S&W Seed Co (NASDAQ:SANW), a company specializing in agricultural crop production, announced on Monday an amended and restated employment agreement with its President and Chief Executive Officer, Mr. Herrmann. The new agreement, effective as of today, solidifies Mr. Herrmann's continued leadership and outlines his compensation and benefits.
Under the terms of the updated agreement, Mr. Herrmann will maintain his annual base salary of $500,000. Starting from fiscal year 2025, he will be eligible for a cash bonus with a target of 50% of his base salary, which can reach up to 75%, and a restricted stock unit award with a target value of $150,000, increasing to a maximum of $300,000. These stock units will vest quarterly over three years, contingent upon his ongoing service with the company.
Additionally, each fiscal year Mr. Herrmann is set to receive stock options valued at $300,000, vesting on a similar quarterly schedule over three years. The agreement stipulates the cessation of company-provided housing in Longmont, Colorado, for Mr. Herrmann by August 31, 2024.
Should Mr. Herrmann's employment end without cause or if he resigns for a good reason, as defined in the employment agreement, he is entitled to a continuation of his base salary for three months. Moreover, if he voluntarily retires after reaching the age of 65, he will benefit from the full acceleration and exercisability of all unvested shares from stock options or restricted stock unit awards, with the options remaining exercisable for 12 months post-termination.
In other recent news, S&W Seed Company (NASDAQ:SANW) reported a slight rise in total revenue for the third quarter of fiscal year 2024, with earnings reaching $18.3 million, up from $17.7 million in the same quarter of the previous year. This growth is attributed to the successful market penetration of the company's Double Team sorghum trait technology, which now commands a 10% share of green sorghum acres in the U.S.
Despite challenges such as geopolitical disruptions in the Middle East and supply shortages in Australia, S&W maintains its revenue guidance for the Double Team sorghum, projecting growth between 77% and 115% compared to fiscal 2023. The company also announced strategic moves including the sale of its partnership with Trigall Genetics in Australia and updates on its Vision Biofuels Oilseeds joint venture.
These are among the recent developments for S&W, which is optimistic about the scalability of Double Team sorghum and its future revenue potential. The company aims to capture a 25% market share in sorghum traits by 2027 and plans to introduce new traits in the coming year.
While the company reported a negative adjusted EBITDA of $1.2 million for Q3 2024, it is focused on achieving positive cash flow in the near future and optimizing operations for profitability. S&W is also concentrating on high-margin products like the glufosinate-resistant Camelina trait, slated for commercial launch in fall 2025.
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