Michael A. Davis
About Michael A. Davis
Michael A. Davis (age 72) has served on the Cyanotech Board since March 2003 and has been Chairman of the Board since April 13, 2011, bringing 30+ years as a private investor in natural and organic foods, nutraceuticals, and related agriculture; he attended Harvard University . He currently serves as President of Skywords Family Foundation, Inc. and as a Director of Canobie Films, Inc., providing perspective on mission-driven capital and media governance . Cyanotech maintains a split Chair/CEO structure with Davis as independent Chair and Matthew K. Custer as CEO, a governance practice the Board highlights for oversight effectiveness .
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| Cyanotech Corporation | Chairman of the Board | Chairman since Apr 13, 2011; Director since Mar 2003 | Oversees board process; separation of Chair/CEO maintained |
External Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| Skywords Family Foundation, Inc. | President | Ongoing | Philanthropic leadership; related holdings noted historically |
| Canobie Films, Inc. | Director | Ongoing | Independent media governance |
Board Governance
- Independence: Board classifies Davis as “independent” under OTCQB Listing Rule Section 1.1(9); only CEO Custer is non-independent .
- Executive sessions: Independent Directors meet without management as needed (2025), and at least twice annually (2024, 2023) .
- Attendance: 100% attendance at Board and applicable committee meetings in FY2025, FY2024, and FY2023; Board met 4x (FY2025), 6x (FY2024), 7x (FY2023) .
- Committee assignments (current and history): Davis chairs Nominating & Corporate Governance and serves on Compensation; he is not on Audit . In FY2024 he chaired Nominating and served on Compensation; in FY2023 he chaired Nominating; Compensation membership then was Menzel (Chair) and Vied .
- Governance documents: Committee charters, Board Code of Conduct, and insider trading policy (filed as Exhibit 19.1 to FY2025 10-K) are publicly available .
| Committee | FY2023 | FY2024 | FY2025 |
|---|---|---|---|
| Audit | Not a member | Not a member (Mulder Chair; McElwee, Vied members) | Not a member (Mulder Chair; Vied member) |
| Compensation | Not a member (Menzel Chair; Vied) | Member (Vied Chair; Davis) | Member (Vied Chair; Davis) |
| Nominating & Corporate Governance | Chair (with Vied) | Chair (with Vied) | Chair (with Vied) |
Fixed Compensation
- Structure: Annual cash fee $32,000 for Independent Directors; Chairman receives $40,000; paid quarterly .
- FY2025 actions: Davis elected stock in lieu of cash for first and second quarterly fees and waived third and fourth quarterly fees totaling $20,000, signaling alignment and cost sensitivity .
| Metric | FY2023 | FY2024 | FY2025 |
|---|---|---|---|
| Cash Fees ($) | $37,500 | $40,000 | $20,000 (cash recognized; elected stock for Q1–Q2; waived Q3–Q4) |
| Chair Cash Retainer Policy | $40,000 annual policy | $40,000 annual policy | $40,000 annual policy |
Performance Compensation
- Annual equity: Independent Directors receive annual restricted stock grants valued at $32,000; Chairman receives $30,000; Davis received restricted shares; no director option awards were recorded for him in FY2023–FY2025 .
- Independent Director Equity Plan: In 2024, shareholders approved the 2024 Independent Director Stock Option and Restricted Stock Grant Plan (800,000 shares reserved, 10-year options at fair market value, six-month vest, CIC acceleration; administered by CEO/CFO), applicable to Independent Directors including Davis .
| Metric | FY2023 | FY2024 | FY2025 |
|---|---|---|---|
| Stock Awards ($) | $30,000 | $30,000 | $30,000 |
| Restricted Shares Granted (date) | 12,245 (Aug 30, 2022) | 37,975 (Aug 25, 2023) | 37,037 (Sep 4, 2024) |
| Option Awards ($) | — | — | — |
Performance Metric Table (Director-specific)
- Cyanotech does not disclose performance-condition metrics tied to Independent Director equity grants; awards are time-based restricted stock under board policy and the 2024 Plan .
Other Directorships & Interlocks
| Company/Organization | Type | Role | Notes/Interlocks |
|---|---|---|---|
| Skywords Family Foundation, Inc. | Foundation | President | Historical shared beneficial ownership included Skywords holdings (424,621 shares in 2023) . |
| Canobie Films, Inc. | Private | Director | No Cyanotech-related transactions disclosed . |
| Compensation Committee Interlocks | — | — | None disclosed for current members; no executive officer interlock reported . |
Expertise & Qualifications
- Sector expertise: Natural/organic foods, nutraceuticals, agriculture investing; board stewardship over a microalgae-based nutraceutical producer .
- Education: Attended Harvard University .
- Board qualifications: Long association with company; chair experience; governance leadership as Nominating Chair .
Equity Ownership
High insider alignment with large beneficial stake.
| As-of Date | Shares Beneficially Owned | % of Outstanding | Breakdown |
|---|---|---|---|
| Jun 26, 2023 | 1,243,149 | 19.8% | 637,278 sole; 605,871 shared including 31,250 spouse; 150,000 trusts; 424,621 Skywords |
| Jun 28, 2024 | 1,356,894 | 19.5% | 1,175,644 sole; 181,250 shared including 31,250 spouse; 150,000 trusts |
| Jun 27, 2025 | 1,788,756 | 24.7% | 1,607,506 sole; 181,250 shared including 31,250 spouse; 150,000 trusts |
- Options/derivatives: No director options reported for Davis in FY2023–FY2025 .
- Pledging/hedging: Not disclosed.
- Ownership guidelines: Not disclosed for directors.
Insider Trades
| Filing Date | Form | Summary |
|---|---|---|
| Apr 4, 2023 | Form 4 | Beneficial ownership disclosure supporting 1,243,149 shares; detail includes shared holdings via spouse, children’s trusts, and Skywords Foundation . |
Related Party Transactions (Conflict Review)
- Davis-affiliated financing: Company obtained a $1,500,000 loan in April 2019 from an entity affiliated with Davis; amendments added a revolving line up to $4,000,000. As of Mar 31, 2025, $1,000,000 was outstanding on the related party note and $3,000,000 on the revolver; maturities: note Apr 12, 2027; revolver Apr 12, 2026 .
- Audit Committee oversight: Audit Committee reviews and approves related party transactions per its charter .
Compensation Committee Analysis
- Composition & independence: Compensation Committee comprised of independent directors (2025–2024: Vied Chair, Davis member) .
- Consultants: Use of independent compensation consultants not disclosed .
- Report: Committee reviewed CD&A and recommended inclusion in proxy .
Say-on-Pay & Shareholder Feedback
- Frequency vote: Board recommends say-on-pay frequency of every three years at the 2025 meeting .
- Historical votes/approval percentages: Not disclosed in these proxies.
Risk Indicators & RED FLAGS
- Related-party credit: Material financing from Davis-affiliated entity with $4.0M revolver capacity and $4.0M combined outstanding at FY2025 year-end—creates potential influence over liquidity, requiring strong independent oversight (RED FLAG) .
- Ownership concentration: Davis beneficially owns ~24.7% (FY2025), increasing influence over director elections and corporate actions—heightens entrenchment risk despite independence designation (signal) .
- Plan administration optics: 2024 Independent Director equity plan administered by CEO/CFO rather than a board committee; while permitted, this structure warrants vigilance to avoid perceived conflicts (signal) .
Attendance & Engagement
| Metric | FY2023 | FY2024 | FY2025 |
|---|---|---|---|
| Board Meetings Held | 7 | 6 | 4 |
| Director Attendance | 100% | 100% | 100% |
| Independent Exec Sessions | ≥2 per year | ≥2 per year | As needed |
Governance Assessment
-
Strengths:
- Independent Chair separate from CEO improves oversight; consistent practice affirmed in proxies .
- High attendance and active committee leadership (Nominating Chair; Compensation member) support board effectiveness .
- Alignment signals: elected stock in lieu of cash and waived fees ($20,000) in FY2025; substantial share ownership .
-
Concerns requiring mitigation:
- Significant related-party financing with Davis-affiliate introduces conflict risk; must remain under Audit Committee review with transparent terms and competitive benchmarking (RED FLAG) .
- Ownership concentration (~24.7%) can amplify influence; robust independent processes and executive sessions are important counterbalances .
-
Net view: Davis’ governance profile combines deep company knowledge, independent chair leadership, and strong engagement; however, the related-party financing and ownership concentration warrant continued, documented oversight by independent directors and the Audit Committee to protect minority shareholders .