Joseph Spain
About Joseph Spain
Joseph D. Spain is Chief Financial Officer and Treasurer of Intellinetics, appointed CFO on December 1, 2016 (joined October 31, 2016) and serving continuously since then . Prior roles include CFO of nChannel and finance leadership at Mettler-Toledo; education is not disclosed in filings reviewed . Under Spain’s tenure, revenues rose from $14.0M* in FY2022 to $18.0M* in FY2024, while GAAP net income moved from $24,027 in FY2022 to a loss of $(546,215) in FY2024; Adjusted EBITDA was $2.45M in FY2024 vs $2.74M in FY2023, and TSR (SEC Pay-vs-Performance measure) improved to 181.88 in 2024 . He signs SOX 302/906 certifications, indicating primary responsibility for controls and reporting .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| nChannel, Inc. | Chief Financial Officer | 2014–2016 | Led finance for SMB retail software provider |
| Mettler-Toledo International | VP Finance & Controller (operating unit) | 1995–2014 | Finance leadership at global precision instruments company |
| Intellinetics, Inc. | CFO & Treasurer | 2016–present | Built controls environment; oversight of SaaS transition and M&A finance |
External Roles
No external public-company or nonprofit directorships disclosed for Spain in company filings reviewed .
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base salary ($) | 171,250 | 200,000 | 240,000 |
| Actual bonus (nonequity incentive) ($) | 26,047 | 30,000 | 48,760 |
| Other compensation ($) and detail | 6,607 (insurance, life, phone) | 6,342 (insurance, life, STD, phone) | 6,347 (insurance, life, phone) |
| Total ($) | 407,280 | 236,342 | 515,857 |
Notes:
- Target bonus % is not disclosed in the proxy; Spain participates in annual performance-based cash bonuses tied to corporate goals .
Performance Compensation
| Component | Grant/Plan | Metric(s) | Weighting | Target | Actual | Payout/Vesting |
|---|---|---|---|---|---|---|
| Annual cash bonus | Company incentive plan | Adjusted EBITDA (primary), plus other corporate goals | Not disclosed | Not disclosed | Adjusted EBITDA: $2,451,882 (FY2024) | $48,760 paid to Spain for FY2024 |
| Stock awards (RSUs/stock) | 2024 equity grant | Not explicitly performance-tied | N/A | N/A | Grant date fair value $220,750 | Standard vesting not detailed for 2024 stock awards |
| Stock options | Multiple grants | Time-based vesting | N/A | N/A | N/A | See vesting schedule table below |
Vesting schedule details (Options):
| Grant | Shares (Exercisable/Unvested) | Strike | Expiration | Vesting specifics |
|---|---|---|---|---|
| 12/7/2016 | 2,000 (exercisable) | $6.50 | 12/7/2026 | Fully vested; exercisable |
| 3/10/2019 | 3,000 (exercisable) | $6.50 | 3/10/2029 | Fully vested; exercisable |
| 9/1/2020 | 20,000 (exercisable) | $4.00 | 9/1/2030 | Fully vested; exercisable |
| 4/13/2022 | 25,952 exercisable / 12,975 unearned | $6.08 | 4/13/2032 | 3-year time-based; 12,975 vested on 4/14/2025 |
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Total beneficial ownership | 95,677 shares; includes 63,927 underlying options exercisable within 60 days of April 25, 2025 |
| Ownership as % of SO | 2.19% of 4,314,458 outstanding shares |
| Options – exercisable | 2,000 @ $6.50 (12/7/2026), 3,000 @ $6.50 (3/10/2029), 20,000 @ $4.00 (9/1/2030), 25,952 @ $6.08 (4/13/2032) |
| Options – unexercisable | 12,975 @ $6.08, vested on 4/14/2025 |
| Pledging/hedging | Prohibited; directors and executive officers may not hedge or pledge company securities or hold them on margin |
| Stock ownership guidelines | Committee monitors executive officer guidelines; specific multiples and status not disclosed |
Insider selling pressure: Form 4 transactions were not disclosed in the proxy; recent 8-Ks list Spain as investor contact but do not include Form 4 summaries. Consider monitoring post-4/14/2025 vesting window for potential option exercises/sales .
Employment Terms
| Term | Spain’s Agreement |
|---|---|
| Employment start | Appointed CFO December 1, 2016; joined October 31, 2016 |
| Contract term | Indefinite; at-will |
| Base pay | Initially $140,000; increased to $240,000 by Compensation Committee |
| Benefits/perquisites | Eligible for 401(k), health insurance, paid vacation; minor perqs (cell phone, life insurance) |
| Non-compete | 6 months post-termination in the State of Ohio |
| Non-solicit | 2 years post-termination (customers, clients, employees) |
| Confidentiality | Required (trade secrets/proprietary info) |
| Severance | One year’s base salary upon change-of-control; six months’ base salary upon termination without cause or for good reason—single-trigger cash severance on CoC |
| Equity acceleration | Not disclosed |
| Clawback provisions | Not disclosed in proxy; Insider Trading Policy and governance documents in place |
| Tax gross-ups | Not disclosed |
Performance & Track Record
Company operating performance (GAAP and non-GAAP):
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Revenues ($) | $14,016,928* | $16,886,381* | $18,018,373* |
| Net Income (GAAP) ($) | $24,027 | $519,266 | $(546,215) |
| Adjusted EBITDA ($) | $2,413,901 | $2,744,649 | $2,451,882 |
| TSR Value of $100 Investment ($) | 90.66 | 66.93 | 181.88 |
Values with asterisks (*) retrieved from S&P Global.
Context:
- FY2024 showed higher revenue with a GAAP net loss, while Adjusted EBITDA remained positive and used prominently in compensation linkage .
- Management emphasizes SaaS growth initiatives, with Spain as CFO featured in earnings communications; Q3 2025 Adjusted EBITDA was $104,783 with SaaS revenue up 14.6% YoY .
Compensation Structure Analysis
- Shift toward equity: Spain received $220,750 in stock awards in 2024 after no equity grants in 2023; options outstanding remain sizable with time-based vesting—equity mixes are increasing, aligning with long-term value creation .
- At-risk pay tied to Adjusted EBITDA: The company identifies Adjusted EBITDA as the key metric linking compensation to performance; Spain’s bonus rose to $48,760 in 2024 despite GAAP net loss, indicating prioritization of non-GAAP operating performance over GAAP earnings .
- Severance economics: Single-trigger cash severance equal to one year base on change-of-control, plus six months for other qualifying terminations—elevated retention cost in strategic events without termination requirement (potentially shareholder-unfriendly vs double-trigger norms) .
- Ownership alignment: 2.19% beneficial stake with prohibitions on hedging/pledging; stock ownership guidelines exist but specifics and compliance status not disclosed .
Risk Indicators & Red Flags
- Hedging/pledging prohibited; reduces misalignment risk .
- Single-trigger CoC severance for CFO; could raise cost-of-control concerns .
- No disclosures of clawbacks, tax gross-ups, or equity acceleration on CoC for Spain; absence of detail is a governance information gap .
- Legal proceedings: Company states no material adverse proceedings involving directors or officers .
- Related-party transactions centered on Taglich affiliates; none disclosed tied to Spain .
Investment Implications
- Alignment: Spain’s increased equity grants and sizable option holdings create upside alignment; prohibitions on hedging/pledging are positive for investor alignment .
- Near-term selling pressure: The April 14, 2025 vesting of 12,975 options adds potential supply; monitor Form 4s around vesting dates for selling signals and remaining holdings .
- Pay-for-performance: Bonuses keyed to Adjusted EBITDA can sustain payouts even during GAAP net losses; investors should track non-GAAP drivers and capital allocation to SaaS growth Spain oversees .
- Event risk: Single-trigger CoC cash severance increases transaction costs; lack of disclosed equity acceleration terms creates uncertainty in change-of-control scenarios .
- Execution risk: FY2024 GAAP loss and FY2025 guide for lower revenues reflect transition headwinds; Spain’s control and finance leadership remain central to scaling SaaS while maintaining positive Adjusted EBITDA .
