David Offerman
About David Offerman
David Offerman is Chairman, President, and CEO of IEH Corporation, serving on the board since 2016 and elevated to CEO and Chairman in March 2017 following the passing of his father, Michael Offerman . He holds a BA from the University of Michigan (1993) and an MBA from NYU Stern (2016, leadership and management) . Age 50 as of the 2025 proxy . Recent performance context: IEH reported FY2025 net income of $999,038 , with quarterly revenue growth of +41% YoY in Q3 FY2025 and subsequent decreases of -11% and -3.6% YoY in Q1 and Q2 FY2026 as the company navigated industry and input cost pressures .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| IEH Corporation | National Sales Manager | 2004–2011 | Led sales; developed customer relationships in connectors |
| IEH Corporation | VP, Sales & Marketing | 2011–2017 | Oversaw sales and marketing; contributed to strategy |
| IEH Corporation | Chairman, President & CEO | 2017–present | Executive leadership and corporate strategy |
| IEH Corporation | Director | 2016–present | Board oversight; Class II Director |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Telecommunications industry | Account executive and sales manager | Pre-2004 | Built industry sales experience prior to IEH |
Fixed Compensation
| Year | Base Salary ($) | Target Bonus (%) | Actual Bonus Paid ($) |
|---|---|---|---|
| 2025 | 491,745 | Up to 100% of base | 50,000 |
| 2024 | 486,022 | Up to 100% of base (per prior agreement) | — |
Performance Compensation
| Instrument / Plan | Metric | Weighting | Target | Actual | Payout / Grant Details | Vesting |
|---|---|---|---|---|---|---|
| 2020 Equity-Based Compensation Plan (Option grant) | Equity awards | Not disclosed | Not disclosed | Not disclosed | 25,000 options @ $10.75 strike; fair value $141,500 | Immediately vested |
| Cash Bonus Plan (1987 plan; paid when profitable) | Profitability | Not disclosed | Company profitable | Company profitable; FY2025 net income $999,038 | $50,000 cash bonus (Offerman) ; total company bonus expense $386,750 | N/A (cash) |
| Long-term incentive eligibility | Equity/performance awards | Not disclosed | As set by Compensation Committee | Not disclosed | Eligible during agreement term | Plan terms apply |
Equity Ownership & Alignment
| Item | Amount / Detail |
|---|---|
| Beneficial ownership (shares) | 657,127 |
| Ownership (% of outstanding) | 24.5% |
| Shares outstanding (record date) | 2,431,278 |
| Options exercisable | 250,000 |
| Options unexercisable | — (none listed) |
| Pledging / Hedging policy | Company prohibits hedging and pledging by insiders |
Outstanding Option Awards (David Offerman)
| Grant Date | Number of Options | Exercise Price ($) | Expiration | Status / Vesting |
|---|---|---|---|---|
| 7/29/2019 | 225,000 | 20.00 | 7/29/2029 | Exercisable; original vesting 75k immediate, 75k on 7/29/2020, 75k on 7/29/2021 |
| 12/24/2024 | 25,000 | 10.75 | 12/24/2034 | Immediately vested (employment agreement) |
Employment Terms
| Term | Detail |
|---|---|
| Current agreement | Effective 1/1/2025; expires 12/31/2029 |
| Title / Roles | Chairman of the Board, President, CEO; Class II Director |
| Base salary | $491,745 per annum |
| Annual bonus | Eligible up to 100% of base; metrics set by Compensation Committee |
| Equity eligibility | Eligible for options and long-term incentives under 2020 Plan |
| Severance (without cause or for good reason) | 36 months of base salary + continued health/welfare benefits up to 24 months + accrued but unpaid comp |
| Change-of-control (within 3 years) | If terminated or role materially reduced and he resigns, same severance benefits as above, subject to 280G cutback to avoid 4999 excise tax |
| Covenants | Confidentiality, non-solicitation, and non-competition; obligations survive termination |
Performance & Track Record
| Metric | Q3 FY2025 (Dec 31, 2024) | Q1 FY2026 (Jun 30, 2025) | Q2 FY2026 (Sep 30, 2025) |
|---|---|---|---|
| Revenue ($) | 7,217,616 | 6,308,155 | 7,077,592 |
| YoY revenue change | +41% | -11% | -3.6% |
| Operating income ($) | -130,086 | -755,306 | -104,380 |
| Net income ($) | -61,640 | -654,618 | -26,861 |
| Basic EPS ($) | -0.03 | -0.27 | -0.01 |
- Backlog/order trend: Over $2.5M in orders booked in recent weeks (missile defense programs) and backlog up 25% since start of FY2026 ; over $7M in orders booked in Q2, backlog at near five-year high .
- CEO commentary emphasized margin pressure from gold prices and tariffs, pricing actions to offset, and strong pipeline in defense, commercial aerospace (e.g., 737 MAX), and commercial space .
Board Governance
| Item | Detail |
|---|---|
| Board composition | 7 directors; 6 independent (Gottlieb, Chafetz, Hugel, Rosenfeld, Spiezio, Glenn) |
| Offerman’s board role | Chairman; Class II Director; Director since 2016 |
| Audit Committee | Members: Hugel (Chair), Spiezio, Glenn; all independent; 5 meetings FY2025 (jointly with Board) |
| Compensation Committee | Members: Chafetz (Chair), Gottlieb, Rosenfeld; meetings: 3 (all members present) |
| Board meetings FY2025 | 6 meetings (phone); five joint with Audit; one director absent per joint meeting; full attendance at Board-only meeting |
| Equity grant practices | Company does not time grants around MNPI; no disclosure timing manipulation |
| Insider trading policy | Hedging and pledging prohibited; policy filed as 10-K Exhibit |
Director Compensation (context; non-executive directors)
| Name | Cash Fees ($) FY2025 |
|---|---|
| Non-executive directors (e.g., Gottlieb, Chafetz, Hugel, Rosenfeld, Spiezio, Glenn) | $15,000–$17,500 each; committee chairs earn additional $2,500 annual |
Related Party Transactions & Governance Red Flags
- The proxy reports no material related-party transactions with directors, executive officers, or 5% holders, other than disclosed compensation arrangements .
- Historical SEC Section 16(a) reporting delinquencies were disclosed for Offerman in the 2020 proxy (late Form 3 and several late Form 4s for prior grants/gifts/exercises) .
- Insider trading policy bans hedging and pledging, mitigating alignment risks .
Compensation Structure Analysis
- Mix of pay: Cash salary plus at-risk bonus eligibility up to 100% of base and equity options under the 2020 Plan .
- Equity award design: Options granted at or above fair market value; immediate vest for 25,000 options in Dec 2024; outstanding options include a larger 2019 tranche now fully exercisable .
- Change-in-control protection: Robust severance with 280G cutback (no excise gross-up), limiting shareholder-unfriendly tax exposure .
- Cash Bonus Plan paid in profitable years; FY2025 bonus expense recorded and accrued amounts paid in June 2025 .
Say-on-Pay & Shareholder Feedback
- 2025 agenda included non-binding say-on-pay and frequency votes; Board recommended annual frequency; final results to be published via Form 8-K after annual meeting .
Investment Implications
- Alignment: Significant insider ownership (24.5% of outstanding shares) and 250,000 exercisable options provide strong skin-in-the-game while hedging and pledging bans reduce misalignment risk .
- Retention risk: Employment agreement through 2029 with severance of 36 months’ salary plus benefits suggests stability but embeds a meaningful termination cost; change-in-control cutback avoids 4999 excise tax issues .
- Near-term selling pressure: Immediate vesting of the 25,000-option grant and fully exercisable 225,000-option tranche create potential liquidity, though no pledging/hedging allowed; monitoring Form 4s is prudent .
- Execution track record: Offerman’s commentary emphasizes defense backlog growth and margin headwinds from input costs; quarterly results were uneven but FY2025 net income turned positive, with backlog strengthening in FY2026 .