No fee required.
25, 2019
You are cordially invited
Details regarding10014.
At the annual meeting one person will be electedand in our restaurants.
We hope you will be able to attend the annual meeting. Whether you plan to attendpresented at the annual meeting and any adjournments or not, it is important that you cast your vote either in person or by proxy. You may vote over the Internet as well as by mail. When you have finished reading the proxy statement, you are urged to vote in accordance with the instructions set forth in this proxy statement. We encourage you to vote by proxy so that your shares will be represented and voted at the meeting, whether or not you can attend.
Thank you for your continued support of The ONE Group Hospitality, Inc. We look forward to seeing you at the annual meeting.
Sincerely,
Jonathan SegalChief Executive Officer
April 29, 2016
TIME: 11:00 a.m.DATE: June 1, 2016PLACE: STK, 26 Little West 12th Street, New York, NY 10014, 3rd FloorPURPOSES:
WHO MAY VOTE:
Sonia Low
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4, 2019
10014.
Although not part of this proxy statement, we are also sending, along with this proxy statement, our 2015 annual report, which includes our financial statements for the fiscal year ended December 31, 2015.
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4, 2019
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Internet voting facilities for stockholders
June 3, 2019.
through certain banks and brokers. If your shares are not registered in your own name and you plan to vote your shares in person at the annual meeting, you should contact your broker or agent to obtain a legal proxy or broker’s proxy card and bring it to the annual meeting in order to vote.
Your bank, broker or other nominee does not have the ability to vote your uninstructed shares in the election of the director. Therefore, if you hold your shares in street name it is critical that you cast your vote if you want your vote to be counted for the election of the director (Proposal 1 of this proxy statement). In
the past, if you held your shares in street name and you did not indicate how you wanted your shares to be voted in the election of directors, your bank, broker or other nominee was allowed to vote your shares on your behalf in the election of directors as it deemed appropriate. In addition, your bank, broker or other nominee is prohibited from voting your uninstructed shares on any matters related to executive compensation. Thus, ifIf you hold your shares in street name and you do not instruct your bank, broker or other nominee how to vote, in the election of directors or on matters related to executive compensation, no votes will be cast on these proposalsany other proposal on your behalf.
Proposal 1: Elect | | | The | | |
| Proposal 2: Ratify Selection of Independent Registered Public Accounting Firm | | | The | |
| Proposal 3: Approve | | | The | |
| Proposal 4: Approve Amendments to our 2013 Employee, Director and Consultant Stock Equity Plan | | | The votes cast “for” must exceed the votes cast “against” to approve amendments to our 2013 Employee, Director and Consultant Stock Equity Plan. Abstentions will have no effect on the results of this vote. | |
annual meeting. We will pay all of the costs of soliciting these proxies. Our directors and employees may solicit proxies in person or by telephone, fax or email. We will pay these employees and directors no additional compensation for these services. We will ask banks, brokers and other institutions, nominees and fiduciaries to forward these proxy materials to their principals and to obtain authority to execute proxies. We will then reimburse them for their expenses.
The annual meeting will be held at 11:00 a.m. on Wednesday, June 1, 2016, at STK, 26 Little West 12th Street, New York, NY 10014, 3rd Floor. When you arrive at STK, signs will direct you to the appropriate meeting rooms. You need not attend the annual meeting in order to vote.
AND RELATED STOCKHOLDER MATTERS
Name and Address of Beneficial Owner | Amount and Nature of Beneficial Ownership(1) | Percentage of Common Stock Beneficially Owned (%) | ||||||
Jonathan Segal(2) | 7,332,519 | 28.80 | % | |||||
Samuel Goldfinger(3) | 368,490 | 1.45 | % | |||||
John Inserra | 52,000 | * | ||||||
Celeste Fierro | 442,061 | 1.74 | % | |||||
Alejandro Munoz-Suarez | — | — | ||||||
Michael Serruya(4) | 250,991 | * | ||||||
Eugene M. Bullis | 8,080 | * | ||||||
Richard Perlman(5) | 201,780 | * | ||||||
Nicholas Giannuzzi | 492,039 | 1.93 | % | |||||
All current executive officers and directors as a group (8 individuals)(2)(3)(4)(5) | 9,147,960 | 35.93 | % |
Directors and Officers: | | | Amount and Nature of Beneficial Ownership(1) | | | Percentage of Common Stock Beneficially Owned (%) | | ||||||
Emanuel P.N. Hilario | | | | | 512,306 | | | | | | 1.8% | | |
Tyler Loy | | | | | 15,000 | | | | | | 0.1 | | |
Linda Siluk | | | | | 14,000 | | | | | | * | | |
Celeste Fierro(2) | | | | | 924,660 | | | | | | 3.2% | | |
Jonathan Segal(3) | | | | | 7,480,764 | | | | | | 25.7% | | |
Michael Serruya(4) | | | | | 301,790 | | | | | | 1.1% | | |
Eugene M. Bullis | | | | | 58,879 | | | | | | 0.2 | | |
Dimitrios Angelis | | | | | 18,458 | | | | | | * | | |
All current executive officers and directors as a group (8 individuals) | | | | | 9,325,857 | | | | | | 31.4% | | |
|
5% Stockholders: | | | Number of Shares Beneficially Owned | | | Percentage of Common Stock Beneficially Owned (%) | | ||||||
Kanen Wealth Management LLC(5) 5850 Coral Ridge Drive, Suite 309 Coral Springs, FL 33076 | | | | | 4,836,872 | | | | | | 16.9% | | |
Argyle Street Management Limited(6) Unit 601-2, 6th Floor St. George’s Building 2 Ice House Street Central, Hong Kong | | | | | 1,500,000 | | | | | | 5.2% | | |
Twinleaf Management, LLC(7) 131 Brookwood Lane New Canaan, CT 06840 | | | | | 1,477,816 | | | | | | 5.2% | | |
5% Stockholders: | | | Number of Shares Beneficially Owned | | | Percentage of Common Stock Beneficially Owned (%) | | ||||||
Maguire Financial, LP(8) 300 Four Falls Corporate Center 300 Conshohocken State Road, Suite 405 West Conshohocken, Pennsylvania 19428 | | | | | 1,476,897 | | | | | | 5.2% | | |
Our certificate of incorporation and bylaws provide that our business is to be managed by or under the direction of our Board of Directors.
stockholders.
Name | | | Age | | | Positions | |
Emanuel P.N. Hilario | | | 51 | | | President, Chief Executive Officer and Director | |
Jonathan Segal | | 58 | | Executive | | ||
| 49 | | Director | | |||
Eugene M. Bullis | | 73 | | | Director | | |
| 54 | | | Director | |||
Jonathan Segal,
Richard E. Perlman,
Nicholas L. Giannuzzi, age 49, has served as a Class II member of our Board of Directors since October 16, 2013. Since December 2010, Mr. Giannuzzi has served as Managing Partner of The Giannuzzi Group LLP, a premier boutique law firm specializing in the representation of fast-growing, independent companies in the hospitality, food and beverage industries. Prior to forming The Giannuzzi Group, Mr. Giannuzzi was a partner at Donovan & Giannuzzi from 1996 through 2010 and an associate at Winthrop, Stimson, Putnam & Roberts from 1992 to 1996. Mr. Giannuzzi received a B.A. from Harvard University in 1989 and a J.DJuris Doctorate from New York University School of Law in 1992.
Law.
2018.
A copy of the Audit Committee’s written charter is publicly available on our website atwww.togrp.com.
Committee’s role and responsibilities are set forth in the Compensation Committee’s written charter and includesinclude reviewing, approving and making recommendations regarding our compensation policies, practices and procedures to ensure that legal and fiduciary responsibilities of the Board of Directors are carried out and that such policies, practices and procedures contribute to our success. Our Compensation Committee also administers our 2013 Employee, Director and Consultant Equity Incentive Plan.Plan (“Equity Incentive Plan”). The Compensation Committee is responsible for the determination of the compensation of our Chief Executive Officer, and shall conduct its decision making process with respect to that issuehis compensation without the Chief Executive Officer present. All members of the Compensation Committee qualify as independent under the definition promulgated by NASDAQ.
executive officers.
If a stockholder wishes to propose a candidate for
stockholders.
While
liquidity and legal risks and a compensation committee could be charged with reviewing and discussing with management whether our compensation arrangements are consistent with effective controls and sound risk management.
In addition, any material that is unduly hostile, threatening, or illegal in nature may be excluded, provided that any communication that is filtered out will be made available to any outside director upon request.
Name | | | Age | | | Positions | |
| 39 | | | Chief Financial Officer | | ||
| 62 | | | Chief | | ||
Celeste Fierro | | 51 | | Vice President of | |
Samuel Goldfinger, age 46,
Alejandro Munoz-Suarez, age 46, has served as Chief Operating Officer of the Company since March 31, 2016. Prior to joining the Company, Mr. Munoz-Suarez served as President of B&B Hospitality Group’s Pacific Division since June 2002. Prior to his employment at B&B Hospitality Group, Mr. Munoz-Suarez was an equity analyst with J.P. Morgan from 1998 to 2001. Mr. Munoz-Suarez also served as a Finance Supervisor with McDonald’s Corporation from 1995 to 1996 and as a Senior Consultant with KPMG US from 1991 to 1995. Mr. Munoz-Suarez holds a Bachelor’s degree in accounting and finance from The Ohio State University, and a Master of Business Administration from Harvard Business School.
Celeste Fierro, age 48, has served as Senior from February 19, 2014 until October 1, 2018, when she became the Vice President of Marketing, Sales and Events of the Company since February 19, 2014.Offsite Special Events. Prior to that time and since 2004, Ms. Fierro served as Senior Vice President of Operations, and in such capacity oversaw all operations of the Company. Ms. Fierro was a founding partner of the Company in 2004 along with Mr. Segal. Prior to joining the Company, Ms. Fierro was an event planner in New York City and founded Cititaste Events, a company which planned events for clients and events such as the Annual All-Star Games of Major League Baseball, the National Football League, the Pro-Bowl, the Cystic Fibrosis Foundation and American Express.
Name and Principal Position | | | Year | | | Salary | | | Bonus | | | Stock Awards(1) | | | Option Awards(2) | | | Total | | ||||||||||||||||||
Emanuel P.N. Hilario(3) President and Chief Executive Officer | | | | | 2018 | | | | | $ | 458,654 | | | | | $ | 156,938 | | | | | $ | — | | | | | $ | — | | | | | $ | 615,592 | | |
| | | 2017 | | | | | $ | 70,701 | | | | | $ | 4,777(4) | | | | | $ | 426,000 | | | | | $ | 156,000 | | | | | $ | 657,478 | | | ||
Jonathan Segal(5) Director of Business Development | | | | | 2018 | | | | | $ | 356,731 | | | | | $ | 109,594 | | | | | $ | — | | | | | $ | — | | | | | $ | 466,325 | | |
| | | 2017 | | | | | $ | 548,846 | | | | | $ | 32,813(4) | | | | | $ | — | | | | | $ | — | | | | | $ | 581,659 | | | ||
Linda Siluk(6) Chief Administrative Officer (former Interim Chief Financial Officer) | | | | | 2018 | | | | | $ | 336,594 | | | | | $ | 60,390 | | | | | $ | — | | | | | $ | — | | | | | $ | 396,984 | | |
| | | 2017 | | | | | $ | 215,044 | | | | | $ | 12,856(4) | | | | | $ | 74,550 | | | | | $ | — | | | | | $ | 302,450 | | | ||
Celeste Fierro(7) Vice President of Offsite Special Events | | | | | 2018 | | | | | $ | 327,236 | | | | | $ | 46,683 | | | | | $ | — | | | | | $ | — | | | | | $ | 373,919 | | |
| | | 2017 | | | | | $ | 357,375 | | | | | $ | 18,250 | | | | | $ | 213,000 | | | | | $ | 215,000 | | | | | $ | 803,625 | | |
Name and Principal Position | Year | Salary | Bonus | Option Awards(1) | All Other Compensation | Total | ||||||||||||||||||
Jonathan Segal(2) Chief Executive Officer | 2015 | $ | 575,000 | $ | 0 | $ | 0 | $ | 0 | $ | 575,000 | |||||||||||||
2014 | $ | 450,000 | $ | 0 | $ | 0 | $ | 0 | $ | 450,000 | ||||||||||||||
Samuel Goldfinger(3) Chief Financial Officer | 2015 | $ | 350,000 | $ | 0 | $ | 0 | $ | 0 | $ | 350,000 | |||||||||||||
2014 | $ | 300,000 | $ | 37,500 | $ | 0 | $ | 0 | $ | 337,500 | ||||||||||||||
Celeste Fierro(4) Senior Vice President of Marketing, Sales and Events | 2015 | $ | 250,000 | $ | 4,808 | $ | 0 | $ | 0 | $ | 254,808 | |||||||||||||
2014 | $ | 250,000 | $ | 4,808 | $ | 482,500 | $ | 0 | $ | 737,308 | ||||||||||||||
John Inserra(5) Former Chief Operating Officer | 2015 | $ | 269,230 | $ | 0 | $ | 0 | $ | 0 | $ | 269,230 | |||||||||||||
2014 | $ | 309,617 | $ | 143,750 | (6) | $ | 514,500 | $ | 0 | $ | 967,867 | |||||||||||||
(1) These amounts represent the aggregate grant date fair value for stock grants awarded in 2018 and 2017, respectively, computed in accordance with FASB ASC Topic 718. These amounts do not correspond to the actual value that will be recognized by the named executive officers. The grant date fair value of these awards, restricted stock units (“RSUs”) assuming the maximum potential value is achieved was $0 and $426,000 for Emanuel P.N. Hilario in 2018 and 2017, respectively; $0 and $74,550 for Linda Siluk in 2018 and 2017, respectively; and $0 and $213,000 for Celeste Fierro in 2018 and 2017, respectively. (2) The amounts in this column represent the aggregate grant date fair value of stock options granted to the named executive officer in the applicable fiscal year computed in accordance with FASB ASC Topic 718. These amounts do not correspond to the actual value that will be recognized by the named executive officers. |
The grant date fair value of the performance-based options is determined based on the probable outcome of such performance conditions as of the grant date.
Jonathan Segal currently
Samuel Goldfinger currently serves as our Chief Financial Officer pursuant to an employment agreement dated October 16, 2013. The agreement provides for a term of two (2) years with the term automatically extending for additional one year periods unless either party provides ninety (90) days written notice prior to the commencement of the renewal term. Mr. Goldfinger received an initial annual base salary of $300,000 which was increased to $350,000 effective January 1, 2015 following review and approval by the Compensation Committee of the Board of Directors, and may be increased (but not decreased) as the Board of Directors or Compensation Committee of the Board of Directors may approve in its sole discretion from time to time, but not less than annually. In addition, Mr. Goldfinger is eligible to receive an annual bonus in an amount targeted at fifty percent (50%) of Mr. Goldfinger’s then-effective annual base salary, based in part upon achievement of individual and corporate performance objectives as determined by the Board of Directors. Mr. Goldfinger shall be eligible to receive a bonus in excess of the targeted bonus if Company
performance exceeds 100% of the targeted goals, and a bonus below the target amount shall be payable if actual performance at least equals a minimum threshold, each as approved by the Board of Directors in consultation with Mr. Goldfinger at the time the annual performance goals are established. Whether Mr. Goldfinger receives a bonus and the amount of any such bonus, will be determined by the Board of Directors in its sole and absolute discretion, except that any portion of the bonus that the Board of Directors determines to be based on the targeted goals will be considered non-discretionary and payable based on achievement of such goals. Mr. Goldfinger received a discretionary bonus of $37,500 in 2014 and did not receive a bonus in 2015. On the effective date of the Merger, Mr. Goldfinger was granted stock options to purchase 511,052 shares of common stock at an exercise price of $5.00 per share, such amount being the fair market value at the time of grant. Of this amount, options to purchase 114,044 shares were forfeited on February 27, 2016, upon the expiration of the Warrants. The options are subject to and governed by the terms of the 2013 Plan and a stock option agreement, which stock option agreement provides that (i) 50% of the options shall vest ratably over the first five anniversaries of the effective date of the employment agreement and remain exercisable for one year following termination of employment (the “Time-Based Options”) and (ii) 50% of the options shall vest upon the achievement of certain targeted annual milestones over a five year period commencing with the 2014 fiscal year (“Milestones”) determined by the Board of Directors (“Milestones Options”). In the event that the Company elects from time to time during the term of employment to award to all of its senior management and executives options to purchase shares of the Company’s stock pursuant to any stock option plan or similar program, Mr. Goldfinger is entitled to participate in any such stock option plan or similar program on a basis consistent with the participation of other senior management and executives of the Company.
Under the employment agreements, Mr. Segal is prohibited for the longer of (i) the four-year anniversary of the effective date of the Merger, and (ii) the two-year anniversary of the date his employment terminates for any reason and Mr. Goldfinger is prohibited for 12 months after termination for any reason from (a) engaging in any competing businessCompeting Business within any geographic area where the Company or its subsidiaries conducts, or plans to conduct, business at the time of his termination, (b) persuading or attempting to persuade any customer, prospective customerCustomer, Prospective Customer or supplierSupplier to cease doing business with an interested partyInterested Party or reduce the amount of business it does with an interested party,Interested Party, (c) persuading or attempting to persuade any service providerService Provider to cease providing services to an interested party, andInterested Party, or (d) soliciting for hire or hiring for himself or for any third party any service providerService Provider unless such person’s employment was terminated by the Company or any of its affiliates or such person responded to a “blind advertisement.”
Each employment agreement terminates uponadvertisement”. All capitalized terms in this paragraph have the earliest to occur of: (i)respective meanings set forth in the death of the employee; (ii) a termination by the Company by reason of the disability of the employee; (iii) a termination by the Company with or without cause; (iv) a termination by the employee with or without good reason; (v) a termination of the agreement by reasons of a change of control of the Company; and (vi) expiration of the agreement.
Set forth below is a description of the potential payments we will need to make upon termination of Messrs. Segal’s or Goldfinger’s employment as provided in their employment agreements.
Directors in good faith, payable when other senior executives receive their annual bonuses for such year, and in no event later than March 15 of the year following the year in which the termination occurs (to the extent milestones for such bonus have not yet been agreed upon as of the termination, reference will be made to the milestones established for the prior year); and (4) an amount equal to the COBRA“COBRA” premium for as long as the executiveMr. Segal and, if applicable, the executive’sMr. Segal’s dependents are eligible for COBRA, subject to a maximum of 18 months in the case ofmonths.
In the agreements, the term “cause” is defined generally as follows: (i) commits a material breach of any material term of the agreement or any material Company policy or procedure of which the executive had prior knowledge; provided that if such breach is curable in not longer than 45 days (as determined by the Board of Directors in its reasonable discretion), the Company shall not have the right to terminate the executive’s employment for cause pursuant hereto unless the executive, having received written notice of the breach from Company specifically citing this breach), fails to cure the breach within a reasonable time; (ii) is convicted of, or pleads guilty or nolo contendere to, a felony (other than a traffic-related felony) or any other crime involving dishonesty or moral turpitude; (iii) willfully engages in illegal conduct or gross misconduct that is materially and demonstrably injurious to the Company; (iv) engages in fraud, misappropriation, dishonesty (or in the case of Mr. Goldfinger, “material dishonesty”) or embezzlement in connection with the business, operations or affairs of Company (including without limitation any business done with clients or vendors); or (v) fails to cure, within 45 days after receiving written notice from Company specifically citing the breach, any material injury to the economic or ethical welfare of Company caused by executive’s gross malfeasance, misfeasance, repeated misconduct or repeated inattention to the executive’s duties and responsibilities under the agreementprovided that, in the case of Mr. Segal only, his cessation of employment shall not be deemed to be for “Cause” unless and until there shall have been delivered to the executive a copy of a resolution duly adopted by the affirmative vote of not less than a majority of the entire membership of the Board of Directors (not including the executive) at an in person meeting of the Board of Directors called and held for such purpose (after reasonable notice is provided to the executive and the executive is given an opportunity, together with counsel, to be heard before the Board of Directors), finding that, in the opinion of the Board of Directors, acting in good faith, a reasonable factual basis exists for the conclusion that executive is guilty of the conduct described in the agreement as “Cause” and specifying the particulars thereof in detail.
In the agreements, the term “good reason” is defined generally as: (i) a significant adverse and non-temporary change, diminution or reduction, for any reason, in the executive’s current authority, title, reporting relationship or duties, excluding for this purpose any action not taken in bad faith and that is remedied by the Company not more than thirty (30) days after receipt of written notice thereof given by executive; (ii) in the case of Mr. Segal only, his removal from the position of Chief Executive Officer of the Company or his removal from or failure to be elected to membership on the Board of Directors; (iii) a reduction in executive’s base salary; (iv) in the case of Mr. Goldfinger only, a material reduction in employee welfare and retirement benefits applicable to the executive, other than any reduction in employee welfare and retirement benefits generally applicable to Company employees or as equally applied to executives in connection with an extraordinary decline in the Company’s fortunes; (v) a reduction in the indemnification protection provided to the executive in the agreement or within the Company’s organizational documents; (vi) the Board of Directors continuing, after reasonable notice from executive, to direct executive either: (I) to take any action that in the executive’s good-faith, considered and informed judgment violates any applicable legal or regulatory requirement, or (II) to refrain from taking any action that in the executive’s good-faith, considered and information judgment is mandated by any applicable legal or regulatory requirement; (vii) the Board of Directors requiring the executive to relocate outside of the New York City metropolitan area (exclusive of incidental travel for or on behalf of the Company); or (viii) a material breach by the Company of the agreement. If circumstances arise giving the executive the right to terminate the agreement for “Good Reason,” the executive must within 90 days notify the Company in writing of the existence of such circumstances, and the Company has 45 days from receipt of such notice within which to investigate and remedy the circumstances, after which 45 days the executive has an additional 45 days within which to
exercise the right to terminate for “Good Reason.” If the executive does not timely do so the right to terminate for “Good Reason” lapses and is deemed waived, and the executive will not thereafter have the right to terminate for “Good Reason” unless further circumstances occur giving rise independently to a right to terminate for “Good Reason.”
If the executive’sSegal’s employment is terminated as a result of his death or disability, wethe Company must pay him or his estate, as applicable, (1) the Segal Accrued Obligations earned through the date of termination and (2) a portion of the bonus that the executivehe would have been eligible to receive for days employed by the Company in the year in which the executive’shis death or disability occurs, determined by multiplying (x) the bonus based on the actual level of achievement of the applicable performance goals for such year, by (y) a fraction, the numerator of which is the number of days up to and including the date of termination, and the denominator of which is 365, such amount to be paid in the same time and the same form as the bonus otherwise would be paid. In the event of the death or disability, of the executive, vested options held by the executiveMr. Segal may be exercised by him or his survivors, as applicable, to the extent exercisable at the time of death for a period of one year from the time of death or disability.
For purposes of the agreement, “disability” shall mean the absence of the executive from the executive’s duties with the Company on a full-time basis for 180 consecutive business days as a result of incapacity due to mental or physical illness, which is determined to be total and permanent by a physician selected by the Company or its insurers and reasonably acceptable to the executive or the executive’s legal representative.
In the event the executive’s
For purposes
or more
Celeste Fierro has served as our Senior from February 19, 2014 until October 1, 2018, when she became the Vice President of Marking, Sales and Events since February 19, 2014. Ms. Fierro is an at-will-employee. For the years ended December 31, 2014 and December 31, 2015,Offsite Special Events. Ms. Fierro’s annual salary in 2017 was $250,000$365,000 and on March 29, 2017, she received a one-time discretionary bonus of $4,808.$17,067 for her performance in overseeing certain catering events, which increased sales of the Company. On June 5, 2014,April 8, 2016, Ms. Fierro receivedwas granted 125,000 RSUs vesting ratably over five years beginning on April 8, 2017. On May 16, 2017, Ms. Fierro was granted (i) 250,000 non-qualifiedincentive stock options to purchase 250,000 shares of our common stock and 100,000 RSUs, both vesting ratably over five years beginning on June 5, 2015.
John Inserra servedMay 16, 2019; and (ii) 50,000 RSUs vesting upon certain performance goals being met.
| | | Option Awards | | | Stock Awards | | |||||||||||||||||||||||||||||||||||||||||||||
Name | | | Number of Securities Underlying Unexercised Options (#) Exercisable | | | Number of Securities Underlying Unexercised Options (#) Unexercisable | | | Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) | | | Option Exercise Price ($) | | | 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 ($) | | | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | | | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) | | ||||||||||||||||||||||||
Emanuel P.N. Hilario | | | | | 100,000(1) | | | | | | 200,000 | | | | | | — | | | | | $ | 1.42 | | | | 10/30/2027 | | | | | — | | | | | | — | | | | | | — | | | | | $ | — | | |
Linda Siluk | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | — | | | | | 28,000(7) | | | | | $ | 85,960 | | | | | | — | | | | | $ | ___ | | |
Celeste Fierro | | | | | 200,000(2) | | | | | | 50,000 | | | | | | — | | | | | $ | 4.85 | | | | 6/5/2024 | | | | | 75,000(8) | | | | | $ | 230,250 | | | | | | — | | | | | $ | ___ | | |
| | | | | 50,000(3) | | | | | | 200,000 | | | | | | — | | | | | $ | 2.13 | | | | 5/15/2027 | | | | | 80,000(9) | | | | | $ | 245,600 | | | | | | — | | | | | $ | ___ | | |
Jonathan Segal | | | | | 397,008(4) | | | | | | — | | | | | | — | | | | | $ | 5.00 | | | | 10/16/2023 | | | | | — | | | | | | — | | | | | | 150,000(10) | | | | | $ | 460,500 | | |
| | | | | 79,402(5) | | | | | | — | | | | | | — | | | | | $ | 5.00 | | | | 10/16/2023 | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
| | | | | — | | | | | | — | | | | | | 500,000(6) | | | | | $ | 2.73 | | | | 4/8/2026 | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Name | | | Fees Earned or Paid in Cash ($)(1) | | | Stock Awards ($)(2) | | | Total ($) | | |||||||||
Michael Serruya | | | | $ | 50,000 | | | | | $ | 40,000 | | | | | $ | 90,000 | | |
Eugene M. Bullis | | | | $ | 50,000 | | | | | $ | 40,000 | | | | | $ | 90,000 | | |
Kin Chan(3) | | | | $ | — | | | | | $ | — | | | | | $ | — | | |
Dimitrios Angelis(4) | | | | $ | 30,000 | | | | | $ | 40,000 | | | | | $ | 70,000 | | |
(Notice Item 4).”
Plan Category | | | Number of securities to be issued upon exercise of outstanding options, warrants or rights (a) | | | Weighted-average exercise price of outstanding options, warrants and rights (b) | | | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (c) | | |||||||||
Equity compensation plans approved by security holders | | | | | 2,765,209 | | | | | $ | 3.29 | | | | | | 596,951 | | |
Equity compensation plans not approved by security holders | | | | | — | | | | | | — | | | | | | — | | |
| | | 2018 | | | 2017 | | ||||||
Audit fees(1) | | | | | | | | | | | | | |
Predecessor audit firm | | | | $ | 622,707 | | | | | $ | 650,467 | | |
Successor audit firm | | | | | 20,000 | | | | | | — | | |
Audit related fees | | | | | — | | | | | | — | | |
Tax fees | | | | | — | | | | | | — | | |
All other fees | | | | | — | | | | | | — | | |
Total | | | | $ | 642,707 | | | | | $ | 650,467 | | |
|
Notwithstanding the foregoing, in the event such merger or other reorganization event also constitutes a change of control under the terms of the 2013 Plan, then all stock options outstanding on the date of the merger or other reorganization event shall be deemed vested at such time.
Amendmentmerger among the Company, CCAC Acquisition Sub, LLC, The ONE Group, LLC and Termination.Samuel Goldfinger, as representative of the owners of membership interests in The 2013 Plan mayONE Group, LLC
material change to: (a) permit a repricing (or decrease in exercise price) of outstanding options,Options, (b) reduce the price at which awardsShares or Options may be offered, or (c) extend the duration of the 2013 Plan; (iii) materially expands the class of participantsParticipants eligible to participate in the 2013 Plan; or (iv) expands the types of awards provided under the 2013 Plan shall become effective unless stockholder approval is obtained.
On April 8, 2016, based upon Any amendment approved by the recommendationAdministrator which the Administrator determines is of our Compensation Committee, our Boarda scope that requires shareholder approval shall be subject to obtaining such shareholder approval. Any modification or amendment of Directors adopted Amendment No. 1the Plan shall not, without the consent of a Participant, adversely affect his or her rights under a Stock Right previously granted to him or her. With the consent of the Participant affected, the Administrator may amend outstanding Agreements in a manner which may be adverse to the 2013 Plan (the “Amendment”). The AmendmentParticipant but which is not inconsistent with the Plan. In the discretion of the Administrator, outstanding Agreements may be amended by the Administrator in a manner which is not adverse to the 2013Participant.
The following table provides information as to equity awards heldretained in employment or other service by each of the named executive officers of the Company at December 31, 2015.
Option Awards | ||||||||||||||||||||
Name | Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#) Unexercisable | Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) | Option Exercise Price ($) | Option Expiration Date | |||||||||||||||
Jonathan Segal | 204,421 | 306,631 | (1) | — | $ | 5.00 | 10/16/2023 | |||||||||||||
— | — | 306,631 | (4) | $ | 5.00 | 10/16/2023 | ||||||||||||||
Samuel Goldfinger | 102,210 | 153,316 | (2) | — | $ | 5.00 | 10/16/2023 | |||||||||||||
12,776 | — | 153,316 | (5) | $ | 5.00 | 10/16/2023 | ||||||||||||||
John Inserra | 40,000 | — | — | $ | 6.00 | 09/25/2016 | ||||||||||||||
10,000 | — | — | $ | 4.85 | 09/25/2016 | |||||||||||||||
Celeste Fierro | 50,000 | 200,000 | (3) | — | $ | 4.85 | 06/05/2024 |
Each non-employee director in 2015 received fully vested stock grants of 8,080 shares of common stock of the Company at the fair market value on May 18, 2015,This Plan shall be construed and $40,000 in director fees for the fiscal year ended December 31, 2015,enforced in accordance with the 2013 Plan. Forlaw of the State of Delaware.
Name | Fees Earned or Paid in Cash ($)(1) | Restricted Stock Awards ($)(2) | Total ($) | |||||||||
Michael Serruya | $ | 50,000 | $ | 40,000 | $ | 90,000 | ||||||
Richard E. Perlman | $ | 50,000 | $ | 40,000 | $ | 90,000 | ||||||
Nicholas Giannuzzi | $ | 40,000 | $ | 40,000 | $ | 80,000 | ||||||
Eugene M. Bullis | $ | 50,000 | $ | 40,000 | $ | 90,000 |
There are no family relationships among our directors or executive officers.
To our knowledge, there have been no events under any bankruptcy act, no criminal proceedings and no federal or state judicial or administrative orders, judgments or decrees or findings, no violations of any federal or state securities law, and no violations of any federal commodities law material to the evaluation of the ability and integrity of any director (existing or proposed) or executive officer (existing or proposed) of the Company during the past ten (10) years.
The following table sets forth information as of December 31, 2015, with respect to compensation plans under which equity securities of the Company are authorized for issuance. For a description of the terms of the Company’s 2013 Plan, please see “Executive Compensation — 2013 Employee, Director and Consultant Equity Incentive Plan.”
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 (excluding securities reflected in column (a)) | |||||||||
Equity compensation plans approved by security holders | 1,672,578 | $ | 5.05 | 3,101,414 | ||||||||
Equity compensation plans not approved by security holders — | — | — | — |
STOCKHOLDERS TO BE HELD JUNE 4, 2019 The Audit Committeeundersigned, having received notice of the Boardmeeting and management’s proxy statement thereof, and revoking all prior proxies, hereby appoint(s) Emanuel Hilario and Linda Siluk, and each of Directors, which consists entirely of directors who meet the independence and experience requirements of The NASDAQ Stock Market, has furnished the following report:
The Audit Committee assists the Board of Directors in overseeing and monitoring the integrity of our financial reporting process, compliance with legal and regulatory requirements and the quality of internal and external audit processes. This committee’s role and responsibilities are set forth in our charter adopted by the Board of Directors, which is available on our website atwww.togrp.com. This committee reviews and reassesses our charter annually and recommends any changes to the Board of Directors for approval. The Audit Committee is responsible for overseeing our overall financial reporting process, and for the appointment, compensation, retention, and oversightthem, as proxies or proxy of the workundersigned (with full power of Grant Thornton LLP. In fulfilling its responsibilitiessubstitution in them and each of them) for and in the financial statements for fiscal year December 31, 2015, the Audit Committee took the following actions:
Based on the Audit Committee’s review of the audited financial statements and discussions with management and Grant Thornton LLP, the Audit Committee recommended to the Board of Directors that the audited financial statements be included in our Annual Report on Form 10-K, for the fiscal year ended December 31, 2015 for filing with the SEC.
Members of The ONE Group Hospitality, Inc.Audit CommitteeEugene M. BullisRichard E. PerlmanMichael Serruya
Section 16(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), requires our directors, executive officers and beneficial owners of more than 10% of our common stock to file with the SEC initial reports of ownership and reports of changes in the ownership of our common stock and other equity securities. Such persons are required to furnish us copies of all Section 16(a) filings.
Based solely upon a review of the copies of the forms furnished to us, our records reflect that all reports which were required to be filed pursuant to Section 16(a) of the Securities Exchange Act of 1934, as amended, were filed on a timely basis, except that one report covering one transaction was filed late by each of Richard Perlman and Michael Serruya.
Mr. Segal is the Chief Executive Officer, a director and a principal stockholder of the Company. As of April 28, 2016, Mr. Segal beneficially owned approximately 29% of our issued and outstanding common stock.
On October 20, 2011, we, and our subsidiaries One 29 Park Management, LLC, STK — Las Vegas, LLC and STK Atlanta, LLC, entered into a credit agreement with Herald National Bank (now BankUnited, N.A.) for a revolving credit line of up to $3,000,000.00. We pledged collateral securing our and the other borrowers’ obligations to Herald National Bank (now BankUnited, N.A.) under the loan agreement, including the pledge of our equity interests in the other borrowers. Interest on amounts borrowed under the agreement accrues and is payable on a monthly basis at an annual rate equal to the greater of (i) the prime rate plus 1.75% or (ii) 5.0% and is payable monthly in arrears. Principal is repayable in nine consecutive monthly payments beginning on the first day of the fourth month following the date of each advance under the credit agreement. In connection with our entering into the credit agreement, Mr. Segal, RCI II, Ltd. and Talia, Ltd each entered into subordination agreements with Herald National Bank (now BankUnited, N.A.). In addition, Mr. Segal personally guaranteed this loan from Herald National Bank (now BankUnited, N.A.), and in exchange, we agreed to pay him a 3% annual “guaranty fee.” On January 24, 2013, the parties entered into Amendment No. 1 to the credit agreement, which extended the commitment period under the agreement until April 30, 2015 and the final maturity date until April 30, 2015, increased the commitment under the agreement to $5,000,000.00, and added additional subsidiaries as borrowers. As of December 31, 2013, the amounts borrowed by us that were outstanding under this line of credit were $4,316,865. On October 15, 2013, we entered into an amendment to the credit facility whereby BankUnited agreed, upon effectiveness of the Merger, to the release and termination of the Jonathan Segal guarantee and pledge, certain subordination agreements of Jonathan Segal and related entities and the release of the assignment of the proceeds of the key-man life insurance policy on the life of Mr. Segal. The amendment also imposed certain post-closing obligations on us, including executing a guarantee in favor of BankUnited unconditionally guaranteeing all of the obligations of the borrowers and the pledge of all of the membership interests of One Group owned by the Company. This post-closing obligation was met on October 25, 2013 when we entered into the Pledge Agreement and Guarantee Agreement with BankUnited, N.A. On June 3, 2014, we entered into Amendment No. 3 to the credit agreement to adjust the commitment termination date to October 31, 2014 and the maturity date to October 31, 2015, on August 6, 2014, we entered into Amendment No. 4 and Addendum to the credit agreement to, among other things, increase available borrowings under the credit agreement to $9.1 million, as well as update certain definitions, add additional subsidiaries as borrowers, remove the advance ratio covenant and add a debt service coverage ratio calculation and on October 31, 2014, we entered into Amendment No. 5 and Addendum to the credit agreement to add one additional subsidiary as a borrower. On December 17, 2014, we entered into a Term Loan Agreement with BankUnited, N.A. in the amount of $7,475,000 maturing December 1, 2019 (the “Term Loan Agreement”). The Term Loan Agreement replaced the existing credit agreement which was terminated and the aggregate principal amount of the existing loans outstanding of $6,395,071 was converted into the Term Loan Agreement. On June 2, 2015, we entered into a second term loan agreement (“Second Term Loan Agreement”) with BankUnited, N.A., wherein BankUnited, N.A. agreed to make multiple advances to the Borrowers in the aggregate principal amount of up to $6,000,000 maturing on September 1, 2020. The amounts outstanding under the Term Loan Agreement and the Second Term Loan Agreement as of April 28, 2016, are approximately $5,600,000 and $6,000,000 respectively.
Mr. Segal is a limited personal guarantor of the leases for the STK Miami premises with respect to certain covenants under the lease relating to construction of the new premises and helping the landlord obtain a new liquor license for the premises in the event of termination of the lease. Mr. Segal is a limited personal guarantor of the leases for the Bagatelle New York premises with respect to JEC II, LLC’s payment and performance under the lease.
Mr. Segal currently owns 85% of Hip Hospitality LLC, which owns 50% of Bagatelle America, LLC (“Bagatelle America”). Mr. Giannuzzi also currently owns 5% of Bagatelle America. Bagatelle America is the Manager of our Bagatelle La Cienega, LLC and Bagatelle Little West 12th LLC subsidiaries, which own and operate our Bagatelle — LA and Bagatelle — NY restaurants, respectively. As Manager, Bagatelle America receives an annual management fee of 5% of the Adjusted Gross Revenue (as defined in the management agreements with each subsidiary). Bagatelle America is also the holder of the trademark for “Bagatelle,” which it licenses royalty free to Bagatelle La Cienega, LLC and Bagatelle Little West 12th LLC.
Mr. Segal also owns 100% of TGF Holdings, LLC, which owns 10% of W15 Properties, LLC. W15 Properties, LLC is a holding company for the property that currently accommodates the 408 Venture.
Prior to the Merger, Nicholas Giannuzzi and Triple GGG, LLC (an entity managed by Nicholas Giannuzzi) were principal stockholders of the Company. Mr. Giannuzzi is the managing partner of The Giannuzzi Group, LLP, a law firm that provides legal services to the Company and its subsidiaries. In 2014 and 2015, we paid The Giannuzzi Group, LLP approximately $552,000 and $547,000 for legal services rendered, respectively. In addition, The Giannuzzi Group, LLP subleases its office space from the Company, for which it currently pays the Company $15,500 per month. The sublease expires in August 2021.
Our Audit Committee was established in November 2013, is comprised of independent directors and will review and approve all related-party transactions entered into after committee was established.
Pursuant to the written charter of our audit committee, 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 parties related to us, including our executive officers, our directors, beneficial owners of more than 5% of our securities, immediate family members of the foregoing persons and any other persons whom our Board of Directors determines may be considered related parties under Item 404 of Regulation S-K, has or will have a direct or indirect material interest.
In reviewing and approving such transactions, the 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 chairman of the audit committee in some circumstances.
The audit committee or its chairman, as the case may be, shall approve only those related party transactions that are determined to be in, or not inconsistent with, the best interests of us and our stockholders, taking into account all available facts and circumstances as the committee or the chairman determines in good faith to be necessary in accordance with principles of Delaware law generally applicable to directors of a Delaware corporation. 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 party 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 the audit committee shall participate in any review, consideration or approval of any related party transaction with respect to which the member or any of his or her immediate family members has an interest.
On March 28, 2016, the Board of Directors nominated Jonathan Segal for election at the annual meeting. The Board of Directors currently consists of five members, classified into three classes as follows: Jonathan Segal constitutes a class with a term which expires at the upcoming annual meeting; Michael Serruya and Richard E. Perlman constitute a class with a term ending in 2017; and Eugene M. Bullis and Nicholas Giannuzzi constitute a class with a term ending in 2018. At each annual meeting of stockholders, directors are elected for a full term of three years to succeed those directors whose terms are expiring.
The Board of Directors has voted to nominate Jonathan Segal as a Class III director for election at the annual meeting for a term of three years to serve until the 2019 Annual Meeting of Stockholders and until his respective successor is elected and qualified subject, however, to such director’s earlier death, resignation, retirement, disqualification or removal. The Class II directors (Eugene M. Bullis and Nicholas Giannuzzi) and the Class I directors (Michael Serruya and Richard E. Perlman) will serve until the Annual Meetings of StockholdersTHE ONE GROUP HOSPITALITY, INC. (the “Company”) to be held in 2018at STK, 26 Little West 12th Street, New York, NY 10014, on Tuesday, June 4, 2019 at 11:00 a.m. local time, and 2017, respectively,at any adjournment sessions thereof, and until their respective successors have been elected and qualified, subject, however, to such directors’ earlier death, resignation, retirement, disqualification or removal.
Unless authoritythere to vote for this nominee is withheld,and act upon the following matters in respect of all shares represented byof stock of the enclosed proxyCompany which the undersigned will be votedFORentitled to vote or act upon with all the election as directorpowers the undersigned would possess if personally present. PLEASE VOTE, DATE, AND SIGN ON THE REVERSE SIDE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON JUNE 4, 2019 The Notice of Jonathan Segal. InAnnual Meeting, Proxy Statement and 2018 Annual Report are available on the event thatCompany’s website at http://www.togrp.com/proxy.html (Continued, and to be marked, dated and signed, on the nominee becomes unable or unwilling to serve, the shares represented by the enclosed proxy will be voted for the election of such other person as the Board of Directors may recommend in that nominee’s place. We have no reason to believe that the nominee will be unable or unwilling to serve as a director.
A plurality of the shares voted for the nominee at the Meeting is required to elect such nominee as a director.
reverse side) THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS RECOMMENDSOF THE ELECTION OF JONATHAN SEGAL AS DIRECTOR, AND PROXIES SOLICITED BY THE BOARD OF DIRECTORS WILL BE VOTED IN FAVOR THEREOF UNLESS A STOCKHOLDER HAS INDICATED OTHERWISE ON THE PROXY.
The Audit Committee has appointed Grant Thornton LLP, as our independent registered public accounting firm, to audit our financial statements for the fiscal year ending December 31, 2016. In connection with the closing of the Merger, Grant Thornton LLP, which was the independent registered public accounting firm for One Group prior to the Merger, became the independent registered public accounting firm for us, and Rothstein Kass was dismissed effective on the date of the closing of the Merger (October 16, 2013), as our independent registered public accounting firm. Grant Thornton LLP audited our financial statements for the fiscal year ended December 31, 2015. We expect that representatives of Grant Thornton LLP will be present at the annual meeting, will be able to make a statement if they so desire, and will be available to respond to appropriate questions.
In deciding to appoint Grant Thornton LLP, the Audit Committee reviewed auditor independence issues and existing commercial relationships with Grant Thornton LLP and concluded that Grant Thornton LLP has no commercial relationship with the Company that would impair its independence for the fiscal year ending December 31, 2016.
The following table presents fees for professional audit services rendered by Grant Thornton LLP for the audit of the Company’s annual financial statements for the years ended December 31, 2015 and December 31, 2014, and fees billed for other services rendered by Grant Thornton LLP during those periods.
2015 | 2014 | |||||||
Audit fees:(1) | $ | 506,229 | $ | 390,804 | ||||
Audit related fees: | — | — | ||||||
Tax fees: | — | — | ||||||
All other fees: | — | — | ||||||
Total | $ | 506,229 | $ | 390,804 |
Consistent with SEC policies regarding auditor independence, the Audit Committee has responsibility for appointing, setting compensation and overseeing the work of our independent registered public accounting firm. In recognition of this responsibility, the Audit Committee has established a policy to pre-approve all audit and permissible non-audit services provided by our independent registered public accounting firm.
Prior to engagement of an independent registered public accounting firm for the next year’s audit, management will submit an aggregate of services expected to be rendered during that year for each of four categories of services to the Audit Committee for approval.
1.Audit services include audit work performed in the preparation of financial statements, as well as work that generally only an independent registered public accounting firm can reasonably be expected to provide, including comfort letters, statutory audits, and attest services and consultation regarding financial accounting and/or reporting standards.
2.Audit-Related services are for assurance and related services that are traditionally performed by an independent registered public accounting firm, including due diligence related to mergers and acquisitions, employee benefit plan audits, and special procedures required to meet certain regulatory requirements.
3.Tax services include all services performed by an independent registered public accounting firm’s tax personnel except those services specifically related to the audit of the financial statements, and includes fees in the areas of tax compliance, tax planning, and tax advice.
4.Other Fees are those associated with services not captured in the other categories. The Company generally does not request such services from our independent registered public accounting firm.
Prior to engagement, the Audit Committee pre-approves these services by category of service. The fees are budgeted and the Audit Committee requires our independent registered public accounting firm and management to report actual fees versus the budget periodically throughout the year by category of service. During the year, circumstances may arise when it may become necessary to engage our independent registered public accounting firm for additional services not contemplated in the original pre-approval. In those instances, the Audit Committee requires specific pre-approval before engaging our independent registered public accounting firm.
The Audit Committee may delegate pre-approval authority to one or more of its members. The member to whom such authority is delegated must report, for informational purposes only, any pre-approval decisions to the Audit Committee at its next scheduled meeting.
In the event the stockholders do not ratify the appointment of Grant Thornton LLP as our independent registered public accounting firm, the Audit Committee will reconsider its appointment.
The affirmative vote of a majority of the votes cast by the stockholders present or represented by proxy and entitled to vote at the annual meeting affirmatively or negatively at the annual meeting is required to ratify the appointment of the independent registered public accounting firm.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE TO RATIFY THE APPOINTMENT OF GRANT THORNTON LLP AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM, AND PROXIES SOLICITED BY THE BOARD OF DIRECTORS WILL BE VOTED IN FAVOR OF SUCH RATIFICATION UNLESS A STOCKHOLDER INDICATES OTHERWISE ON THE PROXY.
We are seeking your advisory vote as required by Section 14A of the Securities Exchange Act of 1934, as amended, on the approval of the compensation of our named executive officers as described in the Executive Officer and Director Compensation section of this proxy statement in the compensation tables and related disclosures. Because your vote is advisory, it will not be binding on our Compensation Committee or our Board of Directors. However, the Compensation Committee and the Board will review the voting results and take them into consideration when making future decisions regarding executive compensation. We have determined to hold an advisory vote to approve the compensation of our named executive officers annually, and the next such advisory vote will occur at the 2017 Annual Meeting of Stockholders.
The objective of the compensation program for our named executive officers is to motivate and reward fairly those individuals who perform over time at or above the levels that we expect and to attract, as needed, and retain individuals with the skills necessary to achieve our objectives. Our compensation program is also designed to reinforce a sense of ownership and to link compensation to the Company’s performance as well as the performance of each of our named executive officers.
We rely on qualified, highly skilled and talented employees who have experience in the restaurant and hospitality industries to execute our business plan and strategy. Thus, our compensation program is patterned in a manner similar to companies in these industries in order to attract and retain talented employees who may have other opportunities in these industry areas.
Our compensation program consists of these general elements:
In determining the total amount and mixture of the compensation for each of our named executive officers, the Compensation Committee subjectively considers the overall value to us of each named executive officer in light of numerous factors, including, but not limited to, the following:
In 2015, Mr. Segal, Mr. Goldfinger and Mr. Inserra did not receive bonuses. For additional information about compensation arrangements with Mr. Inserra, see “Executive Officer and Director Compensation — Employment Agreements with Executive Officers — Chief Operating Officer.”
The Compensation Committee and the Board of Directors believe that these policies and procedures are effective in implementing our compensation philosophy and objectives and in achieving our goals.
Because your vote is advisory, it will not be binding on our Compensation Committee or our Board of Directors, nor will it directly affect or otherwise limit any compensation or award arrangements that have already been granted to any of our named executive officers. However, the Compensation Committee and the Board of Directors will review the voting results and take them into consideration when making future decisions regarding executive compensation. In accordance with the rules recently adopted by the SEC, the following resolution, commonly known as a “say-on-pay” vote, is being submitted for a stockholder vote at the 2016 annual meeting:
“RESOLVED, that the compensation paid to the named executive officers of The ONE Group Hospitality, Inc., as disclosed pursuant to the compensation disclosure rules of the SEC, including the compensation tables and the related material disclosed in this proxy statement, is hereby APPROVED.”
The affirmative vote of a majority of the votes cast by the stockholders present or represented by proxy and entitled to vote at the annual meeting affirmatively or negatively at the annual meeting is required to approve, on an advisory basis, this resolution.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE TO APPROVE THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS, AND PROXIES SOLICITED BY THE BOARD OF DIRECTORS WILL BE VOTED IN FAVOR OF SUCH APPROVAL UNLESS A STOCKHOLDER INDICATES OTHERWISE ON THE PROXY.
We have adopted a code of conduct and ethics that applies to all of our employees, including our chief executive officer and chief financial and accounting officers. The text of the code of conduct and ethics is posted on our website atwww.togrp.comand is incorporated by reference as an exhibit to our Annual Report on Form 10-K. Disclosure regarding any amendments to, or waivers from, provisions of the code of conduct and ethics that apply to our directors, principal executive and financial officers will be included in a Current Report on Form 8-K within four business days following the date of the amendment or waiver, unless website posting or the issuance of a press release of such amendments or waivers is then permitted by the rules of NASDAQ.
The Board of Directors knows of no other business which will be presented to the annual meeting. If any other business is properly brought before the annual meeting, proxies will be voted in accordance with the judgment of the persons named therein.
To be considered for inclusion in the proxy statement relating to our 2017 Annual Meeting of Stockholders, we must receive stockholder proposals (other than for director nominations) no later than February 1, 2017 and no earlier than January 2, 2017. To be considered for presentation at the 2017 Annual Meeting, although not included in the proxy statement, proposals (including director nominations that are not requested to be included in our proxy statement) must be received no later than February 1, 2017 and no earlier than January 2, 2017. Proposals that are not received in a timely manner will not be voted on at the 2017 Annual Meeting. If a proposal is received on time, the proxies that management solicits for the meeting may still exercise discretionary voting authority on the proposal under circumstances consistent with the proxy rules of the SEC. All stockholder proposals should be marked for the attention of Security Holder Communication, Board of Directors at The ONE Group Hospitality, Inc., 411 W. 14th Street, 2nd Floor, New York, NY 10014.
New York, New York 10014April 29, 2016