SHF Holdings, Inc. (NASDAQ:SHFS), a finance services company, has recently amended employment agreements with two of its key executives, as documented in a Form 8-K filed with the Securities and Exchange Commission (SEC) on Monday. The company, formerly known as Northern Lights Acquisition Corp., aims to align executive pay with its revenue performance and ensure business continuity.
On August 21, 2024, SHF Holdings entered into revised employment agreements with Tyler Beuerlein, Chief Strategic Business Development Officer, and Daniel Roda, transitioning to Chief Credit Officer. The amendments are designed to better synchronize with the company's financial reporting cycle and to reflect changes in compensation structure.
Under the new terms, Beuerlein's agreement, which extends through February 8, 2025, includes a reduced base salary of $250,000. However, he is eligible for additional incentives tied to increases in the company's service income from the fourth quarter of 2023. Service income encompasses revenues from deposit, activity, onboarding services, and investments.
Roda's amended agreement extends his tenure through June 30, 2025, and introduces his new role as Chief Credit Officer. Similarly, Roda will receive a base salary of $250,000 with performance-based incentives related to growth in the company's loan interest income since the fourth quarter of 2023. The loan interest income includes earnings from the company's credit services.
Both amendments also include a clause that converts any accrued but unused paid time off (PTO) as of August 1, 2024, into a payout during August 2024. Consequently, no PTO will accrue or be paid out upon either executive's departure from the company for any reason.
The adjustments to the executives' employment agreements reflect SHF Holdings' strategic approach to compensation and management structure. This move comes as the company continues to navigate the finance services sector, with its shares and warrants traded on The Nasdaq Stock Market.
In other recent news, Safe Harbor Financial reported substantial increases in net income and gross profit for Q2 2024, alongside an impressive reduction of operating expenses by 84% compared to the same period last year. The company's loan interest income also saw a significant surge, increasing by approximately 204% to $1.8 million.
Despite these gains, total revenue for the quarter decreased by 12% from the prior year to $4 million, and the number of active accounts and aggregate deposit balances decreased by roughly 33% versus the previous year.
The company's recent endeavors in the cannabis financial services market have resulted in the successful exit from a defaulted loan, recovering the full principal and accrued interest. This reflects Safe Harbor's strategic focus on improving loan portfolio quality and diversifying income streams.
On the horizon, Safe Harbor Financial anticipates positive contributions from its expanded lending platform and potential regulatory changes in the cannabis sector. The company has projected full-year 2024 revenue to be between $17 million and $18 million, with adjusted EBITDA ranging from $3.75 million to $4.25 million.
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