Karl Marrott
About Karl Marrott
Chief Operating Officer of TSS, Inc. since July 1, 2024; joined TSS as SVP Operations on November 2, 2022. Age 59, with deep operations leadership across electronics manufacturing and logistics (Applied Technical Services VP–Operations 2019–2022; prior executive roles at Flex, Solectron, Moduslink) . Company performance during his tenure inflected sharply: FY2024 revenue rose 172% to $148.1M, Adjusted EBITDA rose 283% to $10.2M, and net income reached $6.0M; TSR on a $100 initial investment was $2,045 at year-end 2024 (vs $52 at year-end 2023) .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Applied Technical Services (privately held electronics manufacturer) | Vice President – Operations | 2019–2022 | Ran full turnkey electronics operations; operational execution and scaling |
| Flex; Solectron; Moduslink | Executive operations roles | Not disclosed | Led operations in large-scale contract manufacturing/logistics environments |
External Roles
- No external public company directorships or committee roles disclosed for Marrott in the 2025 proxy .
Fixed Compensation
| Metric | FY 2023 | FY 2024 |
|---|---|---|
| Base Salary ($) | 250,000 | 281,489 |
| Bonus ($) | 44,914 | 113,163 |
| Stock Awards – Grant-date Fair Value ($) | 59,000 | 581,000 |
| Option Awards – Grant-date Fair Value ($) | — | — |
| All Other Compensation ($) | 178,180 | — |
| Total Compensation ($) | 532,094 | 975,652 |
- Base salary increased to $300,000 upon promotion to COO effective July 1, 2024 (contract term) .
Performance Compensation
Equity Awards (RS/PSU)
| Type | Grant Date | Shares | Vesting | Performance Condition |
|---|---|---|---|---|
| Restricted Stock (service-based) | Feb 24, 2025 | 33,334 | Vests Feb 24, 2025 | None disclosed |
| Restricted Stock (service-based) | Jun 27, 2024 | 250,000 | 125,000 on each of the first two anniversaries (Jun 27, 2025; Jun 27, 2026) | None disclosed |
| Restricted Stock (performance-based) | Jan 19, 2024 | 50,000 | Vests Jan 1, 2026 | Performance criteria; not detailed |
| Restricted Stock (service-based) | Jan 16, 2025 | 150,000 | 50,000 on each of the first three anniversaries (Jan 16, 2026/2027/2028) | None disclosed |
| Restricted Stock (performance-based) | Not specified (2015 Plan) | 10,000 | 5,000 approx Mar 15, 2026; 5,000 Jan 1, 2027 upon Board certification | Performance criteria; not detailed |
- Market value of unvested stock at 12/31/2024: $5,762,141 (493,334 shares at $11.86) .
- Change-in-control: all restricted shares immediately vest; options become immediately exercisable .
Stock Options
| Grant Date | Options (#) | Exercise Price ($) | Expiration | Vesting |
|---|---|---|---|---|
| Nov 2, 2022 | 66,668 (remaining tranche) | 0.60 | Jan 22, 2028 | Final tranche scheduled to vest Nov 2, 2025 |
- Options are non-transferable/pledge-restricted per plan; no reload options permitted .
Equity Ownership & Alignment
| Ownership Metric (as of April 28, 2025) | Value |
|---|---|
| Total beneficial ownership (shares) | 562,175 |
| Ownership (% of 25,020,498 shares outstanding) | 2.25% |
| Unvested restricted shares (subject to forfeiture) | 483,334 |
| Options outstanding (unexercisable) | 66,668 @ $0.60, expiring 1/22/2028 |
| Shares pledged/margin | Company policy prohibits pledging/margin of Company securities |
| Hedging | Strongly discouraged; requires Compliance Officer pre-approval |
| Trading windows/10b5-1 | Quarterly blackout and event-driven restrictions; 10b5-1 plans must be pre-approved |
- Stock ownership guidelines (salary multiples) not disclosed; clawback/recovery provisions apply to awards under the 2025 Omnibus Plan .
Employment Terms
| Term | Detail |
|---|---|
| Employment start | Hired as SVP Operations on Nov 2, 2022; promoted to COO effective Jul 1, 2024 |
| Base salary | $300,000 after promotion to COO |
| Bonus eligibility | Bonus in amount/terms set by Board |
| Benefits | Vacation, health insurance, other executive benefits |
| Severance (without Cause / Good Reason) | Salary continuation for 6 months; 12 months if termination occurs within 12 months following a Change in Control |
| Change-in-control vesting | Immediate vesting of all restricted shares; options immediately exercisable |
| Clawbacks | Awards subject to Company recoupment/recovery policies and law/exchange rules |
| Non-compete/Non-solicit | Not disclosed in proxy |
Vesting Calendar (insider selling pressure indicators)
| Award | 2025 | 2026 | 2027 | 2028 |
|---|---|---|---|---|
| RS (33,334; 2015 Plan) | 33,334 on Feb 24, 2025 | — | — | — |
| RS (250,000; Jun 27, 2024) | 125,000 on Jun 27, 2025 | 125,000 on Jun 27, 2026 | — | — |
| RS (50,000; Jan 19, 2024, perf.) | — | 50,000 on Jan 1, 2026 | — | — |
| RS (150,000; Jan 16, 2025) | — | 50,000 on Jan 16, 2026 | 50,000 on Jan 16, 2027 | 50,000 on Jan 16, 2028 |
| RS (10,000; perf.) | — | ~5,000 on ~Mar 15, 2026 | 5,000 on Jan 1, 2027 | — |
| Option (66,668; Nov 2, 2022) | 66,668 vests Nov 2, 2025 | — | — | Expires Jan 22, 2028 |
Performance & Track Record
| Metric | FY 2023 | FY 2024 |
|---|---|---|
| Revenue ($M) | 54.4 | 148.1 (+172%) |
| Net Income ($M) | 0.07 | 5.98 (+~7,976% YoY) |
| Adjusted EBITDA ($M) | 2.65 | 10.15 (+283%) |
| TSR value of $100 initial investment | 2022 | 2023 | 2024 |
|---|---|---|---|
| Company TSR ($) | 97 | 52 | 2,045 |
Compensation Structure Analysis
- Equity-heavy shift: Grant-date stock awards for Marrott rose to $581k in 2024 vs $59k in 2023, materially increasing at-risk, equity-linked compensation .
- Multi-year RS layering: Service-based tranches across 2025–2028 plus performance-based grants in 2026–2027 create continuous retention hooks; CIC terms accelerate all awards (double-edged for retention around transactions) .
- Governance safeguards: No option repricing without shareholder approval; anti-pledging/margin; hedging discouraged and pre-cleared; clawbacks enabled .
Investment Implications
- Alignment: Significant unvested equity (493,334 shares; $5.76M at 12/31/2024) ties Marrott’s incentives to share price and execution through 2028; options have a low $0.60 strike versus $11.86 at year-end 2024, reinforcing upside alignment .
- Near-term supply risk: 2025 vesting (approx 158k RS plus 66,668 options) and large 2026 tranches could create discretionary selling pressure; however, company policy imposes blackout windows and discourages hedging/pledging, mitigating disorderly sales .
- Retention and CIC dynamics: Base salary increased on promotion; severance of 6–12 months plus CIC acceleration could elevate transaction timing risk but also provide stability; equity cadence through 2028 supports retention absent a CIC .
- Performance linkage: 2024 pay-versus-performance shows CAP rising alongside outsized TSR and net income growth, indicating strong pay-for-performance context for equity awards; specific PSU metrics are not disclosed, limiting direct KPI-to-payout analysis .