonus based on the number of days elapsed in the year prior, plus (c) 2.0 times the respective base salary for non-competition, and (d) continuing other benefits. The Company will also accelerate vesting of stock incentive awards, which as of June 30, 2016 are approximately $1.3 million each, and although it may not impact our cash position, will negatively affect our financial performance. The Company estimates the cash disbursements over time to be $1.5 to $2.0 million each for the respective agreements with Mr. Long and Mr. Hoch.
 
In the case of termination of the agreement due to death of the executive, the Company will be liable for separation payments, equaling an amount of (a) 2.95 the respective base salary and bonus payments, plus (b) a pro rata portion of the respective annual bonus based on the number of days elapsed in the year prior to death, and (c) continuing other benefits. The Company estimates the cash disbursements over time to be around to be $1.0 million each for the respective agreements with Mr. Long and Mr. Hoch.
 
In the case of termination of the agreement due to disability without death, the Company will be liable for separation payments, equaling an amount of (a) 2.95 the respective base salary and bonus payments, plus (b) a pro rata portion of the respective annual bonus based on the number of days elapsed in the year prior to death, plus (c) continuing other benefits, plus (d) disability benefits constituting salary for 3 years. The Company estimates the cash disbursement over time to be $1.8 to $2.2 million for each for the respective agreements with Mr. Long and Mr. Hoch.
 
The Compensation Committee of the Board of Directors has indicated it is in the process of renegotiating the amendments to the employment agreements with respect to the death and disability separation payments, which, if finalized, would greatly reduce the amounts due in those instances. Both Mr. Long and Mr. Hoch have agreed that the 5th amendment to the employment agreements should have only allowed for deferred compensation in the case of death calculations using only the executive’s salary and nothing for bonus compensation or any other benefits and or deferred compensation in the case of disability the only deferred compensation will be the continuation of only salary payments for thirty-six months to be paid by the company and or any disability insurance carrier. Both Mr. Long and Mr. Hoch have agreed to execute the amendments once the Compensation Committee approves the changes. While there is no guarantee that these amendments will be executed, both management and the Compensation Committee have indicated this is their intent.