Karen Hawkins
About Karen Hawkins
Karen L. Hawkins, 59, has served as Optex Systems’ Chief Financial Officer since November 19, 2014; previously VP Finance & Controller since March 30, 2009 and Controller since September 28, 2009, with over 30 years’ finance experience in defense and transportation and a CPA (1992) after a BBA in Accounting (1986) from Stephen F. Austin State University . Optex’s pay-versus-performance disclosure shows TSR of 180.52 in FY 2024 versus 163.78 in FY 2023, while net income rose from $2.263M to $3.768M; CFO “compensation actually paid” was $363,304 in 2024 and $420,256 in 2023, reflecting equity performance share vesting dynamics . Company revenues increased from $25.659M to $33.995M and net income from $2.263M to $3.768M over FY 2023–FY 2024 .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Optex Systems Holdings | Chief Financial Officer | 2014–present | Led finance through growth and equity incentive shifts; corporate secretary responsibilities . |
| Optex Systems Holdings | VP Finance & Controller | 2009–2014 | Built cost/accounting infrastructure post-reorganization . |
| Optex Systems (Texas) | Finance roles (Controller) | 2007–2009 | Transitioned controls during Delaware reorg . |
| General Dynamics – Ordnance & Tactical Systems (Garland) | Controller (Accounting & IT); Program Manager (Army IDIQ); Materials Manager | 1994–2007 | Managed $250M 3-year Army IDIQ; leadership across pricing, production control, and warehousing . |
| Luminator (Mark IV Industries Co) | Finance/Accounting roles | pre-1994 | Industry finance roles in transportation . |
| Johnson Controls (Battery Division - Garland) | Finance/Accounting roles | pre-1994 | Manufacturing finance experience . |
External Roles
No external public company board or committee roles disclosed for Ms. Hawkins -.
Fixed Compensation
| Item | FY 2023 | FY 2024 |
|---|---|---|
| Base Salary (paid) | $218,774 | $228,469 |
| Employment Agreement Base Salary | — | $224,328 initial annual base effective Jan 1, 2024; annual review; term through Dec 31, 2026 with automatic 12-month renewals unless 90 days’ notice . |
| Target Bonus % | 30% of base; Board may adjust ±20% | 30% of base; Board may adjust ±20% . |
| Discretionary Bonus (paid) | $0 | $0 . |
| Non-Equity Incentive (paid) | $56,082 | $58,325 |
| All Other Compensation | $0 | $0 |
| Total Reported Compensation | $302,621 | $341,886 |
Performance Compensation
| Metric | Weighting | Target | Actual | Payout | Vesting |
|---|---|---|---|---|---|
| Revenue (FY 2023 bonus formula) | 50% | Not disclosed | Not disclosed | 0%, 10%, 20%, or 30% of base salary depending on performance (combined schedule with EBITDA) | Cash bonus per FY 2023 formula |
| Adjusted EBITDA (FY 2023 bonus formula) | 50% | Not disclosed | Not disclosed | 0%, 10%, 20%, or 30% of base salary depending on performance (combined schedule with revenue) | Cash bonus per FY 2023 formula |
| 2023 Performance Shares (PSUs) | Equity; 5 tranches | VWAP 30-day thresholds: $3.70, $4.45, $5.35, $6.40, $7.70 (equal share increments) | All thresholds reached; all tranches vested in FY 2024 | Shares issued upon threshold achievement; grant-date fair value recognized under ASC 718 | Shares vest on meeting 30-day VWAP thresholds; all vested in FY 2024 |
- FY 2023 PSUs grant: 35,000 performance shares to Ms. Hawkins on May 3, 2023; maximum potential value at the highest threshold was $269,500; vesting in five equal increments tied to defined VWAP hurdles; all vested during FY 2024 when $7.70 threshold was reached .
Equity Ownership & Alignment
| Item | As of Jan 16, 2024 | As of Jan 10, 2025 |
|---|---|---|
| Beneficial Ownership (shares) | 32,951 | 43,606 |
| Ownership % of Outstanding | 0.5% | 0.6% |
| Unvested RSUs/PSUs | 35,000 PSUs unearned at FY 2023 YE; fair value $145,600 | None; no unvested awards outstanding at FY 2024 YE |
| Options (exercisable/unexercisable) | None; 2009 Option Plan canceled with 2023 Plan adoption | None |
| Hedging/Pledging | Hedging prohibited by Insider Trading Policy; pledging policy not disclosed | |
| Stock Ownership Guidelines | Not disclosed |
Employment Terms
- Agreement effective January 1, 2024; CFO through December 31, 2026; auto-renew for successive 12-month periods unless either party gives 90 days’ notice .
- Target bonus: 30% of base salary; Board/Comp Committee retains discretion to adjust ±20% .
- Termination provisions: for cause/good reason defined; if terminated without cause or she resigns for good reason, severance equals six months of base salary plus accrued/earned amounts; otherwise accrued/earned only .
- Change-of-control (Plan-level): Unvested restricted stock/RSUs vest at change-of-control; PSUs vest pro rata based on months elapsed in the performance period; options/SARs become fully exercisable or cashed out based on change-of-control price; no separate executive change-of-control agreement disclosed - -.
- Clawback: Company prohibits hedging; broader clawback policy is referenced in another executive agreement (Section 10D Exchange Act compliance), but not explicitly in Ms. Hawkins’ agreement .
Company Performance Context
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Revenues ($USD) | $22.383M | $25.659M | $33.995M |
| EBITDA ($USD) | $1.954M* | $3.132M* | $5.308M* |
| Net Income ($USD) | $1.283M | $2.263M | $3.768M |
Values retrieved from S&P Global.*
Pay vs Performance (disclosed):
- TSR value of fixed $100 investment: $163.78 (FY 2023) and $180.52 (FY 2024) .
- CFO compensation actually paid: $420,256 (FY 2023) and $363,304 (FY 2024) .
Compensation Structure Highlights
- Stock/equity mix increased via 2023 PSUs tied to explicit price hurdles; all vested in FY 2024, aligning pay with shareholder returns during that period .
- Cash bonus formula in FY 2023 balanced growth and profitability (Revenue and Adjusted EBITDA, equal weights) with capped payouts at 30% of base, supporting pay-for-performance discipline .
- No options outstanding and prior option plan canceled; equity shifts emphasize RSUs/PSUs versus options (lower risk versus traditional options) .
Risk Indicators & Red Flags
- Hedging of company securities prohibited (positive alignment); pledging not disclosed (information gap) .
- No related-party transactions disclosed for executives beyond standard compensation .
- No separate change-of-control agreement; plan-level acceleration creates potential equity cash-out in an M&A scenario but Ms. Hawkins had no unvested awards at FY 2024 YE -.
Governance and Committee Context (for compensation oversight)
- Compensation Committee: Independent directors; chaired by Dale Lehmann; four meetings and eight written consents in FY 2024, indicating active oversight .
- Nominating and Audit Committees chaired by independent directors; three of four directors independent .
Investment Implications
- Near-term insider selling pressure from vesting appears low given Ms. Hawkins had no unvested awards outstanding at FY 2024 YE; any selling would be discretionary rather than vest-driven .
- Bonus design historically tied to revenue and adjusted EBITDA fosters balanced growth/profit focus; coupled with robust company fundamentals (rising revenues and net income) this supports pay-for-performance alignment .
- Plan-level change-of-control acceleration exists, but without a separate golden parachute; severance limited to six months base salary for without-cause or good-reason departures, moderating change-of-control cost risk -.
- Hedging prohibition is alignment-positive, but absence of disclosed pledging restrictions and ownership guidelines is a governance gap for skin-in-the-game analysis .