(6)
| (3) The amounts in this column represent the aggregate grant-date fair value of RSUs granted to each named executive officer, computed in accordance with the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) Topic 718. See Note 15. Stockholders' Equity of the Notes to the Financial Statements included in the Transition Report on Form 10-KT for the period ended December 31, 2022, for a discussion of the assumptions made in determining the grant-date fair value of the Company’s equity awards. (4) The amounts in this column represent the aggregate grant-date fair value of option awards granted to each named executive officer, computed in accordance with the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) Topic 718. See Note 15. Stockholders' Equity of the Notes to the Financial Statements included in the 2022 Form 10-KT for a discussion of the assumptions made in determining the grant-date fair value of the Company’s equity awards. (5) The amount reported in the "All Other Comp" column for each NEO includes: (a) For Mr. Toama: (i) car allowance payments totaling $6,000 and $4,000 for the 2022 transition period and 2022 fiscal year, respectively; (ii) payments for the cost of reimbursable medical, dental, and other benefits totaling $14,000 and $6,000 for the 2022 transition period and 2022 fiscal year, respectively; and (iii) Company paid life insurance premiums totaling $5,000 and $3,000 for the 2022 transition period and 2022 fiscal year respectively.
(b) For Ms. Naidrich: (i) car allowance payments totaling $6,000 and $4,000 for the 2022 transition period and 2022 fiscal year, respectively; (ii) payments for the cost of reimbursable medical, dental, and other benefits totaling $17,600 for the 2022 transition period.
26 2023 Proxy Statement
SUMMARY OF NEO EMPLOYMENT AGREEMENTS Sadiq (“Sid”) Toama The Company entered into an Executive Employment Agreement (the “Prior Toama Employment Agreement”), effective as of March 21, 2022, with Sadiq (“Sid”) Toama to serve as its President. Mr. Toama was later elected Chief Executive Officer of the Company on May 19, 2022. The Prior Toama Employment Agreement was for an initial term of five (5) years, which automatically renewed for additional one (1) year periods unless either party delivered written notice to the other at least ninety (90) days’ prior to the end of a term, that the applicable term will not be extended. Notwithstanding the foregoing, the Prior Toama Employment Agreement provided that, on or before the third (3rd) anniversary date of the Prior Toama Employment Agreement, the Company could offer to extend the term for an additional period of five (5) years, which Mr. Toama could accept or reject. If the Company did not offer such extension, or if Mr. Toama rejected the extension offered by the Company, Mr. Toama could have resigned, and such resignation would have been deemed to be with good reason (as defined in the Prior Toama Employment Agreement), or he could not resign, in which case the terms of the Prior Toama Employment Agreement would have continued. Under the Prior Toama Employment Agreement, Mr. Toama’s annual base salary for the Transition Period ended December 31, 2022 was $500,000, Mr. Toama was entitled to receive an annual bonus, subject to bonus increases at least annually upon mutually agreed-to performance milestones, as well as discretionary bonuses. Mr. Toama also received 2,500,000 RSUs (which was adjusted to 100,000 RSUs following the 2023 reverse stock split), which RSUs vested one-third on the first anniversary date of the EEA and two-thirds in two (2) equal installments on the second and third anniversary dates of the EEA. Mr. Toama was able to participate, to the extent eligible, in all employee benefit plans and programs provided by the Company to its Senior Executives. For the Transition Period ended December 31, 2022, Mr. Toama also received an auto allowance of $1,000 per month and life insurance benefits of $9,135 per year. On February 13, 2023 the Company entered into an agreement that amended the Prior Toama Employment Agreement (the "Toama Amendment") and provided that, among other things, Mr. Toama would have a base salary of $750,000 and a car allowance of $3,000 per month, and be eligible for an annual incentive bonus of up to 200% of his base salary based on achievement of annual Company and individual performance objectives as determined by the Compensation Committee. Under the terms of the Toama Amendment, Mr. Toama was entitled to a one-time Retention Bonus upon the occurrence of a "Triggering Event" (as defined in the Toama Amendment), subject to Mr. Toama's continuous employment through the occurrence thereof. The amount of Mr. Toama's retention bonus, if any, was, $2,250,000 if the Triggering Event was a "Change of Control", or, $1,500,000 if the Triggering Event was a "Financing Transaction" (each as defined in the amendment). In addition, if no Change of Control or Financing Transaction had been consummated by February 10, 2024, or if Mr. Toama's employment was terminated by the Company other than for cause (as defined in the the Prior Toama Employment Agreement) or he resigned for good reason (ass defined in the the Prior Toama Employment Agreement) prior to a Triggering Event, the retention bonus, if paid, would be in lieu of Mr. Toama's annual bonus for the 2023 fiscal year.
On May 26, 2023, the Company and Mr. Toama entered into a new employment agreement and a new restrictive covenant agreement (together, the “New Toama Employment Agreement”). The New Toama Employment Agreement superseded the Prior Toama Employment Agreement, as amended.
Pursuant to the New Toama Employment Agreement, Mr. Toama was initially be entitled to an annual base salary of $750,000 and was eligible to receive an annual bonus based on the achievement of annual Company objectives and individual performance objectives, with a target annual bonus equal to 200% of his base salary. In addition, pursuant to the New Toama Employment Agreement, Mr. Toama was entitled to a one-time cash retention bonus in an amount equal to $2,000,000 (the “Retention Bonus”), which was paid on the first regularly scheduled 27 2023 Proxy Statement
payroll date of the Company following May 26, 2023. The Retention Bonus is subject to clawback if Mr. Toama’s employment with the Company terminates prior to a “Triggering Event” for any reason other than (i) a termination by the Company without Cause (as defined in the New Agreements), (ii) a resignation by Mr. Toama for Good Reason (as defined in the New Agreements), or (iii) due to Mr. Toama’s death or Disability (as defined in the New Agreements). A “Triggering Event” is defined in the New Toama Employment Agreement as the earliest to occur of (x) the consummation of a Change of Control (as defined in the New Toama Employment Agreement), (y) the consummation of a refinancing, refunding or restructuring of the Company’s existing debt, and (z) February 10, 2024. The Retention Bonus is in lieu of any annual bonus for the portion of the 2023 calendar year prior to the Triggering Event.
In the event that Mr. Toama’s employment had been terminated by the Company without Cause (other than by reason of his death or Disability), or if he had resigned for Good Reason, subject to his execution and non-revocation of a release in favor of the Company, Mr. Toama would have been entitled to: (i) continued payment of his then-current base salary until the later of (x) the date that is 12 months following such termination, and (y) January 1, 2027, (ii) a pro-rated annual bonus for the calendar year of termination, (iii) reimbursement of COBRA premiums for up to 18 months following such termination, (iv) immediate vesting of all then-outstanding and unvested options, restricted shares, restricted stock units, and any other equity awards, and (v) reasonable outplacement services for up to 90 days. In the event that Mr. Toama’s employment had terminated on account of his death or Disability, subject to his execution and non-revocation of a release in favor of the Company, Mr. Toama would have been entitled to: (i) a pro-rated annual bonus for the calendar year of termination, (ii) 24-months of additional vesting of any then-outstanding and unvested options, restricted shares, restricted stock units, or other equity awards, and (iii) continued participation in the Company’s group health insurance plans at active employee rates for up to 18 months following such termination.
In the event that a Change of Control had occurred during Mr. Toama’s employment, all of his then-outstanding and unvested options, restricted shares, restricted stock units, and any other equity awards would have immediately vested. In the event that Mr. Toama’s employment had been terminated by the Company without Cause or he had resigned for Good Reason, in either case, within 12 months following a Change of Control, in addition to his severance entitlements described above, he would have been entitled to an amount equal to his target annual bonus for the year of his termination and any other cash-based performance awards outstanding on the date of his termination.
Pursuant to the New Toama Employment Agreement, Mr. Toama agreed to customary confidentiality and inventions assignment covenants and to be subject to noncompete, nonsolicit and non-interference covenants that applied during his employment and for a period of 18 months thereafter (unless the Company failed to pay any severance benefits when due following a termination by the Company without Cause or a resignation by Mr. Toama for Good Reason). Further, Mr. Toama has agreed not to make disparaging or defamatory comments about the Company and its subsidiaries and the Company has agreed to instruct its officers and directors not to make disparaging or defamatory comments about Mr. Toama.
Effective as of August 14, 2023, the Company terminated the employment of Mr. Toama for “Cause,” pursuant to the terms of the New Toama Employment Agreement.
Erica Naidrich The Company entered into an Executive Employment Agreement with Erica Naidrich to serve as its Chief Financial Officer on May 23, 2022 (the “Naidrich Employment Agreement”). The Naidrich Employment Agreement was for an initial term of three (3) years, which automatically renewed for additional one (1) year periods unless either party delivers, at least sixty (60) days prior to the end of the term, written notice to the other that the term will not be extended. Ms. Naidrich’s annual base salary for the Transition Period ended December 31, 2022 was $400,000. She also received a one-time signing bonus of $100,000 on June 30, 2022. 28 2023 Proxy Statement
She was also eligible for discretionary bonuses as determined by the Compensation Committee and an annual bonus of thirty (30%) percent of her base salary subject to meeting the objectives and her continued employment at the time payment was due. Ms. Naidrich was also granted 200,000 RSUs (which was adjusted to 8,000 RSUs following the 2023 reverse stock split) vesting over three (3) years and was eligible to participate fully in any other long-term equity incentive programs. She also could have participate, dto the extent eligible, at a level commensurate with her position, in all employee benefit plans and programs provided by the Company to employees. She also received an auto allowance of $1,000 per month. On February 10, 2023, the Company entered into an agreement that amended the terms of Nadrich Employment Agreement (the “Naidrich Amendment”). The Naidrich Amendment, (i) increased Ms. Naidrich’s base salary to $450,000, (ii) increased her car allowance to $3,000 per month, (iii) provided for an annual reimbursement of $5,481 for life insurance, and (iv) provided that she was eligible for an annual incentive bonus of up to 100% of her base salary based on achievement of annual Company and individual performance objectives as determined by the Compensation Committee. In addition, under the terms of the Naidrich Amendment, Ms. Naidrich was entitled to a one- time Retention Bonus upon the occurrence of a Triggering Event, subject to Ms. Naidrich’s continuous employment through the occurrence thereof.
The amount of Ms. Naidrich’s Retention Bonus, if any, would have been (i) $900,000, if the Triggering Event was a Change of Control or (ii) $450,000, if the Triggering Event was a Financing Transaction. In addition, a Retention Bonus of $450,000 will have been payable to Ms. Naidrich if no Change of Control or Financing Transaction had been consummated by February 10, 2024, or if Ms. Naidrich’s employment was terminated by the Company other than for Cause or she resigns for Good Reason prior to a Triggering Event, subject to her delivery of a customary release in favor of the Company and any additional severance payable by the Company under the terms of the Naidrich Employment Agreement. The Retention Bonus, if paid, would have been in lieu of Ms. Naidrich’s annual bonus for the 2023 fiscal year.
Effective as of August 14, 2023, the Company terminated the employment of Ms. Naidrich for “Cause,” pursuant to the terms of the Naidrich Employment Agreement. OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END
| | | | | | | | | | | | | | | | | | | | | Name | Number of Securities Underlying Unexercised Options (#) Exercisable | Option Awards Number of Securities Underlying Unexercised Options (#) Unexercisable | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock that have not Vested (#) | Market Value of Shares or Units of Stock that have not Vested (3) | Sid Toama(1) | — | | — | | — | | N/A | 2,500,000 | | $ | 300,000 | | | | | | | | | Erica Naidrich(2) | — | | — | | — | | N/A | 200,000 | | $ | 24,000 | |
(1) Granted under the Company’s equity plan, Mr. Toama’s awards consist of 2,500,000 RSUs (which was adjusted to 100,000 RSUs following the 2023 reverse stock split) granted on March, 31, 2022, which vest in three (3) equal annual installments, beginning on March 31, 2023.
(2) Granted under the Company’s equity plan, Ms. Naidrich’s awards consist of 200,000 RSUs (which was adjusted to 8,000 RSUs following the 2023 reverse stock split) granted on May, 27, 2022, which vest 25.0% on April 1, 2023, 37.5% on April 1, 2024 and 37.5% on April 1, 2025.
(3) Determined by multiplying the $0.12 closing price of the Company’s common stock on December 31, 2022 by the number of shares of common stock underlying the RSUs. For information regarding the vesting acceleration provisions applicable to the RSUs held by our NEOs, please see “Summary of NEO Employment Agreements” above. 29 2023 Proxy Statement
PENSION BENEFITS Each of Troika Media Group Inc., Converge Direct, LLC, and Mission-Media USA, Inc., has a 401(k) benefit plan. The Company makes safe harbor contributions to the Troika Media Group, Inc. 401(k) benefit plan. We currently do not make any matching contributions to any of the other foregoing retirement plans and did not make any other matching contributions with respect to the 2022 plan year. NONQUALIFIED DEFERRED COMPENSATION We do not have any non-qualified defined contribution plans or other deferred compensation plans. EQUITY COMPENSATION PLAN INFORMATION The following table provides information as of December 31, 2022 with respect to shares of common stock that may be issued under equity plans and standalone option grants: COMMON STOCK ISSUABLE UNDER EQUITY PLANS | | | | | | | | | | | | Plan Category | Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights | Weighted Average Exercise Price of Outstanding Options, Warrants and Rights | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans | Equity compensation plans approved by stockholders (1) | 240,849 (3) | $23.25 (4) | 383,484 (5) | Equity compensation plans not approved by stockholders (2) | 140,000 | — | — |
| | | | | | | | | | | | | | | (1) | Equity compensation plans approved by shareholders include the 2017 Equity Incentive Plan and the 2021 Incentive Plan. | (2) | This amount includes 40,000 and 100,000 restricted stock units issued to Sid Toama and Tom Marianacci, respectively | (3) | This amount includes 198,849 shares of common stock that are issuable upon the exercise of stock options, and 42,000 shares of common stock that are deliverable under outstanding RSU awards. | (4) | The weighted average exercise price pertains only to outstanding stock options and not to outstanding restricted stock units, which by their nature have no exercise price | (5) | This amount represents the number of shares available for issuance pursuant to equity awards that may be granted in the future under the 2021 Omnibus Incentive Plan.
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NON-EMPLOYEE DIRECTOR COMPENSATION Our director compensation program is intended to enhance our ability to attract, retain, and motivate non-employee directors of exceptional ability and to promote the common interest of directors and stockholders in enhancing the value of the common stock. The Board reviews director compensation annually based on recommendations by the Nominating and Governance Committee. The Nominating and Governance Committee has the sole authority to engage a consulting firm to evaluate director compensation. Under our non-employee director compensation program, each non-employee director is eligible to receive compensation for Board and Committee service consisting of annual cash retainers and equity awards. Directors also may be paid for serving on ad hoc committees of the Board of Directors. The Company’s former Chief Executive Officer, Mr. Toama received no additional compensation for his services as a Director. Mr. Toama’s total compensation can be found under “Executive Compensation” above. Under our non-employee director compensation program, in 2022 our non-employee directors were eligible to receive the following annual cash compensation for their service on the Board of Directors and its standing Committees: 30 2023 Proxy Statement
NON-EMPLOYEE DIRECTOR ANNUAL RETAINERS
| | | | | | Position | Annual Cash Retainer | Chairman of the Board | $ | 300,000 | | Member(s) of Special Committee | $ | 480,000 | | Wendy Parker | $ | 60,000 | | All Other Directors | $ | 30,000 | |
Note: Additional compensation is not paid for sitting on committees. Fees paid to directors cover all positions.
In connection with their appointment to the Board, it was determined that in lieu of the standard compensation for non-employee directors, each of Messrs. Lyon and Stein will receive $40,000 per month in cash compensation, plus $5,000 per day in the event that they are obligated to participate in litigation proceedings as witnesses, or otherwise
The following table shows the total compensation for non-employee directors during the Transition Period ended December 31, 2022.
2022 NON-EMPLOYEE DIRECTOR COMPENSATION TABLE
| | | | | | | | | | | | | | | Non-Employee Director | Paid in Cash($) Fees Earned or | Option Awards($) | Stock Awards($) | Total($) | Grant Lyon | $ | 69,000 | | $ | — | | $ | — | | $ | 69,000 | | Randall D. Miles | $ | 137,500 | | $ | 564,000 | | $ | — | | $ | 701,500 | | Thomas Ochocki | $ | — | | $ | — | | $ | — | | $ | — | | I. Martin Pompadur | $ | 15,000 | | $ | — | | $ | — | | $ | 15,000 | | Jeffrey S. Stein | $ | 69,000 | | $ | — | | $ | — | | $ | 69,000 | | Wendy Parker | $ | 30,000 | | $ | — | | $ | 37,000 | | $ | 67,000 | | Sabrina Yang | $ | 15,000 | | $ | — | | $ | 37,000 | | $ | 52,000 | | John Belniak+ | $ | 7,500 | | $ | — | | $ | — | | $ | 7,500 | |
+ Denotes former director.
31 2023 Proxy Statement
2022 PAY VERSUS PERFORMANCE As required by Item 402(v) of Regulation S-K, this section discusses the relationship between executive compensation and Troika’s financial performance for each of the last two completed calendar years. In determining the “compensation actually paid” to our principal executive officer (the “PEO”) and our other NEO, we are required to make various adjustments to amounts that have been previously reported in the Summary Compensation Table in previous years, as the SEC’s valuation methods for this section differ from those required in the Summary Compensation Table. The table below summarizes compensation values both previously reported in our Summary Compensation Table, as well as the adjusted values required in this section for the transition period running from July 1, 2022 through December 31, 2022 (the “2022TP” or “2022 transition period’) and the fiscal years ended June 30, 2022 and June 30, 2021.
| | | | | | | | | | | | | | | | | | | | | | | | | | | Year | Summary Compensation Table for Sid Toama(1) ($) | Summary Compensation Table for Robert Machinist (1) | Compensation Actually Paid to Sid Toama(1)(2) ($) | Compensation Actually Paid to Robert Machinist (1)(2) ($) | Average Summary Compensation Table Total for Non-PEO NEOs (1) ($) | Average Compensation Actually Paid to Non-PEO NEOs (1)(2) ($) | Value of Initial Fixed $100 Investment Based on Total Shareholder Return (3) ($) | Net Loss (5) ($) | 2022 TP | 294,000 | | N/A | (1,023,500) | | N/A | 223,600 | | 118,200 | | 10.00 | | (9,579,745) | | 2022 | 2,753,000 | | 2,469,000 | | 2,215,500 | | 2,469,000 | | 338,000 | | 846,050 | | 65.43 | | (38,693,006) | | 2021 | N/A | 1,929,000 | | N/A | 1,929,000 | | 575,797 | | 575,797 | | 129.09 | | (15,997,000) | |
| | | | | | (1) | Robert Machinist, our former Chief Executive Officer, was our PEO for the 2021 fiscal year and for the 2022 fiscal year through his resignation date of May 19, 2022. Sid Toama was our PEO for the 2022 fiscal year beginning May 19, 2022 and for the 2022 transition period. The Non-PEO named executive officers (“Non-PEO NEOs”) for each year presented are listed below. |
| | | | | | | | | | | | | | | 2021 TP | | 2022 | | 2021 | Erica Naidrich | | Erica Naidrich | | Chris Broderick | | | Chris Broderick | | Michael Tenore | | | | | Daniel Pappalardo | | | | | Kevin Dundas | | | | | Matthew Craig | | | | | Andrew Bressman |
| | | | | | (2) | Amounts reported in this column are based on total compensation reported for our PEO and the average of the total compensation reported for the Non-PEO NEOs in the Summary Compensation Table for the indicated fiscal years and adjusted as shown in the tables below. Fair value of equity awards was computed in accordance with the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) Topic 718. See Note 14. Stockholders EquityCompany’s methodology used for financial reporting purposes. The compensation reported for Mr. Dundas for the 2021 fiscal year was converted to USD from GBP using a rate of 1.38491, which was obtained from Oanda, as of June 30, 2021. |
32 2023 Proxy Statement
| | | | | | | | | | | | | | | | | | Adjustments to Determine Compensation “Actually Paid” for PEO (Sid Toama) | 2022 TP ($) | | 2022 ($) | | 2021 ($) | Deduct for Amounts Reported under the “Stock Awards” Column in the Summary Compensation Table | — | | | (2,435,000) | | | N/A | Deduct for Amounts Reported under the “Option Awards” Column in the Summary Compensation Table | — | | | — | | | N/A | Increase for Fair Value of Awards Granted during Covered Year that Remain Unvested as of Year End | 290,000 | | | 1,897,500 | | | N/A | Increase for Fair Value of Awards Granted during Covered Year that Vested During Covered Year | — | | | — | | | N/A | Increase/Deduct for Change in Fair Value from Prior Year-End to Current Year-End of Awards Granted Prior to Covered Year that were Outstanding and Unvested as of Year-End | (1,607,500) | | | — | | | N/A | Increase/Deduct for Change in Fair Value from Prior Year-end to Vesting Date of Awards Granted Prior to Covered Year that Vested During Covered Year | — | | | — | | | N/A | Deduct for Fair Value of Awards Granted Prior to Covered Year that Failed to Meet Applicable Vesting Conditions During Covered Year | — | | | — | | | N/A | Increase Based on Dividends or Other Earnings Paid During Covered Year Prior to Vesting Date of Award | — | | | — | | | N/A | Total Adjustments | (1,317,500) | | | (537,500) | | | N/A |
| | | | | | | | | | | | | | | | | | Adjustments to Determine Compensation “Actually Paid” for PEO (Robert Machinist) | 2022 TP ($) | | 2022 ($) | | 2021 ($) | Deduct for Amounts Reported under the “Stock Awards” Column in the Summary Compensation Table | N/A | | (2,025,000) | | | — | | Deduct for Amounts Reported under the “Option Awards” Column in the Summary Compensation Table | N/A | | — | | | — | | Increase for Fair Value of Awards Granted during Covered Year that Remain Unvested as of Year End | N/A | | — | | | — | | Increase for Fair Value of Awards Granted during Covered Year that Vested During Covered Year | N/A | | 2,025,000 | | | — | | Increase/Deduct for Change in Fair Value from Prior Year-End to Current Year-End of Awards Granted Prior to Covered Year that were Outstanding and Unvested as of Year-End | N/A | | — | | | — | | Increase/Deduct for Change in Fair Value from Prior Year-end to Vesting Date of Awards Granted Prior to Covered Year that Vested During Covered Year | N/A | | — | | | — | | Deduct for Fair Value of Awards Granted Prior to Covered Year that Failed to Meet Applicable Vesting Conditions During Covered Year | N/A | | — | | | — | | Increase Based on Dividends or Other Earnings Paid During Covered Year Prior to Vesting Date of Award | N/A | | — | | | — | | Total Adjustments | N/A | | — | | | — | |
33 2023 Proxy Statement
| | | | | | | | | | | | | | | | | | Adjustments to Determine Compensation “Actually Paid” for Non-PEO NEO | 2022 TP ($) | | 2022 ($) | | 2021 ($) | Deduct for Amounts Reported under the “Stock Awards” Column in the Summary Compensation Table | — | | | (990,000) | | | — | | Deduct for Amounts Reported under the “Option Awards” Column in the Summary Compensation Table | — | | | — | | | — | | Increase for Fair Value of Awards Granted during Covered Year that Remain Unvested as of Year End | 23,200 | | | 151,800 | | | — | | Increase for Fair Value of Awards Granted during Covered Year that Vested During Covered Year | — | | | 800,000 | | | — | | Increase/Deduct for Change in Fair Value from Prior Year-End to Current Year-End of Awards Granted Prior to Covered Year that were Outstanding and Unvested as of Year-End | (128,600) | | | — | | | — | | Increase/Deduct for Change in Fair Value from Prior Year-end to Vesting Date of Awards Granted Prior to Covered Year that Vested During Covered Year | — | | | — | | | — | | Deduct for Fair Value of Awards Granted Prior to Covered Year that Failed to Meet Applicable Vesting Conditions During Covered Year | — | | | — | | | — | | Increase Based on Dividends or Other Earnings Paid During Covered Year Prior to Vesting Date of Award | — | | | — | | | — | | Total Adjustments | (105,400) | | | (38,200) | | | — | |
| | | | | | (3) | The TSR set forth in this table assumes $100 was invested in the Company’s common stock for the period starting June 21, 2021 through the end of the Noteslisted year in the table. Historical stock performance is not necessarily indicative of future stock performance. | (4) | We are a smaller reporting company pursuant to Rule 405 of the Securities Act of 1933, and as such, we are only required to include information for the past two fiscal years in this table. | (5) | The dollar amounts reported represent the amount of net (loss) reflected in our audited financial statements for the applicable covered year. |
34 2023 Proxy Statement
DESCRIPTION OF THE RELATIONSHIP BETWEEN COMPENSATION ACTUALLY PAID TO OUR NEOS AND COMPANY PERFORMANCE The graphs below describe the relationship between compensation actually paid to our PEO and to the non-PEO NEO (as calculated above) and our financial and stock performance for the indicated years. The first graph reflects the relationship among the compensation actually paid to the PEO, the average compensation actually paid to the non-PEO NEO and our cumulative total shareholder return for the transition period ended December 31, 2022 and the year ended June 30, 2022.
Compensation Actually Paid vs Total Shareholder Return
Compensation Actually Paid vs Net Loss
35 2023 Proxy Statement
NON-BINDING ADVISORY VOTE ON THE FREQUENCY OF FUTURE ADVISORY VOTES ON THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS (PROXY ITEM NO. 4) REQUIRED VOTE The option that receives the affirmative vote of a majority of the shares of our common stock present in person or represented by proxy at the Meeting and entitled to vote thereon will be the frequency of the advisory vote on the compensation of our NEOs that stockholders recommend. In the event that no option receives such a majority, we will consider the option that receives the most votes to be the option selected by stockholders of the Company. Although this advisory vote is not binding, the Board will review and consider the outcome of this vote when making its determination as to the frequency of future advisory stockholder votes on the compensation of our NEOs. SAY ON FREQUENCY VOTE As required by the Dodd-Frank Act and related SEC rules, we are asking our stockholders to vote, on an advisory basis, for their preference regarding the frequency of future advisory votes on the compensation of our NEOs. Specifically, stockholders may vote on whether the advisory vote on the compensation of our named executive officers should occur every one, two, or three years. The Board has given consideration to the preferred frequency of the advisory vote on the compensation of our NEOs. After considering the benefits and consequences of available options, the Board recommends that stockholders vote in favor of holding the advisory vote on the compensation of our named executive officers every year. An annual advisory vote would continue to provide the Board with consistent feedback from our stockholders on this important matter. When voting on this proposal, stockholders should understand that they are not voting “for” or “against” the recommendation of the Board to hold the advisory vote every year. Rather, stockholders will have the option to choose whether to approve holding future advisory votes on the compensation of our named executive officers every one, two, or three years, or to abstain entirely from voting on the matter.
| | | | | | RECOMMENDATION OF THE BOARD OF DIRECTORS | | THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE ONE YEAR WITH RESPECT TO HOW FREQUENTLY A NON-BINDING ADVISORY SHAREHOLDER VOTE TO APPROVE THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS SHOULD OCCUR. UNLESS A CONTRARY CHOICE IS SPECIFIED, PROXIES SOLICITED BY THE BOARD WILL BE VOTED FOR A FREQUENCY OF ONE YEAR. |
36 2023 Proxy Statement
CURRENT EXECUTIVE OFFICERS OF THE COMPANY
The following table sets forth information, as of October 18, 2023, about our executive officers. Each executive officer serves at the discretion of the Board. There are no family relationships among our directors and executive officers.
| | | | | | | | | Name and Position(s) | Age | Career | Grant Lyon
▪Member of the Board of Directors from November, 2022 to October, 2023
▪Former Member of the Special Committee and the Special Litigation Committee
▪President and Interim Chief Executive Officer, since August 14, 2023 | 60 | Mr. Lyon has over thirty (30) years of experience in corporate restructuring, expert testimony and corporate governance. Mr. Lyon has served as Co-founder and managing partner of Areté Capital Partners, LLC, a special situation advisory firm, since July 2020. He previously served as founder and managing director of Atera Capital, LLC, a fiduciary and financial advisory firm, from June 2017 to June 2020. Mr. Lyon also served as managing director of KRyS Global USA, a restructuring advisory and distressed investment consulting firm, from 2014 to June 2017. Mr. Lyon has served as the financial advisor to the Government of the Commonwealth of the Bahamas. Mr. Lyon has served numerous times as a Chapter 11 Trustee, state-court receiver, chief executive officer, chief financial officer and chief restructuring officer. Mr. Lyon has testified many times in numerous jurisdictions, including bankruptcy court, federal district court and state court.
| Education | Mr. Lyon has a Masters of Business Administration degree and a Bachelor of Science degree in Accounting from Brigham Young University. |
| | | | | | | | | Name and Position(s) | Age | Career | Eric Glover
▪Vice President, Treasurer and Interim Chief Financial Statements includedOfficer, since August 14, 2023 | 62 | Eric Glover, a Managing Director with Areté Capital Partners, has more than thirty-five years of operating experience leading multinational companies across a wide range of industries, including aerospace & defense, automotive, banking, business services, construction, consumer products, commercial/industrial products, distribution, healthcare, hi-tech, logistics, media services, oil & gas, private equity, restaurant, and retail. Mr. Glover’s experience spans all business sectors; including manufacturing, construction, government contracting, service, omni- channel retail, and wholesale trade, and encompasses all types of capital structures; including public, private, private-equity sponsored, family-office owned, and non-profit.
Prior to joining Areté, Mr. Glover served as President of Raben Tire Company, one of the top 20 commercial tire dealers in America, where he led the company through a major turnaround and restructuring culminating with a sale to the Goodyear Tire & Rubber Company. Prior to Raben, Mr. Glover served as President & CEO of Heartland Automotive Services, the world’s largest Jiffy Lube operator with 440 locations, where he led a highly successful restructuring campaign resulting in a change of control.
During his career, Mr. Glover has held Board and/or C-Suite level positions with Finca Impact Finance, Health Connect America, Paragon Integrated Services Group, QMax, Raben Tire, LifeWay Christian Stores, Heartland Automotive Services, Le Creuset of America, Publicis USA, United Technologies Photonics, and Able Body Corporation.
| Education | Mr. Glover is a Certified Public Accountant and has an MBA from the University of Connecticut and a bachelor’s degree from Missouri Southern State College. |
37 2023 Proxy Statement
| | | | | | | | | Name and Position(s) | Age | Career | Lawrence Wolfe
▪Vice President Chief Operating Officer, since January 1, 2023 | 51 | Mr. Wolfe began his career at the Company as Head of Enterprise Technology, where he was responsible for the company's engineering and technology solutions. He also lead the enterprise software development roadmap and business continuity and security measures. As Chief Operating Officer, Mr. Wolfe directs daily business operations encompassing areas including engineering, analytics, creative, digital delivery and infrastructure.
Prior to joining the Company, Mr. Wolfe was Director of Digital & Technology at PulseCX, a life sciences marketing agency and was later promoted to VP, Technology. He lead digital strategy for their life sciences client portfolio and served as the lead architect and principal engineer for all digital initiatives and data analytics solutions. Before his tenure at Pulse CX, Lawrence served in various roles throughout his tenure with Liquid Interactive, a vertically agnostic digital agency. Most recently as VP, Strategic Partnerships, Mr. Wolfe was embedded with key clients to lead architecture and delivery of integrated business and customer facing solutions. | Education | Mr. Wolfe has a Bachelors of Technology from SUNY Farmingdale. |
| | | | | | | | | Name and Position(s) | Age | Career | Derek McKinney
▪Vice President, General Counsel and Corporate Secretary, since June 19, 2023 | 50 | Mr. McKinney has over nineteen years’ experience as a corporate attorney. Mr. McKinney began his career as a corporate tax associate at the law firm of Skadden, Arps, Slate, Meagher & Flom LLP. He also worked as an associate in the Annual Report on Form 10-K for the fiscal year ended June 30, 2022, for a discussioncorporate department of the assumptions made in determining the grant-date fair valuelaw firm Morrison Cohen LLP with a focus on mergers and acquisition and acquisition financing. Before coming to Troika, Mr. McKinney worked in-house at two other public companies, Arrow Electronics, Inc. and ITT Inc. In his last in-house role, Mr. McKinney served as Vice President and General Counsel of the Company’s equity awards. ITT’s Connect and Control Technologies business. | | Education | (7) | The amountsMr. McKinney has BFA in this column represent the aggregate grant-date fair valueTheatre from Southern Methodist University and a JD and an LLM (tax law) from New York University School of awards granted to each named executive officer, computed in accordance with the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) Topic 718. See Note 14. Stockholders Equity of the Notes to the Financial Statements included in the Annual Report on Form 10-K for the fiscal year ended June 30, 2022, for a discussion of the assumptions made in determining the grant-date fair value of the Company’s equity awards. Law. |
OTHER MATTERS 6DELIVERY OF DOCUMENTS TO SECURITY HOLDERS SHARING AN ADDRESS
Participation inSEC rules permit us to deliver one Notice of Internet Availability to two or more stockholders who share an address, unless we have received contrary instructions from one or more of the Virtualstockholders. This delivery method, which is known as “householding,” can reduce our expenses for printing and mailing. Any stockholder of record at a shared address to which a single copy of the Notice of Internet Availability was delivered may request a separate Notice of Internet Availability, or a separate copy of the 2022 Annual Meeting
The board of directors considersReport and this Proxy Statement, by calling (212) 213-0111 or sending a letter to Investor Relations at Troika Media Group, Inc., 25 West 39th Street, New York, NY 10018, to the appropriate formatattention of our annual meetingsSecretary. Stockholders of stockholdersrecord who wish to receive separate copies of these documents in
the future may also contact us as stated above. Stockholders of record who share an address and receive two or more copies of the Notice of Internet Availability may contact us as stated above to request delivery of a single copy. A stockholder who holds shares in “street name” and who wishes to obtain copies of proxy materials should follow the instructions on an annual basis. This year the board chose a virtual meeting formatstockholder’s voting instruction form or should contact the holder of record. EXPENSES RELATED TO PROXY SOLICITATION SERVICES We have engaged Broadridge Financial Solutions, Inc. to assist with preparation and distribution of the Proxy Statement and copies of the 2022 Annual Report. We will pay all expenses of preparing, printing and mailing, and making available over the Internet, the Annual Meeting proxy materials, as well as all other expenses of soliciting proxies for the Annual Meeting on behalf of the board of 38 2023 Proxy Statement
directors. We have engaged D.F. King & Co., Inc. (“DFK”) to solicit proxies including, for example, by personal interview, mail, telephone, facsimile, email, Internet or other means of electronic transmission, and will request brokerage houses, banks, and other custodians, nominees and fiduciaries to forward soliciting material to the beneficial owners of common stock held of record by these persons. We will pay a fee of approximately $12,500 to DFK for its services associated with soliciting services and will reimburse it for payments made to brokers and other nominees for their expenses in an effortforwarding soliciting material. In addition, certain of our directors, officers, and employees, who will receive no compensation in addition to facilitate stockholder attendancetheir regular salary or other compensation, may solicit proxies by personal interview, mail, telephone, facsimile, email, Internet, or other means of electronic transmission. INFORMATION ON THE PROXY STATEMENT AND VOTING Q: When and participation by enabling stockholders to participate fully, and equally, from any location around the world, at no cost. The virtual meeting formatwhere will allow stockholders to engage with us at the Annual Meeting from any geographic location, using any convenient internet connected devices, including smart phones and tablets as well as laptop and desktop computers. Webe held? A: This year the Annual Meeting of Stockholders of Troika Media Group, Inc., will be ableheld exclusively by webcast beginning at 10:00 a.m., Eastern time, on Friday, December 15, 2023. In order to engage with all stockholders as opposed to just those who can afford to travel to an in-person meeting. The virtual format allows stockholders to submit questions and comments duringattend the Annual Meeting, you must register in advance at www.virtualshareholdermeeting.com/TRKA2023 prior to the deadline of 11:59 p.m., Eastern time, on December 14, 2023. Upon completing your registration, you will receive further instructions via email, including your unique join link and a password that will allow you to access the Annual Meeting. Please be sure to follow the instructions on your proxy card and subsequent instructions that will be delivered to you via email. Q: Who may join the Annual Meeting? A: Participation in the Annual Meeting, including listening, voting shares and submitting questions, will be limited to registered stockholders and proxyholders. To ensure they can participate, stockholders and proxyholders should visithttps://web.lumiagm.com/238744591 www.virtualshareholdermeeting.com/ TRKA2023 and register to attend the Annual Meeting after 9:00 A.M.prior to the deadline of 11:59 p.m., Eastern time, on December 14, 2023. Upon completing your registration, you will receive further instructions via email, including your unique join link and a password that will allow you to access the date of the meeting. Stockholders shouldAnnual Meeting. Please be sure to follow the instructions on theiryour proxy cards.card and subsequent instructions that will be delivered to you via email. Stockholders and proxyholders whothat intend to vote at the meeting will need to enter the virtual control number included on their Notice of Internet Availability of Proxy Materials or proxy card. Online check-in to the Annual Meeting webcast will begin at 9:00 a.m., Eastern time, on December 15, 2023. We encourage you to allow ample time to log in to the meeting webcast and test your computer audio system. Q: How do I register and attend the Annual Meeting? A. You must register in advance to attend the Annual Meeting virtually by visiting www.virtualshareholdermeeting.com/TRKA2023 prior to the deadline of 11:59 p.m., Eastern time, on December 14, 2023. You will need to enter your name, phone number, mailing address as it appears on your proxy card, and email address as part of the registration, following which you will receive an email confirming your registration, as well as the password to attend the Annual Meeting. On the day of the Annual Meeting, if you have properly registered, you may enter the Annual Meeting by logging in using the password you received via email in your registration confirmation. If you wish to vote your shares electronically at the Annual Meeting, you will need your virtual control number included on your Notice of Internet Availability of Proxy Materials or proxy card. Q: What materials have been prepared for stockholders in connection with the Annual Meeting? 39 2023 Proxy Statement
A: We are furnishing you and other stockholders of record with the following proxy materials: •our 2022 Annual Report on Form 10-KT for the Transition Period ended December 31, 2022 (including our audited consolidated financial statements for 2022 and 2021), which we refer to as the Transition Period Report or the 2022 Annual Report; •this Proxy Statement for the 2023 Annual Meeting, which we refer to as this Proxy Statement and which also includes a letter from our Chief Executive Officer to stockholders and a Notice of 2023 Annual Meeting of Stockholders; and •a Notice of Internet Availability of Proxy Materials, which we refer to as the Notice of Internet Availability, which includes a control number for use in submitting proxies. These materials were first made available on the Internet, on or about October 31, 2023. The Notice of Internet Availability was first mailed to stockholders on or about October 31, 2023. If, in accordance with the instructions provided in the Notice of Internet Availability, you request a printed set of proxy materials, you will receive by mail, at no charge, a printed copy of 2022 Annual Report, this Proxy Statement, a proxy card for the Annual Meeting, and a pre-addressed envelope to be used to return the completed proxy card. If, in accordance with the instructions provided in the Notice of Internet Availability, you request that a set of proxy materials be emailed to you, you will receive by email, at no charge, electronic copies of the 2022 Annual Report and this Proxy Statement. Q: Why was I mailed a Notice of Internet Availability rather than a printed set of proxy materials? A: In accordance with rules adopted by the SEC, we are furnishing the proxy materials to stockholders by providing access via the Internet, instead of mailing printed copies. This process expedites the delivery of proxy materials to our stockholders, lowers our costs, and reduces the environmental impact of the Annual Meeting. The Notice of Internet Availability tells you how to access and review the proxy materials on the Internet and how to vote on the Internet. It also provides instructions you may follow to request paper or emailed copies of the proxy materials. Q: Are the proxy materials available via the Internet? A: You can access and review the proxy materials for the Annual Meeting at www.virtualshareholdermeeting.com/TRKA2023. In order to submit your proxies, however, you will need to refer to the Notice of Internet Availability sent to you with this Proxy Statement or a proxy card mailed to you upon your request to obtain your control number and other personal information needed to vote by proxy or in person. Q: What is a proxy? A: The term “proxy,” when used with respect to stockholder, refers to either a person or persons legally authorized to act on the stockholder’s behalf or a format that allows the stockholder to vote without being physically present at the Annual Meeting. Because it is important that as many stockholders as possible be represented at the Annual Meeting, the Board is asking that you review this Proxy Statement carefully and then vote by following the instructions set forth on the Notice of Internet Availability or the proxy card. In voting prior to the Annual Meeting, you will deliver your proxy to the Proxy Committee, which means you will authorize the Proxy Committee to vote your shares at the Annual Meeting in the way you instruct. The Proxy Committee consists of Grant Lyon and Eric Glover. All shares represented by valid proxies will be voted in accordance with the stockholder’s specific instructions.
40 2023 Proxy Statement
Q: What matters will the stockholders vote on at the Annual Meeting? A: Proposal 1: To elect the six (6) nominees named below to the Board of Directors: ▪Randall D. Miles ▪Thomas Ochocki ▪Wendy Parker ▪I. Martin Pompadur ▪Sabrina Yang ▪Jeffrey S. Stein Proposal 2: To ratify the appointment of RBSM LLP as Troika’s independent registered public accounting firm for 2023 Proposal 3: To conduct a non-binding advisory vote on the compensation of Troika’s named executive officers. Proposal 4: To conduct a non-binding advisory vote to determine whether future stockholder advisory votes on the compensation of Troika’s named executive officers should occur either every one, two or three years. Q: Who can vote at the Annual Meeting? A: Stockholders of record of common stock at 5:00 p.m., Eastern time, on October 18, 2023, the record date, who have registered by the deadline of 11:59 p.m., Eastern time, on December 14, 2023, at www.virtualshareholdermeeting.com/TRKA2023 will be entitled to vote at the Annual Meeting. As of the record date, there were outstanding a total of 16,676,762 shares of common stock, each of which will be entitled to one vote on each proposal. As a result, up to a total of 16,676,762 votes can be cast on each proposal. Q: What is a stockholder of record? A: A stockholder of record is a stockholder whose ownership of common stock is reflected directly on the books and records of our transfer agent, AST. Q: What does it mean for a broker or other nominee to hold theirshares in “street name”? A: If you beneficially own shares held in an account with a broker, bank, or similar organization, that organization is the stockholder of record and is considered to hold those shares in “street name.” An organization that holds your beneficially owned shares in street name and who wishwill vote in accordance with the instructions you provide. If you do not provide the organization with specific voting instructions with respect to participate ina proposal, the organization’s authority to vote your shares will, under Nasdaq’s rules, depend upon whether the proposal is considered a “routine” or a “non-routine” matter. ▪The organization generally may vote your beneficially owned shares on routine items for which you have not provided voting instructions to the organization. The only routine matter expected to be voted on at the Annual Meeting is the ratification of the appointment of our independent auditor for the period January 1, 2023, to December 31, 2023 (Proposal 2). ▪The organization generally may not vote on non-routine matters, including Proposals 1, 3, and 4. Instead, it will inform the inspector of election that it does not have the authority to vote on those matters. This is referred to as a “broker non-vote.” For the purpose of determining a quorum, we will treat as present at the Annual Meeting any proxies that are voted on any of the four (4) proposals to be acted upon by the stockholders, including abstentions or proxies containing broker non-votes. Q: How do I vote my shares if I do not attend the Annual Meeting? A: If you are a stockholder of record, you may vote prior to the Annual Meeting as follows: ▪Via the Internet: You may vote via the Internet by going to www.proxyvote.com in accordance with the voting instructions on the Notice of Internet Availability and the proxy card. 41 2023 Proxy Statement
Internet voting is available 24 hours a day until 11:59 p.m., Eastern time, on December 14, 2023. You will be given the opportunity to confirm that your instructions have been recorded properly. ▪By Mail: If you obtain a proxy card by mail, you may vote by returning the completed and signed proxy card in a postage-paid return envelope that will be provided with the proxy card. If you hold shares in street name, you may vote by following the voting instructions provided by your bank, broker, or other nominee. In general, you may vote prior to the Annual Meeting as follows: ▪Via the Internet: You may vote via the Internet by going to www.proxyvote.com in accordance with the voting instructions on the Notice of Internet Availability and the proxy card. Internet voting is available 24 hours a day until 11:59 p.m., Eastern time, on December 14, 2023. You will be given the opportunity to confirm that your instructions have been recorded properly. For your information, voting via the Internet is the least expensive for us with voting by mail being the most expensive. Q: Can I vote at the Annual Meeting? A: If you are a stockholder of record who registered at www.virtualshareholdermeeting.com/TRKA2023 prior to the deadline of 11:59 p.m., Eastern time, on December 14, 2023, you may vote in person at the Annual Meeting, whether or not you previously voted. If your shares are held in street name, you must provide at registration, theira legal proxy obtained from the broker,your bank or other organization that holds their shares.broker during registration and you will be assigned a virtual control number in order to vote your shares during the Annual Meeting. If you are unable to obtain a legal proxy to vote your shares, you will still be able to attend the Annual Meeting (but will not be able to vote your shares) so long as you demonstrate proof of stock ownership. Instructions on how to connect and participate via the Internet, including how to demonstrate proof of stock ownership, are posted at https://web.lumiagm.com/238744591.Stockholders who have registered at https://web.lumiagm.com/238744591 will be able to participate inwww.virtualshareholdermeeting.com/TRKA2023. On the day of the Annual Meeting, you may only vote during the meeting using the web portal during the meeting.
In order to attend the Annual Meeting, you must register in advance at www.virtualshareholdermeeting.com/TRKA2023 prior to the deadline of 11:59 p.m., Eastern time, on December 14, 2023. Upon completing your registration, you will receive further instructions via live webcast.email, including your unique join link and a password that will allow you to access the Annual Meeting and submit questions. Please be sure to follow the instructions on your proxy card and subsequent instructions that will be delivered to you via email. In order to vote at the Annual Meeting, be sure to have your digit control number included on their Notice of Internet Availability of Proxy Materials or proxy card. Q: Can I ask questions at the Annual Meeting? A: You may submit questions via the Internet during the Annual Meeting by participating in the webcast via the unique join link and password delivered to you after registration. We will answer any timely submitted questions on a matter to be voted on at the Annual Meeting before voting is closed on the matter. Following adjournment of the formal business of the Annual Meeting, we will address appropriate general questions from stockholders regarding our company in the order in which the questions are received. Questions relating to stockholder proposals or our company may be submitted in the field provided in the web portal at or before the time the questions are to be discussed. All questions received during the Annual Meeting will be presented as submitted, uncensored and unedited, except that we may omit certain personal details for data protection issues and we may edit profanity or other inappropriate language. If we receive substantially similar questions, we will group those questions together and provide a single response to avoid 42 2023 Proxy Statement
repetition. Additional information regarding the submission of questions during the Annual Meeting can be found in our 2022 Annual Meeting of Stockholders2023 Rules of Conduct and Procedures,Procedure, a copy of which is attached hereto as Appendix A. Any material changesAPPENDIX A. Q: Why is the Annual Meeting being conducted as a virtual meeting? A: The Board considers the appropriate format of our annual meeting of stockholders on an annual basis. This year the Board chose a virtual meeting format for the Annual Meeting in an effort to facilitate safe stockholder attendance and participation, by enabling stockholders to participate fully, and equally, from any location around the world, at no cost. The virtual meeting format will allow our stockholders to engage with us at the Annual Meeting from any geographic location, using any convenient internet-connected devices, including smart phones and tablet, laptop or updatesdesktop computers.The virtual format allows stockholders to submit questions during the 2022 Rulesmeeting. Q: If I am unable to participate in the live audio webcast of Conduct and Proceduresthe Annual Meeting, may I listen at a later date? A: An audio replay of the Annual Meeting will be posted and publicly available at https://www.troikamedia.com/investor-relations following the Annual Meeting and will remain publicly available until our annual meeting of stockholders in 2024. This audio replay will cover the entire Annual Meeting, including each stockholder question addressed during the Annual Meeting. Q: May I change my vote or revoke my proxy? A: If you are a stockholder of record and previously delivered a proxy, you may subsequently change or revoke your proxy at any time before it is exercised by: ▪voting via the Internet or telephone at a later time; ▪submitting a completed and signed proxy card with a later date; or ▪voting at the Annual Meeting. If you are a beneficial owner of shares held in street name, you should contact your bank, broker, or other nominee for instructions as to whether, and how, you can change or revoke your proxy.
Q: What happens if I do not give specific voting instructions? A: If you are a stockholder of record and you return a proxy card without giving specific voting instructions, the Proxy Committee will vote your shares in the manner recommended by the Board on all five proposals presented in this Proxy Statement and as the Proxy Committee may determine in its discretion on any other matters properly presented for a vote at the Annual Meeting. If you are a beneficial owner of shares held in street name and do not provide specific voting instructions to the broker, bank or other organization that is the stockholder of record of your shares, the organization generally may vote on routine, but not non-routine, matters. The only routine matter expected to be voted on at the Annual Meeting is the ratification of the appointment of our websiteindependent auditor for the period January 1, 2023, to December 31, 2023 (Proposal 2). If the organization does not receive instructions from you on how to vote your shares on one or more of Proposals 1, 3, and disclosed4, your shares will be subject to a broker non-vote and no vote will be cast on those matters. See “Q. What does it mean for a broker or other nominee to hold shares in a Current Report on Form 8-K filed with‘street name’?” above. Q: What should I do if, during check-in or the SEC.meeting, I have technical difficulties or trouble accessing the virtual meeting website? A: Online check-in to the Annual Meeting webcast will begin at 9:00 a.m., Eastern time, on December 15, 2022, and you2023. You should allow ample time to log in to the meeting webcast and test your computer audio system. We have designed our virtual format to enhance, rather than constrain, stockholder access, participation, and communication. For example, stockholders will be able to communicate with us during
43 2023 Proxy Statement
Q: What if other matters are presented at the Annual Meeting so they can ask questions. An audio replayMeeting? A: If a stockholder of record provides a proxy by voting in any manner described in this Proxy Statement, the Annual MeetingProxy Committee will be made publicly availablehave the discretion to vote on any matters, other than the proposals presented in this Proxy Statement, that are properly presented for consideration athttps://www.troikamedia.com/investor-relations until our 2023 annual meeting of stockholders. This audio replay will include each stockholder question addressed during the Annual Meeting. We are utilizing technology from American Stock Transfer & Trust Company, LLC (“AST”). The AST platform is expected to accommodate most, if not all, stockholders. Both we and AST will test the platform technology before going “live” for the Annual Meeting. Questions and Answers About the Annual Meeting
Q: | When and where will the Annual Meeting be held? | | | A: | This year the Annual Meeting of Stockholders of Troika Media Group, Inc., will be held exclusively by webcast beginning at 10:00 a.m., Eastern time, on Thursday, December 15, 2022. In order to attend the Annual Meeting, please visit https://web.lumiagm.com/238744591after 9:00 a.m., on December 15, 2022. Please be sure to follow the instructions on your proxy card. | | | Q: | Who may join the Annual Meeting? | | | A: | Participation in the Annual Meeting, including voting shares and submitting questions, will be limited to stockholders and proxyholders. To ensure they can participate, stockholders and proxyholders should visit https://web.lumiagm.com/238744591after 9:00 a.m. on December 15, 2022. Please be sure to follow the instructions on your proxy card. Stockholders and proxyholders that intend to vote at the meeting will need to enter the virtual control number included on their Notice of Internet Availability of Proxy Materials or proxy card.
| | | | Online check-in to the Annual Meeting webcast will begin at 9:00 a.m., Eastern time, on December 15, 2022. We encourage you to allow ample time to log in to the meeting webcast and test your computer audio system. | | | Q: | How do I register and attend the Annual Meeting? | | | A: | Participants can log in to attend the Annual Meeting virtually by visiting ttps://web.lumiagm.com/238744591 after 9:00 a.m. on December 15, 2022. You will need to enter your 11 digit Control Number as it appears on your proxy card, along with the password on the proxy card. | | | | If you wish to vote your shares electronically at the Annual Meeting, you will need your virtual control number included on your Notice of Internet Availability of Proxy Materials or proxy card. | | | Q: | What materials have been prepared for stockholders in connection with the Annual Meeting? | | | A: | We are furnishing you and other stockholders of record with the following proxy materials: | | | | ● | our Annual Report on Form 10-K for the fiscal year ended June 30, 2022 (including our audited consolidated financial statements for 2022 and 2021), which we refer to as the 2022 Annual Report; | | | | | ● | this Proxy Statement for the 2022 Annual Meeting, which we refer to as this Proxy Statement and which also includes a letter from our Chief Executive Officer to stockholders and a Notice of 2022 Annual Meeting of Stockholders; and | | | | | ● | a Notice of Internet Availability of Proxy Materials, which we refer to as the Notice of Internet Availability, which includes a control number for use in submitting proxies. | | | | | These materials were first made available on the Internet, on or about November 4, 2022. The Notice of Internet Availability was first mailed to stockholders on or about November 4, 2022. |
| If, in accordance with the instructions provided in the Notice of Internet Availability, you request a printed set of proxy materials, you will receive by mail, at no charge, printed copies of the 2022 Annual Report, this Proxy Statement, a proxy card for the Annual Meeting, and a pre-addressed envelope to be used to return the completed proxy card. If, in accordance with the instructions provided in the Notice of Internet Availability, you request that a set of proxy materials be emailed to you, you will receive by email, at no charge, electronic copies of the 2022 Annual Report and this Proxy Statement. |
Q: | Why was I mailed a Notice of Internet Availability rather than a printed set of proxy materials? | | | A: | In accordance with rules adopted by the SEC, we are furnishing the proxy materials to stockholders by providing access via the Internet, instead of mailing printed copies. This process expedites the delivery of proxy materials to our stockholders, lowers our costs, and reduces the environmental impact of the Annual Meeting. The Notice of Internet Availability tells you how to access and review the proxy materials on the Internet and how to vote on the Internet. It also provides instructions you may follow to request paper or emailed copies of the proxy materials. | | | Q: | Are the proxy materials available via the Internet? | | | A: | You can access and review the proxy materials for the Annual Meeting at http://www.astproxyportal.com/ast/24175/. In order to submit your proxies, however, you will need to refer to the Notice of Internet Availability sent to you with this Proxy Statement or a proxy card mailed to you upon your request to obtain your control number and other personal information needed to vote by proxy or in person. | | | Q: | What is a proxy? | | | A: | The term “proxy,” when used with respect to stockholder, refers to either a person or persons legally authorized to act on the stockholder’s behalf or a format that allows the stockholder to vote without being physically present at the Annual Meeting. Because it is important that as many stockholders as possible be represented at the Annual Meeting, the board of directors is asking that you review this Proxy Statement carefully and then vote by following the instructions set forth on the Notice of Internet Availability or the proxy card. In voting prior to the Annual Meeting, you will deliver your proxy to the Proxy Committee, which means you will authorize the Proxy Committee to vote your shares at the Annual Meeting in the way you instruct. The Proxy Committee consists of Catherine Akers and Brad Berman. All shares represented by valid proxies will be voted in accordance with the stockholder’s specific instructions. | | | Q: | What matters will the stockholders vote on at the Annual Meeting? |
A: | Proposal | | Election of the following six director nominees: | | | | | | | | | | | | | ● | Randall Miles | ● | Thomas Ochocki | ● | Wendy Parker | | | ● | Martin Pompadur | ● | Sadiq Toama | ● | Sabrina Yang | | | | | | | | | | | Proposal | | Ratification of the appointment of our independent auditor | | | | | | Proposal | | Approval, as an advisory vote, of 2022 executive compensation disclosed in this Proxy Statement |
Q: | Who can vote at the Annual Meeting? | | | A: | Stockholders of record of common stock at 5:00 p.m., Eastern time, on October 27, 2022, the record date, who have registered at https://web.lumiagm.com/238744591 will be entitled to vote at the Annual Meeting. As of the record date, there were outstanding a total of 67,031,116 shares of common stock, each of which will be entitled to one vote on each proposal. As a result, up to a total of 67,031,116 votes can be cast on each proposal. |
Q: | What is a stockholder of record? | | | A: | A stockholder of record is a stockholder whose ownership of common stock is reflected directly on the books and records of our transfer agent, American Stock Transfer & Trust Company, LLC (“AST”). |
Q: | What does it mean for a broker or other nominee to hold shares in “street name”? | | | A: | If you beneficially own shares held in an account with a broker, bank, or similar organization, that organization is the stockholder of record and is considered to hold those shares in “street name.” An organization that holds your beneficially owned shares in street name will vote in accordance with the instructions you provide. If you do not provide the organization with specific voting instructions with respect to a proposal, the organization’s authority to vote your shares will, under the rules of The Nasdaq Stock Market or Nasdaq, depend upon whether the proposal is considered a “routine” or a non-routine matter. |
| ● | The organization generally may vote your beneficially owned shares on routine items for which you have not provided voting instructions to the organization. The only routine matter expected to be voted on at the Annual Meeting is the ratification of the appointment of our independent auditor for the transition period July 1, 2022, to December 31, 2022 (Proposal 2). | | | | | ● | The organization generally may not vote on non-routine matters, including Proposals 1 and 3. Instead, it will inform the inspector of election that it does not have the authority to vote on those matters. This is referred to as a “broker non-vote.” | | | | | For the purpose of determining a quorum, we will treat as present at the Annual Meeting any proxies that are voted on any of the three (3) proposals to be acted upon by the stockholders, including abstentions or proxies containing broker non-votes. |
Q: | How do I vote my shares if I do not attend the Annual Meeting? | | | A: | If you are a stockholder of record, you may vote prior to the Annual Meeting as follows: |
| ● | Via the Internet: You may vote via the Internet by going to www.voteproxy.comin accordance with the voting instructions on the Notice of Internet Availability and the proxy card. Internet voting is available 24 hours a day until 11:59 p.m., Eastern time, on December 14, 2022. You will be given the opportunity to confirm that your instructions have been recorded properly. | | | | | ● | By Mail: If you obtain a proxy card by mail, you may vote by returning the completed and signed proxy card in a postage-paid return envelope that will be provided with the proxy card. |
| If you hold shares in street name, you may vote by following the voting instructions provided by your bank, broker, or other nominee. In general, you may vote prior to the Annual Meeting as follows: |
| ● | Via the Internet: You may vote via the Internet by going to www.proxyvote.com in accordance with the voting instructions on the Notice of Internet Availability and the proxy card. Internet voting is available 24 hours a day until 11:59 p.m., Eastern time, on December 14, 2022. You will be given the opportunity to confirm that your instructions have been recorded properly. |
| For your information, voting via the Internet is the least expensive for us with voting by mail being the most expensive. |
Q: | Can I vote at the Annual Meeting? | | | A: | If you are a stockholder of record who registered at https://web.lumiagm.com/238744591by December 15, 2022, you may vote in person at the Annual Meeting, whether or not you previously voted. If your shares are held in street name, you must provide a legal proxy from your bank or broker during registration and you will be assigned a virtual control number in order to vote your shares during the Annual Meeting. If you are unable to obtain a legal proxy to vote your shares, you will still be able to attend the Annual Meeting (but will not be able to vote your shares) so long as you demonstrate proof of stock ownership. Instructions on how to connect and participate via the Internet, including how to demonstrate proof of stock ownership, are posted at http://www.astproxyportal.com/ast/24175/. On the day of the Annual Meeting, you may only vote during the meeting using the web portal during the meeting. | | | | In order to attend the Annual Meeting, you must register at https://web.lumiagm.com/238744591on the day of the meeting. In order to vote at the Annual Meeting, be sure to have your digit control number included on their Notice of Internet Availability of Proxy Materials or proxy card. |
Q: | Can I ask questions at the Annual Meeting? | | | A: | You may submit questions via the Internet during the Annual Meeting by participating in the webcast via the unique join link and password delivered to you after registration. We will answer any timely submitted questions on a matter to be voted on at the Annual Meeting before voting is closed on the matter in accordance with Appendix A. Following adjournment of the formal business of the Annual Meeting, we will address appropriate general questions from stockholders regarding our company in the order in which the questions are received. Questions relating to stockholder proposals or our company may be submitted in the field provided in the web portal at or before the time the questions are to be discussed. All questions received during the Annual Meeting will be presented as submitted, uncensored and unedited, except that we may omit certain personal details for data protection issues and we may edit profanity or other inappropriate language. If we receive substantially similar questions, we will group those questions together and provide a single response to avoid repetition. Additional information regarding the submission of questions during the Annual Meeting can be found in our 2022 Rules of Conduct and Procedure, a copy of which is attached hereto as Appendix A. | | | Q: | Why is the Annual Meeting being conducted as a virtual meeting? | | | A: | The board of directors considers the appropriate format of our annual meeting of stockholders on an annual basis. This year the board chose a virtual meeting format for the Annual Meeting in an effort to facilitate safe stockholder attendance and participation, by enabling stockholders to participate fully and equally, from any location around the world, at no cost. The virtual meeting format will allow our stockholders to engage with us at the Annual Meeting from any geographic location, using any convenient internet-connected devices, including smart phones and tablet, laptop or desktop computers. The virtual meeting format will also allow stockholders to maintain their own personal safety in light of the continuing public health risks attributable to the COVID-19 (Coronavirus) pandemic. | | | | The virtual format allows stockholders to submit questions during the meeting. We are utilizing technology from American Stock Transfer & Trust Company, LLC (“AST”). The AST platform is expected to accommodate most, if not all, stockholders. Both we and AST will test the platform technology before going “live” for the Annual. |
Q: | If I am unable to participate in the live audio webcast of the Annual Meeting, may I listen at a later date? | | | A: | An audio replay of the Annual Meeting will be posted and publicly available at https://www.troikamedia.com/investor-relations following the Annual Meeting and will remain publicly available until our annual meeting of stockholders in 2023. This audio replay will cover the entire Annual Meeting, including each stockholder question addressed during the Annual Meeting. | | | Q: | May I change my vote or revoke my proxy? | | | A: | If you are a stockholder of record and previously delivered a proxy, you may subsequently change or revoke your proxy at any time before it is exercised by: |
| ● | voting via the Internet or telephone at a later time; | | ● | submitting a completed and signed proxy card with a later date; or | | ● | voting at the Annual Meeting. |
| If you are a beneficial owner of shares held in street name, you should contact your bank, broker, or other nominee for instructions as to whether, and how, you can change or revoke your proxy. |
Q: | What happens if I do not give specific voting instructions? | | | A: | If you are a stockholder of record and you return a proxy card without giving specific voting instructions, the Proxy Committee will vote your shares in the manner recommended by the board of directors on all three proposals presented in this Proxy Statement and as the Proxy Committee may determine in its discretion on any other matters properly presented for a vote at the Annual Meeting. | | | | If you are a beneficial owner of shares held in street name and do not provide specific voting instructions to the broker, bank or other organization that is the stockholder of record of your shares, the organization generally may vote on routine, but not non-routine, matters. The only routine matter expected to be voted on at the Annual Meeting is the ratification of the appointment of our independent auditor for the transition period July 1, 2022, to December 31, 2022 (Proposal 2). If the organization does not receive instructions from you on how to vote your shares on one or more of Proposals 1 and 3, your shares will be subject to a broker non-vote and no vote will be cast on those matters. See “Q. What does it mean for a broker or other nominee to hold shares in ‘street name’?” above. |
Q: | What should I do if, during check-in or the meeting, I have technical difficulties or trouble accessing the virtual meeting website? | | | A: | Online check-in to the Annual Meeting webcast will begin at 9:00 a.m., Eastern time, on December 15, 2022. You should allow ample time to log in to the meeting webcast and test your computer audio system.Technical questions may also be addressed on the message board hosted by AST. | | | Q: | What if other matters are presented at the Annual Meeting? | | | A: | If a stockholder of record provides a proxy by voting in any manner described in this Proxy Statement, the Proxy Committee will have the discretion to vote on any matters, other than the three proposals presented in this Proxy Statement, that are properly presented for consideration at the Annual Meeting. We do not know of any other matters to be presented for consideration at the Annual Meeting. |
Vote Required for Election or Approval
Our only voting securities are the outstanding shares of common stock. As of the record date, which is 5:00 p.m., Eastern time, on October 27, 2022, there were outstanding 67,031,116 shares of common stock, each of which will be entitled to one vote on each proposal. Based on the number of votes for each share common stock, up to a total of 67,031,116 votes can be cast on each proposal.
Only stockholders of record as of the record date will be entitled to notice of, and to vote at the Annual Meeting. A majority of the issued and outstanding shares of common stock entitled to vote, represented either in person or by proxy, constitutes a quorum at the Annual Meeting. For the purpose of determining a quorum, we will treat as present at the Annual Meeting any proxies that are voted on any matter to be acted upon by the stockholders, as well as votes to “withhold,” abstentions, or any proxies containing broker non-votes.
| Election of Directors | | | | The affirmative vote of a plurality of votes cast by shares entitled to vote and present in person or represented by proxy at the Annual Meeting at which a quorum is present is required to elect each director. Broker non-votes will not have any effect on the outcome of the election of directors, since broker non-votes are not counted as “votes cast.” | | | | Ratification of Appointment of Independent Auditor | | | | The ratification of RBSM LLP as our independent auditor for the transition period July 1, 2022 to December 31, 2022, must be approved by affirmative votes constituting a majority of the votes entitled to be voted and present in person or represented by proxy at the Annual Meeting. Abstentions will count as votes against this proposal because shares with respect to which the stockholder abstains will be deemed present and entitled to vote. Because this proposal is considered a routine matter, discretionary votes by brokers will be counted. | | | | Approval of 2022 Executive Compensation on an Advisory Basis | | | | The advisory “say-on-pay” vote to approve our 2022 executive compensation must be approved by affirmative votes constituting a majority of the votes entitled to be voted and present in person or represented by proxy at the Annual Meeting. Abstentions will count as votes against this proposal because shares with respect to which the stockholder abstains will be deemed present and entitled to vote. Broker non-votes will have no effect on the outcome of this proposal, because they are not entitled to be cast on the matter. |
Proposal
| | — Election of Directors |
At the Annual Meeting, stockholders will elect the entire board of directors to serve for the ensuing year and until their successors are elected and qualified. The board has designated as nominees for election the six persons named below, each of whom currently serves as a director.
Shares of common stock that are voted as recommended by the board will be voted in favor of the election as directors of the nominees named below. If any nominee becomes unavailable for any reason or if a vacancy should occur before the election, which we do not anticipate, the shares represented by a duly completed proxy may be voted in favor of such other person as may be determined by the Proxy Committee.
Director Qualifications
The board of directors has determined that, as a whole, it must have the right mix of characteristics, skills, and experience to provide effective oversight of our company. The board considers recommendations for board nominees from the nominating and governance committee. Directors should have relevant expertise and experience and be able to offer advice and guidance to our Chief Executive Officer based on that expertise and experience. Each director should be able to read and understand basic financial statements, should have sufficient time to devote to our affairs, should have demonstrated excellence in his or her field, should have the ability to exercise sound business judgment, and should have the commitment to rigorously represent the long-term interests of our stockholders. In selecting directors, the nominating and corporate governance committee seeks to achieve a mix of directors that enhances the diversity of background, age, skills, and experience on the board to maintain a balance of knowledge, experience, and capability. A majority of directors should be independent under applicable Nasdaq listing standards, board and committee guidelines, and applicable laws and regulations.
The board also generally expects directors to have:
● | a high standard of personal and professional ethics, integrity, and values; |
● | the training, experience, and ability to make and oversee policy in business, government, and education sectors; |
● | the willingness and ability to keep an open mind when considering matters affecting our interests and the interests of our constituents; |
● | the willingness and ability to devote the required time and effort to effectively fulfill the duties and responsibilities related to board and committee membership; |
● | the willingness and ability to serve on the board for multiple terms, if nominated and elected, to enable development of a deeper understanding of our business affairs; |
● | the willingness not to engage in activities or interests that may create a conflict of interest with the director’s responsibilities and duties to us and our constituents; and |
● | the willingness to act in the best interests of our company and our constituents, and objectively assess board, committee, and management performance. |
The board seeks to maintain a membership comprised of directors who can productively contribute to our success. From time to time, the board may change the criteria for directorship to maximize the opportunity to achieve this success. When this occurs, existing directors will be evaluated according to the new criteria. A director who no longer meets the complete criteria for board membership may be asked to adjust his or her committee assignments or resign from the board.
The board does not believe that a fixed retirement age for directors or a limit on the number of director terms is appropriate. Directors who have served on the board for an extended period of time are able to provide continuity and valuable insight into our company, our operations, and our prospects based on their experience with, and understanding of, our history, policies and objectives. The board believes that, as an alternative to fixed term limits, it can ensure that the board continues to evolve and adopt new ideas and viewpoints through the director nomination process described above.
Identifying and Evaluating Nominees for Directors
When the board of directors or its nominating and governance committee identifies a need to add a new director with specific qualifications or to fill a vacancy on the board, the chair of the nominating and corporate governance committee will initiate a search, seeking input from other directors and senior management, review any candidates that the nominating and governance committee has previously identified, and, if necessary, hire a search firm. The nominating and governance committee then will identify the initial list of candidates who satisfy the specific criteria and otherwise qualify for membership on the board. Based on a satisfactory outcome of those interviews, the nominating and governance committee will make its recommendation on the candidate to the board.
Information Concerning Nominees for Election as Directors
The information appearing in the following table sets forth, for each nominee for election as a director:
| ● | the nominee’s professional experience for at least the past five (5) years; |
| ● | the year in which the nominee first became one of our directors; |
| ● | each standing committee of the board of directors on which the nominee currently serves; |
| ● | the nominee’s age as of the record date for the Annual Meeting; |
| ● | the relevant skills the nominee possesses that qualify him or her for nomination to the board; and |
| ● | directorships held by each nominee presently and at any time during the past five (5) years at any public company or registered investment company. |
Randall Miles |
INDEPENDENT
| | TMG Board Service:
● Tenure: Since July 2022
● Chair of the Board
● Committees:
○ Audit
○ Nominating and Governance
○ Compensation
Age: 66
|
Professional Experience | | Mr. Miles serves as Chairman & CEO of SCM Capital Group, a global transaction and strategic advisory firm. In addition, Mr. Miles sits on the boards of eXp World Holdings, Inc. (NASDAQ:EXPI) as Vice Chairman, private equity-backed Arthur H Thomas Companies as Vice Chairman, and Kuity, Inc. as Chairman.
For over thirty (30) years, Mr. Miles has held senior executive leadership positions in global financial services, financial technology, and investment banking companies, including at bulge bracket, regional, and boutique firms. His extensive investment experience advising companies on strategic and financial needs has spanned many disciplines while serving as CEO, Executive Committee Chair, Head of FIG, Head of M&A, and other responsibilities across these industries. Mr. Miles’ transactional and advisory experience is complemented by leadership of public and private equity backed financial technology, specialty finance, and software companies: Chairman and CEO at LIONMTS, where he was nominated for the Ernst & Young Entrepreneur of the Year award, CEO at Syngence Corporation, COO of AtlasBanc Holdings Corp., and CEO of Advantage Funding / NAFCO Holdings.
|
Education | ● | BBA from the University of Washington and FINRA licenses Series 7, 24, 63, and 79. |
Relevant Skills | ● | Leadership | ● | Governance | ● | Business | ● | Fiduciary Literacy | ● | Fund Raising | ● | International |
Thomas Ochocki |
| | TMG Board Service:
● Tenure: Since 2018
● Committees:
○ None
Age: 46
|
Professional Experience |
| Mr. Ochocki is serving on the Board of Directors representing the Coates families’ equity interest and has over twenty (20) years of experience in stock brokering, private equity, and investment banking in the United Kingdom. He is currently Chief Executive Officer and majority stockholder of Union Investment Management Ltd., whose history dates back to The Union Discount Company of London (est. 1885). An Old Cholmeleian of Highgate School, Mr. Ochocki read Psychology & Computer Science at Liverpool University prior to working with Sony Interactive Entertainment on the PlayStation launch titles. He went on to manage and facilitate the development of over 50 published video games before switching to his predominant career in the capital markets. |
Education | ● | Studied Psychology and Computer Science at Liverpool University. Studied at London SCT and Westminster University and obtained computer programming certification in C / C++ on Unix. |
Relevant Skills | ● | Business | ● | Finance | ● | Industry |
BENEFICIAL OWNERSHIP OF COMMON STOCK BY DIRECTORS AND EXECUTIVE OFFICERS Wendy Parker |
INDEPENDENT
| | TMG Board Service:
● Tenure: Since April 2022
● Committees:
○ Compensation
Age: 57
|
Professional Experience | | Ms. Parker is a London, England based barrister and has been a member of Gatehouse Chambers’ Commercial, Property and Insurance Groups in London where she undertakes most areas of work within those fields. She has developed a strong practice both as an adviser and advocate and has experience of appearing in the specialist commercial and property forums as well as Tribunals and the Court of Appeal.
Ms. Parker has been involved in many technically complex cases. She has a strong academic background which she combines with a practical and common sense approach in order to assist clients in achieving their objectives. Ms. Parker is a member of the United Kingdom Chancery Bar Association and the COMBAR (the Specialist Bar Association for Commercial Barristers advising the international business community).
|
Relevant Skills | ● | Restructuring | ● | Business | ● | International | ●
| Legal |
Martin Pompadur |
INDEPENDENT
| | TMG Board Service:
● Tenure: Since April 2021
● Committees:
○ Audit
○ Nominating and Governance
○ Compensation
Age: 87
|
Professional Experience | | Mr. Pompadur was elected to the Board of Directors in April 2021 upon the listing on the Nasdaq Capital Market. Mr. Pompadur is a private investor, senior advisor, consultant, and Board member. Mr. Pompadur entered the media field when in 1960, he joined American Broadcasting Companies, Inc. (“ABC, Inc.”). He remained at ABC, Inc. for 17 years, culminating with his becoming the youngest person ever appointed to the ABC, Inc. Board of Directors.
Mr. Pompadur is a board member of two additional public companies: Nexstar Broadcasting Group and Truli Media Group. Previously, he was a board member of many public and private companies including Imax Corporation, ABC, Inc., BSkyB, Sky Italia, Premier World, Fox Kids Europe, Metromedia International, and Elong.
|
Education | ● | BA from Williams College and LLB from the University of Michigan Law School |
Relevant Skills | ● | Business | ● | Finance | ●
●
| Industry
International
|
Sadiq (“Sid”) Toama |
CEO
| | TMG Board Service
● Tenure: Since March 2022
● Committees:
○ None
Age: 40
|
Professional Experience | | Sadiq (“Sid”) Toama was elected President of Troika Media Group, Inc. and joined the Company’s Board of Directors on March 21, 2022. Subsequently, Mr. Toama was elected Chief Executive Officer of the Company in May 2022. Mr. Toama joined Converge in 2016. He started his career as a commercial attorney in London, representing distressed brands through product liability and crisis management events.
Mr. Toama became Maclaren’s Global Chief Executive Officer in 2011, instigating its global corporate and operational restructuring. Mr. Toama expanded Maclaren’s Brand standing, in part, by implementing multi-year licensing and product development partnerships with brands such as BMW, Gucci, Liberty, Juicy Couture, Cath Kidston, and Emirates Airlines.
Beginning in 2016, Mr. Toama was the Chief Operating Officer of Converge. Since 2016, Mr. Toama spearheaded all ad-tech and mar-tech systems integrations and reporting for clients and internal teams to ensure on time delivery of data across all sales and marketing platforms. In particular, Mr. Toama has architected and implemented Converge’s proprietary business intelligence platform, Helix, to leverage disparate and unstructured and varied data points into actionable insights.
| | | Education | ● | LLB (Law) with Honors from the University of London | | | Relevant Skills | ● | Business | ● | Industry | ● | Leadership | ●
| Legal |
Sabrina Yang |
| | TMG Board Service
● Tenure: Since April 2022
● Committees:
○ Audit
Age: 43
| INDEPENDENT | | |
Professional Experience | | Ms. Yang is a seasoned finance executive with over 17 years of experience in accounting, financial planning and analysis (“FP&A”), M&A advisory, and corporate finance. Since 2021, Ms. Yang has served as CFO of Final Bell Holdings, Inc. (“Final Bell”), an industry leader in providing end-to-end product development and supply chain solutions to leading cannabis brands in the United States and Canada. During her tenure at Final Bell, she has led the reverse take-over transaction process, establishing a path for Final Bell to become a publicly traded company on the Canadian Stock Exchange. In conjunction with the reverse takeover, she also integrated and managed all of Final Bell’s administrative functions, including accounting, finance, legal, HR, and IT operations.
Prior to joining Final Bell and since 2018, Ms. Yang has served as CFO, on a part-time basis, of Apollo Program, a data-driven advertising technology company, where she ran all administrative and operating functions. She also served as deputy CFO for a private school with operations in both the United States and China. She has held prior roles in strategy, analytics, and FP&A at the Topps Company, a collectibles and licensing company, and at Undertone, a digital advertising company. Sabrina started her career with five (5) years at KPMG LLP in its transaction services team, in which she advised.
| | | Education | ●
| Louisiana State University, MS Accounting and Applied Statistics.
| ● | Northeastern University of China BA English and International Business.
| | | Relevant Skills | ● | Business | ● | Finance | ● | Industry |
The board of directors recommends a vote
FOR
each of the six nominees for election as directors.
Proposal | | — Ratification of Appointment of Independent Auditor |
The audit committee annually evaluates the performance of our independent auditor and determines whether to reengage the then-current independent auditor or to consider other audit firms.
This year the audit committee has again approved the retention of RBSM LLP, or RBSM, as our independent auditor to report on our consolidated financial statements for the transition period from July 1, 2022 to December 31, 2022. RBSM has served as our independent auditor since 2014. Factors considered by the audit committee in deciding to engage RBSM included:
● | RBSM’s technical expertise and knowledge of our company’s industry; |
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● | RBSM’s objectivity and professional skepticism; |
● | the appropriateness of RBSM’s fees; and |
● | RBSM’s independence and the appropriateness of controls and processes in place that help ensure RBSM’s continued independence. |
The audit committee considers RBSM to be well qualified. Even if the proposal is approved, the audit committee may, in its discretion, appoint a different independent registered public accounting firm to serve as independent auditor at any time during the year.
Representatives of RBSM will participate in the Annual Meeting. The RBSM representatives will have the opportunity to make a statement if they desire to do so, and we expect that they will be available to respond to appropriate questions.
The board of directors recommends a vote
FOR
the ratification of the appointment of RBSM as our independent auditor.
Proposal | | — Advisory Vote on 2022 Executive Compensation |
Our stockholders have the opportunity at the Annual Meeting to vote to approve, on a non-binding, advisory basis, the compensation of our named executive officers in 2022 as disclosed in this Proxy Statement.
Our compensation program is intended to provide appropriate and balanced incentives toward achieving our annual and long-term strategic objectives and to create an alignment of interests between our executives and stockholders. This approach is intended to motivate our existing executives and to attract new executives with the skills and attributes that we need. Please refer to “Executive Compensation” for an overview of the compensation of our named executive officers.
We are asking for stockholder approval of the compensation of our named executive officers as disclosed in this Proxy Statement in accordance with SEC rules. Those disclosures include the information in the compensation tables and narrative disclosures included under “Executive Compensation.” This vote is not intended to address any specific item of compensation, but rather the overall compensation of our named executive officers and the policies and practices described in this Proxy Statement.
Accordingly, stockholders are being asked to vote on the following resolution:
| Resolved: | That the stockholders approve the compensation paid to the “named executive officers” of Troika Media Group, Inc. with respect to the fiscal year ended June 30, 2022, as disclosed, pursuant to Item 402 of Regulation S-K promulgated by the Securities and Exchange Commission, in the Proxy Statement for the 2022 Annual Meeting of Stockholders, including the compensation tables and narrative discussion set forth under “Executive Compensation” therein. |
This vote is advisory and not binding on us, the board of directors, or the compensation committee. The board and the compensation committee value the opinions of our stockholders; however, and to the extent there is any significant vote against the named executive officer compensation disclosed in this Proxy Statement, we will consider our stockholders’ concerns and the compensation committee will evaluate whether any actions are necessary or appropriate to address those concerns.
The board of directors recommends a vote
FOR
the approval of the compensation paid to our named executive officers with respect to 2022, as disclosed in the compensation tables and narrative discussion set forth under “Executive Compensation” and elsewhere in this Proxy Statement.
Corporate Governance
Board of Directors Overview
Under our Bylaws and the Nevada Business Corporation Act, our business and affairs are managed by or under the direction of the board of directors, which selectively delegates responsibilities to its standing committees.
The board currently operates under its current governance practices in accordance with applicable statutory and regulatory requirements, including those of the SEC and The Nasdaq Stock Market, or Nasdaq. Under such practices, we expect directors to regularly attend meetings of the board and of all committees on which they serve and to review the materials sent to them in advance of those meetings. While we do not maintain a formal policy on annual meeting attendance, we expect directors to participate in the Annual Meeting.
The board generally expects to hold four (4) regular meetings per year and to meet on other occasions when circumstances require. Directors spend additional time preparing for board and committee meetings, and we call upon directors for advice between meetings. We encourage our directors to attend director education programs.
The board held four (4) regular meetings in 2022, not including committee meetings, several of which included an executive session with only non-employee directors in attendance. Each of the then-serving directors participated in at least 85% of the meetings of the board during 2022.
The board maintains an audit committee, a compensation committee, and a nominating and corporate governance committee. The board has adopted charters for each of the committees, and those charters are reviewed annually by the committees and the board. Our governance documents listed below are all available online at https://www.troikamedia.com/investor-relations:
● | the audit committee charter |
● | the compensation committee charter |
● | the nominating and corporate governance committee charter |
The functions and responsibilities of the committees are described below.
Independence of Directors
The board of directors must consist of a majority of independent directors under the applicable requirements of the Nasdaq.
Under Nasdaq rules, independent directors must comprise a majority of a listed company’s board of directors. In addition, Nasdaq rules require that, subject to specified exceptions, each member of a listed company’s audit, compensation, and nominating and corporate governance committees be independent. Under Nasdaq rules, an individual will qualify as an “independent director” only if, in the opinion of the company’s board of directors, he or she does not have a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director.
● | Audit committee members must also satisfy additional independence criteria, including those set forth in Rule 10A-3 under the Securities Exchange Act of 1934 or the Securities Exchange Act. In order to be considered independent for purposes of Rule 10A-3, a member of an audit committee of a listed company may not accept, directly or indirectly, any consulting, advisory, or other compensatory fee from the listed company or any of its subsidiaries, other than compensation for board or committee service, and may not be an affiliated person of the listed company or any of its subsidiaries. |
● | Compensation committee members must also satisfy additional independence criteria, including those set forth in Rule 10C-1 under the Securities Exchange Act. In determining independence requirements for members of compensation committees, Nasdaq and other national securities exchanges and national securities associations are to consider relevant factors that include (a) the source of compensation of a director, including any consulting, advisory or other compensatory fee paid by the listed company to the director, and (b) whether the director is affiliated with the listed company, a subsidiary of the listed company or an affiliate of a subsidiary of the listed company. |
The board annually reviews the independence of all non-employee directors. The board has determined that Randall Miles, Wendy Parker, Martin Pompadur, and Sabrina Yang each qualifies as an independent director in accordance with the rules of Nasdaq and Rules 10C-1 and 10A-3 under the Securities Exchange Act. The independent members of the board hold separate, regularly scheduled executive sessions during board meetings at which only independent directors are present.
Corporate Code of Conduct
Our board of directors has adopted a Corporate Code of Conduct applicable to all of our officers and employees. We have posted the Corporate Code of Conduct on our website at https://www.troikamedia.com/s/Corporate-Code-of-Conduct-06162017.pdf. We will post any amendments to the Corporate Code of Conduct on our website. In accordance with the requirements of the SEC and Nasdaq, we will also post waivers applicable to any of our officers or directors from provisions of the Code of Business Conduct and Ethics on our website. We have not granted any such waivers to date.
We have implemented whistleblower procedures, which establish formal protocols for receiving and handling complaints from employees. We have posted copies of our whistleblower procedures on our website at https://static1.squarespace.com/static/5f692a99c24215543de3d40a/t/62953464e63d46218c2339fc/1653945444279/Whistleblower+Policy+06162017.pdf. Any concerns regarding accounting or auditing matters reported under these procedures are to be communicated to the audit committee.
Director, Officer, and Employee Hedging
Pursuant to our insider trading policy as most recently updated by the board of directors in June 2017, none of our directors, officers, or other employees (or specified entities or controlled entities), or Covered Persons, may hedge or pledge any of our securities that they hold directly. An exception to this prohibition may be granted where a Covered Person wishes to pledge our securities as collateral for a loan (not including margin debt) and clearly demonstrates the financial capacity to repay the loan without resort to the pledged securities.
Board Oversight of Risk
The board of directors has responsibility for the oversight of our risk management processes and, either as a whole or through its committees, regularly discusses with management our major risk exposures, their potential impact on our business, and the steps we take to manage them. The risk oversight process includes receiving regular reports from board committees and members of senior management to enable the board to understand our risk identification, risk management and risk mitigation strategies with respect to areas of potential material risk, including operations, finance, legal, regulatory, strategic, and reputational risk.
The audit committee reviews information regarding liquidity and operations, and oversees our management of financial risks. Periodically, the audit committee reviews our policies with respect to risk assessment, risk management, loss prevention, and regulatory compliance. Oversight by the audit committee includes the Chief Financial Officer reporting directly to the audit committee at least quarterly to provide an update on management’s efforts to manage risk.
Matters of significant strategic risk, including cybersecurity risks and risks to the company and our employees due to the COVID-19 (Coronavirus) pandemic, are considered by the board as a whole.
Board Diversity
The board of directors is committed to a policy of inclusiveness. We endeavor to have a diverse board representing a range of experiences in areas that are relevant to TMG’s business and the needs of the board from time to time. The board believes that maintaining a diverse membership with varying backgrounds, skills, expertise, and other differentiating personal characteristics promotes the success of our business and represents stockholder interests through the exercise of sound judgment using the board’s diversity of experience and perspectives. In performing its responsibilities for identifying, screening, and recommending candidates to the board in connection each director search, the nominating and governance committee is committed to including in the initial candidate pool one or more highly qualified candidates who reflect diverse backgrounds, skills, and experiences, including individuals with diversity of gender identity, sexual orientation, race, ethnicity and national origin, and diversity of viewpoints, education, and professional experience (including individuals from non-executive corporate positions and non-traditional environments).
Board Leadership Structure
The board of directors recognizes that it is important to determine an optimal board leadership structure to ensure the independent oversight of management as we continue to grow. The Corporate Governance Guidelines provide that the board will select the Chair of the Board and the Chief Executive Officer in the manner it determines to be in the best interests of our stockholders and that it is our policy that those two positions not be held by the same person. In adopting that policy, the board has determined that separating the positions of Chair of the Board and Chief Executive Officer is the best structure to fit our current needs. This structure allows the Chief Executive Officer to focus on the strategic management of our day-to-day business, while allowing the Chair of the Board to focus on leading the board in its fundamental role of providing advice to, and independently overseeing, management. The board recognizes the time, effort, and energy that the Chief Executive Officer is required to devote to the position in the current business environment, as well as the commitment required to serve as the Chair of the Board, particularly as the board’s oversight responsibilities continue to grow. The board believes that having separate positions, with an independent, non-executive director serving as the Chair of the Board, is the appropriate leadership structure for our company and allows the board to fulfil its role with appropriate independence.
Audit Committee
The principal responsibilities of the audit committee are:
| ● | appoint, compensate, and oversee the work of any registered public accounting firm employed by us; |
| ● | resolve any disagreements between management and the auditor regarding financial reporting; |
| ● | pre-approve all auditing and non-audit services; |
| ● | retain independent counsel, accountants, or others to advise the audit committee or assist in the conduct of an investigation; |
| ● | seek any information it requires from employees-all of whom are directed to cooperate with the audit committee’s requests-or external parties; |
| ● | meet with our officers, external auditors, or outside counsel, as necessary; and |
| ● | oversee that management has established and maintained processes to assure our compliance with all applicable laws, regulations, and corporate policy. |
Our independent auditor is ultimately accountable to the audit committee. The audit committee has the ultimate authority and responsibility to select, evaluate, approve terms of retention and compensation of, and, where appropriate, replace the independent auditor.
The current members of the audit committee are Randall Miles, Martin Pompadur, and Sabrina Yang, with Mr. Miles serving as chair. Each of the current members of the audit committee is standing for re-election at the Annual Meeting. The board determined that each of the current audit committee members is (a) independent, as defined in the listing standards of Nasdaq, (b) a “non-employee director,” as defined in Rule 16b-3 under the Securities Exchange Act, (c) an “outside director,” as defined in Section 162(m) of the Internal Revenue Code of 1986, or the Code, and (d) financially literate. The board also determined that each of Martin Pompadur and Randall Miles is an audit committee financial expert in accordance with the standards of the SEC. The audit committee met once in 2022. The meeting was attended by all members.
Compensation Committee
The principal responsibilities of the compensation committee are to assist the board of directors in fulfilling its responsibilities relating to:
| ● | discharge the responsibilities of the Board of Directors relating to compensation of our directors, executive officers, and key employees; |
| ● | assist the Board of Directors in establishing appropriate incentive compensation and equity-based plans and to administer such plans; and |
| ● | oversee the annual process of evaluation of the performance of our management; and |
| ● | perform such other duties and responsibilities as enumerated in and consistent with compensation committee’s charter. |
The current members of the compensation committee are Martin Pompadur and Randall Miles, with Mr. Pompadur serving as chair. Each of the current members of the compensation committee is standing for re-election at the Annual Meeting. The board determined that each of the current compensation committee members is (a) independent, as defined in the listing standards of Nasdaq, (b) a “non-employee director,” as defined in Rule 16b-3 under the Securities Exchange Act and (c) an “outside director,” as that term is defined in Section 162(m) of the Code.
The compensation committee has the sole authority to retain, oversee, and terminate any compensation consultant to be used to assist in the evaluation of executive compensation and to approve the consultant’s fees and retention terms.
The compensation committee held one (1) meeting in 2022. Each of the then-serving members participated in all of the meetings of the compensation committee during 2022.
Compensation Committee Interlocks and Insider Participation
During 2022, none of the members of the compensation committee was an officer or employee of our company or any of our subsidiaries, and none of our executive officers served as a member of the board of directors or compensation committee of any entity that has one or more executive officers serving on the board or compensation committee.
Nominating and Governance Committee
The principal responsibilities of the nominating and governance committeeare:
| ● | assist the Board of Directors by identifying qualified candidates for director nominees, and to recommend to the Board of Directors the director nominees for the next annual meeting of stockholders; |
| ● | lead the Board of Directors in its annual review of its performance; |
| ● | recommend to the Board of Directors nominees for each committee of the Board of Directors; and |
| ● | develop and recommend to the Board of Directors corporate governance guidelines applicable to us. |
The current members of the nominating and governance committee are Randall Miles, Wendy Parker and Martin Pompadur, with Mr. Miles serving as chair. Each of the current members of the nominating and governance committee is standing for re-election at the Annual Meeting. The board determined that each of the current nominating and corporate governance committee members is independent, as defined in the listing standards of Nasdaq.
The nominating and governance committee has the sole authority to retain, oversee, and terminate any consulting or search firm to be used to identify director candidates or assist in evaluating director compensation and to approve any such firm’s fees and retention terms.
The nominating and governance committee held two (2) meetings in 2022. Each of the then-serving members participated in all of the meetings of the nominating and governance committee during 2022.
Certain Relationships and Related-Person Transactions
Procedures for Approval of Related Person Transactions
The audit committee is responsible for reviewing and approving, prior to our entry into any such transaction, all transactions in which we are a participant and in which any of the following persons has or will have a direct or indirect material interest:
| ● | the beneficial owners of more than five (5%) percent of our securities; |
| ● | the immediate family members of any of the foregoing persons; and |
| ● | any other persons whom our Board determines may be considered related persons. |
For purposes of this policy, “immediate family members” means any child, stepchild, parent, stepparent, spouse, sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law, and any person (other than a tenant or employee) sharing the household with the executive officer, director, or five (5%) percent beneficial owner.
In reviewing and approving such transactions, our audit committee shall obtain, or shall direct our management to obtain on its behalf, all information that the committee believes to be relevant and important to a review of the transaction prior to its approval. Following receipt of the necessary information, a discussion shall be held of the relevant factors if deemed to be necessary by the committee prior to approval. If a discussion is not deemed to be necessary, approval may be given by written consent of the committee. This approval authority may also be delegated to the chair of the audit committee in some circumstances. No related person transaction shall be entered into prior to the completion of these procedures.
Our audit committee or its chair, as the case may be, shall approve only those related person transactions that are determined to be in, or not inconsistent with, our best interest and our stockholders’ best interests, taking into account all available facts and circumstances as the committee or the chair determines in good faith to be necessary. These facts and circumstances will typically include, but not be limited to, the benefits of the transaction to us; the impact on a director’s independence in the event the related person is a director, an immediate family member of a director or an entity in which a director is a partner, stockholder or executive officer; the availability of other sources for comparable products or services; the terms of the transaction; and the terms of comparable transactions that would be available to unrelated third parties or to employees generally. No member of our audit committee shall participate in any review, consideration, or approval of any related person transaction with respect to which the member or any of his or her immediate family members is the related person.
Conflict of Interest Transactions
The following is a description of the transactions we have engaged in during the year ended June 30, 2022, with our directors, executive officers, and beneficial owners of more than five (5%) percent of our voting securities and their affiliates.
See “Executive Compensation” for the terms and conditions of employment agreements and senior management consulting agreements and options and warrants issued to officers, directors, consultants, and senior management of the Company.
Converge Direct, LLC Acquisition
Certain terms of the Converge Acquisition resulted in amounts remaining to be paid to the Converge Sellers. At the time of the Acquisition, the Company owed to Converge Sellers (i) an approximate $4.34 million payment under the terms of the Membership Interest Purchase Agreement (“MIPA”) dated as of November 22, 2021, on account of excess working capital retained by the Company, and (ii) a $5.0 million payment pursuant to a side letter agreement, dated as of March 9, 2022 (the “Side Letter”), by the Borrower and Converge Direct, LLC which specified that $5.0 million of the purchase price will be retained by the Company for working capital and be repaid twelve (12) months from the Acquisition date.
Union Ventures Limited purchase of Mission-Media Holdings Limited
On August 1, 2022, Troika-Mission Holdings, Inc, (“TMH or Seller”), a subsidiary of the Company, entered into an Equity Purchase Agreement (the “Purchase Agreement”) with Union Ventures Limited (“UVL”), a company organized under the 2006 Companies Act in the United Kingdom (“Buyer”). UVL is a company owned by Union Investments Management Limited, which is shareholder and affiliated with Daniel Jankowski, a former director of the Company, and Thomas Ochocki, a current Director of the Company. Per the agreement, the Buyer shall purchase from Sellers, all of Sellers’ right, title, and interest in and to Sellers’ respective Mission UK Shares, including any and all liabilities and assets on an as-is basis (the “Mission UK Shares”) in Mission-Media Holdings Limited, a private limited company incorporated under the Laws of England and Wales (“Mission UK”). As consideration for all the Mission UK Shares, Buyer shall pay Sellers an aggregate purchase price, not to exceed $1,000 USD (the “Aggregate Purchase Price”).
Beneficial Ownership of Common Stock
The following table sets forth the number of outstanding shares of common stock beneficially owned, and the percentage of the class beneficially owned, as of October 27, 2022,18, 2023, by: ● | each named executive officer included in “Executive Compensation—Summary Compensation Table”; |
● | each current director; and |
● | all of our current executive officers and directors, as a group. |
•each named NEO included in “Executive Compensation—Summary Compensation Table”; •each current director; and •all of our current executive officers and directors, as a group. The number of shares of common stock beneficially owned by each person is determined under the rules of the SEC. Under these rules, beneficial ownership includes any shares as to which the individual has sole or shared voting power or investment power and also any shares that the individual has the right to acquire by December 26, 202217, 2023 (60 days after October 27, 2022)18, 2023), through the exercise or conversion of a security or other right. Unless otherwise indicated, each person has sole investment and voting power, or shares such power with a family member, with respect to the shares set forth in the following table. The inclusion in this table of any shares deemed beneficially owned does not constitute an admission of beneficial ownership of those shares for any other purpose. As of October 27, 2022,18, 2023, there were 67,031,11616,676,762 shares of common stock outstanding. Shares not outstanding but deemed beneficially owned by virtue of the right of a person to acquire those shares, are treated as outstanding only for purposes of determining the number and percent of shares of common stock owned by such person or group. Each person known to us to be the beneficial owners of more than five (5%) percent of the shares of common stock outstanding as of October 27, 2022,18, 2023, is also included in the table below. Unless otherwise noted below, the address of each person listed in the table is in care of Troika Media Group, Inc., 25 West 39th Street, New York, NY 10018. Name | Shares | Percent of Outstanding | Peter Coates +
| 10,597,996
| 15.0% | Thomas Marianacci (1)+ | 7,020,000 | 10.5% | Thomas Ochocki (2) | 4,318,334 | 6.4% | Sadiq (Sid) Toama (3) | 1,970,000 | 2.9% | Michael Tenore (4) | 1,033,333 | 1.5% | Randall Miles (5) | 277,777 | * | Martin Pompadur (6) | 70,000 | * | Wendy Parker (7)
| –
| – | Sabrina Yang (7)
| – | – | All Officers and Directors as a Group | 25,287,440 | 37.2% |
| | | | | | | | | | | | | | | Name | | Shares | | Percent of Outstanding | | | | | | | | | | | Thomas Ochocki (1) | | 136,161 | | | * | | | | | | Randall D. Miles (2) | | 38,889 | | | * | I. Martin Pompadur (3) | | 2,800 | | | * | Sabrina Yang (4) | | 2,000 | | | * | Wendy Parker (4) | | 2,000 | | | * | Grant Lyon | | — | | | * | Jeffrey S. Stein | | — | | | * | Eric Glover | | — | | | * | All Officers and Directors as a Group | | 181,850 | | | 1.1% |
___________________ *Less than 1% of the issued and outstanding shares of common stock. 44 2023 Proxy Statement
+ Denotes 5% stockholder of the Company.
(1) Of these shares, ten (10%) percent are held in escrow until March 21, 2023, under the terms of an escrow agreement under the Converge Acquisition. Does not include 1,000,000 RSUs which vest in three (3) equal installments on March 21, 2023, 2024, and 2025 pursuant to the Executive Employment Agreement.(2) These shares include 1,475,000 shares of common stock held by Mr. Ochocki, and 575,000 held by Union Investment Management, and 1,193,334 held by Union Eight Ltd, affiliates of Mr. Ochocki. Also includes 1,075,0006,427 warrants held by Mr. Ochocki.
(3) Of these shares ten (10%) percent are held in escrow until March 21, 2023, under the terms of an escrow agreement under the Converge Acquisition. Does not include 2,500,000 RSUs which vest in three (3) equal installments on March 21, 2023, 2024, and 2025 pursuant to the Executive Employment Agreement.(2) (4) Of these shares, (i) 333,333 are issuable upon exercise of options granted to Mr. Tenore in October 2017, which are exercisable at $0.75 per share. One-half (50%) of the options vested on July 1, 2018, and the remaining one-half (50%) vested on July 1, 2019; (ii) 200,000 RSUs are vested and unexercised; and (iii) 500,000 were issued upon conversion of RSUs.
(5) 2,000,00080,000 options vesting monthly over 36 months.months which were granted on July 15, 2022.
(6) (3) Mr. Pompadur was granted 20,000800 warrants to purchase common stock of the Company which vested nine (9) months from the date of issuance upon his joining the Board, exercisable for five (5) years at $0.75$18.75 per share; and 50,0002,000 shares were issued upon conversion of RSUs.
(7) (4) Ms. Yang and Ms. Parker were each issued 50,0002,000 RSUs on August 1, 2022, which will vestvested on August 1, 2023.
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SHAREHOLDER PROPOSALS Director Compensation
Our director compensation program is
A shareholder proposal intended to enhance our ability to attract, retain,for inclusion in the proxy statement and motivate non-employee directorsform of exceptional ability and to promoteproxy for the common interestannual meeting of directors and stockholders in enhancing the valueshareholders of the common stock. The board of directors review director compensation annually based on recommendationsCompany to be held in 2024 must be received by the nominatingCompany before July 7, 2024, at its executive offices, Attention: Corporate Secretary. Any shareholder proposal submitted outside the processes of Rule 14a-8 under the Exchange Act for presentation at our 2024 annual meeting will be considered untimely for purposes of Rule 14a-4 and governance committee. The nominating and governance committee has14a-5 if notice thereof is received by us after July 7, 2024. In addition, shareholders who intend to solicit proxies in support of director nominees other than the sole authority to engage a consulting firm to evaluate director compensation.Under our non-employee director compensation program, each non-employee director is eligible to receive compensation for board and committee service consisting of annual cash retainers and equity awards. DirectorsCompany’s nominees must also may be paid for serving on ad hoc committees of the board. Sadiq Toama, our Chief Executive Officer, does not receive any additional compensation for his service as a director.
Under our non-employee director compensation program, in 2022 our non-employee directors were eligible to receive the following annual cash compensation for their service on the board and the board’s standing committees:
NON-EMPLOYEE DIRECTOR ANNUAL RETAINERS
Position | | Annual Cash Retainer | Chair of the Board | | $300,000 | | All Other Independent Directors | | $30,000 | |
Note: Additional compensation is not paid for sitting on committees. Fees paid to directors cover all positions.
The following table shows the total compensation for non-employee directors during the fiscal year ended June 30, 2022.
2022 NON-EMPLOYEE DIRECTOR COMPENSATION TABLE
Non-Employee Director | | Fees Earned or Paid in Cash($) | | Option Awards($) | | Stock Awards($) | | Total($) | Sabrina Yang | $ | 7,500 |
| $ | — | | $
| — | | $ | 7,500 |
| Wendy Parker | $ | 15,000 |
| $ | — | | $ | — | | $ | 15,000 |
| Jeff Kurtz+ | $ | — | | $ | — | | $ | 150,000 |
| $ | 150,000 |
| Martin Pompadur | $ | 30,000 |
| $ | — | | $ | 50,000 |
| $ | 80,000 |
| Thomas Ochocki
| $ | — | | $ | — | | $ | 475,000 |
| $ | 475,000 |
|
+ Denotes former director.
Executive Officers
The following table sets forth information, as of October 27, 2022, about our executive officers. Each executive officer serves at the discretion of the board of directors.
EXECUTIVE OFFICERS
Name | | Age | | Positions and Business Experience | Sadiq Toama | | 40 | | Please see “Proposal 1. Election of Directors—Information Concerning Nominees for Election as Directors” at page 18.
| Erica Naidrich | | 48 | | Professional Experience
On May 23, 2022, Troika Media Group, Inc. appointed Erica Naidrich to serve as the Company’s Chief Financial Officer replacing Christopher Broderick. Ms. Naidrich brings substantial financial and business knowledge to Troika, with experience within public companies in corporate finance, operational management systems, and financial reporting. Ms. Naidrich joins the Troika Executive Team to oversee the Company’s global finance and enterprise functions; she reports to Sid Toama, Chief Executive Officer and President of Troika.
Prior to joining Troika Media Group, Ms. Naidrich served as Vice President of Accounting and Controller for Madison Square Garden Entertainment Corp. (“MSG”), a leader in live sports, entertainment, and programming. Prior to her role at MSG, Ms. Naidrich held multiple Controller roles within the technology, consumer goods and professional services industries, in addition to spending eight years managing SEC Reporting in the private equity space. Ms. Naidrich started her career in Public Accounting for RSM and PricewaterhouseCoopers. Ms. Naidrich possesses valuable experience in Troika’s core sectors providing financial oversight of sports and entertainment, technology and media, private equity, and professional services businesses.
Education
Ms. Naidrich is a certified public accountant and obtained a Certificate in Accounting in June 2003 from the University of California, San Diego - La Jolla, California. Ms. Naidrich received a Bachelor of Arts in Communications Studies from West Virginia University, Morgantown, West Virginia in August 1996.
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There are no family relationships among our directors and executive officers.
Executive Compensation
Summary Compensation Table
We are eligible, and have chosen, to comply with the scaled executive and director compensation disclosure rules applicable to a “smaller reporting company,” as defined in applicable SEC rules.
The following table provides information concerningadditional requirements of Rule 14a-19(b) under the compensation paid for our fiscal years ended June 30, 2022, and 2021 to our “named executive officers” as of June 30, 2022.
Name and Principal Position | Year | | Salary | | Bonus | Stock Awards (6) | Option Awards (7) | | All Other Comp | Total | Sadiq (Sid) Toama, | 2022 | | $ | 115,000 | | $ | — | $ | 2,625,000 | $ | — | | $ | 13,000 | $ | 2,753,000 | President and CEO (1) | 2021 | | | N/A | | | N/A | | N/A | | N/A | | | N/A | | N/A | Robert Machinist, | 2022 | | $ | 362,000 | | $ | — | $ | 2,025,000 | $ | — | | $ | 82,000 | $ | 2,469,000 | CEO & Chairman (2) | 2021 | | $ | 270,000 | | $ | 100,000 | $ | — | $ | 1,559,000 | | $ | — | $ | 1,929,000 | Andrew Bressman | 2022 | | $ | 225,000 | | $ | 50,000 | $ | 1,300,000 | $ | — | | $ | 677,000 | $ | 2,252,000 | Advisor (3) | 2021 | | $ | 15,000 | | $ | 100,000 | $ | — | | — | | $ | 1,458,000 | $ | 1,573,000 | Chris Broderick, | 2022 | | $ | 348,000 | | $ | 62,500 | $ | 800,000 | $ | — | | $ | 220,000 | $ | 1,430,500 | COO & CFO (4) | 2021 | | $ | 350,000 | | $ | 137,500 | $ | — | $ | — | | $ | — | $ | 487,500 | Michael Tenore, | 2022 | | $ | 229,000 | | $ | 62,500 | $ | 710,000 | $ | — | | $ | 7,000 | $ | 1,008,500 | General Counsel (5) | 2021 | | $ | 200,000 | | $ | 87,500 | $ | — | $ | — | | $ | — | $ | — |
(1) | Mr. Toama was elected President of the Company in March 2022 and was appointed Chief Executive Officer in May 2022. Mr. Toama was also granted 2,500,000 Restricted Stock Units “RSUs” on March 22, 2022.
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(2) | Mr. Machinist was elected Chief Executive Officer in March 2018 and Chairman of the Board in July 2017. On January 1, 2021, he was awarded 500,000 warrants exercisable at $0.75 per share for six (6) years in fiscal 2020 and 2021, which had been forfeited by a former director. In 2022, Mr. Machinist was awarded 2,000,000 RSUs which have been converted. Mr. Machinist resigned as CEO from the Company on May 19, 2022, and stepped down as Chairman of the Board in July 2022. All Other Compensation includes approximately $63,000 in severance payments and an auto allowance of $12,000. Mr. Machinist also received a payment in fiscal year 2021 in an amount of approximately $159,000 consisting of salary that was earned and deferred by Mr. Machinist in periods prior to fiscal year 2021.
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(3) | Mr. Bressman was the Managing Director and Assistant to the CEO (Robert Machinist) from March 2015 until April 20, 2021. Under the terms of his Separation Agreement described below, his Consultant Agreement with SAB Management LLC was terminated effective immediately prior to the listing of the Company’s securities on the Nasdaq Capital Market. Mr. Bressman was employed by the Company thereafter. In January 2022 Mr. Bressman was provided with an employment agreement to serve as Advisor to the CEO. Mr. Bressman’s compensation includes amounts paid to him as an employee of the Company and through his company SAB Management LLC. All Other Compensation includes separation payments made under the aforementioned Separation agreement totaling approximately $646,000 and $1,453,000, for the years ended June 30, 2022 and 2021, respectively. Mr. Bressman also received a payment in fiscal year 2021 in an amount of approximately $379,000 consisting of salary that was earned and deferred by Mr. Bressman in periods prior to fiscal year 2021.
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(4) | Mr. Broderick served as Chief Operating Officer of the Company since July 2017. Mr. Broderick was appointed CFO of the Company in April 2021 and stepped down in May 2022 upon the appointment of Erica Naidrich. Mr. Broderick resigned as COO from the Company in June 2022. All Other Compensation includes an auto allowance of $12,000 and severance payments totaling $200,000. Mr. Broderick also received a payment in fiscal year 2021 in an amount of approximately $199,000 consisting of salary that was earned and deferred by Mr. Bressman in periods prior to fiscal year 2021.
| | | (5)
| Mr. Tenore was appointed General Counsel of the Company in 2016. Effective January 1, 2022, his base salary was increased to $300,000. Additionally, Mr. Tenore was granted 500,000 RSUs on January 10, 2022, and 200,000 RSUs on March 22, 2022.
| | | (6)
| The amounts in this column represent the aggregate grant-date fair value of awards granted to each named executive officer, computed in accordance with the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) Topic 718. See Note 14. Stockholders Equity of the Notes to the Financial Statements included in the Annual Report on Form 10-K for the fiscal year ended June 30, 2022, for a discussion of the assumptions made in determining the grant-date fair value of the Company’s equity awards.
| | | (7) | The amounts in this column represent the aggregate grant-date fair value of awards granted to each named executive officer, computed in accordance with the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) Topic 718. See Note 14. Stockholders Equity of the Notes to the Financial Statements included in the Annual Report on Form 10-K for the fiscal year ended June 30, 2022, for a discussion of the assumptions made in determining the grant-date fair value of the Company’s equity awards.
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Narrative Explanation of the Summary Compensation Table
Overview
The compensation paid to our executives for fiscal year ended June 30, 2022, consisted of the following components:
● | Base Salary. Base salaries for our executives are established based on the scope of their responsibilities, taking into account competitive market compensation paid by other companies for similar positions. Base salaries are reviewed annually and adjusted from time to time to realign salaries with market levels after taking into account individual responsibilities, performance, and experience. Annual reviews will typically be delivered in February of each year. |
● | Discretionary Annual Bonus. The compensation committee will have the authority to award discretionary annual bonuses to our executive officers and senior management and will set the terms and conditions of those bonuses and take all other actions necessary for the plan’s administration. These awards are intended to compensate officers for achieving financial and operational goals and for achieving individual annual performance objectives. These objectives vary depending on the individual. |
● | Long-Term Incentive Program. We believe that long-term performance is achieved through an ownership culture that encourages such performance by our executive officers through the use of stock and stock-based awards. Our stock compensation plans have been established to provide certain of our employees, including our executive officers, with incentives to help align those employees’ interests with the interests of stockholders. |
The primary objectives of our executive compensation program are to attract and retain the best possible executive talent, to motivate our executive officers to enhance our growth and profitability, to increase stockholder value, and to reward superior performance and contributions to the achievement of corporate objectives. The focus of our executive pay strategy is to tie short- and long-term cash and equity incentives to the achievement of measurable corporate and individual performance objectives, and to align executives’ incentives with stockholder value creation. Our compensation plan is designed to attract and retain the best possible talent, and we recognize that different elements of compensation are more or less valuable depending on the individual. For this reason, we offer a broad range of compensation elements. We offer our executive team salaries that are competitive with the market, executive bonuses that are in line with our corporate goals and dependent on measurable results, plus stock option plans designed to retain talent, promote a sense of company ownership, and tie corporate success to monetary rewards. Specifically, all management employedExchange Act by the Company or one of its subsidiaries are entitled to participate in an equity incentive plan that will compensate management if certain financial performance and milestones are met. The Company reserves the right to increase the size of the plan as it deems necessary, at its sole discretion.
Base salaries for our executive officers are determined based on the scope of their job responsibilities, prior experience, and depth of their industry skills, education, and training. Compensation paid by industry competitors for similar positions, as well as market demand, are also taken into account. Base salaries are reviewed annually as part of our performance management program, whereby merit or equity adjustments may be made. Merit adjustments are based on the level of success in which individual and corporate performance goals have been met or exceeded. Equity adjustments may be made to ensure base salaries are competitive with the market and will be determined using benchmark survey data.
Our compensation structure is primarily comprised of base salary, annual performance bonus, and stock options. In setting executive compensation, the Board of Directors will consider the aggregate compensation payable to an executive officer and the form of the compensation. The Board will seek to achieve an appropriate balance between immediate cash rewards and long-term financial incentives for the achievement of both annual and long-term financial and non-financial objectives.
Employment Agreements
Sadiq (“Sid”) Toama
The Company entered into an Executive Employment Agreement (“EEA”), effective as of March 21, 2022, with Sadiq (“Sid”) Toama to serve as its President. He was later elected Chief Executive Officer of the Company on May 19, 2022. The EEA is for an initial term of five (5) years, which automatically renews for additional one (1) year periods unless either party delivers, at least ninety (90) days’ prior to the end of a term, writtenOctober 16, 2024. A shareholder’s notice to the other thatSecretary must set forth as to each matter the term will not be extended. Notwithstanding the foregoing, the EEA provides that, on orshareholder proposes to bring before the third (3rd) anniversary date ofannual meeting the EEA, the Company may offerinformation required by applicable law and our bylaws (as amended from time to extend the term for an additional period of five (5) years, which Mr. Toama may accept or reject. If the Company does not offer such extension, or if Mr. Toama rejects the extension offered by the Company, Mr. Toama may resign, and such resignation will be deemed to be with good reason (as defined in EEA), or he may not resign, in which case the terms of the EEA will continue.
Mr. Toama’s annual base salary is $500,000 and he is entitled to receive an annual bonus, subject to bonus increases at least annually upon mutually agreed-to performance milestones, as well as discretionary bonuses. Mr. Toama also received restricted stock units (“RSUs”) for 2,500,000 shares, vesting one-third on the first anniversary date of the EEA and two-thirds in two (2) equal installments on the second and third anniversary dates of the EEA. Mr. Toama may participate, to the extent eligible, in all employee benefit plans and programs provided by the Company to its senior executives. He also receives an auto allowance of $1,000 per month and life insurance benefits of $9,135 per year.
If Mr. Toama’s employment is terminated by the Company other than for cause (as defined in the EEA) or by him for good reason (as defined in the EEA), he is entitled to severance in an amount equal to his then-current base salary for a minimum of twelve (12) months or, if longer, until the end of the term, plus a pro rata bonus, as well as immediate vesting of options and stock grants, and Company paid-for premiums for COBRA continuation coverage under its health plans for an eighteen (18) month period. Upon a termination of Mr. Toama’s employment due to death or disability, all equity awards that would have vested during the twenty-four (24) months following such termination shall immediately vest. Upon a change of control (as defined in the EEA), all of Mr. Toama’s then-unvested shares or options shall immediately vest, all performance bonuses (both current and future) shall be immediately due and payable, and if, after a change of control, Mr. Toama terminates his employment with the Company, he shall receive the severance benefits described above.
The EEA also provides, that during his employment and, if his employment is terminated for cause (as defined in the EEA), for one (1) year following his termination date, or, if his employment is terminated for any other reason, for the longer of six (6) months or the period during which he is receiving severance payments, Mr. Toama cannot: (i) compete, directly or indirectly, anywhere in the U.S. as an employee, consultant, or director or have any financial interest in a competitive business; or (ii) hire, solicit for services, encourage the resignation of any employee or consultant (devoting more than 70% of consultant’s time) to a consulting business.
Michael Tenore
The Company entered into an amended and restated EEA, as of October 21, 2016, with Michael Tenore to serve as its General Counsel. The initial term of the agreement was until December 31, 2019, but automatically renews for additional one (1) year periods unless either party delivers, at least sixty (60) days prior to the end of the term, written notice to the other that the term will not be extended. Mr. Tenore‘s annual base salary was $200,000. Effective January 1, 2022, Mr. Tenore’s annual base salary was increased to $300,000. Mr. Tenore was granted stock options to purchase 333,333 shares of common stock, all of which vested June 1, 2019, and 700,000 RSUs, all of which are vest. He is eligible for an annual discretionary bonus to be set by the compensation committee and also may participate, to the extent eligible, at a level commensurate with his position, in all employee benefit plans and programs provided by the Company to its senior executives. He is also covered under the Company’s directors’ and officers’ liability insurance. Mr. Tenore is also entitled to receive a $37,500 bonus in the event he assists in closing one or more corporate acquisitions each in the amount in excess of $10,000,000.
If Mr. Tenore’s employment is terminated by the Company other than for cause (as defined in the EEA) or by him for good reason (as defined in the EEA), Mr. Tenore is entitled to severance in amount equal to twelve (12) months’ base salary, a prorated bonus, and Company paid-for premiums for COBRA continuation coverage under its health plans for a period of twelve (12) months. Upon a termination of his employment due to his death or disability, Mr. Tenore or his estate, shall vest in any equity awards that would have vested during the twelve (12) month period following the date of death or disability. Upon a change of control (as defined in the EEA), all of Mr. Tenore’s equity awards shall immediately vest in full and, if, after a change of control, he terminates employment for good reason (as defined in the EEA), he shall be entitled to the severance benefits described above.
Mr. Tenore is also subject to non-compete and non-solicitation provision during employment and for a period of six (6) months following his termination of employment.
Robert Machinist
On May 1, 2018, the Company entered into an EEA with Robert Machinist, to serve as Chief Executive Officer of the Company. Mr. Machinist was compensated at an annual base salary of $210,000. Effective April 1, 2021, Mr. Machinist’s annual base salary was increased to $300,000, and effective January 1, 2022, it was increased to $550,000. He was eligible for discretionary bonuses as determined by the compensation committee and was granted 333,333 warrants, vesting quarterly over two (2) years. Following the listing of the Company’s securities on the Nasdaq Capital Market, Mr. Machinist was awarded a discretionary bonus of $100,000 by the Company’s Board of Directors.
On May 19, 2022, Robert Machinist resigned as Chief Executive Officer of the Company and all employment by the Company’s subsidiaries for personal reasons unrelated to the management or operations of the Company. Pursuant to his EEA, Mr. Machinist will be paid one (1) year of severance at his current base salary of $550,000 paid over the next year.
Andrew Bressman
On January 1, 2022, Mr. Bressman was provided with a four-year employment agreement to serve as Advisor to the CEO with an annual salary of $400,000 a year. The agreement provided for customary benefits and a severance equal to 36 months of salary paid over a period of five (5) months. Upon a Change of Control (as defined), Mr. Bressman may terminate his employment for Good Reason, and he shall be entitled to the severance described above, subject to a one-year non-competition period. Mr. Bressman is also subject to a three-month non-solicitation period after the termination of his employment.
FORM 10-KT
The Company entered into a Separation Agreement dated as of February 28, 2021, with SAB Management, LLC (“SAB”) and Andrew Bressman (“Bressman”). Mr. Bressman is one offiled its Annual Report on Form 10-KT (as amended) for the principals of SAB and part owner. Under the terms of the Separation Agreement, Mr. Bressman’s consultancyinterim period July 1, 2022 through December 31, 2022 with the Company under a Consultant Agreement dated as of June 1, 2017, terminated, without cause, effective immediately prior to the listing of the Company’s securitiesSEC on the Nasdaq Capital Market in April 2021. The Consultant Agreement had provided for Mr. Bressman to be Managing Director and Assistant to the CEO until December 31, 2024.
Upon the completion of the initial public offering, the Company paid Mr. Bressman (i) accrued and unpaid consulting fees, expense, and interest as of February 28, 2021, and (ii) one-half of the consulting fees owed under the Consultant Agreement in the amount of $1,291,833. The balance of Consultant’s fees under the Consultant Agreement in the amount of $1,291,833 shall be paid in equal installments on a regular bi-weekly schedule through March 21,7, 2023.
Christopher Broderick
The Company entered into an amended and restated EEA (dated February 15, 2017) with Christopher J. Broderick as of June 1, 2017, which was amended on June 12, 2017, and June 5, 2018, to serve as its Chief Operating Officer. Mr. Broderick’s base salary was $350,000. On January 1, 2022, Mr. Broderick’s base salary was increased to $400,000. Mr. Broderick was entitled to receive $37,500 in the event he assisted in closing one or more corporate acquisitions each in the excess of $10,000,000. Mr. Broderick was granted stock options to purchase 800,000 shares of common stock, which became vested and exercisable fifty (50%) percent on July 1, 2018 and fifty (50%) percent on July 1, 2019, provided the closing price of the Company’s Common Stock is at least $0.45 per share at the time of vesting.
On June 8, 2022, Mr. Broderick entered into a Separation Agreement with the Company and resigned effective June 10, 2022, for personal reasons unrelated to the management or operations of the Company. He had maintained his position with the Company since 2017. His departure follows the Company’s recent acquisition of Converge Direct. As part of his agreement, Mr. Broderick was entitled to severance and certain other benefits which were incorporated into the Separation Agreement. The Separation Agreement provided for a severance payment in an amount equal to one (1) year of his current base salary payable in two (2) equal installments on June 30, 2022 and September 30, 2022. The vesting of all equity awards held by Mr. Broderick would also no longer be subject to continued employment with the Company. The Company and Mr. Broderick exchanged mutual releases and waivers of claims against each other.
Erica Naidrich
The Company entered into an EEA with Erica Naidrich to serve as its Chief Financial Officer on May 23, 2022. The EEA is for an initial term of three (3) years, which automatically renews for additional one (1) year periods unless either party delivers, at least sixty (60) days prior to the end of the term, written notice to the other that the term will not be extended.
Ms. Naidrich has an annual base salary of $400,000. She also received a one-time signing bonus of $100,000 on June 30, 2022. She is also eligible for discretionary bonuses as determined by the compensation committee and an annual bonus of thirty (30%) percent of her base salary subject to meeting objectives set forth by the Chief Executive Officer, President, and the Audit Committee of the Company’s Board of Directors and continued employment at the time payment is due. Ms. Naidrich was granted 200,000 RSUs vesting over three (3) years. She also may participate, to the extent eligible, at a level commensurate with her position, in all employee benefit plans and programs provided by the Company to employees. She also receives an auto allowance of $1,000 per month.
If Ms. Naidrich’s employment is terminated by the Company other than for cause (as defined in the EEA) or by her for good reason (as defined in the EEA), she is entitled to severance in an amount equal to six (6) months then-current base salary, plus a pro rata bonus, as well as immediate vesting of any equity awards, and Company paid-for premiums for COBRA continuation coverage under its health plans for a thirty (30) day period. Upon a termination of Ms. Naidrich’s employment due to her death or disability, all equity awards that would have vested during the twelve (12) months following such termination shall immediately vest.
The EEA Agreement provides that during the term of employment and for three (3) months after termination, Ms. Naidrich shall not compete with the Company nor solicit employees of the Company.
Ms. Naidrich was not a “name executive officer” in fiscal year 2022 and, as a result, her compensation is not reported in the table above.
Pension Benefits
Each of Troika Design Group and Mission Media has a 401(k) benefit plan.
Non-Qualified Deferred Compensation
We do not have any non-qualified defined contribution plans or other deferred compensation plans.
Outstanding Equity Awards at June 30, 2022
The following table sets forth information regarding each unexercised option or unvested RSU awards held by each of our “named executive officers” as of June 30, 2022:
| | | | Option Awards | | Stock Awards | Name | | | | Number of Securities Underlying Unexercised Options Exercisable(#) | | Number of Securities Underlying Unexercised Options Unexercisable(#) | | Option Exercise Price($) | | Option Expiration Date | | Number of Shares or Units of Stock that have not Vested(#) | | Market Value of Shares or Units of Stock that have not Vested | Sid Toama | | | | N/A | | | N/A |
| | N/A | |
| N/A | | 2,500,000 | |
| $ | 2,625,000 | | Michael Tenore | | | | 333,333 | | | — | | | $ 0.75 | | | 4/22/2025 | | — | | | $ | —
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For information regarding the vesting acceleration provisions applicable to the options held by our named executive officers, please see “–Employment Agreements” above.
Equity Compensation Plan Information
The following table provides information as of June 30, 2022, with respect to shares of common stock that may be issued under equity plans and standalone option grants:
COMMON STOCK ISSUABLE UNDER EQUITY PLANS
Plan Category | | Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights | | Weighted Average Exercise Price of Outstanding Options, Warrants and Rights | | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans | Equity compensation plans approved by stockholders | | | 4,757,833 | | $1.28 | | | 3,300,000 | Equity compensation plans not approved by stockholders | | | — | | — | | | — |
Accounting Matters
Principal Independent Auditor Fees
The following table sets forth the aggregate fees billed to us by RBSM, our current independent auditor, for professional services rendered for the fiscal year ended June 30, 2022 and 2021.
| 2022 | | 2021 | | RBSM | | RBSM | | | | | Audit Fees (1) | $ 460,000 | | $ 360,000 | Audit-related Fees (2) | 520,000 | | — | Tax Fees (3) | — | | — | All Other Fees | — | | 150,000 | Total Fees | $ 980,000 | | $ 510,000 | | | | |
(1) | Includes services relating to the audit of annual consolidated financial statements, review of quarterly consolidated financial statements, statutory audits, comfort letters, and consents and review of documentation filed with SEC-registered and other securities offerings. | (2) | Includes services related to assistance with general accounting matters, work performed on acquisitions and divestitures, employee benefit plan audits, and assistance with statutory audit matters. | (3) | Includes services for tax compliance, tax advice, and tax planning. |
Audit Committee Pre-Approval Policies and Procedures
The audit committee approves in advance all audit and non-audit services performed by the independent registered public accounting firm. There are no other specific policies or procedures relating to the pre-approval of services performed by the independent registered public accounting firm.
Report of Audit Committee
The Audit Committee of the board of directors consists entirely of members who meet the independence requirements of Nasdaq and the rules and regulations of the SEC, as determined by the board of directors. The Audit Committee is responsible for providing independent, objective oversight of the financial reporting processes and internal controls of Troika Media Group, Inc. (“TMG”). The Audit Committee operates under a written charter approved by the board. A copy of the current charterforegoing (without exhibits or documents incorporated by reference) is available on TMG’s website at https://www.troikamedia.com/investor-relations
Management is responsible for TMG’s system of internal control and financial reporting processes, for the preparation of consolidated financial statements in accordance with U.S. generally accepted accounting principles (“US GAAP”) and for the annual report on TMG’s internal control over financial reporting. The independent auditor is responsible for performing an independent audit of TMG’s consolidated financial statements in accordance with the standards of the Public Company Accounting Oversight Board (“PCAOB”), and for issuing a report on the financial statements. The Audit Committee’s responsibility is to monitor and oversee these processes. In performing its functions, the Audit Committee acts only in an oversight capacity and necessarily relies on the work and assurances of management, the internal audit group, and the independent auditor. Audit Committee members do not serve as professional accountants or auditors for TMG, and their functions are not intended to duplicate or certify the activities of TMG’s management or independent auditor.
Consistent with its monitoring and oversight responsibilities, the Audit Committee met with management and RBSM LLP, or RBSM, the independent auditor of TMG, to review and discuss the June 30, 2022, audited consolidated financial statements. Management represented that TMG had prepared the consolidated financial statements in accordance with US GAAP. The Audit Committee discussed with RBSM the matters required by the PCAOB in accordance with Auditing Standard No. 1301, “Communications with Audit Committees.”
The Audit Committee received from RBSM the written communication that is required by PCAOB Rule 3526, “Communication with Audit Committees Concerning Independence,” and the Audit Committee discussed with RBSM that firm’s independence. The Audit Committee also considered whether RBSM’s provision of non-audit services and the audit and non-audit fees paid to RBSM were compatible with maintaining that firm’s independence. On the basis of these reviews, the Audit Committee determined that RBSM has the requisite independence.
Management completed the documentation, testing and evaluation of TMG’s system of internal control over financial reporting as of June 30, 2022, as required by Section 404 of the Sarbanes-Oxley Act of 2002. The Audit Committee received periodic updates from management and RBSM at Audit Committee meetings throughout the year and provided oversight of the process. Prior to filing TMG’s Annual Report on Form 10-K for the fiscal year ended June 30, 2022, or the Form 10-K, with the SEC, the Audit Committee also reviewed management’s report on the effectiveness of TMG’s internal control over financial reporting contained in the Form 10-K, as well as the Report of Independent Registered Public Accounting Firm provided by RBSM and also included in the Form 10-K. RBSM’s report included in the Form 10-K related to its audit of TMG’s consolidated financial statements.
Based upon the Audit Committee’s discussions with management and RBSM and the Audit Committee’s review of the information provided by, and the representations of, management and RBSM, the Audit Committee approved the inclusion in the Form 10-K of the audited consolidated financial statements as of and for the fiscal year ended June 30, 2022. The Audit Committee approved the appointment and retention of RBSM as TMG’s independent auditor for the transition period July 1, 2022, to December 31, 2022, and recommended that the appointment be submitted for ratification by the stockholders of TMG.
Audit Committee
Randall Miles - Chair
Martin Pompadur
Sabrina Yang
Delivery of Documents to Security Holders Sharing an Address
SEC rules permit us to deliver one Notice of Internet Availability to two or more stockholders who share an address, unless we have received contrary instructions from one or more of the stockholders. This delivery method, which is known as “householding,” can reduce our expenses for printing and mailing. Any stockholder of record at a shared address to which a single copy of the Notice of Internet Availability was delivered may request a separate Notice of Internet Availability, or a separate copy of the 2022 Annual Report andto Shareholders that is being delivered or made available via the Internet concurrently with this Proxy Statement to all shareholders.
By Order of the Board of Directors, Derek McKinney Vice President, General Counsel & Corporate Secretary October 31, 2023
45 2023 Proxy Statement
CAUTIONARY STATEMENT REGARDING FORWARD LOOKING INFORMATION
This Proxy Statement and other publicly available documents may include forward-looking statements intended to qualify for the safe harbor from liability established by calling American Stock Transfer & Trust Company, LLC at 888-Proxy-NA (888-776-9962)the Private Securities Litigation Reform Act of 1995. These forward-looking statements are not historical facts, but rather are based on current expectations, estimates, assumptions and projections about our business, future financial results and the industry in which we operate, and other legal, regulatory and economic developments. These forward-looking statements include, but are not limited to, future strategic plans and other statements that describe the company’s business strategy, outlook, objectives, plans, intentions or 718-921-8562 (for international callers),goals, and any discussion of future events and future operating or sendingfinancial performance. These forward-looking statements are subject to a letternumber of risks, uncertainties and assumptions that could cause actual results or events to Investor Relations at Troika Media Group, Inc., 25 West 39th Street, New York, NY 10018, todiffer materially from those anticipated and disclosed, including those risks described in the attentionsection titled “Risk Factors” set forth in Part I, Item 1A of our Secretary. Stockholders of record who wish2022 Transition Report on Form 10-KT and in our other SEC filings. We use words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” “target,” “future,” “may,” “will,” “could,” “should,” “potential,” “continue,” “guidance” and other similar expressions to receive separate copies of these documents in the future may also contact us as stated above. Stockholders of record who share an addressidentify forward-looking statements. Forward-looking statements are uncertain and, receive two or more copiesby their nature, many are inherently unpredictable and outside of the NoticeCompany’s control, and are subject to known and unknown risks, uncertainties and other important factors that could cause actual results to differ materially from those expressed or implied in, or reasonably inferred from, such forward-looking statements. Where in any forward-looking statement we express an expectation or belief as to future results or events, such expectation or belief is based on current plans and expectations of Internet Availability may contact usour management, expressed in good faith and believed to have a reasonable basis. However, there can be no assurance that the expectation or belief will occur or that anticipated results will be achieved or accomplished. The forward-looking statements included in this report speak only as stated above to request delivery of a single copy. A stockholder who holds shares in “street name” and who wishes to obtain copies of proxy materials should follow the instructions on the stockholder’s voting instruction form or should contact the holder of record.Other Matters
We will pay all expenses of preparing, printing and mailing, and making available over the Internet, the Annual Meeting proxy materials, as well as all other expenses of soliciting proxies for the Annual Meeting on behalf of the boarddate of directors. Certainthis Proxy Statement. We undertake no obligation (and expressly disclaim any obligation) to update any forward-looking statements, whether written or oral or as a result of our directors, officers, and employees, who will receive no compensation in addition to their regular salarynew information, future events or other compensation, may solicit proxies by personal interview, mail, telephone, facsimile, email, Internet, or other means of electronic transmission. otherwise. 46 2023 Proxy Statement
47 Appendix A2023
2022 Proxy Statement
2023 Annual Meeting of Stockholders Rules of Conduct and Procedures Welcome to the 20222023 Annual Meeting of Stockholders (the “Annual Meeting”) of Troika Media Group, Inc. (the “Company”). In the interest of providing a fair and informative Annual Meeting, participants are required to honor the following Rules of Conduct and Procedures:1. | The Company’s bylaws describe requirements for meetings of our stockholders, and the Annual Meeting will be conducted consistent with those requirements. |
2. | 1.The Company’s bylaws describe requirements for meetings of our stockholders, and the Annual Meeting will be conducted consistent with those requirements. The Company’s Chair of the Board will serve as the chair of the Annual Meeting (the “Chair”) and will have the authority and discretion necessary to preside over the Annual Meeting, including following adjournment of the formal business of the Annual Meeting. In the event of disorder, technical malfunction, or any other issue that disrupts the Annual Meeting, the Chair may adjourn, recess, or expedite the Annual Meeting or may take any other action that he or she determines is appropriate in light of the circumstances. In the event of any question of conduct or procedures that is not addressed expressly and clearly by these Rules of Conduct and Procedures, the Chair is authorized to address the question in the manner he or she determines, in his reasonable judgment, to be in the best interest of conducting a fair and informative Annual Meeting consistent with the purposes of the Annual Meeting.
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3. | Participation in the Annual Meeting, including listening, voting shares, and submitting questions, will be limited to registered stockholders and proxyholders.
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4. | Participants can log in to attend the Annual Meeting virtually by visiting https://web.lumiagm.com/238744591 after 9:00 A.M. on December 15, 2022. You will need to enter your 11 digit Control Number as it appears on your proxy card, along with the Password troika2022. |
5. | Each stockholder of record as of 5:00 p.m., Eastern time, on October 27, 2022, may log into the webcast by entering- the information of the Proxy Card. If you have voted your shares prior to the start of the Annual Meeting, your vote has been received by the Company’s inspector of elections and there is no need to vote those shares during the Annual Meeting, unless you wish to revoke or change your vote. |
6. | The Meeting will begin at 10:00 a.m., Eastern time, on December 15, 2022. The only business to be conducted at the Annual Meeting will consist of the consideration of, and voting on, the three proposals set forth in the Proxy Statement. These proposals will be considered sequentially at the Annual Meeting, in the order they are enumerated and set forth in the Proxy Statement. |
7. | If a stockholder has a question about one of the agenda matters that is to be voted on at the Annual Meeting as set forth in the Proxy Statement, the question may be submitted in the field provided in the web portal at or before the time the matters are presented for consideration at the Annual Meeting. We will answer questions on any matters set forth in the Proxy Statement to be voted on by the stockholders at the Annual Meeting before voting is closed. During this period, the Company will not permit discussions or questions that are not relevant or pertinent to the agenda matter then being discussed, as determined by the Chair in his reasonable judgment. |
2.The Company’s Chair of the Board will serve as the chair of the Annual Meeting (the “Chair”) and will have the authority and discretion necessary to preside over the Annual Meeting, including following adjournment of the formal business of the Annual Meeting. In the event of disorder, technical malfunction, or any other issue that disrupts the Annual Meeting, the Chair may adjourn, recess, or expedite the Annual Meeting or may take any other action that he or she determines is appropriate in light of the circumstances. In the event of any question of conduct or procedures that is not addressed expressly and clearly by these Rules of Conduct and Procedures, the Chair is authorized to address the question in the manner he or she determines, in his reasonable judgment, to be in the best interest of conducting a fair and informative Annual Meeting consistent with the purposes of the Annual Meeting.
3.Participation in the Annual Meeting, including listening, voting shares, and submitting questions, will be limited to registered stockholders and proxyholders.
4.Participants must register in advance to attend the Annual Meeting virtually by visiting www.virtualshareholdermeeting.com/TRKA2023 prior to the deadline of 11:59 p.m., Eastern time, on December 14, 2023. You will need to enter your name, phone number, mailing address as it appears on your proxy card and email address as part of the registration, following which, you will receive an email confirming your registration, as well as the password to attend the Annual Meeting. On the day of the Annual Meeting, if you have properly registered, you may enter the Annual Meeting by logging in using the password you received via email in your registration confirmation.
5.Each stockholder of record as of 5:00 p.m., Eastern time, on October 18, 2023, who has registered by the December 14, 2023, deadline may log into the webcast by entering the unique join link and password mailed to such stockholder upon registration. If you have voted your shares prior to the start of the Annual Meeting, your vote has been received by the Company’s inspector of elections and there is no need to vote those shares during the Annual Meeting, unless you wish to revoke or change your vote.
6.The Meeting will begin at 10:00 a.m., Eastern time, on December 15, 2023. The only business to be conducted at the Annual Meeting will consist of the consideration of, and voting on, the four proposals set forth in the Proxy Statement. These proposals will be considered sequentially at the Annual Meeting, in the order they are enumerated and set forth in the Proxy Statement.
7.If a stockholder has a question about one of the agenda matters that is to be voted on at the Annual Meeting as set forth in the Proxy Statement, the question may be submitted in the field provided in the web portal at or before the time the matters are presented for consideration at the Annual Meeting. We will answer questions on any matters set forth in the Proxy Statement to be voted on by the stockholders at the Annual Meeting before voting is closed. During this period, the Company will not permit discussions or questions that are not relevant or pertinent to the agenda matter then being discussed, as determined by the Chair in his reasonable judgment. 48 2023 Proxy Statement
8. | Following adjournment of the formal business of the Annual Meeting, the Chair will give a presentation about the Company’s business. At the conclusion of this presentation, the Company will address appropriate general questions as time allows from stockholders regarding the Company. The following rules will apply to this process: |
| a. | To ensure that as many stockholders as possible are able to ask questions, each stockholder will be permitted to submit no more than two questions. Questions must be succinct and cover a single topic. Questions being addressed will be presented as submitted, uncensored and unedited, except that we may omit certain personal details for data protection issues and we may edit profanity or other inappropriate language. |
| b. | In addressing questions: |
| i. | Questions from multiple stockholders related to the same topic, or that are otherwise related, may be grouped and answered together. |
| ii. | Any second question from a stockholder will be deferred until such time as all appropriate first questions from stockholders have been addressed. |
| iii. | If more questions are presented than time permits to be answered, the Chair shall determine which questions will be addressed in his reasonable discretion. |
| c. | The views, questions and constructive comments of all stockholders are valued and welcomed. The purpose of the Annual Meeting must be observed, however, and the Company will not permit questions that: |
| i. | are not relevant or pertinent to the business of the Company; |
| ii. | are related to material non-public information of the Company; |
| iii. | are related to financial or operating results of the Company for the second quarter of 2023; |
| iv. | are related to pending or threatened litigation or investigations; |
| v. | are in furtherance of a stockholder’s personal or business interests; |
| vi. | are repetitious of statements made by another stockholder; |
| vii. | are related to personal grievances; |
| viii. | include derogatory references to individuals or are otherwise in bad taste; or |
| ix. | are out of order or not otherwise suitable for the conduct of the Annual Meeting as determined by the Chair in his reasonable judgment. |
9. | If there are any matters of individual concern to a stockholder and not of general concern to all stockholders, or if a question posed was not otherwise answered, such matters may be raised separately after the Annual Meeting by contacting Investor Relations at investorrelations@troikamedia.com. |
10. | Recording of the Annual Meeting is prohibited without the prior written permission of the Company. A webcast playback of the Annual Meeting will be available at https://www.troikamedia.com/investor-relationswithin approximately 48 hours after the completion of the Annual Meeting and will remain publicly available until our annual meeting of stockholders in 2023. The webcast playback will include each stockholder question addressed during the Annual Meeting. |
11. | A violation of any of the above conduct requirements will be cause for dismissal from the Annual Meeting. |
8.Following adjournment of the formal business of the Annual Meeting, the Chair will give a presentation about the Company’s business. At the conclusion of this presentation, the Company will address appropriate general questions as time allows from stockholders regarding the Company. The following rules will apply to this process:
a.To ensure that as many stockholders as possible are able to ask questions, each stockholder will be permitted to submit no more than two questions. Questions must be succinct and cover a single topic. Questions being addressed will be presented as submitted, uncensored and unedited, except that we may omit certain personal details for data protection issues and we may edit profanity or other inappropriate language.
b.In addressing questions:
i.Questions from multiple stockholders related to the same topic, or that are otherwise related, may be grouped and answered together. ii.Any second question from a stockholder will be deferred until such time as all appropriate first questions from stockholders have been addressed. iii.If more questions are presented than time permits to be answered, the Chair shall determine which questions will be addressed in his reasonable discretion.
c. The views, questions and constructive comments of all stockholders are valued and welcomed. The purpose of the Annual Meeting must be observed, however, and the Company will not permit questions that:
i.are not relevant or pertinent to the business of the Company; ii.are related to material non-public information of the Company; iii.are related to financial or operating results of the Company for the second quarter of 2023; iv.are related to pending or threatened litigation or investigations; v.are in furtherance of a stockholder’s personal or business interests; vi.are repetitious of statements made by another stockholder; vii.are related to personal grievances; viii.include derogatory references to individuals or are otherwise in bad taste; or ix.are out of order or not otherwise suitable for the conduct of the Annual Meeting as determined by the Chair in his reasonable judgment.
9. If there are any matters of individual concern to a stockholder and not of general concern to all stockholders, or if a question posed was not otherwise answered, such matters may be raised separately after the Annual Meeting by contacting Investor Relations at investorrelations@troikamedia.com.
10. Recording of the Annual Meeting is prohibited without the prior written permission of the Company. A webcast playback of the Annual Meeting will be available at https://www.troikamedia.com/investor-relations within approximately 48 hours after the completion of the Annual Meeting and will remain publicly available until our annual meeting of stockholders in 2023. The webcast playback will include each stockholder question addressed during the Annual Meeting.
11. A violation of any of the above conduct requirements will be cause for dismissal from the Annual Meeting.
THANK YOU FOR YOUR COOPERATION AND FOR JOINING THE ANNUAL MEETING. 49 A-22023 Proxy Statement
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