You are right. I woke up in the middle of the night realizing that it was Patriot who is paying Carl for his role in PDS. Even though the MA states that only the independent manager may receive compensation for his/her role as a manager of PDS, in typical fashion, PTSC decides to approve a $36,000 payment to Carl because it appears he can't get it from PDS directly. Is it possible that PTSC submits Carl's payment to PDS as an expense for "expert" counsel as a way around the no compensation clause?

At any rate, the intent was clear in the MA..no compensation..However, when there are, as you pointed out only Carl and Gloria on the compensation committee for Patriot, I suppose a conference call between them not only justifies Carl's payment for being the chair of the compensation committee but the two of them can approve "other" compensation (i.e..Carl's compensation for being on the management committee of Phoenix Digital Solutions.

Honestly if they had turned this company around due to their efforts, I'd be the last one complaining about their earnings. It appears to me that if there is weasel room to make changes for anything that will benefit the BoD, they will take advantage of it (i.e. majority voting)