Stephen Brown
NAOVAbout Stephen Brown
Stephen Brown is Chief Financial Officer of NanoVibronix, Inc. (NAOV), serving as CFO since October 5, 2020; he previously served as NAOV’s CFO from February 3, 2015 through April 30, 2019 and was a financial consultant until reappointment in 2020 . Brown was CFO of IDT Corporation (NYSE: IDT) from April 1995 to January 2009, overseeing the IPO of a start-up telecom company, spin‑offs of subsidiaries, and multiple public offerings and bank facilities; he also served six years on IDT’s board and five years on Net2Phone’s board, founded and chaired IDT Entertainment, is a managing partner of The Mcguffin Group Financial since 2009, and a partner at Brown, Brown and Associates; formerly a CPA, he also serves on educational boards including Touro College’s Board of Governors . Company performance data shows revenue rising from $0.752M in FY22 to $2.558M in FY24, while net income remained negative (FY22: -$5.448M; FY23: -$3.711M; FY24: -$3.705M) and cumulative TSR values of $36.13 (2022), $27.01 (2023), and $51.30 (2024) based on an initial $100 investment benchmark .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| NanoVibronix, Inc. | Chief Financial Officer | Feb 3, 2015 – Apr 30, 2019 | Led finance during early commercialization; continued as consultant post-2019 . |
| NanoVibronix, Inc. | Chief Financial Officer | Oct 5, 2020 – Present | Returned to CFO role amid capital markets and product development initiatives . |
| IDT Corporation (NYSE: IDT) | Chief Financial Officer | Apr 1995 – Jan 2009 | Oversaw IPO, spin‑offs, multiple offerings and bank facilities . |
| IDT Entertainment Inc. (IDT subsidiary) | Founder & Chairman | Not disclosed | Led media studio; part of IDT’s diversification strategy . |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| The Mcguffin Group Financial | Managing Partner | 2009 – Present | Advises early stage and micro‑cap companies on finance and strategy . |
| Brown, Brown and Associates | Partner (Accounting & Tax) | Not disclosed | Provides accounting/tax services; complements CFO technical expertise . |
| IDT Corporation | Director | 6 years | Board oversight during capital markets activities . |
| Net2Phone Inc. | Director | 5 years | Governance role in telecom subsidiary growth . |
| Touro College | Board of Governors | Not disclosed | Educational governance and community engagement . |
| Academy of Television Arts & Sciences | Member | Not disclosed | Industry membership linked to IDT Entertainment involvement . |
Fixed Compensation
| Agreement | Effective Dates | Base Salary ($) | Target Bonus | Term & Renewal | Notice Period | Notes |
|---|---|---|---|---|---|---|
| 2022 Brown Employment Agreement | Jan 1, 2022 – auto‑renew annually | 250,000 | Up to $50,000 | Initial 2‑year term; auto‑renews annually unless non‑renewal notice | Not disclosed | Included non‑competition, non‑solicit, confidentiality and work product assignment . |
| 2024 Brown Employment Agreement | Sep 20, 2024 – Aug 31, 2025 | 267,500 | Up to $50,000 | Fixed term through Aug 31, 2025 unless earlier termination | 90 days | May be eligible for incentive stock options; standard restrictive covenants . |
| 2025 Amended & Restated Brown Employment Agreement | Aug 11, 2025 – at‑will | 300,000 | Not disclosed | At‑will | 30 days | Severance $180,000 if terminated without Cause after effective date or if Brown resigns after 6 months; 2% cap on ownership in competitors listed on U.S. exchanges; non‑solicit, non‑compete, confidentiality . |
| Stephen Brown – Summary Compensation (SCT) | 2023 | 2024 |
|---|---|---|
| Salary ($) | 250,000 | 257,292 |
| Bonus ($) | 42,500 | 22,500 |
| Option Awards ($) | 69,167 | 26,428 |
| All Other Compensation ($) | – | – |
| Total ($) | 361,667 | 306,220 |
Performance Compensation
| Incentive Type | Metric | Weighting | Target | Actual | Payout | Vesting |
|---|---|---|---|---|---|---|
| Annual Cash Bonus (2023) | Performance criteria determined in good faith by Board (specific metrics not disclosed) | Not disclosed | Not disclosed | Not disclosed | $42,500 | Cash; vesting N/A . |
| Annual Cash Bonus (2024) | Performance criteria determined in good faith by Board (specific metrics not disclosed) | Not disclosed | Not disclosed | Not disclosed | $22,500 | Cash; vesting N/A . |
| Equity Awards (Options) | Grant Date | Shares | Exercise Price | Expiration | Vesting Schedule | Notes |
|---|---|---|---|---|---|---|
| Stock Options | Nov 15, 2023 | 1,273 | $13.64 | Not disclosed | Fully vested on grant | Option awards recognized in SCT: 2023 $69,167; 2024 $26,428 . |
| Option Cancellation & Release | Nov 29, 2023 | Not applicable | Not applicable | Not applicable | Cancelled “Options previously granted” | $1.00 paid to each option holder; applied to directors and officers, including Stephen Brown . |
The company discloses it does not tie executive compensation to net income performance and does not have other financial metrics used to determine executive compensation for NEOs, indicating limited pay‑for‑performance alignment .
Equity Ownership & Alignment
| Holder | Common Shares | Options Exercisable ≤60 Days | Total Beneficially Owned | Ownership % |
|---|---|---|---|---|
| Stephen Brown | 2 | 582 | 584 | <1% (asterisk per table) |
- As of the record date, there were 1,011,102 shares of common stock outstanding; Brown’s ownership is below 1% .
- Pledging or hedging: No pledging/hedging disclosures for Brown identified in the latest proxy .
- Stock ownership guidelines: Not disclosed for executives .
Employment Terms
| Provision | 2022 Agreement | 2024 Agreement | 2025 Amended & Restated Agreement |
|---|---|---|---|
| Employment Status | Fixed term (2 years + annual auto‑renewal) | Fixed term through Aug 31, 2025 | At‑will |
| Base Salary | $250,000 | $267,500 | $300,000 |
| Bonus Opportunity | Up to $50,000 | Up to $50,000 | Not disclosed |
| Notice Period | Not disclosed | 90 days (either party) | 30 days (either party) |
| Severance | Not disclosed | Not disclosed | $180,000 if terminated without Cause after effective date or resignation after 6 months, subject to terms |
| Restrictive Covenants | Non‑compete, non‑solicit, confidentiality, assignment of inventions/work product | Standard non‑compete, non‑solicit, confidentiality | Non‑compete, non‑solicit, confidentiality; may not own >2% of a competitor’s listed stock |
Company Performance Context (for alignment assessment)
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Revenues ($) | 752,000 | 2,283,000 | 2,558,000 |
| EBITDA ($) | -5,011,000* | -3,075,000* | -3,581,000* |
| Net Income ($) | -5,448,000 | -3,711,000 | -3,705,000 |
| *Values retrieved from S&P Global. |
- Pay vs performance section states NAOV does not tie executive compensation to net income or other financial metrics; CAP and TSR are shown for context but are not drivers of NEO pay .
- Cumulative TSR (value of an initial $100 investment): $36.13 (2022), $27.01 (2023), $51.30 (2024) .
Compensation Structure Analysis
- Increased fixed cash: Brown’s base salary rose from $250,000 (2022) to $267,500 (2024), then to $300,000 (2025 A&R), while bonus opportunities remained flat or undisclosed, indicating higher guaranteed pay and potential reduction in at‑risk compensation .
- Limited performance link: The company explicitly states executive compensation is not tied to net income or other financial metrics, undermining pay‑for‑performance alignment .
- Equity changes: An option cancellation and release (Nov 29, 2023) for directors/officers (including Brown) is a governance red flag; however, Brown also received a fully‑vested option grant on Nov 15, 2023, and retains options exercisable within 60 days per the ownership table .
- Severance economics: The 2025 A&R sets a fixed severance of $180,000 payable on certain terminations, with a shorter 30‑day notice period, which may increase turnover optionality and near‑term retention risk .
Risk Indicators & Red Flags
- Option cancellation agreement affecting insiders (Nov 29, 2023) is a compensation governance red flag (potential repricing/modification history) .
- Low insider ownership/alignment: Brown’s beneficial ownership is <1% (two common shares and 582 options exercisable within 60 days) .
- At‑will arrangement with modest severance ($180,000) and 30‑day notice may elevate retention risk during volatile periods .
- Company profitability remains negative across FY22–FY24; compensation is not tied to these metrics per disclosure .
Investment Implications
- Alignment: Low equity ownership and the explicit lack of performance‑metric linkage to executive pay suggest weaker pay‑for‑performance alignment; this may reduce management incentives to drive profitability and TSR near term .
- Retention: The 2025 A&R’s at‑will status and 30‑day notice, with fixed severance, increase turnover optionality; monitor for Form 4 activity and any 8‑K Item 5.02 changes that might signal transition risk .
- Trading signals: The prior option cancellation for insiders and fully‑vested option grant to Brown in Nov 2023 warrant scrutiny for future equity actions; low ownership reduces forced selling pressure but also indicates limited “skin‑in‑the‑game” .
- Performance backdrop: Revenues improved FY22→FY24, but EBITDA and net income remained negative; absent explicit operating targets in incentive plans, investors should rely on external performance indicators and capital allocation discipline to assess execution .