Russell M. Sarachek
About Russell M. Sarachek
Independent director of Frequency Electronics, Inc. (FEIM) since August 2016; former Chairman of the Board (June 2020–May 2022). Age 62. He is Managing Director of Contra Capital Management, LLC (since 2002) and previously served six years as a director of Breeze‑Eastern Corp. until its 2016 sale to TransDigm; earlier, he was EVP and Director of M&A at Groupe Schneider (1992–2002) .
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| Contra Capital Management, LLC | Managing Director | 2002–present | Public company governance experience; aerospace/defense involvement |
| Breeze‑Eastern Corp. | Director | ~2010–2016 (six years) | Board member until sale to TransDigm in 2016 |
| Groupe Schneider | EVP; Director of M&A | 1992–2002 | Led M&A for global industrial/electrical controls company |
External Roles
| Company/Institution | Role | Status/Notes |
|---|---|---|
| Public company boards | — | No current public company directorships disclosed in FEIM proxy; prior role at Breeze‑Eastern noted above |
Board Governance
- Independence: Board has determined Sarachek is independent under NASDAQ rules; Board composition: four independent directors (Brolin, Lord, Sarachek, Schwartz) and one management director (CEO McClelland) .
- Committees: Audit Committee (members: Brolin—chair, Lord, Sarachek); Compensation Committee (members: Brolin, Sarachek, Schwartz) .
- Attendance and engagement: In FY2025, the Board held 6 meetings; “each director attended… all of the meetings of the Board and of committees of which such director was a member.” Audit Committee met 4x; Compensation Committee 5x; Nominating & Corporate Governance 5x .
- Leadership: Sarachek served as FEIM Chairman from June 2020 until May 2022 .
- Executive sessions: Independent directors meet in executive session at least annually, and as needed .
| Governance Metric | FY2025 | Notes |
|---|---|---|
| Board meetings held | 6 | 100% attendance for all directors |
| Audit Committee meetings | 4 | Brolin is Audit Chair |
| Compensation Committee meetings | 5 | Committee includes Brolin, Sarachek, Schwartz |
| Nominating & Corporate Governance meetings | 5 | Independent committee |
Fixed Compensation
| Component | FY2024 | FY2025 |
|---|---|---|
| Annual cash retainer (policy) | $50,000 (increased from $25,000 effective Sept 2023) | $50,000 |
| Audit Chair stipend (policy) | $8,000 | $8,000 |
| Compensation Chair stipend (policy) | $4,000 | $4,000 |
| Cash actually paid to Sarachek | $43,750 | $50,000 |
Notes:
- Cash retainer doubled to $50,000 effective September 2023 .
- FY2025 director cash for Sarachek: $50,000; total director compensation $134,579 (see stock below) .
Performance Compensation
- Director equity: On October 31, 2024, each eligible non‑officer director received 6,702 FEIM shares; aggregate grant-date fair value $84,579 per director. Sarachek reported $84,579 in “Fees Paid in Stock” for FY2025 .
- Performance conditions: None disclosed for director equity (annual fixed stock grant; no director performance metrics stated) .
| Director Equity Grant (FY2025) | Grant date | Shares | Grant-date fair value |
|---|---|---|---|
| Annual director stock grant | Oct 31, 2024 | 6,702 | $84,579 |
Other Directorships & Interlocks
| Organization | Role | Interlock/Notes |
|---|---|---|
| Breeze‑Eastern Corp. | Director (prior) | Aerospace/defense manufacturer; sold to TransDigm in 2016 |
| Board shareowner representation | — | Fellow director Jonathan Brolin (Edenbrook Capital) beneficially owns 19.5% and sits on the Board; large holder presence alongside Sarachek’s 4.8% stake may influence governance dynamics |
Expertise & Qualifications
- Corporate governance and M&A expertise, including EVP and Director of M&A at Groupe Schneider (1992–2002) .
- Aerospace/defense industry involvement; former Breeze‑Eastern director .
- Public company governance background via Contra Capital; served as FEIM Chairman (2020–2022) .
Equity Ownership
| Holder | Shares beneficially owned | % of shares outstanding | Ownership form |
|---|---|---|---|
| Russell M. Sarachek | 464,080 | 4.8% (based on 9,749,271 shares) | Indirect via Contra Capital Management, LLC; Sarachek is sole managing member with sole investment discretion and voting control |
Additional ownership alignment and policies:
- Hedging policy: Directors and their families are prohibited from hedging Company securities (e.g., prepaid forwards, swaps, collars, exchange funds) .
- Pledging: Not specifically disclosed in proxy (Stock Award Plan notes awards are subject to any Company hedging/pledging policies adopted) .
- Director ownership guidelines: Not disclosed in proxy materials reviewed .
Fixed vs. Equity Mix (Signal)
- FY2025: Cash $50,000 vs. stock $84,579 → equity ≈ 63% of total ($84,579 / $134,579), indicating higher alignment with shareholders through stock retainer .
Related-Party Transactions and Conflicts
- Company states no related-person transactions exceeding the lesser of $120,000 or 1% of average total assets for the last two completed fiscal years .
- Auditor non‑audit “All Other Fees” in FY2025 included a comprehensive assessment and study of executive compensation at Board request (potential independence perception risk; Audit Committee pre‑approved) .
Say‑on‑Pay & Shareholder Feedback (Context)
- 2019 frequency vote: 89.9% of stockholders supported annual say‑on‑pay frequency (context for Board’s continued annual recommendation) .
Governance Assessment
-
Positives:
- Independent director with 100% attendance at Board and committee meetings; active on Audit and Compensation Committees .
- Meaningful skin‑in‑the‑game: 4.8% beneficial ownership (via Contra Capital), plus equity‑heavy director pay mix in FY2025 .
- Clear hedging prohibition for directors; separation of Chair and CEO roles; regular executive sessions of independent directors .
-
Watch items / potential red flags:
- Auditor “All Other Fees” included compensation study work in FY2025; while pre‑approved, investors often scrutinize non‑audit services for independence optics .
- Board diversity gap disclosed in 2024 (no “Diverse” director under Nasdaq Rule 5605 for boards ≤5; Board stated intent to add a diverse director) .
- Concentrated influence: large shareholder director (Brolin/Edenbrook 19.5%) and Sarachek at 4.8%; alignment can be positive but may raise concerns about board plurality and minority holder voice .
- No explicit director stock ownership guidelines or pledging prohibition disclosure beyond general hedging policy and award‑level policy references .
No legal proceedings disclosed for directors; no related‑party transactions reported; all directors attended 2024 annual meeting (virtually) .