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Heitz Greene Quillen
FY Ended Compensation Compensation Compensation
May 31, 1988 $300,000 $300,000 $300,000
May 31, 1989 350,000 450,000 100,000
May 31, 1990 1,300,000 300,000 ---
May 31, 1991 1,200,000 --- ---
May 31, 1992 1,400,000 --- ---
May 31, 1993 1,300,000 --- ---
May 31, 1994 1,000,000 --- ---
In FY’s 1993 and 1994, Mr. Heitz’ compensation as a percentage of
Exacto's gross receipts was approximately 11 percent and 6
percent, respectively.
Exacto did not have a written employment contract with Mr.
Heitz or a stated formula for determining his compensation.
During the years in issue, Exacto's board of directors comprised
Mr. Heitz, Mr. Quillen, Mr. Greene, and Mr. Linsley. The board
of directors approved the level of compensation paid to Mr. Heitz
on the basis of his performance. Exacto determined and paid
Mr. Heitz' compensation in December, just over halfway through
its fiscal year. Mr. Heitz' compensation was reduced in FY 1994
from $1,300,000 to $1 million to reflect the fact that he would
be taking time off recuperating from surgery, which took place in
December 1993. Respondent determined $380,952 and $400,000 as
reasonable compensation for Mr. Heitz for taxable years ended
May 31, 1993 and 1994, respectively, and disallowed Exacto's
claimed deductions for the excess.
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Last modified: May 25, 2011