UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
(Amendment No. )
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| | Preliminary Proxy Statement |
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☐ | | Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)14a-6(e)(2)) |
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☒ | | Definitive Proxy Statement |
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☐ | | Definitive Additional Materials |
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☐ | | Soliciting Material pursuant to Rule 14a-12 14a-12 |
LIVEXLIVE MEDIA, INC.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
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269 South Beverly Drive, Suite #1450
1450
Beverly Hills, CA 90212
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON SEPTEMBER 12, 201915, 2021 |
To the Stockholders of LiveXLive Media, Inc.:
The 20192021 Annual Meeting of Stockholders (the “Annual Meeting”) of LiveXLive Media, Inc., a Delaware corporation (the “Company”), will be held on Thursday, September12, 2019, 15, 2021, at 10:00 a.m. local time at Kimpton La Peer Hotel, 627 N La Peer Dr, West Hollywood,the principal executive offices of PodcastOne located at 335 North Maple Drive, Suite 127, Beverly Hills, CA 90069,90210, for the following purposes, as more fully described in the accompanying proxy statement (the “Proxy Statement”):
1. to elect the eight director nominees identified in the accompanying proxy statement to hold office until the 2020 Annual Meeting of Stockholders;
| 1. | to elect the nine director nominees identified in the accompanying proxy statement to hold office until the 2022 Annual Meeting of Stockholders; |
| 2. | to hold an advisory vote on the Company’s executive compensation; |
| 3. | to ratify the appointment of BDO USA, LLP as the Company’s independent registered public accounting firm for the fiscal year ending March 31, 2022; and |
| 4. | to transact such other business as may properly come before the Annual Meeting or any adjournment or postponement thereof. |
2. to ratify the appointment of BDO USA, LLP as the Company’s independent registered public accounting firm for the fiscal year ending March31, 2020; and
3. to transact such other business as may properly come before the Annual Meeting or any adjournment or postponement thereof.
Pursuant to the Company’s Bylaws, the Company’s board of directors has fixed the close of business on July24, 2019 23, 2021 (the “Record Date”) as the record date for the determination of stockholders entitled to notice of and to vote at the Annual Meeting and at any adjournment or postponement thereof. Holders of the Company’s common stock are entitled to vote at the Annual Meeting.
Thank you for your ongoing support and continued interest in the Company.
| | By Order of the Board of Directors, |
| | |
| /s/ Robert S. Ellin |
| Robert S. Ellin |
| Chairman and Chief Executive Officer |
| | |
Robert S. Ellin
| Beverly Hills, California |
| | | Chairman and Chief Executive Officer
|
| | Beverly Hills, California
|
| | July26, 2019 29, 2021 |
YOUR VOTE IS IMPORTANT!
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR
THE STOCKHOLDER MEETING TO BE HELD ON SEPTEMBER12, 2019:
Our Proxy Statement is attached. The Notice of Annual Meeting of Stockholders, Proxy Statement, Proxy Card and 2019 Annual Report may be accessed over the internet free of charge athttps://xbrlfinancialwidget.com/default.aspx?CIKNum=1491419&view=All.
We are using Securities and Exchange Commission rules that allow us to make our proxy statement and related materials available on the internet. Accordingly, we are sending a “Notice of Internet Availability of Proxy Materials,” or Notice of Availability, to our stockholders of record instead of a paper proxy statement and annual report containing financial statements, unless paper copies have previously been requested. The rules provide us the opportunity to save money on the printing and mailing of our proxy materials and to reduce the impact of our Annual Meeting on the environment. We hope that you will view our Annual Meeting materials over the internet if possible and convenient for you. Instructions on how to access the proxy materials over the internet or to request a paper or email copy of our proxy materials can also be found in the notice you received.
Whether or not you expect to attend the Annual Meeting, please make sure you vote so that your shares will be represented at the Annual Meeting. Our stockholders can vote over the internet or by telephone as specified in the accompanying voting instructions or by completing and returning a proxy card. This will ensure the presence of a quorum at the Annual Meeting and save the expense and extra work of additional solicitation. Sending your proxy card will not prevent you from attending the Annual Meeting, revoking your proxy and voting your stock in person.
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YOUR VOTE IS IMPORTANT!
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR
THE STOCKHOLDER MEETING TO BE HELD ON SEPTEMBER 15, 2021:
Our Proxy Statement is attached. The Notice of Annual Meeting of Stockholders, Proxy Statement, Proxy Card and 2021 Annual Report may be accessed over the internet free of charge at https://xbrlfinancialwidget.com/default.aspx?CIKNum=1491419&view=All.
We are using U.S. Securities and Exchange Commission rules that allow us to make our proxy statement and related materials available on the internet. Accordingly, we are sending a “Notice of Internet Availability of Proxy Materials,” or Notice of Availability, to our stockholders of record instead of a paper proxy statement and annual report containing financial statements, unless paper copies have previously been requested. The rules provide us the opportunity to save money on the printing and mailing of our proxy materials and to reduce the impact of our Annual Meeting on the environment. We hope that you will view our Annual Meeting materials over the internet if possible and convenient for you. Instructions on how to access the proxy materials over the internet or to request a paper or email copy of our proxy materials can also be found in the notice you received.
Whether or not you expect to attend the Annual Meeting, please make sure you vote so that your shares will be represented at the Annual Meeting. Our stockholders can vote over the internet or by telephone as specified in the accompanying voting instructions or by completing and returning a proxy card. This will ensure the presence of a quorum at the Annual Meeting and save the expense and extra work of additional solicitation. Sending your proxy card will not prevent you from attending the Annual Meeting, revoking your proxy and voting your stock in person.
TABLE OF CONTENTS
269 South Beverly Drive, Suite #1450
1450
Beverly Hills, CaliforniaCA 90212
PROXY STATEMENT FOR ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON SEPTEMBER 15, 202112, 2019 |
The board of directors of LiveXLive Media, Inc., a Delaware corporation (“we,” “us,” “our,” LiveXLive” or “our Company”) solicits the enclosed proxy for the Annual Meeting of Stockholders (the “Annual Meeting”) to be held on Thursday, September12, 2019,September 15, 2021, at 10:00 a.m. local time at Kimpton La Peer Hotel, 627 N La Peer Dr, West Hollywood,the principal executive offices of PodcastOne located at 335 North Maple Drive, Suite 127, Beverly Hills, CA 90069,90210, and for any adjournment or postponement thereof. This proxy statement (this “Proxy Statement”) is being made available to stockholders on or about July30, 2019.July 30, 2021.
QUESTIONS AND ANSWERS ABOUT THE PROXY MATERIALS AND THE ANNUAL MEETING
1. Q: Why did I receive a notice regarding the availability of proxy materials on the internet?
| 1. | Q: | Why did I receive a notice regarding the availability of proxy materials on the internet? |
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| A: | Instead of mailing paper proxy materials, we sent a “Notice of Internet Availability of Proxy Materials” to our stockholders of record. We refer to that notice as the Notice of Availability. The Notice of Availability provides instructions on how to view our proxy materials over the internet, how to vote and how to request a paper or email copy of our proxy materials. This method of providing proxy materials is permitted under rules adopted by the U.S. Securities and Exchange Commission (the “SEC”). We hope that following this procedure will allow us to save money on the printing and mailing of those materials and to reduce the impact that our Annual Meeting has on the environment. |
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| | We intend to mail the Notice of Availability on or about July 30, 2021 to all of our stockholders of record entitled to vote at the Annual Meeting. |
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| 2. | Q: | What is the purpose of the Annual Meeting? |
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| A: | At the Annual Meeting, our stockholders will act upon the matters outlined in this Proxy Statement, including: |
A: Instead of mailing paper proxy materials, we sent a “Notice of Internet Availability of Proxy Materials” to our stockholders of record. We refer to that notice as the Notice of Availability. The Notice of Availability provides instructions on how to view our proxy materials over the internet, how to vote and how to request a paper or email copy of our proxy materials. This method of providing proxy materials is permitted under rules adopted by the U.S. Securities and Exchange Commission (the “SEC”). We hope that following this procedure will allow us to save money on the printing and mailing of those materials and to reduce the impact that our Annual Meeting has on the environment.
| ● | election of the nine members of our board of directors, the director nominees being Robert S. Ellin, Jay Krigsman, Craig Foster, Ramin Arani, Patrick Wachsberger, Kenneth Solomon, Bridget Baker, Maria Garrido and Kristopher Wright (Proposal No. 1); |
We intend to mail the Notice of Availability on or about July30, 2019 to all of our stockholders of record entitled to vote at the Annual Meeting.
| ● | advisory vote on our executive compensation (Proposal No. 2); |
2. Q: What is the purpose of the Annual Meeting?
| ● | ratification of BDO USA, LLP as our independent registered public accounting firm for the fiscal year ending March 31, 2022 (Proposal No. 3). |
A: At the Annual Meeting, our stockholders will act upon the matters outlined in this Proxy Statement, including:
• election of the eight members of our board of directors, the director nominees being Robert S. Ellin, Jay Krigsman, Craig Foster, Tim Spengler, Jerome N. Gold, Ramin Arani, Patrick Wachsberger and Kenneth Solomon (Proposal No. 1); and
• ratification of BDO USA, LLP as our independent registered public accounting firm for the fiscal year ending March31, 2020 (Proposal No. 2).
Our management, certain members of our board of directors and representatives of BDO USA, LLP, our independent registered public accounting firm, will be present at the Annual Meeting to respond to appropriate questions from stockholders.
| 3. | Q: | 3. Q: Who is entitled to vote at the Annual Meeting? |
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| A: | Only common stockholders as of the close of business on July 23, 2021 (the “Record Date”) are entitled to notice of and to vote at the Meeting. As of the Record Date, there were issued and outstanding and entitled to vote 78,344,870 shares of our common stock, $0.001 par value per share. |
| 4. | Q: | What are the voting rights of the holders of our common stock? |
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| A: | Each outstanding share of our common stock will be entitled to one vote on each of the proposals presented at the Annual Meeting. |
| 5. | Q: | Which of my shares may I vote? |
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| A: | All shares owned by you as of the close of business on the Record Date may be voted by you. These shares include shares that are (i) held directly in your name as the stockholder of record and (ii) held for you as the beneficial owner through a broker, bank or other nominee. |
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| 6. | Q: | Who can attend the Annual Meeting? |
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| A: | All of our stockholders as of the Record Date may attend the Annual Meeting. Even if your shares are held in “street name,” as the beneficial owner of shares, you are invited to attend the Annual Meeting. However, if you wish to attend the Annual Meeting, please bring to the Annual Meeting your bank or brokerage statement or a letter from your nominee evidencing your beneficial ownership of our stock and a form of personal identification. We reserve the right to deny admission to anyone who cannot show valid identification or sufficient proof of share ownership as of the Record Date. |
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| | Please contact us at (310) 601-2505 or tenia@livexlive.com for directions to the Annual Meeting. |
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| 7. | Q: | Can I find out who the stockholders are? |
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| A: | A list of stockholders as of the Record Date will be available for examination by any stockholder, for any purpose germane to the Annual Meeting, during ordinary business hours for ten days prior to the Annual Meeting at the office of the Office Manager of the Company at the above address, and at the time and place of the Annual Meeting. |
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| 8. | Q: | What constitutes a quorum? |
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| A: | Presence at the Annual Meeting, in person or by proxy, of the holders of a majority of our common stock outstanding on the Record Date will constitute a quorum, permitting the Annual Meeting to proceed and business to be conducted. Abstentions and broker non-votes are included in the calculation of the number of shares considered to be present at the Annual Meeting. At the close of business on the Record Date, we had 78,344,870 shares of our common stock issued and outstanding and entitled to vote. |
| 9. | Q: | What is the difference between holding shares as a “record holder” versus a “beneficial owner”? |
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| A: | Some of our stockholders hold their shares through a broker, bank or other nominee rather than directly in their own name. As summarized below, there are some distinctions between shares held of record and those owned beneficially: |
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| | Record holders — If your shares are registered directly in your name with our transfer agent, VStock Transfer, LLC, you are, with respect to those shares, the stockholder of record or “record holder.” As the record holder, you have the right to grant your voting proxy directly to us or to vote in person at the Annual Meeting. We have enclosed or sent a proxy card for you to use. You may also vote by mail, over the internet or by telephone, as described below under the heading “Voting — How do I vote?” |
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| | Beneficial owners — If your shares are held in a brokerage account or bank or by another nominee, you are, with respect to those shares, the “beneficial owner” of shares held in “street name.” As the beneficial owner, you have the right to direct your nominee on how to vote or to vote in person at the Annual Meeting. |
| | |
| | However, since you are not a record holder, you may not vote these shares in person at the Annual Meeting unless you obtain a “legal proxy” from your nominee (who is the record holder), giving you the right to vote the shares. If you do not wish to vote in person, you may vote by mail, over the internet or by telephone, as described below under the heading “Voting — How can I vote?” |
| 10. | Q: | How do I vote? |
| | |
| A: | If you are a registered stockholder of common stock on the Record Date, meaning that you hold your shares in certificate form or through an account with our transfer agent, VStock Transfer, LLC, and you wish to vote prior to the Annual Meeting, you may vote over the Internet, by mail or in person at the Annual Meeting: |
| ● | Over the Internet. Go to the website of our tabulator, VStock Transfer, at https://www.shareholderaccountingsoftware.com/vstock/pxlogin. Have your proxy card in hand when you access the website and follow the instructions to vote your shares. You must submit your Internet proxy before 11:59 p.m., Eastern Time, on September 14, 2021, the day prior to the Annual Meeting, for your proxy to be valid and your vote to count. |
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| ● | By Mail. Complete and sign your proxy card and mail it to VStock Transfer, LLC, 18 Lafayette Place, Woodmere, NY 11598, in the postage prepaid envelope we provided. Computershare must receive the proxy card not later than September 14, 2021, the day before the Annual Meeting, for your proxy to be valid and your vote to count. |
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| ● | In Person at the Meeting. You can vote in person by attending the Annual Meeting and delivering your completed proxy card in person or by completing a ballot, which we will provide to you at the meeting. |
A: Only common stockholders as of the close of business on July24, 2019 (the “Record Date”) are entitled to notice of and to vote at the Meeting. As of the Record Date, there were issued and outstanding and entitled to vote 52,599,609shares of our common stock, $0.001 par value per share.
4. Q: What are the voting rights of the holders of our common stock?
A: Each outstanding share of our common stock will be entitled to one vote on each of the proposals presented at the Annual Meeting.
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5. Q: Which of my shares may I vote?
A: All shares owned by you as of the close of business on the Record Date may be voted by you. These shares include shares that are (i) held directly in your name as the stockholder of record and (ii) held for you as the beneficial owner through a broker, bank or other nominee.
6. Q: Who can attend the Annual Meeting?
A: All of our stockholders as of the Record Date may attend the Annual Meeting. Even if your shares are held in “street name,” as the beneficial owner of shares, you are invited to attend the Annual Meeting. However, if you wish to attend the Annual Meeting, please bring to the Annual Meeting your bank or brokerage statement or a letter from your nominee evidencing your beneficial ownership of our stock and a form of personal identification. We reserve the right to deny admission to anyone who cannot show valid identification or sufficient proof of share ownership as of the Record Date.
Please contact us at (310) 601-2500 or tenia@livexlive.com for directions to the Annual Meeting.
7. Q: Can I find out who the stockholders are?
A: A list of stockholders as of the Record Date will be available for examination by any stockholder, for any purpose germane to the Annual Meeting, during ordinary business hours for ten days prior to the Annual Meeting at the office of the Office Manager of the Company at the above address, and at the time and place of the Annual Meeting.
8. Q: What constitutes a quorum?
A: Presence at the Annual Meeting, in person or by proxy, of the holders of a majority of our common stock outstanding on the Record Date will constitute a quorum, permitting the Annual Meeting to proceed and business to be conducted. Abstentions and broker non-votes are included in the calculation of the number of shares considered to be present at the Annual Meeting. At the close of business on the Record Date, we had 52,599,609shares of our common stock issued and outstanding and entitled to vote.
9. Q: What is the difference between holding shares as a “record holder” versus a “beneficial owner”?
A: Some of our stockholders hold their shares through a broker, bank or other nominee rather than directly in their own name. As summarized below, there are some distinctions between shares held of record and those owned beneficially:
Record holders— If your shares are registered directly in your name with our transfer agent, VStock Transfer, LLC, you are, with respect to those shares, the stockholder of record or “record holder.” As the record holder, you have the right to grant your voting proxy directly to us or to vote in person at the Annual Meeting. We have enclosed or sent a proxy card for you to use. You may also vote by mail, over the internet or by telephone, as described below under the heading “Voting — How do I vote?”
Beneficial owners— If your shares are held in a brokerage account or bank or by another nominee, you are, with respect to those shares, the “beneficial owner” of shares held in “street name.” As the beneficial owner, you have the right to direct your nominee on how to vote or to vote in person at the Annual Meeting.
However, since you are not a record holder, you may not vote these shares in person at the Annual Meeting unless you obtain a “legal proxy” from your nominee (who is the record holder), giving you the right to vote the shares. If you do not wish to vote in person, you may vote by mail, over the internet or by telephone, as described below under the heading “Voting — How can I vote?”
10. Q: How do I vote?
A: If you are a registered stockholder of common stock on the Record Date,meaning that you hold your shares in certificate form or through an account with our transfer agent, VStock Transfer, LLC, and you wish to vote prior to the Annual Meeting, you may vote over the Internet, by mail or in person at the Annual Meeting:
• Over the Internet. Go to the website of our tabulator, VStock Transfer, atwww.vstocktransfer.com/proxy. Have your proxy card in hand when you access the website and follow the instructions to vote your
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shares. You must submit your Internet proxy before 11:59 p.m., Eastern Time, on September11, 2019, the day prior to the Annual Meeting, for your proxy to be valid and your vote to count.
• By Mail. Complete and sign your proxy card and mail it to VStock Transfer, LLC, 18 Lafayette Place, Woodmere, NY 11598, in the postage prepaid envelope we provided. Computershare must receive the proxy card not later than September11, 2019, the day before the Annual Meeting, for your proxy to be valid and your vote to count.
• In Person at the Meeting. You can vote in person by attending the Annual Meeting and delivering your completed proxy card in person or by completing a ballot, which we will provide to you at the meeting.
If on the Record Date your shares are held in street name,the proxy materials are being forwarded to you by or on behalf of your bank, broker or other nominee. If you received the proxy materials directly from Broadridge, follow the instructions above for stockholders of record. If you received the proxy materials from your bank, broker or other nominee, follow the instructions provided by your bank, broker or other nominee explaining how you can vote. If you would like to vote in person at the Annual Meeting, contact your bank, broker or other nominee who holds your shares to obtain a broker’s proxy card and bring it with you to the Annual Meeting, along with a bank or brokerage statement or a letter from your nominee evidencing your beneficial ownership of our stock and a form of personal identification. A broker’s proxy is not the form of proxy enclosed with this Proxy Statement.You will not be able to vote shares you hold in street name in person at the Annual Meeting unless you have a proxy from your bank, broker or other nominee issued in your name giving you the right to vote your shares.
11. Q: What if I do not specify how my shares are to be voted?
| 11. | Q: | What if I do not specify how my shares are to be voted? |
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| A: | If you are the stockholder of record and you submit a proxy but do not provide any voting instructions, your shares will be voted in accordance with the recommendations of our board of directors. If you hold your shares in street name and do not instruct your bank or broker how to vote, it will nevertheless be entitled to vote your shares of common stock with respect to “routine” items but not with respect to “non-routine” items. |
A: If you are the stockholder of record and you submit a proxy but do not provide any voting instructions, your shares will be voted in accordance with the recommendations of our board of directors. If you hold your shares in street name and do not instruct your bank or broker how to vote, it will nevertheless be entitled to vote your shares of common stock with respect to “routine” items but not with respect to “non-routine” items.
Please note that at the Annual Meeting, we believe that only the ratification of the appointment of our independent registered public accounting firm (Proposal No. 2)3) will be considered a “routine” matter. Under applicable rules, banks and brokers are permitted to vote the shares held in their name for the account of a beneficial holder for “routine” matters, even if such bank or broker does not receive instructions from the beneficial holder. We will refer to these votes cast by banks and brokers without instruction from the relevant beneficial holder as “Broker Discretionary Votes”. We believe that based on the policies of most banks and brokers, the majority of Broker Discretionary Votes will be cast in accordance with the recommendations of our board of directors, and therefore “FOR” Proposal No. 2.3.
We believe that each of the other proposal (Proposalproposals (Proposals No. 1)1 and No. 2) will be considered a “non-routine”“non-routine” item, and your broker will not have discretion to vote on this proposal.these proposals. We will refer to these shares not voted by banks and brokers in absence of instructions from the relevant beneficial holder as “broker non-votes”non-votes”.
It is therefore important that you provide instructions to your bank or broker so that your shares are voted accordingly.
12. Q: What is a broker non-vote?
| 12. | Q: | What is a broker non-vote? |
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| A: | Generally, a broker non-vote occurs when shares held by a nominee for a beneficial owner are not voted with respect to a particular proposal because (i) the nominee has not received voting instructions from the beneficial owner with respect to such proposal (despite voting on at least one other proposal for which it does have discretionary authority or for which it has received instructions) and (ii) the nominee lacks discretionary voting power to vote such shares. Under the rules of The Nasdaq Capital Market (“Nasdaq”), a nominee does not have discretionary voting power with respect to “non-routine” matters or the election of directors. The ratification of the appointment of our independent registered public accounting firm (Proposal No. 3) is a routine matter and the other proposal is a non-routine matter. |
A: Generally, a broker non-vote occurs when shares held by a nominee for a beneficial owner are not voted with respect to a particular proposal because (i) the nominee has not received voting instructions from the beneficial owner with respect to such proposal (despite voting on at least one other proposal for which it does have discretionary authority or for which it has received instructions) and (ii) the nominee lacks discretionary voting power to vote such shares. Under the rules of The Nasdaq Capital Market (“Nasdaq”), a nominee does not have discretionary voting power with respect to “non-routine” matters or the election of directors. The ratification of the appointment of our independent registered public accounting firm (Proposal No. 2) is a routine matter and the other proposal is a non-routine matter.
If you are the beneficial owner of our common stock, your nominee will send you directions on how you can instruct them to vote.
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| 13. | Q: | 13. Q: May I change my vote after I return my proxy? |
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| A: | Yes. You may revoke your proxy and change your vote at any time before the proxy is exercised. Record holders may change their vote by: |
| ● | a timely, valid, later-dated proxy; |
| ● | a timely written notice of revocation submitted to our Office Manager at our principal executive offices at 269 South Beverly Drive, Suite 1450, Beverly Hills, CA 90212; or |
| ● | attending the Annual Meeting and voting in person. |
A: Yes. You may revoke your proxy and change your vote at any time before the proxy is exercised. Record holders may change their vote by:
• a timely, valid, later-dated proxy;
• a timely written notice of revocation submitted to our Office Manager at our principal executive offices at 269 South Beverly Drive, Suite #1450, Beverly Hills, CA 90212; or
• attending the Annual Meeting and voting in person.
• Beneficial owners may change their vote by complying with the instructions on their voting instruction cards.
You should be aware that simply attending the Annual Meeting will not in and of itself constitute a revocation of your proxy.
| 14. | Q: | 14. Q: How does the Company’s board of directors recommend that I vote? |
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| A: | The Company’s board of directors recommends that you vote your shares: |
| ● | FOR the election of each of the director nominees named in this Proxy Statement (Proposal No. 1); |
| ● | FOR the advisory resolution approving our executive compensation (Proposal No. 2); and |
| ● | FOR the ratification of BDO USA, LLP as the Company’s independent registered public accounting firm for the fiscal year ending March 31, 2022 (Proposal No. 3). |
| 15. | Q: | Vote Requirement — How many votes are required to approve each item? |
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| A: | Election of directors (Proposal No. 1) — If a quorum is present, a plurality of the votes cast shall be sufficient to elect directors (that is the nominees for our directors who receive the most votes will be elected). For purposes of electing directors, not voting or withholding your vote by voting “abstain” (or a direction to your broker, bank or other nominee to withhold your vote, called a “broker non-vote”) is not counted as a vote cast, and therefore will have no effect on the outcome of the election of directors. |
A: The Company’s board of directors recommends that you vote your shares:
• FOR the election of each of the director nominees named in this Proxy Statement (Proposal No. 1);
• FOR the ratification of BDO USA, LLP as the Company’s independent registered public accounting firm for the fiscal year ending March31, 2020 (Proposal No. 2).
15. Q: Vote Requirement — How many votes are required to approve each item?
Election of directors (Proposal No. 1)— If a quorum is present, a plurality of the votes cast shall be sufficient to elect directors (that is the nominees for our directors who receive the most votes will be elected). For purposes of electing directors, not voting or withholding your vote by voting “abstain” (or a direction to your broker, bank or other nominee to withhold your vote, called a “broker non-vote”) is not counted as a vote cast, and therefore will have no effect on the outcome of the election of directors.
Other proposal (Proposalproposals (Proposals No. 2 and 3 and any other items properly brought before the Annual Meeting)— If a quorum is present, approval of each of this proposalthese proposals and any other item properly brought before the Annual Meeting requires that the votes cast in favor of such action exceed the votes cast opposing such action. For purposes of these votes, abstentions or not voting on a matter will not be counted as either votes cast for or against this proposal and therefore will not count in determining the approval of this proposal. Broker non-votesnon-votes will have no effect on the outcome of this proposal.these proposals.
The results of Proposal No.2, isProposals No. 2 and No. 3 are not binding on our board of directors.
16. Q: What happens if a nominee is unable to stand for election?
A: If a nominee is unable to stand for election, the board of directors may either reduce the number of directors to be elected or select a substitute nominee. If a substitute nominee is selected, the proxy holders will vote your shares for the substitute nominee, unless you have voted “Withhold” with respect to the original nominee.
17. Q: Vote Count — How are votes counted?
A: Votes will be counted by the inspector of election appointed for the Annual Meeting, who will separately count, for each proposal votes “For,” “Against,” abstentions and broker non-votes.
18. Q: Voting Results — Where can I find the voting results of the Annual Meeting?
A: We will publish the final voting results of the Annual Meeting in a Current Report on Form 8-K filed with the SEC within four business days after the Annual Meeting.
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19. Q: What should I do if I receive more than one set of voting materials?
A: You may receive more than one set of voting materials, including multiple copies of the Notice of Availability, this Proxy Statement and multiple proxy cards or voting instruction cards. For example, if you hold your shares in more than one brokerage account, you may receive a separate voting instruction card for each brokerage account. If you are a record holder and your shares are registered in more than one name, you will receive more than one Notice of Availability or proxy card. If you receive multiple sets of voting materials, please vote each Notice of Availability, proxy card and voting instruction card that you receive.
20. Q: Who will pay the costs of soliciting these proxies?
A: Proxies will be solicited initially by mail. Further solicitation may be made in person or by telephone, email or facsimile by members of our management. We will bear the expense of preparing, printing and mailing this Proxy Statement and accompanying materials to our stockholders. Upon request, we will reimburse brokers, banks or similar entities acting as nominees for reasonable expenses incurred in forwarding copies of the proxy materials relating to the Annual Meeting to the beneficial owners of our common stock.
21. Q: What happens if additional matters are presented at the Annual Meeting?
A: Other than the two proposals described in this Proxy Statement, we are not aware of any other business to be acted upon at the Annual Meeting. If you grant a proxy, the persons named as proxy holders, Robert S. Ellin, our Chairman and Chief Executive Officer, and Michael Zemetra, our Chief Financial Officer, will have the discretion to vote your shares on any additional matters properly presented for a vote at the Annual Meeting.
22. Q: Who can help answer my questions?
A:
| 16. | Q: | What happens if a nominee is unable to stand for election? |
| | |
| A: | If a nominee is unable to stand for election, the board of directors may either reduce the number of directors to be elected or select a substitute nominee. If a substitute nominee is selected, the proxy holders will vote your shares for the substitute nominee, unless you have voted “Withhold” with respect to the original nominee. |
| | |
| 17. | Q: | Vote Count — How are votes counted? |
| | |
| A: | Votes will be counted by the inspector of election appointed for the Annual Meeting, who will separately count, for each proposal votes “For,” “Against,” abstentions and broker non-votes. |
| | |
| 18. | Q: | Voting Results — Where can I find the voting results of the Annual Meeting? |
| | |
| A: | We will publish the final voting results of the Annual Meeting in a Current Report on Form 8-K filed with the SEC within four business days after the Annual Meeting. |
| | |
| 19. | Q: | What should I do if I receive more than one set of voting materials? |
| | |
| A: | You may receive more than one set of voting materials, including multiple copies of the Notice of Availability, this Proxy Statement and multiple proxy cards or voting instruction cards. For example, if you hold your shares in more than one brokerage account, you may receive a separate voting instruction card for each brokerage account. If you are a record holder and your shares are registered in more than one name, you will receive more than one Notice of Availability or proxy card. If you receive multiple sets of voting materials, please vote each Notice of Availability, proxy card and voting instruction card that you receive. |
| | |
| 20. | Q: | Who will pay the costs of soliciting these proxies? |
| | |
| A: | Proxies will be solicited initially by mail. Further solicitation may be made in person or by telephone, email or facsimile by members of our management. We will bear the expense of preparing, printing and mailing this Proxy Statement and accompanying materials to our stockholders. Upon request, we will reimburse brokers, banks or similar entities acting as nominees for reasonable expenses incurred in forwarding copies of the proxy materials relating to the Annual Meeting to the beneficial owners of our common stock. |
| | |
| 21. | Q: | What happens if additional matters are presented at the Annual Meeting? |
| | |
| A: | Other than the two proposals described in this Proxy Statement, we are not aware of any other business to be acted upon at the Annual Meeting. If you grant a proxy, the persons named as proxy holders, Robert S. Ellin, our Chairman and Chief Executive Officer, and Michael Quartieri, our Chief Financial Officer, will have the discretion to vote your shares on any additional matters properly presented for a vote at the Annual Meeting. |
| | |
| 22. | Q: | Who can help answer my questions? |
| | |
| A: | If you have any questions about our proxy materials or the Annual Meeting, you can contact our Office Manager at: |
LiveXLive Media, Inc.
269 South Beverly Drive, Suite #1450
1450
Beverly Hills, CA 90212
Attention: Office Manager
(310) 601-2500601-2505
****
5
CORPORATE GOVERNANCE
We have adopted a Code of Ethics for our directors, officers and employees, which, in conjunction with our Certificate of Incorporation, Bylaws and board of directors’ committee charters, form our framework for governance. All of these documents are publicly available on our investor relations/corporate governance website athttp://ir.livexlive.com/ir-homeir-home or may be obtained upon written request to:
LiveXLive Media, Inc.
269 South Beverly Drive, Suite #1450
1450
Beverly Hills, CA 90212
Attention: Office Manager
Governance Highlights
We are committed to maintaining high standards of business conduct and corporate governance, which we believe are essential to running our business efficiently, serving our stockholders well and maintaining our integrity in the marketplace. Some of the highlights of our corporate governance include:
What We Do:
• 6 of
| ● | 8 of 9 directors are independent |
| ● | Annual election of all members of our board of directors (see Proposal No. 1) |
| ● | Annual advisory vote to ratify independent auditor (see Proposal No. 3) |
| ● | Restrictive stock ownership and insider trading guidelines |
| ● | Regular board of directors self-assessments at both individual and committee levels |
| ● | Board of directors committee members are all independent |
• Annual election of all members of our board of directors (see Proposal No. 1)
• Annual advisory vote to ratify independent auditor (see Proposal No. 2)
• Restrictive stock ownership and insider trading guidelines
• Regular board of directors self-assessments at both individual and committee levels
• Board of directors committee members are all independent
What WeDon’t Do:
•
| ● | No repricing of underwater stock options without stockholder approval |
| ● | No hedging of Company securities per Company policy |
| ● | No pledging of Company securities without preapproval per Company policy |
• No hedging of Company securities per Company policy
• No pledging of Company securities without preapproval per Company policy
Director Independence
Our board of directors currently consists of eightnine directors, sixeight of whom are independent (as determined by our board of directors), one of whom serves as our Chairman and Chief Executive Officer and one of whom serves as our Chief Strategy Officer. Our board of directors has reviewed the independence of our directors and has determined that each of Messrs. Foster, Krigsman, Spengler, Arani, Wachsberger, Solomon and SolomonWright and Ms. Baker and Ms. Garrido qualifies as an independent director pursuant to Rule 5605(a)(2) of Nasdaq and applicable SEC rules and regulations. In making this determination, our board of directors considered the relationships that each of these non-employeenon-employee directors has with us and all other facts and circumstances our board of directors deemed relevant in determining their independence.
Board Composition and Director Qualifications
Our Nominating Committee periodically assesses the appropriate size and composition of our board of directors, taking into account our specific needs. The committee utilizes various methods for identifying and evaluating candidates for director. Candidates may come to the attention of the committee through recommendations of directors, management, stockholders and professional search firms. Generally, the committee seeks members with diverse backgrounds, viewpoints and viewpointslife and professional experiences, which contribute to the board of directors’ broad spectrum of experience and expertise, and who have a reputation of integrity.integrity, provided such individuals should all have a high level of management and/or financial experience.
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While we have no formal diversity policy that applies to the consideration of director candidates, the Nominating Committee has determined that diversity should be an important consideration in the selection of candidates, and that the board should be comprised of members who reflect diversity not only in race and gender, but also in viewpoints, experiences, backgrounds, skills and other qualities and attributes. The board and the Nominating Committee recognize the value of gender, race, ethnicity and age diversity and are focused on expanding the board to continue to diversify its makeup. Consistent with this commitment, the board appointed its first female member during the fiscal year ended March 31, 2020 and its second female members this past fiscal year, appointed Mr. Wright in May 2021 and continues to search for other suitable diverse candidates.
Rather than being bound by one-size-fits-allone-size-fits-all policies regarding the composition of theour board of directors, the Nominating Committee instead seeks to make individual, facts-specificfacts-specific determinations. We believe that our Company requires specialized experience and expertise in its leaders due to the uniqueness of its business and industry. Commencing with our 2020 fiscal year, the Nominating Committee will annually assessassesses the appropriateness of the size of our board of directors, the skill set mix of each director, and the performance of each director when reviewing the annual board self-assessments,self-assessments, where each director will havehas the opportunity to provide comprehensive feedback on himself/herself, his/her peers and the board as a whole. Two of the current members of our board of directors have been our directors since 2011 and 2012 respectively, and the other sixseven director nominees named in this Proxy Statement joined us in 2017, 20182019, 2020 and 2019,2021, reflecting our evolving and expanding business and leadership needs.
The Nominating Committee does not mandate an age or length of service at which a director must resign, and instead focuses on whether each director continues to provide value to the company and its stockholders. The Nominating Committee has committed itself to carefully considering diversity when evaluating future director candidates, giving strong consideration to candidates that would contribute to the board’s gender, ethnic and other diversity.
At a minimum, directors should:
• have experience in positions with a high degree of responsibility;
| ● | have experience in positions with a high degree of responsibility; |
• demonstrate strong leadership skills;
| ● | demonstrate strong leadership skills; |
• have the time, energy, interest and willingness to serve as a director; and
| ● | have the time, energy, interest and willingness to serve as a director; and |
•
| ● | contribute to the mix of skills, core competencies and qualifications of the board of directors and management. |
In addition, our board of directors reconstituted our board committees in February 2021 to more closely reflect the committees’ composition with the skills and experience of our board members.
In addition to recommendations from directors, management and professional search firms, the Nominating Committee will consider director candidates properly submitted by our stockholders. Stockholder recommendations should be sent to the Office Manager at our principal executive offices. The Nominating Committee will review all potential director nominees in the same manner, regardless of the source of the recommendation, in accordance with its charter.
Our Nominating Committee currently consists of Messrs. Foster and Krigsman and Spengler,Ms. Garrido, with Mr.FosterMr. Foster serving as the chairman.
Board Leadership Structure
Currently, the office of Chairman of our board of directors and Chief Executive Officer are held by Robert S. Ellin. Due to our size and early stage of operations, we believe it is currently most effective to have the Chairman of the board of directors and Chief Executive Officer positions be held by the same individual. Under our Bylaws, the Chairman of the board of directors is responsible for coordinating the board of directors’ activities, including the scheduling of meetings and the determination of relevant agenda items.
Risk Oversight and Compensation Risk Assessment
Our board of directors oversees a company-widecompany-wide approach to risk management. Our board of directors determines the appropriate risk level for us generally, assesses the specific risks faced by us and reviews the steps taken by our management to manage those risks. While our board of directors has ultimate oversight responsibility for the risk management process, its committees oversee risk in certain specified areas.
Specifically, our Compensation Committee is responsible for overseeing the management of risks relating to our executive compensation plans and arrangements, and the incentives created by the compensation awards it administers. Our Audit Committee oversees management of enterprise risks and financial risks, as well as potential conflicts of interests. Our board of directors is responsible for overseeing the management of risks associated with the independence of our board of directors.
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Our management also reviews and reports on potential areas of risk at the request of the Audit Committee or other members of the board of directors.
We believe that our compensation policies and practices do not create inappropriate or unintended significant risk to our Company as a whole. We also believe that our incentive compensation arrangements provide incentives that do not encourage risk-takingrisk-taking beyond our ability to effectively identify and manage significant risks, are compatible with effective internal controls and our risk management practices and are supported by the oversight and administration of the Compensation Committee with regard to executive compensation programs.
Code of Ethics
We have adopted a Code of Ethics applicable to all of our directors, officers and employees, including our Chief Executive Officer, Chief Financial Officer and Controller, which is a “code of ethics” as defined by applicable SEC rules. The purpose and role of this code is to, among other things, focus our directors, officers and employees on areas of ethical risk, provide guidance to help them recognize and deal with ethical issues, provide mechanisms to report unethical or unlawful conduct and to help enhance and formalize our culture of integrity, honesty and accountability. If we make any amendments to this code, other than technical, administrative or other non-substantivenon-substantive amendments, or grant any waivers, including implicit waivers, from any provision of this code that applies to our Chief Executive Officer, Chief Financial Officer or Controller, or persons performing similar functions, and that relates to an element of the SEC’s “code of ethics” definition, then we will disclose the nature of the amendment or waiver in the “Corporate Governance” section of our investor relations/corporate governance websitehttp://ir.livexlive.com/ir-homeir-home.
Policy Regarding Attendance at Annual Meetings of Stockholders
We do not have a policy with regard to board members’ attendance at annual meetings. We expect that our Chairman and one or more of the other directors will attend our Annual Meeting.
Stockholder Communications
Stockholders and other interested parties may communicate with the board of directors, any committee thereof, the independent or non-managementnon-management directors as a group or any individual director in writing. All such written communications must identify the recipient and be forwarded by mail to:
LiveXLive Media, Inc.
269 South Beverly Drive, Suite #1450
1450
Beverly Hills, CA 90212
Attention: Office Manager
The Office Manager will act as agent for the directors in facilitating such communications. In that capacity, the Office Manager may review, sort and summarize the communications.
Complaints about accounting, internal accounting controls or auditing matters may be made by utilizing our Business Integrity web-reportingweb-reporting tool, which we are in the process of implementing.
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PROPOSAL NO. 1 — ELECTION OF DIRECTORS
Director Nominees
Our board of directors is soliciting approval of the following director nominees:
• Robert S. Ellin
• Jay Krigsman
• Craig Foster
• Tim Spengler
• Jerome N. Gold
• Ramin Arani
• Patrick Wachsberger
•
| ● | Bridget Baker |
| | |
| ● | Maria Garrido |
| | |
| ● | Kristopher Wright |
As we elect all members of our board of directors annually, the eightnine nominees will serve for a one-yearone-year term expiring on the date of our 20202022 Annual Meeting of Stockholders or until their successors are elected or their earlier resignation or removal. All of the director nominees are current members of the board of directors and are standing for re-election.re-election.
Each of the director nominees has indicated a willingness to serve, or continue to serve, as a director if elected. If any director nominee becomes unable to serve, the board of directors may designate a substitute nominee, in which case the designated proxy holders, Mr.EllinMr. Ellin and Mr.Zemetra,Mr. Quartieri, will vote for such substitute nominee.
Vote Required
A plurality of votes cast will be required to elect each director nominee (that is the nominees for our directors who receive the most votes will be elected). For purposes of electing directors, not voting, withholding your vote by voting “abstain” or a broker non-votenon-vote is not counted as a vote cast, and therefore will have no effect on the outcome of the election of directors.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTEFOR
EACH NAMED DIRECTOR NOMINEE.
The Board of Directors Unanimously Recommends a Vote FOR
Each Named Director Nominee.
General Information About the Board of Directors
Our Bylaws provide that our business and affairs will be managed by, or under the direction of, our board of directors. Set forth below is biographical information for the director nominees as of the date of this Proxy Statement, and the qualifications that led our board of directors to conclude that each should serve as a director.
Robert S. Ellin, Age: 56
• Age: 54
| ● | Professional Background: Mr. Ellin has served as our Chairman (or Executive Chairman prior to September 1, 2017) of our board of directors since September 2011 and as our Chief Executive Officer (or President prior to September 1, 2017) since September 2011. On September 2, 2017, our board of directors changed Mr. Ellin’s title from President to Chief Executive Officer. Mr. Ellin formerly served as our Chief Executive Officer from September 9, 2011 to April 30, 2014 and as our Chief Financial Officer from April 26, 2012 until September 30, 2013. Mr. Ellin has more than 20 years of investment and turnaround experience. He is Managing Director and Portfolio Manager of Trinad Capital Master Fund Ltd. (“Trinad Capital”). Trinad Capital is our principal stockholder and a hedge fund dedicated to investing in micro-cap public companies. Mr. Ellin was a founder, and served as a member of the board of directors from February 2005 to September 2013, and as Executive Chairman of the board of directors, of Mandalay Digital Group, Inc. (MNDL) from December 2011 to April 2013. He has also served on the Board of Governors at Cedars-Sinai Hospital in Los Angeles, California since March 2007. Prior to joining Trinad Capital, Mr. Ellin was the founder and President of Atlantis Equities, Inc. (“Atlantis”), a private investment company. Founded in 1990, Atlantis actively managed an investment portfolio of small capitalization public companies as well as select private company investments. Mr. Ellin played an active role in Atlantis investee companies including board representation, management selection, corporate finance and other advisory services. Through Atlantis and related companies, he spearheaded investments into THQ, Inc., Grand Toys, Forward Industries, Inc. (FORD), Majesco Entertainment (COOL) and iWon.com. Mr. Ellin also completed a leveraged buyout of S&S Industries, Inc. where he served as President from 1996 to 1998. S&S Industries was one of the largest manufacturers in the world of underwires which had strong partnerships with leading companies including Bally’s, Maidenform, and Sara Lee. Prior to founding Atlantis Equities, Mr. Ellin worked in Institutional Sales at LF Rothschild and was Manager of Retail Operations at Lombard Securities. Mr. Ellin received his BBA degree from Pace University. |
| ● | Board Membership Qualifications: Our board of directors has concluded that Mr. Ellin is well-qualified to serve on our board of directors and has the requisite qualifications, skills and perspectives based on, among other factors, him being the Managing Director and Portfolio Manager of Trinad Capital, our controlling stockholder, and his extensive business, investment, finance and public company experience, particularly in investing in micro-cap public companies. |
• Professional Background: Mr.Ellin has served as our Chairman (or Executive Chairman prior to September1, 2017) of our board of directors since September 2011 and as our Chief Executive Officer (or President prior to September1, 2017) since September 2011. On September2, 2017, our board of directors changed Mr.Ellin’s title from President to Chief Executive Officer. Mr.Ellin formerly served as our Chief Executive Officer from September9, 2011 to April30, 2014 and as our Chief Financial Officer from April26, 2012 until September30, 2013. Mr.Ellin has more than 20 years of investment and turnaround experience. He is Managing Director and Portfolio Manager of Trinad Capital. Trinad Capital is our principal stockholder and a hedge fund dedicated to investing in micro-cap public companies. Mr.Ellin was a founder, and served as a member of the board of directors from February 2005 to September 2013,
9
and as Executive Chairman of the board of directors, of Mandalay Digital Group, Inc. (MNDL) from December 2011 to April 2013. He has also served on the Board of Governors at Cedars-Sinai Hospital in Los Angeles, California since March 2007. Prior to joining Trinad Capital, Mr.Ellin was the founder and President of Atlantis Equities, Inc. (“Atlantis”), a private investment company. Founded in 1990, Atlantis actively managed an investment portfolio of small capitalization public companies as well as select private company investments. Mr.Ellin played an active role in Atlantis investee companies including board representation, management selection, corporate finance and other advisory services. Through Atlantis and related companies, he spearheaded investments into THQ, Inc., Grand Toys, Forward Industries, Inc. (FORD), Majesco Entertainment (COOL) and iWon.com. Mr.Ellin also completed a leveraged buyout of S&S Industries, Inc. where he served as President from 1996 to 1998. S&S Industries was one of the largest manufacturers in the world of underwires which had strong partnerships with leading companies including Bally’s, Maidenform, and Sara Lee. Prior to founding Atlantis Equities, Mr.Ellin worked in Institutional Sales at LF Rothschild and was Manager of Retail Operations at Lombard Securities. Mr.Ellin received his BBA degree from Pace University.
• Board Membership Qualifications: Our board of directors has concluded that Mr.Ellin is well-qualified to serve on our board of directors and has the requisite qualifications, skills and perspectives based on, among other factors, him being the Managing Director and Portfolio Manager of Trinad Capital, our controlling stockholder, and his extensive business, investment, finance and public company experience, particularly in investing in micro-cap public companies.
Jay Krigsman, Age: 56
• Age: 54
| ● | Professional Background: Mr. Krigsman has served as a director of our Company since April 26, 2012. Mr. Krigsman has been the Executive Vice President and Asset Manager of The Krausz Companies since 1992, where he assists in property acquisitions, oversees the company’s property management team and is responsible for developing and implementing strategic leasing programs. Prior to joining The Krausz Companies, Mr. Krigsman had the senior leasing responsibilities for Birtcher Development Co. Mr. Krigsman holds a Certified Commercial Investment Member designation from the CCIM Institute, a Sr. Certified Leasing Specialist designation from the International Council of Shopping Centers and holds a California Real Estate Broker’s License. Mr. Krigsman currently serves on the board of directors of Trinad Capital, our principal stockholder. Mr. Krigsman received a BA in Business Administration from the University of Maryland. |
| ● | Board Membership Qualifications: Our board of directors has concluded that Mr. Krigsman is well-qualified to serve on our board of directors and has the requisite qualifications, skills and perspectives based on, among other factors, his professional background and experience in acquisitions and management and him being the Executive Vice President and Asset Manager of The Krausz Companies for over 20 years. |
• Professional Background: Mr.Krigsman has served as a director of our Company since April26, 2012. Mr.Krigsman has been the Executive Vice President and Asset Manager of The Krausz Companies since 1992, where he assists in property acquisitions, oversees the company’s property management team and is responsible for developing and implementing strategic leasing programs. Prior to joining The Krausz Companies, Mr.Krigsman had the senior leasing responsibilities for Birtcher Development Co. Mr.Krigsman holds a Certified Commercial Investment Member designation from the CCIM Institute, a Sr. Certified Leasing Specialist designation from the International Council of Shopping Centers and holds a California Real Estate Broker’s License. Mr.Krigsman currently serves on the board of directors of Trinad Capital, our principal stockholder. Mr.Krigsman received a BA in Business Administration from the University of Maryland.
• Board Membership Qualifications: Our board of directors has concluded that Mr.Krigsman is well-qualified to serve on our board of directors and has the requisite qualifications, skills and perspectives based on, among other factors, his professional background and experience in acquisitions and management and him being the Executive Vice President and Asset Manager of The Krausz Companies for over 20 years.
Craig Foster, Age: 50
• Age: 48
| ● | Professional Background: Mr. Foster has served as a director of our Company since July 7, 2017. Mr. Foster previously served as the Chief Financial Officer and Chief Accounting Officer of Amobee, Inc., a digital advertising platform, from April 2015 until May 2017. From February 2013 until April 2015, Mr. Foster served as Chief Financial Officer and Chief Accounting Officer of Ubiquiti Networks, Inc., a publicly-traded networking and communications company. From June 2012 to February 2013, Mr. Foster served as Director in the technology infrastructure and software group of Credit Suisse Securities (USA) LLC, an investment bank. From August 2007 to June 2012, Mr. Foster served as an Executive Director and co-head of the software group of UBS Securities LLC, an investment bank. Mr. Foster has also held various management positions at RBC Capital Markets, an investment bank, Loudcloud, a software and services platform, PricewaterhouseCoopers, a public accounting firm and Deloitte, a public accounting firm. Mr. Foster holds an M.B.A. in Finance from the Wharton School of Business and a B.A. in Economics from the University of California, San Diego. |
• Professional Background: Mr.Foster has served as a director of our Company since July7, 2017. Mr.Foster previously served as the Chief Financial Officer and Chief Accounting Officer of Amobee, Inc., a digital advertising platform, from April 2015 until May 2017. From February 2013 until April 2015, Mr.Foster served as Chief Financial Officer and Chief Accounting Officer of Ubiquiti Networks, Inc., a publicly-traded networking and communications company. From June 2012 to February 2013, Mr.Foster served as Director in the technology infrastructure and software group of Credit Suisse Securities (USA) LLC, an investment bank. From August 2007 to June 2012, Mr.Foster served as an Executive Director and co-head of the software group of UBS Securities LLC, an investment bank. Mr.Foster has also held various management positions at RBC Capital Markets, an investment bank, Loudcloud, a software and services platform, PricewaterhouseCoopers, a public accounting firm and Deloitte, a public accounting firm. Mr.Foster holds an M.B.A. in Finance from the Wharton School of Business and a B.A. in Economics from the University of California, San Diego.
| ● | Board Membership Qualifications: Our board of directors has concluded that Mr. Foster is well-qualified to serve on our board of directors and has the requisite qualifications, skills and perspectives based on, among other factors, his experience in technology and software for over 10 years. |
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• Board Membership Qualifications: Our board of directors has concluded that Mr.Foster is well-qualified to serve on our board of directors and has the requisite qualifications, skills and perspectives based on, among other factors, his experience in technology and software for over 10 years.
Tim Spengler
• Age: 55
• Professional Background: Mr.Spengler has served as a director of our Company since September27, 2017. Mr.Spengler has more than 25 years of experience working directly with marketers to drive business results through innovative approaches to media. From July 2016 until June 2017, he served as President and Chief Revenue Officer of Simulmedia, an advertising technology firm. From October 2015 through June 2016, Mr.Spengler served as Chief Executive Officer of FUISZ Video, an interactive digital video company. From November 2013 through October 2014, Mr.Spengler served as President/Content Marketing and Revenue Strategy for iHeartMedia, a leading media company delivering music, news and talk content across multiple platforms. Mr.Spengler served as a senior executive at IPG for nearly two decades, holding positions of increasing responsibility, including President, North America for Initiative from 2008 to 2012 and Worldwide Chief Executive Officer for MAGNA GLOBAL from 2012 to 2013. Mr.Spengler currently sits on the Board of Directors for the Hollywood Radio & Television Society and National Association of Television Program Executives. He is also on the advisory board of emerging media companies, including Influential Social and IgnitionOne. Mr.Spengler received a B.A. in Political Science from Washington University in St Louis, Missouri.
• Board Membership Qualifications: Our board of directors has concluded that Mr.Spengler is well-qualified to serve on our board of directors and has the requisite qualifications, skills and perspectives based on, among other factors, his experience in marketing and television for over 20 years.
Jerome N. Gold
• Age: 73
• Professional Background: Mr.Gold has served as our Chief Strategy Officer and Executive Vice President since April 2018 and from April 2017 to April 2018, Mr.Gold served as our Chief Financial Officer and Executive Vice President. Mr.Gold has been serving as a member of our board of directors since April16, 2018. From October 2015 to April 2017, Mr.Gold was Managing Director at Pacific Capital Partners LLC, an investment firm arranging debt and equity financing for real estate, technology and entertainment ventures. From July 2013 to April 2017, Mr.Gold served as Chief Executive Officer of Biometrics Technology International Inc., a start-up company which he co-founded, that developed patented authentication and security technology to replace passwords using facial, voice, fingerprint and signature recognition to control access to valuable and confidential information. From July 2011 to June 2013, Mr.Gold served as Chief Executive Officer of Bonded Services, one of the leading providers of asset management services for the media and entertainment market. Mr.Gold has been a music and entertainment executive for the past 37 years, including serving as the Executive Vice President and Chief Financial Officer of Warner Music Group for nearly a decade. In addition to his responsibilities as Warner Music’s Chief Financial Officer, he extended his focus to strategic planning, mergers and acquisitions and joint ventures. Mr.Gold also managed Warner Music’s investment in Columbia House, a direct marketing joint venture with Sony Music, and was a member of the board of directors. Mr.Gold was also a partner at Ernst & Young for 12 years and led the firm’s media and entertainment practice where he was responsible for clients like Time Warner, PolyGram, Boston Ventures and Silver Screen Partners. Mr.Gold received his BBA in Business Administration from Baruch College and passed the Certified Public Accountant exam.
• Board Membership Qualifications: Our board of directors has concluded that Mr.Gold is well-qualified to serve on our board of directors and has the requisite qualifications, skills and perspectives based on, among other factors, his professional chief financial officer background and experience, including having been a music and entertainment executive for the past 37 years, including serving as the Executive Vice President and Chief Financial Officer of Warner Music Group for nearly a decade, extensive strategic planning, mergers and acquisitions and joint ventures experience, and deep familiarity with our Company.
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Ramin Arani, Age: 51
• Age: 49
| ● | Professional Background: Mr. Arani has been serving as a member of our board of directors since January 14, 2019. Mr. Arani was the portfolio manager at Fidelity Management & Research Company (“FMR Co”), the investment adviser for Fidelity’s family of mutual funds, until his retirement at the end of 2018. FMR Co is a wholly owned subsidiary of FMR LLC, which is a greater than 5% stockholder of our Company and acquired its position as part of our public offering completed in December 2017. Fidelity Investments is a leading provider of investment management, retirement planning, portfolio guidance, brokerage, benefits outsourcing, and other financial products and services to more than 20 million individuals, institutions and financial intermediaries. In his portfolio manager role, he served as the lead manager of the Fidelity Puritan Fund. Prior to assuming his lead responsibilities in 2008, Mr. Arani co-managed Fidelity Puritan Fund from 2007 to 2008. Previously, he managed the equity portion of Fidelity Asset Manager Portfolio from 2005 to 2006, Fidelity Trend Fund from 2000 to 2007 and Select Health Care Portfolio from 1999 to 2000. Mr. Arani has held various other roles within FMR Co’s Equity Research group, including that of analyst covering the health care industry from 1999 to 2000, analyst covering the retail industry/portfolio manager of Select Retailing Portfolio from 1997 to 1999, and analyst covering defense electronics companies, then real estate investment trusts from 1992 to 1996. Before joining Fidelity in 1992, Mr. Arani was a research analyst intern at Josephthal & Co. in 1991. He has been in the investments industry since 1992. Mr. Arani earned his Bachelor of Arts degree in international relations from Tufts University. He also received the 1994, 1996 and 1998 Institutional Investor “Best of the Buyside” awards for his research work. |
| ● | Board Membership Qualifications: Our board of directors has concluded that Mr. Arani is well-qualified to serve on our board of directors and has the requisite qualifications, skills and perspectives based on, among other factors, his experience in the investment industry for over 25 years, including deep understanding of the capital markets. |
• Professional Background: Mr Arani has been serving as a member of our board of directors since January14, 2019. Mr.Arani was the portfolio manager at Fidelity Management & Research Company (“FMR Co”), the investment adviser for Fidelity’s family of mutual funds, until his retirement at the end of 2018. FMR Co is a wholly owned subsidiary of FMR LLC, which is a greater than 5% stockholder of our Company and acquired its position as part of our public offering completed in December 2017. Fidelity Investments is a leading provider of investment management, retirement planning, portfolio guidance, brokerage, benefits outsourcing, and other financial products and services to more than 20million individuals, institutions and financial intermediaries. In his portfolio manager role, he served as the lead manager of the Fidelity Puritan Fund. Prior to assuming his lead responsibilities in 2008, Mr.Arani co-managed Fidelity Puritan Fund from 2007 to 2008. Previously, he managed the equity portion of Fidelity Asset Manager Portfolio from 2005 to 2006, Fidelity Trend Fund from 2000 to 2007 and Select Health Care Portfolio from 1999 to 2000. Mr.Arani has held various other roles within FMR Co’s Equity Research group, including that of analyst covering the health care industry from 1999 to 2000, analyst covering the retail industry/portfolio manager of Select Retailing Portfolio from 1997 to 1999, and analyst covering defense electronics companies, then real estate investment trusts from 1992 to 1996. Before joining Fidelity in 1992, Mr.Arani was a research analyst intern at Josephthal & Co. in 1991. He has been in the investments industry since 1992. Mr.Arani earned his Bachelor of Arts degree in international relations from Tufts University. He also received the 1994, 1996 and 1998 Institutional Investor “Best of the Buyside” awards for his research work.
• Board Membership Qualifications: Our board of directors has concluded that Mr.Arani is well-qualified to serve on our board of directors and has the requisite qualifications, skills and perspectives based on, among other factors, his experience in the investment industry for over 25 years, including deep understanding of the capital markets.
Patrick Wachsberger, Age: 69
• Age: 67
| ● | Professional Background: Mr. Wachsberger has been serving as a member of our board of directors since January 25, 2019. Mr. Wachsberger currently serves as the founder and manager of Picture Perfect Entertainment LLC, a film and television production and distribution studio he founded in 2018. Prior to that, Mr. Wachsberger was serving as Co-Chairman of Lionsgate Films (Lionsgate Motion Picture Group), an American film production and film distribution studio (“Lionsgate”), joining in January 2012 when Lionsgate acquired Summit Entertainment, which he helped launch in 1993. Mr. Wachsberger has risen to become one of the leading international film executives in the world during his 30-year motion picture industry career. As Co-Chairman at Lionsgate, Mr. Wachsberger oversaw all aspects of Lionsgate’s feature film acquisition, production and distribution and was responsible for leading its motion picture business around the world. During his tenure, Lionsgate’s feature film slate generated nearly $10 billion at the global box office over the past five years, led by the critically-acclaimed breakout sensation Wonder, the global box office phenomenon La Land, winner of six Academy Awards ®, double Oscar® winner Hacksaw Ridge, and the blockbuster Hunger Games, John Wick, and Now You See Me franchises. Other recent hits include The Hitman’s Bodyguard, The Big Sick (in partnership with Amazon Studios) and The Shack. Under Mr. Wachsberger’s leadership, Lionsgate built a global distribution infrastructure encompassing nearly 20 output deals in major territories, including the successful 50/50 joint venture of International Distribution Company in Latin America and Lionsgate’s successful self-distribution operations in the U.K. Lionsgate, while also continuing to grow its film business in China and India. Mr. Wachsberger was awarded in 2017 the prestigious honor of Chevalier des Arts et des Lettres (Knight in the Order of Arts and Letters), received CineEurope’s International Distributor of the Year award in 2018 and was named as a “Game Changer” at the 2016 Zurich Film Festival. |
• Professional Background: Mr.Wachsberger has been serving as a member of our board of directors since January25, 2019. Mr.Wachsberger currently serves as the founder and manager of Picture Perfect Entertainment LLC, a film and television production and distribution studio he founded in 2018. Prior to that, Mr.Wachsberger was serving as Co-Chairman of Lionsgate Films (Lionsgate Motion Picture Group), an American film production and film distribution studio (“Lionsgate”), joining in January 2012 when Lionsgate acquired Summit Entertainment, which he helped launch in 1993. Mr.Wachsberger has risen to become one of the leading international film executives in the world during his 30-year motion picture industry career. As Co-Chairman at Lionsgate, Mr.Wachsberger oversaw all aspects of Lionsgate’s feature film acquisition, production and distribution and was responsible for leading its motion picture business around the world. During his tenure, Lionsgate’s feature film slate generated nearly $10billion at the global box office over the past five years, led by the critically-acclaimed breakout sensation Wonder, the global box office phenomenon La La Land, winner of six Academy Awards ®, double Oscar® winner Hacksaw Ridge, and the blockbuster Hunger Games, John Wick, and Now You See Me franchises. Other recent hits include The Hitman’s Bodyguard, The Big Sick (in partnership with Amazon Studios) and The Shack. Under Mr.Wachsberger’s leadership, Lionsgate built a global distribution infrastructure encompassing nearly 20 output deals in major territories, including the successful 50/50 joint venture of International Distribution Company in Latin America and Lionsgate’s successful self-distribution operations in the U.K. Lionsgate, while also continuing to grow its film business in China and India. Mr.Wachsberger was awarded in 2017 the prestigious honor of Chevalier des Arts et des Lettres (Knight in the Order of Arts and Letters), received CineEurope’s International Distributor of the Year award in 2018 and was named as a “Game Changer” at the 2016 Zurich Film Festival.
| ● | Board Membership Qualifications: Our board of directors has concluded that Mr. Wachsberger is well-qualified to serve on the board of directors and has the requisite qualifications, skills and perspectives based on, among other factors, his extensive experience and leadership in the media and entertainment industry, including with respect to the acquisition, production, growth and distribution of various entertainment assets. |
• Board Membership Qualifications: Our board of directors has concluded that Mr.Wachsberger is well-qualified to serve on the board of directors and has the requisite qualifications, skills and perspectives based on, among other factors, his extensive experience and leadership in the media and entertainment industry, including with respect to the acquisition, production, growth and distribution of various entertainment assets.
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Kenneth Solomon, Age: 58
• Age: 56
| ● | Professional Background: Mr. Solomon has been serving as a member of our board of directors since May 24, 2019. Mr. Solomon currently serves as the Chairman of the Board and Chief Executive Officer of The Tennis Channel, Inc., which operates a professional sports and tennis lifestyle-based television channel. Mr. Solomon is also a Partner of Arcadia Investment Partners, a private investment firm, serves as the Chairman of Ovation TV, Inc., and since 2008 has been serving as a director of World Golf Tour, Inc. Previously Mr. Solomon served as Founding President of Fine Living Network, LLC (also known as Fine Living TV Network) (formerly Fine Living Cable Network). He led the network from concept through launch in just over three years and ultimately to 25,000,000 subscribers and agreements with distributors representing 73% of the cable and satellite universe. Prior to launching Fine Living, he served as founding president of iBlast. Mr. Solomon was responsible for building the nation’s largest and farthest-reaching digital distribution network, with 18 major broadcast groups comprising 246 individual television stations, covering 93% of U.S. television households. He served as President of Universal Studios Television (also Studios USA Television) where he oversaw worldwide program and asset development and distribution activities for primetime network, cable, syndication, and made-for-television movies. Mr. Solomon also served as Co-head of DreamWorks Television, where he worked with the new studio’s legendary founders to help create and develop its worldwide television operations. He also has held senior positions at News Corp., including Executive Vice President of network distribution of Fox Broadcasting through its transitional ascending period where he was responsible for all network affiliate relations, as well as leading the network’s successful conversion of dozens of CBS, ABC and NBC affiliates to Fox, and launching the NFL and NHL franchises. He also served as Executive Vice President and General Sales Manager of Twentieth Century Fox Domestic Television. Mr. Solomon was integrally involved in the formative development, sale and launch of FX cable network, News Corp.’s first venture into basic cable. He held key leadership positions at a number of preeminent media and television companies. Mr. Solomon has more than 20 years of experience in cable, new media, TV production, distribution, and advertising through top posts at Universal Television, DreamWorks, News Corp. and Scripps. Mr. Solomon captured the Emmy award for best drama with “Law & Order” and pioneered the licensing of an original series across multiple network platforms with “Law & Order: Special Victims Unit” to NBC and USA Network. Mr. Solomon received his Bachelor of Arts degree in Sociology from UCLA. Mr. Solomon has been honored as “Humanitarian of the Year” by H.E.L.P. Group. |
| ● | Board Membership Qualifications: Our board of directors has concluded that Mr. Solomon is well-qualified to serve on the board of directors and has the requisite qualifications, skills and perspectives based on, among other factors, his extensive experience and leadership in the media and entertainment industry, including entertainment asset development and distribution. |
• Professional Background: Mr.Solomon has been serving as a member of our board of directors since May24, 2019. Mr.Wachsberger currently serves as the Chairman of the Board and CEO of The Tennis Channel, Inc.Bridget Baker, which operates a professional sports and tennis lifestyle-based television channel. Mr.Solomon is also a Partner of Arcadia Investment Partners, a private investment firm, serves as the Chairman of Ovation TV,Age: 59
| ● | Professional Background: Ms. Baker has been serving as a member of our board of directors since October 20, 2019. As Chief Executive Officer of Baker Media Inc., Ms. Baker advises and represents major media and technology companies. Prior to establishing Baker Media in 2013, Ms. Baker had a distinguished 22-year career at NBCUniversal as a cofounder of CNBC and ultimately, from 2006 to 2013, the company’s first President of TV Networks Distribution, overseeing its $5 billion content distribution business. In this role, she was a member of the company’s Management Committee, the top 1% senior executives, and at the forefront of a wide range of strategic initiatives, from expanding coverage of the Olympic Games to creating Hulu. She was a key player in over $50-billion of corporate mergers and acquisitions, including Universal Studios, Bravo and Telemundo. She established the first ever women’s affinity group at NBCUniversal, the award-winning Women’s Network, and served as chair from 2005-2009. Additionally, she served on the boards of the Sundance Channel, the NBC Peacock Foundation and Women in Cable & Telecommunications. From 2013 to 2018, Ms. Baker served as a member of the board of directors of General Communication, Inc.,the largest Alaska-based communications provider offering a full range of wireless, data, video, and managed services to residential customers, businesses, governmental entities, and educational and medical institutions. Ms. Baker received her Bachelor of Arts degree in Political Studies from Pitzer College where she is an 18-year Trustee and was honored in 2010 as a Distinguished Alumni. |
| ● | Board Membership Qualifications: Our board of directors has concluded that Ms. Baker is well-qualified to serve on the board of directors and has the requisite qualifications, skills and perspectives based on, among other factors, her extensive experience and leadership in the media, tech and entertainment industry, including content distribution and strategy, as well bringing diversity in viewpoints, experiences, backgrounds, skills and other qualities and attributes to the board of directors. |
Maria Garrido, and since 2008 has been serving as a director of World Golf Tour, Inc. Previously Mr.Solomon served as Founding President of Fine Living Network, LLC (also known as Fine Living TV Network) (formerly Fine Living Cable Network). He led the network from concept through launch in just over three years and ultimately to 25million subscribers and agreements with distributors representing 73% of the cable and satellite universe. Prior to launching Fine Living, he served as founding president of iBlast. Mr.Solomon was responsible for building the nation’s largest and farthest-reaching digital distribution network, with 18 major broadcast groups comprising 246 individual television stations, covering 93% of U.S. television households. He served as President of Universal Studios Television (also Studios USA Television) where he oversaw worldwide program and asset development and distribution activities for primetime network, cable, syndication, and made-for-television movies. Mr.Solomon also served as Co-head of DreamWorks Television, where he worked with the new studio’s legendary founders to help create and develop its worldwide television operations. He also has held senior positions at News Corp.Age: 48
| ● | Professional Background: Ms. Garrido has been serving as a member of our board of directors since December 29, 2020. Ms. Garrido is a multilingual, multinational executive with 24 years of experience in modern marketing. She has held global and local leadership positions in profitable business units, and has held both operational and strategic roles in consumer goods, media, communications and entertainment across North America, Latin America and Europe. Since February 2018, Ms. Garrido has been the Senior Vice President, Brand Marketing of Vivendi SA, a French media conglomerate headquartered in Paris, France and the owner of Universal Music Group, Groupe Canal+ and Dailymotion, having activities in music, television, film, video games, book publishing, tickets and video hosting services, where she leads the content marketing practice across the Vivendi group of companies. From January 2017 to December 2018, Ms. Garrido served as the Chief Executive Officer of Havas X SA, a French multinational advertising and public relations company, headquartered in Paris, France, where she promoted Havas initiatives in the various innovation spaces (AI, start-ups, academic partnerships) and lead a team of innovators around the world. From 2014 to December 2020, Ms. Garrido served as the Chief Insights Officer of Havas SA where she lead the development of strategic analytical tools to improve client’s KPI performance and managed data analytics product/service portfolio at a global level. Ms. Garrido has also previously held various marketing consulting, director and manager positions with Mondelez Europe GmbH, Colgate-Palmolive Company, 3M Company and Hallmark Cards, Inc. She is a prolific global public speaker, having appeared on Bloomberg news, The Guardian’s Summit, Cartagena Inspira, Mumbrella Australia, South Tech Summit, World Retail Congress, APAC Hall Healthcare Conference, IBC and IAB Mexico. Ms. Garrido is a member of the International Women’s Forum and Marketing World50 and has also been a Media Jury member for Cristal Media Festival, Dubai Lynx, Cannes International Festival of Creativity, and President Entertainment Jury Eurobest. Ms. Garrido received her Master of International Business Studies from the University of South Carolina and Bachelor of Arts double degrees in International Relations and French from Drake University. |
| | |
| ● | Board Membership Qualifications: Our board of directors has concluded that Ms. Garrido is well-qualified to serve on the board of directors and has the requisite qualifications, skills and perspectives based on, among other factors, her extensive experience and leadership in the consumer goods, media, communications and entertainment industries, as well bringing diversity in viewpoints, experiences, backgrounds, skills and other qualities and attributes to the board of directors. |
Kristopher Wright, including Executive Vice President of network distribution of Fox Broadcasting through its transitional ascending period where he was responsible for all network affiliate relations, as well as leading the network’s successful conversion of dozens of CBS, ABC and NBC affiliates to Fox, and launching the NFL and NHL franchises. He also served as Executive Vice President and General Sales Manager of Twentieth Century Fox Domestic Television. Mr.Solomon was integrally involved in the formative development, sale and launch of FX cable network, News Corp.’s first venture into basic cable. He held key leadership positions at a number of preeminent media and television companies. Mr.Solomon has more than 20 years of experience in cable, new media, TV production, distribution, and advertising through top posts at Universal Television, DreamWorks, News Corp. and Scripps. Mr.Solomon captured the Emmy award for best drama with “Law & Order” and pioneered the licensing of an original series across multiple network platforms with “Law & Order: Special Victims Unit” to NBC and USA Network. Mr.Solomon received his Bachelor of Arts degree in Sociology from UCLA. Mr.Solomon has been honored as “Humanitarian of the Year” by H.E.L.P. Group.Age: 46
• Board Membership Qualifications: Our board of directors has concluded that Mr.Solomon is well-qualified to serve on the board of directors and has the requisite qualifications, skills and perspectives based on, among other factors, his extensive experience and leadership in the media and entertainment industry, including entertainment asset development and distribution.
| | Professional Background: Mr. Wright has been serving as a member of our board of directors since May 21, 2021. Mr. Wright is a senior leader in the Consumer Products Industry with more than 20 years of innovative, growth oriented, results-driven leadership experience. Mr. Wright has spent the past 10 years at Nike and is currently Vice President of Nike Global Men’s Footwear Lifestyle Product. Prior to joining Nike, Mr. Wright held senior management roles at Converse, Jordan, and Reebok. In October 2020, Mr. Wright was recognized by Business Insider as one of 28 Outstanding People of Color in the Sneaker Industry. Prior to joining Nike, Mr. Wright founded the luxury lifestyle footwear brand Jhung Yuro, where as Chief Executive Officer, he led the company’s Far East factory/supplier sourcing and negotiations, developed marketing initiatives, established distribution and merchandising strategies for a wide variety of retail partners. In 2008 Headgear purchased a 50% stake in Jhung Yuro to launch a joint venture partnership which provided infrastructure and resources to grow the brand. Additionally, Mr. Wright is an appointed member of the Executive Leadership Council, a national organization of Black CEOs and senior executives in Fortune 1000 and Global 500 companies. Mr. Wright also serves on the Advisory Board of Directors for the Southwestern Athletic Conference (SWAC). Mr. Wright earned his Bachelor of Arts degree in marketing and business administration from Clark Atlanta University. |
| | |
| ● | Board Membership Qualifications: Our board of directors has concluded that Mr. Wright is well-qualified to serve on the board of directors and has the requisite qualifications, skills and perspectives based on, among other factors, his extensive experience and leadership in the marketing industry, including brand awareness and distribution strategies, as well bringing diversity in viewpoints, experiences, backgrounds, skills and other qualities and attributes to the board of directors. |
Board Meetings
Our board of directors both met in person and/or via telephone/video conference and acted by unanimous written consent during our fiscal year ended March31, 2019.March 31, 2021. Our board of directors met fourthree times in person during the 20192021 fiscal year, with all of the incumbent directors (who were on the board of directors at the time that such meetings were held during such fiscal year) attending more than 75% of the aggregate of the meetings of the board of directors and of board committees on which they served, except that Mr.Wachsberger could not attend one meetingserved. Our board of directors also acted numerous times by written consent during the Compensation Committee for personal reasons.2021 fiscal year. We intend to adopt a formal policy on director attendance at annual meetings of stockholders, which will state that each director is strongly encouraged to attend such meetings, whether by phone or in person, unless attendance is precluded by health or other significant personal matters. We held our 20182020 annual meeting of stockholders on November29, 2018.September 17, 2020.
The board of directors has informally designated Mr.FosterMr. Foster to preside over executive sessions of the non-managementnon-management directors.
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Board Committees
The board of directors has three standing committees: the Audit Committee, the Nominating Committee and the Compensation Committee, each of which is described below. Each committee operates under a written charter adopted by the board of directors. All of the committee charters are publicly available in the “Corporate Governance” section of our investor relations/corporate governance website athttp://ir.livexlive.com/ir-homeir-home or may be obtained upon written request to our Office Manager at our principal executive offices.
Committee members are elected by our board of directors, upon the Nominating Committee’s recommendations, and serve until their successors are elected or their earlier resignation or removal.
The current composition of the board of directors’ committees is as follows:
Name | | Audit Committee | | Nominating Committee | | Compensation Committee |
Robert S. Ellin | | | | | | |
Jay Krigsman | | S
| | S
☒ | | S☒(Chair)
|
Craig Foster | | S☒(Chair)
| | S☒(Chair)
| | S
|
Tim Spengler
Patrick Wachsberger | | S
| | S
| | S
☒ |
Jerome N. Gold
Ramin Arani | | ☒ | | | | |
| Kenneth Solomon | | ☒ | | | | |
| Bridget Baker | | | | | | ☒ |
| Maria Garrido | | | | ☒ | | |
| Kristopher Wright | | | | | | |
Patrick Wachsberger
| | | | | | S
|
Ramin Arani
| | S
| | | | |
Kenneth Solomon
| | S
| | | | S
|
Audit Committee
During
As of the end of our fiscal year ended March31, 2019,March 31, 2021, the Audit Committee consisted of and currently consists of Messrs. Krigsman, Foster, SpenglerSolomon and Arani.Arani, with Mr. Foster serving as the Chairman of the Audit Committee. The Audit Committee currently consists of Messrs. Krigsman, Foster, Spengler, Arani and Solomon.the same members. The board of directors has determined that all fourthree of the current members of the Audit Committee are independent, pursuant to Rule 5605(a)(2) of Nasdaq and Rule 10A-310A-3 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Our board of directors has also determined that each Audit Committee member is financially literate and that Mr.FosterMr. Foster qualifies as an “audit committee financial expert,” as such term is defined in Item 407(d)(5) of Regulation S-K.S-K. The Audit Committee met sixfive times in person and/or via telephone/video conference during our 20192021 fiscal year.
As set forth in more detail in the Audit Committee Charter, the Audit Committee’s purpose is to assist the board of directors in its general oversight of the quality and integrity of our accounting, auditing and financial reporting and internal control practices. The specific responsibilities of the Audit Committee include:
• appointing, compensating, retaining, evaluating, terminating, and overseeing our independent registered public accounting firm;
| ● | appointing, compensating, retaining, evaluating, terminating, and overseeing our independent registered public accounting firm; |
• discussing with our independent registered public accounting firm the independence of its members from its management;
| ● | discussing with our independent registered public accounting firm the independence of its members from its management; |
• reviewing with our independent registered public accounting firm the scope and results of their audit;
| ● | reviewing with our independent registered public accounting firm the scope and results of their audit; |
• approving all audit and permissible non-audit services to be performed by our independent registered public accounting firm;
| ● | approving all audit and permissible non-audit services to be performed by our independent registered public accounting firm; |
• overseeing the financial reporting process and discussing with management and our independent registered public accounting firm the interim and annual financial statements that we file with the SEC;
| ● | overseeing the financial reporting process and discussing with management and our independent registered public accounting firm the interim and annual financial statements that we file with the SEC; |
• reviewing and monitoring our accounting principles, accounting policies, financial and accounting controls, and compliance with legal and regulatory requirements;
| ● | reviewing and monitoring our accounting principles, accounting policies, financial and accounting controls, and compliance with legal and regulatory requirements; |
• coordinating the oversight by our board of directors of our code of business conduct and our disclosure controls and procedures;
| ● | coordinating the oversight by our board of directors of our code of business conduct and our disclosure controls and procedures; |
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| ● | establishing procedures for the confidential and/or anonymous submission of concerns regarding accounting, internal controls or auditing matters; and |
• establishing procedures for the confidential and/or anonymous submission of concerns regarding accounting, internal controls or auditing matters; and
| ● | reviewing and approving related-person transactions. |
• reviewing and approving related-person transactions.
Audit Committee meetings are attended by our Chief Executive Officer and/or Chief Financial Officer, from time to time, and other members of management, as requested by the committee. For additional information concerning the Audit Committee, see “Report of the Audit Committee of the Board of Directors” included in this Proxy Statement.
Nominating Committee
During
As of the end of our fiscal year ended March31, 2019,March 31, 2021, the Nominating Committee consisted of and currently consists of Messrs. Krigsman and Foster and Spengler.Ms. Garrido, with Mr. Foster serving as the Chairman of the Nominating Committee. The board of directors has determined that all members of the Nominating Committee are independent pursuant to Rule 5605(a)(2) of Nasdaq. During our 20192021 fiscal year, our Nominating Committee acted solely by unanimous written consent. The specific responsibilities of the Nominating Committee include:
• identifying, screening and recruiting qualified individuals to become board members;
| ● | identifying, screening and recruiting qualified individuals to become board members; |
• proposing nominations for the board of directors and board committee membership;
| ● | proposing nominations for the board of directors and board committee membership; |
•
| ● | assessing the composition of the board of directors and board committees; |
| ● | overseeing the performance of the board of directors; and |
| ● | complying with all other responsibilities and duties set forth in the Nominating Committee Charter. |
Compensation Committee
As of the boardend of directors and board committees;
• overseeing the performance of the board of directors; and
• complying with all other responsibilities and duties set forth in the Nominating Committee Charter.
Compensation Committee
During our fiscal year ended March31, 2019,March 31, 2021, the Compensation Committee consisted of Messrs. Krigsman, Foster, Spengler and Wachsberger. The Compensation Committee currently consists of Messrs. Krigsman Foster, Spengler,and Wachsberger and Solomon.Ms. Baker, with Mr. Krigsman serving as the Chairman of the Compensation Committee. The board of directors has determined that all members of the Compensation Committee are independent pursuant to Rule 5605(a)(2) of Nasdaq. The Compensation Committee met three times in person and/or via telephone/video conference during our 20192021 fiscal year. The specific responsibilities of the Compensation Committee include:
• reviewing key employee compensation goals, policies, plans and programs;
| ● | reviewing key employee compensation goals, policies, plans and programs; |
• reviewing and approving the compensation of our directors and executive officers;
| ● | reviewing and approving the compensation of our directors and executive officers; |
• reviewing and approving employment agreements and other similar arrangements between us and our executive officers; and
| ● | reviewing and approving employment agreements and other similar arrangements between us and our executive officers; and |
•
| ● | appointing and overseeing any compensation consultants or advisors. |
Compensation Committee meetings are attended by our Chief Executive Officer and/or Chief Financial Officer, from time to time, and other members of management, as requested by the committee.
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DIRECTOR COMPENSATION
Only our independent board members have received compensation for their services as a director. Current director compensation consists of an annual grant of between $90,000 and $120,000$130,000 worth of restricted stock units (or pro-ratapro-rata for service less than one year) to each director, depending on committee membershipconsisting of an annual grant of $90,000 worth of restricted stock units to each independent board member and responsibilities,(i) $10,000 worth of restricted stock units to each member of our Audit Committee and an additional $15,000 worth of restricted stock units to the chairman of our Audit Committee, and (ii) $5,000 worth of restricted stock units to each member of our Compensation Committee and an additional $10,000 worth of restricted stock units to the chairman of our Compensation Committee, with the number of restricted stock units calculated based on the fair market value of our stock on the date of the grant approval date, which restricted unitsunit grants for our 2021 fiscal year vest on August16, 2019 for Messrs. Krigsman, Foster and Spengler and on November29, 2019 for Messrs. Arani, Wachsberger and Solomon,October 31, 2021, provided that such director continues to serve as our director and if applicable, a member of the respective committee, on the vesting date. In addition, during 2018 fiscal year, we granted 25,000 stock options to each Messrs. Krigsman, Foster and Spengler, which options vest annually over a periodMembers of two years with one-half of the options vestingour Nominating Committee do not receive any additional compensation for their service on the first anniversary date of the date of the grant and the remainder of the options vesting on the second anniversary date of the date of grant, provided that such director continues to serve as our director on each vesting date.committee. At the direction of the Compensation Committee of our board of directors, we are currently undertakingintend to undertake a process to formerly review, on a periodic basis, our board of directors’ compensation, including but not limited to pay for (i)(x) each of our non-employeenon-employee directors in cash, (ii)(y) each member of the Audit Committee, Compensation Committee and Nominating Committee additional annual cash amounts, and (iii)(z) the Chairpersons of the Audit Committee, Compensation Committee and Nominating Committee additional cash amounts. This process includesWe anticipate retaining an expert compensation consulting firm to benchmark director compensation and provide recommendations around near and long-termlong-term compensation for our board. We expect to conclude this board of director compensation review as early asduring our 20202022 fiscal year. Currently, no additional per-meetingper-meeting fees apply under the plan. Subject to such compensation review, we may also grant to each non-employeenon-employee director restricted stock units, shares of our common stock and/or stock options to purchase shares of our common stock (i)(A) upon such non-employeenon-employee director’s appointment to the board of directors (prorated for the period from the director’s appointment through the anticipated date of our next annual meeting of stockholders), and (ii)(B) on an annual basis thereafter. We may also grant additional discretionary stock-basedstock-based awards to our non-employeenon-employee directors, and subject to our director compensation review and board’s approval, these directors may have the option of electing to receive their cash fees in the form of shares of our common stock. Only non-employeenon-employee directors are currently eligible to receive compensation for their services as a director. Accordingly, Mr.Ellin,Mr. Ellin, our Chief Executive Officer and Chairman and Mr.Gold, our Chief Strategy Officer and Executive Vice President, did not receive any separate director compensation during the 20192021 fiscal year.
2019
2021 Director Compensation Table
The following table shows compensation paid to the members of our board of directors for the fiscal year ended March31, 2019.
Name | | Fees
earned or
paid in
cash
($) | | Stock
awards
($)(1) | | Option
awards
($) | | Non-equity
incentive plan
compensation
($) | | Nonqualified deferred compensation earnings
($) | | All other compensation ($) | | Total
($) |
Jay Krigsman | | — | | 113,608 | (2) | | — | | — | | — | | — | | 113,608 |
Craig Foster | | — | | 118,547 | (2) | | — | | — | | — | | — | | 118,547 |
Tim Spengler | | — | | 103,729 | (2) | | — | | — | | — | | — | | 103,729 |
Robert Ellin | | — | | — | (3) | | — | | — | | — | | — | | — |
Jerome N. Gold | | — | | — | (3) | | — | | — | | — | | — | | — |
Ramin Arani | | — | | 112,660 | (2) | | — | | — | | — | | — | | 112,660 |
Patrick Wachsberger | | — | | 103,709 | (2) | | — | | — | | — | | — | | 103,709 |
Kenneth Solomon | | — | | — | (4) | | — | | — | | — | | — | | — |
| Name | | Fees
earned or
paid in
cash
($) | | | Stock
awards
($)(1) | | | Option
awards
($) | | | Non-equity
incentive plan
compensation
($) | | | Nonqualified
deferred
compensation
earnings
($) | | | All other
compensation
($) | | | Total
($) | |
| Jay Krigsman | | | — | | | | — | (2) | | | — | | | | — | | | | — | | | | — | | | | — | |
| Craig Foster | | | — | | | | — | (2) | | | — | | | | — | | | | — | | | | — | | | | — | |
| Robert Ellin | | | — | | | | — | (3) | | | — | | | | — | | | | — | | | | — | | | | — | |
| Ramin Arani | | | — | | | | — | (2) | | | — | | | | — | | | | — | | | | — | | | | — | |
| Patrick Wachsberger | | | — | | | | — | (2) | | | — | | | | — | | | | — | | | | — | | | | — | |
| Kenneth Solomon | | | — | | | | — | (2) | | | — | | | | — | | | | — | | | | — | | | | — | |
| Bridget Baker | | | — | | | | — | (2) | | | — | | | | — | | | | — | | | | — | | | | — | |
| Maria Garrido | | | — | | | | 72,555 | (2)(4) | | | — | | | | — | | | | — | | | | — | | | | 72,555 | |
| Kristopher Wright | | | — | | | | — | (5) | | | — | | | | — | | | | — | | | | — | | | | — | |
| Tim Spengler | | | — | | | | — | (2)(6) | | | — | | | | — | | | | — | | | | — | | | | — | |
| Jerome N. Gold | | | — | | | | — | (3) | | | — | | | | — | | | | — | | | | — | | | | — | |
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| (1) | Represents the aggregate grant date fair value computed in accordance with FASB ASC Topic 718. The assumptions used in calculating the amounts are discussed in Note 2 — Summary of Significant Accounting Policies — “Stock-Based Compensation” of our financial statements for the year ended March 31, 2021 included elsewhere in our 2021 Annual Report on Form 10-K. |
| (2) | On December 29, 2020, our board of directors approved a plan to compensate our non-employee directors with restricted stock units in lieu of cash director fees for the period from October 1, 2020 through September 30, 2021, based upon a price of $3.10 per restricted stock unit, as determined by our board of directors. Ms. Garrido’s restricted stock unit awards were granted on December 29, 2020 with a grant date fair value of $72,555, whereas Messrs. Krigsman, Foster, Arani, Wachsberger, Solomon, Spengler, and Ms. Baker received their grants on June 14, 2021 with a grant date fair value of: $161,903, $179,867, $154,193, $146,483, $156,736, $53,966 and $146,483, respectively. With the exception of Ms. Garrido, the Director Compensation Table above reflects that no such grants were made during the fiscal year ended March 31, 2021. All restricted stock units shall vest on October 31, 2021; provided that on such vesting date such person continues to serve as a director of our Company. Each restricted stock unit represents a contingent right to receive one share of our common stock or the cash value thereof. Each director has the right to delay the vesting of such restricted stock units to a later date for tax purposes. |
| (3) | Employee directors do not receive any additional compensation for their services on our board of directors. Mr. Gold resigned as a member of our board of directors on March 25, 2021. |
| (4) | Represents prorata consideration for Ms. Garrido’s service on our board through September 30, 2021, as Ms. Garrido was elected to our board effective as of December 29, 2020. Ms. Garrido’s grant was made on December 29, 2020. |
| (5) | Mr. Wright was appointed as a member of our board of directors effective as of May 3, 2021. |
| |
| (6) | Mr. Spengler resigned as a member of our board of directors on January 11, 2021. |
17
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information regarding beneficial ownership of our capital stock by:
• each person, or group of affiliated persons, known by us to beneficially own more than 5% of our common stock;
| ● | each person, or group of affiliated persons, known by us to beneficially own more than 5% of our common stock; |
• each of our directors;
• each of our Named Executive Officers (as defined below);
| ● | each of our Named Executive Officers (as defined below); |
• our other executive officers; and
| ● | our other executive officers; and |
•
| ● | all of our current executive officers and directors as a group. |
The number of shares and percentages of beneficial ownership are based on 52,599,609shares78,344,870 shares of our common stock outstanding as of July24, 2019July 23, 2021 (the Record Date).
The following table is based upon information supplied by to us by our officers, directors and certain principal stockholders. We have determined beneficial ownership in accordance with the rules of the SEC. These rules generally attribute beneficial ownership of securities to persons who possess sole or shared voting power or investment power with respect to those securities. In addition, the rules include shares of common stock that the person has the right to acquire beneficial ownership within 60 days, including common stock issuable pursuant to the exercise of stock options or warrants and settlement of restricted stock units that are either immediately exercisable or issuable or exercisable or issuable on or before September21, 2019,September 21, 2021, which is within 60 days of the Record Date. These shares are deemed to be outstanding and beneficially owned by the person holding those options, warrants or restricted stock units for the purpose of computing the percentage ownership of that person, but they are not treated as outstanding for the purpose of computing the percentage ownership of any other person. Unless otherwise indicated, the persons or entities identified in this table have sole voting and investment power with respect to all shares shown as beneficially owned by them, subject to applicable community property laws.
Except as otherwise noted below, the address for each person or entity listed in the table is c/o LiveXLive Media, Inc., 269 South Beverly Drive, Suite #1450,1450, Beverly Hills, CA 90212.
Name and address of beneficial owner | | Amount of Common Stock Beneficially Owned and Nature of Beneficial Ownership(1) | | Percentage of Class |
5% or greater stockholders | | | | | |
Robert S. Ellin and his affiliates(1) | | 17,693,302 | | 32.4 | % |
FMR LLC(2) | | 4,110,233 | | 7.8 | % |
245 Summer Street, Boston, MA 02210 | | | | | |
Rho Ventures VI, L.P.(3) | | 3,602,939 | | 6.8 | % |
152 W 57th Street, 23rd Floor, New York, NY 10019 | | | | | |
Marvin Ellin(4) | | 3,336,564 | | 6.3 | % |
Sandor Capital Master Fund(5) | | 3,018,644 | | 5.7 | % |
2828 Routh St., Suite 500, Dallas, TX 75201 | | | | | |
| Name and address of beneficial owner | | Amount of Common Stock
Beneficially Owned and
Nature of Beneficial
Ownership(1) | | | Percentage of
Class | |
| 5% or greater stockholders | | | | | | |
| Robert S. Ellin and his affiliates(1) | | | 18,461,673 | | | | 22.8 | % |
| FMR LLC(2) | | | 10,333,226 | | | | 13.2 | % |
| 245 Summer Street, Boston, MA 02210 | | | | | | | | |
| | | | | | | | | |
| Directors and Executive Officers | | | | | | | | |
| Robert S. Ellin(1) | | | 18,461,673 | | | | 22.8 | % |
| Dermot McCormack(3) | | | 19,635 | | | | * | |
| Mike Bebel(4) | | | 651,208 | | | | * | |
| Michael Quartieri(5) | | | — | | | | — | |
| Craig Foster(6)(7) | | | 118,109 | | | | * | |
| Jay Krigsman(6)(7)(8) | | | 1,066,436 | | | | 1.3 | % |
| Ramin Arani(7) | | | 74,992 | | | | * | |
| Patrick Wachsberger(7) | | | 76,436 | | | | * | |
| Kenneth Solomon(7) | | | 73,540 | | | | * | |
| Bridget Baker(7) | | | 65,900 | | | | * | |
| Maria Garrido(7) | | | — | | | | — | |
| Kristopher Wright(7) | | | — | | | | — | |
| All current directors and executive officers as a group (12 persons)(9)(10) | | | 20,607,929 | | | | 25.2 | % |
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| * | Represents beneficial ownership of less than one percent. |
Name and address of beneficial owner | | Amount of Common Stock Beneficially Owned and Nature of Beneficial Ownership(1) | | Percentage of Class |
Directors and Executive Officers | | | | | |
Robert S. Ellin(1) | | 17,693,302 | | 32.4 | % |
Dermot McCormack(6) | | 7,170 | | — | |
Mike Bebel(7) | | 206,815 | | * | |
Michael Zemetra(8) | | 329,167 | | * | |
Jerome N. Gold(9) | | 646,666 | | 1.2 | % |
Douglas Schaer(10) | | 258,334 | | * | |
Blake Indursky(11) | | 316,667 | | * | |
Craig Foster(12)(13) | | 36,664 | | — | |
Jay Krigsman(12)(13)(14) | | 965,884 | | 1.8 | % |
Tim Spengler(12)(13) | | 100,293 | | * | |
Ramin Arani(13) | | — | | * | |
Patrick Wachsberger(13) | | — | | * | |
Kenneth Solomon(13) | | — | | * | |
All current directors and executive officers as a group (13 persons)(15)(16) | | 20,560,943 | | 36.7 | % |
| (1) | Includes (i) 1,213,209 shares of common stock owned directly by Mr. Ellin; (ii) 6,806,245 shares of our common stock owned by Trinad Capital, as Mr. Ellin, the Managing Director and Portfolio Manager of Trinad Capital, is deemed to have sole voting and dispositive power over such shares, (iii) 716,216 shares of our common stock owned by Trinad Capital Management LLC (“Trinad LLC”), as Mr. Ellin, the Managing Member of Trinad LLC, is deemed to have sole voting and dispositive power over such shares; (iv) 6,817,810 shares of our common stock owned by JJAT Corp., an entity owned by Mr. Ellin, as Mr. Ellin is deemed to have sole voting and dispositive power over such shares; (v) approximately 1,865,069 shares of our common stock issuable upon conversion of the convertible notes held by Trinad Capital (assuming conversion as of July 23, 2020), which Trinad Capital has the right to convert as a result of the consummation of the Public Offering at a conversion price of $3.00 per share; (vi) 666,667 stock options that have vested as of September 21, 2021 (as more fully discussed below); and (vii) 25,168 restricted stock units granted to Mr. Ellin in lieu of reduced base salary for the period from April 2, 2021 to July 31, 2021 and for the base salary received solely in cash for the period from August 1, 2020 through December 31, 2020, which would vest as of September 21, 2021. Accordingly, securities owned by these entities may be regarded as being beneficially owned by Mr. Ellin. Mr. Ellin disclaims beneficial ownership in the shares held by Trinad LLC, Trinad Capital and the Profit Sharing Plan. Does not include (x) 4,498,781 shares of our common stock held by a family trust and family foundation as to which Mr. Ellin does not exercise voting or dispositive power, and (y) 500,000 options to purchase shares of our common stock granted to Mr. Ellin on September 7, 2017 pursuant to his employment agreement which vest according to certain conditions specified in his employment agreement, subject to Mr. Ellin’s continued employment with us through the applicable vesting date. As of September 21, 2021, the 500,000 options are not expected to vest as of such date. Each tranche of the vested options shall become exercisable one year after the date such tranche shall vest. In the event of a Change of Control (as defined in Mr. Ellin’s employment agreement), any unvested portion of the options shall vest and become exercisable effective immediately prior to such event. |
____________
| (2) | As reported on Schedule 13G, Amendment No. 4, filed with the SEC on February 8, 2021 by FMR LLC, Abigail P. Johnson and Fidelity Puritan Fund. Ms. Johnson is a Director, Chairman and Chief Executive Officer of FMR LLC. Members of the Johnson family, including Abigail P. Johnson, are the predominant owners, directly or through trusts, of Series B voting common shares of FMR LLC, representing 49% of the voting power of FMR LLC. The Johnson family group and all other Series B shareholders have entered into a shareholders’ voting agreement under which all Series B voting common shares will be voted in accordance with the majority vote of Series B voting common shares. Accordingly, through their ownership of voting common shares and the execution of the shareholders’ voting agreement, members of the Johnson family may be deemed, under the Investment Company Act of 1940, to form a controlling group with respect to FMR LLC. Neither FMR LLC nor Abigail P. Johnson has the sole power to vote or direct the voting of the shares owned directly by the various investment companies registered under the Investment Company Act (“Fidelity Funds”) advised by Fidelity Management & Research Company, a wholly owned subsidiary of FMR LLC, which power resides with the Fidelity Funds’ Boards of Trustees. Fidelity Management & Research Company carries out the voting of the shares under written guidelines established by the Fidelity Funds’ Boards of Trustees. |
| (3) | Includes 25,168 restricted stock units granted to Mr. McCormack in lieu of reduced base salary for the period from April 2, 2021 to July 31, 2021, which would vest as of September 21, 2021. Excludes 1,000,000 restricted stock units granted to Mr. McCormack effective as of July 15, 2019 pursuant to his employment agreement that cliff vest three years from the effective date of the grant, subject to Mr. McCormack’s continued employment with us through the vesting date. As of September 21, 2021, none of such restricted stock units would vest. |
| (4) | Includes (i) 293,708 restricted stock units granted to Mr. Bebel effective as of January 28, 2018 pursuant to his employment agreement, and (ii) 13,842 restricted stock units granted to Mr. Bebel in lieu of reduced base salary for the period from April 2, 2021 to July 31, 2021, in each case which would vest as of September 21, 2021. Excludes 85,936 restricted stock units granted to Mr. Bebel pursuant to his employment agreement, which would not vest as of September 21, 2021. 1/2 of such unvested restricted stock units vest shall vest every three months after June 30, 2021 with the second half vesting on January 28, 2022, in each case subject to Mr. Bebel’s continued employment with us through the applicable vesting date. |
| (5) | Excludes 500,000 restricted stock units that were granted effective as of November 30, 2020, none of which would vest as of September 21, 2021. |
| (6) | Includes 25,000 vested stock options for each director. |
| (7) | (i) Includes 23,128 and 24,144 vested restricted stock units granted to Messrs. Krigsman and Foster respectively, in 2018 and 66,091 and 68,965 vested restricted stock units granted to Messrs. Krigsman and Foster respectively, in 2019, (ii) includes 17,521, 16,129 and 13,196 vested restricted stock units granted to Messrs. Arani, Wachsberger and Solomon, respectively, in 2018 and 57,471, 54,597 and 60,344 vested restricted stock units granted to Messrs. Arani, Wachsberger and Solomon, respectively, in 2019. Excludes 33,871, 37,629, 32,258, 30,645, 32,790 and 30,645 restricted stock units granted to Messrs. Krigsman, Foster, Arani, Wachsberger and Solomon and Ms. Baker, on June 14, 2021, respectively, and 21,953 and 12,011 restricted stock units granted to Ms. Garrido and Mr. Wright on December 29, 2020 and May 3, 2021, respectively, which shall vest on October 31, 2021, subject to such director’s continuing to serve on our board of directors on the applicable vesting date. |
| (8) | Includes 860,186 shares of our common stock held by the Krigsman Family Trust, as Mr. Krigsman, a trustee of the trust, holds shared voting and dispositive power over such shares. Excludes certain shares that were formerly held in custodial accounts for the benefit of Mr. Krigsman’s daughters under the Uniform Transfers to Minors Act (“UTMA”) and for which Mr. Krigsman was the custodian. Mr. Krigsman no longer has control or voting or dispositive power over such shares as a result of the transfer from such UTMA accounts to Mr. Krigsman’s daughters’ individual accounts. |
| (9) | The shares of our common stock held by Trinad Capital, Trinad LLC, JJAT Corp. and the Profit Sharing Plan and the shares of our common stock issuable upon conversion of our convertible notes owned by Trinad Capital, which are deemed to be beneficially owned by Mr. Ellin, are counted only once in this total. |
| (10) | Does not include (i) stock options granted to Messrs. Ellin and Bebel and restricted stock units granted to Messrs. McCormack, Bebel and Quartieri that would not vest as of September 21, 2021 pursuant to the terms of their respective employment agreements, and (ii) restricted stock units granted to our non-employee directors as compensation for their services on our board of directors that would not vest as of September 21, 2021. |
* Represents beneficial ownership of less than one percent.
19
20
21
EXECUTIVE OFFICERS AND DIRECTORS
The following table sets forth certain information regarding our current executive officers and directors as of July24, 2019:July 29, 2021:
Name | | Age | | Position |
Executive Officers | | | | |
Robert S. Ellin | | 54
56 | | Chief Executive Officer, Chairman of the Board and Director |
Dermot McCormack | | 49
51 | | President |
Mike Bebel
Michael Quartieri | | 57
53 | | Senior Executive Vice President
|
Michael Zemetra
| | 48
| | Chief Financial Officer, Executive Vice President and Secretary |
Douglas Schaer
Mike Bebel | | 47
59 | | Chief Operating Officer
|
Jerome N. Gold
| | 73
| | Chief Strategy Officer,Senior Executive Vice President and Director
|
Blake Indursky
| | 47
| | Chief Business Officer and Executive Vice President
|
| | | | | |
Non-EmployeeNon-Executive Directors
| | | | |
Jay Krigsman | | 54
56 | | Director |
Craig Foster | | 48
50 | | Director |
Tim Spengler
Ramin Arani | | 55
51 | | Director |
Ramin Arani
Patrick Wachsberger | | 49
69 | | Director |
Patrick Wachsberger
Kenneth Solomon | | 47
58 | | Director |
Kenneth Solomon
Bridget Baker | | 56
59 | | Director |
| Maria Garrido | | 48 | | Director |
| Kristopher Wright | | 46 | | Director |
Executive Officers
Robert S. Ellin. Please see above under “Proposal No. 1 — Election of Directors — General Information About the Board of Directors”.Directors.”
Dermot McCormack. Mr.McCormackMr. McCormack has served as our President since July 2019. Mr. McCormack is a seasoned media executive, accomplished leader and innovator with expertise in cross platform content creation, product development, social media and distribution. Prior to joining the Company, Mr.McCormackMr. McCormack served and continues to serve on the board of SNKR Inc., the world’s leading video brand based around sneaker and youth culture, a company he co-foundedco-founded in September 2016. Prior to co-foundingco-founding SNKR, Mr.McCormackMr. McCormack served as AOL’s Global President — Video and Studios group from October 2014 to December 2015, where he was a key player in AOL’s sale to Verizon Communications Inc. and oversaw product and engineering and shepherded the overall user experience. As President of the Video and Studios group, he oversaw the video business for brands ranging from HuffPost to TechCrunch, and developed episodic programming including James Franco’s “Making A Scene” and Steve Buscemi’s Emmy Award-winningAward-winning “Park Bench.” In addition, he headed up AOL Studios, overseeing the creation and distribution of high-qualityhigh-quality original programming. Prior to his tenure at AOL, from March 2008 to September 2014, Mr.McCormackMr. McCormack served as the EVP of Digital Media for Viacom’s Music Group and the head of Viacom Music & Logo’s Connected Content Group. In these roles, Mr.McCormackMr. McCormack led all digital brand properties initiatives for MTV, MTV2, MTV Other, VH1, PALLADIA, VH1 CLASSIC, CMT, CMT Pure and Logo, where he created and implemented the vision and strategy for how these culture defining brands maintained leadership in today’s hyper connected world. Mr.McCormackMr. McCormack assisted MTV to build a user base of more than 100million100 million followers. Among other innovations, while at Viacom, Mr.McCormackMr. McCormack created the O Music Awards, a multiple Webby Award honoree, and developed MTV Artists, an online music portal for artists to create and manage their online presence. He also launched the MTV Music Meter, an algorithm-basedalgorithm-based mobile music app and tool that recommended music based on social media traction. Prior to joining Viacom, Mr.McCormackMr. McCormack oversaw the interactive and broadband divisions as the SVP of New Media and Digital Product at Cablevision, where he was integral to Cablevision’s growth as it achieved the highest household penetration rate in the areas it served. Mr.McCormackMr. McCormack began his digital media career as one of the earliest employees of iVillage.com, an online network geared towards women, and served as the CTO at Flooz.com, an online payment provider, which he co-foundedco-founded in 1999. Mr.McCormackMr. McCormack currently also serves on the board of Axonista, a leading European OTT player. Mr.McCormackMr. McCormack received his undergraduate degree from Dublin Institute of Technology’s School of Electrical and Electronic Engineering.
Michael Quartieri. Mr. Quartieri has served as our Chief Financial Officer, Executive Vice President and Secretary since November 2020. Mr. Quartieri is a seasoned executive with extensive financial, mergers and acquisitions and operational experience in building, managing and scaling large global organizations, operations and acquisitions. Mr. Quartieri has built and led financial organizations across multi-billion-dollar gaming and lodging companies. Prior to his appointment as our Chief Financial Officer and since November 2015, Mr. Quartieri served as the Executive Vice President, Chief Financial Officer and Secretary at Scientific Games (Nasdaq: SGMS), a $3.4 billion world leader in entertainment offering dynamic games, systems and services for casino, lottery, social gaming, online gaming and sports betting. Prior to that, Mr. Quartieri spent nine years with Las Vegas Sands Corp., the pre-eminent developer and operator of world-class Integrated Resorts that feature luxury hotels, best-in-class gaming, retail, dining and entertainment and many other business and leisure amenities, ending his tenure as Senior Vice President, Chief Accounting Officer and Global Controller, and prior to that he spent 13 years at Deloitte & Touche, rising to the position of Director of Audit and Assurance Services, specializing in gaming and hospitality. Mr. Quartieri holds a Masters in Accounting and a Bachelor of Science in Accounting from the University of Southern California and is a Certified Public Accountant.
Mike Bebel. Mr.BebelMr. Bebel has served as our Senior Executive Vice President on a full-timefull-time basis since January 2019 and, prior to that, as our Executive Vice President of Corporate Development and Rights Management on a
22
full-time full-time basis from January 2018 and on an interim basis from August 2017. Mr.BebelMr. Bebel is a music industry veteran and digital music service entrepreneur with more than 20 years of global operating experience. Since June 2016, Mr.BebelMr. Bebel consulted for several digital media and entertainment companies assisting with strategic planning, forecasting, operational development, business development, music licensing and music industry relations. From May 2015 to May 2017, Mr.BebelMr. Bebel was the Chief Operating Officer of MixRadio, LTD, a division of LINE Corporation, where he led the product management, product marketing, engineering, global music industry relations, music licensing and content programming teams. From August 2009 to April 2015, Mr.BebelMr. Bebel held various digital entertainment leadership positions at Nokia, Inc. and Microsoft. From January 2008 to June of 2009, Mr.BebelMr. Bebel was the Chief Executive Officer of Total Music, LLC a joint venture between the Universal Music Group and Sony Music Entertainment. From August 2006 until January 2008, Mr.BebelMr. Bebel was the President and Chief Executive Officer of Ruckus Network, Inc. From September 2005 until July 2006, Mr.BebelMr. Bebel served as the Chief Executive Officer of Mashboxx, LLC. From May 2003 to February 2004, Mr.BebelMr. Bebel served as the President and Chief Operating Officer of Napster. Prior to this, Mr.Bebelthat, Mr. Bebel served as the Chief Operating Officer and Chief Executive Officer of Pressplay, an early digital music subscription service, since its founding as a joint venture between the Universal Music Group and Sony Music Entertainment in May 2001. Prior to this, Mr.Bebelthat, Mr. Bebel was an Executive Vice President at the Universal Music Group. Mr.BebelMr. Bebel holds an MBA in Finance and Economics from Binghamton University and a BS in Accounting from the State University of New York at Fredonia.
Michael Zemetra. Mr.Zemetra has served as our Chief Financial Officer and Executive Vice President since April 2018. Prior to his appointment with our Company, Mr.Zemetra served as the Vice President of Finance (divisional Chief Financial Officer for the business cloud division of j2 Global (NASDAQ: JCOM) since March 2018. From June 2013 to August 2016, Mr.Zemetra served as the Chief Financial Officer and Chief Accounting Officer for the in-flight entertainment services company, Global Eagle Entertainment (NASDAQ: ENT), and from May 2008 to June 2013, as Senior Vice President and Chief Accounting Officer for digital content and media company, Demand Media, Inc. (now Leaf Group, NASDAQ: LFGR). Mr.Zemetra is a seasoned executive with extensive financial and operational experience in building, managing and scaling large global organizations, systems and operations. Mr.Zemetra has built and led financial organizations across multi-billion-dollar technology, media, ecommerce, entertainment, retail and telecommunications companies. Mr.Zemetra holds a Masters in Accounting from the University of Southern California, a Bachelor of Arts in Business-Economics from the University of California, Riverside and received his CPA license from the State of California.
Douglas Schaer. Mr.Schaer has served as our Chief Operating Officer since May 2017. Mr.Schaer has also been involved with the Company in an advisory capacity since January 2016, providing strategic guidance and introductions, and in the process crafting and managing effective marketing and operational solutions. An experienced entrepreneur and business strategist, Mr.Schaer specializes in franchise asset development and foundation building in the entertainment and sports genres. From July 2011 to April 2017, Mr.Schaer served as Chief Operating Officer for Hero Ventures, an innovative live entertainment production and touring company. He continues to serve on its board of directors. Prior to launching Hero Ventures, Mr.Schaer co-founded Silent Partner Media, a boutique, creative marketing and consulting firm with a distinctive entertainment, sports and music industry client list, after a long stint as a certified player agent by the Major League Baseball Players Association (since 1998), where he was regarded for his expertise in the niche area of Baseball Salary Arbitration preparation and litigation. Mr.Schaer earned a BA in Government from Wesleyan University, and holds a JD from the University of Southern California Gould School of Law and was admitted to the California State Bar.
Jerome N. Gold. Please see above under “Proposal No. 1 — Election of Directors — General Information About the Board of Directors”.
Blake Indursky. Mr.Indursky has served as our Executive Vice Chairman and Senior Vice President of Operations on October6, 2015, which title was changed to Chief Business Officer and Executive Vice President on May7, 2016. Mr.Indursky was a member of our Advisory Board from August 2015 until October 2016. Mr.Indursky has over 20 years of experience as an executive in various music and technology companies. Mr.Indursky was President of Flying Point Ventures, LLC, a brand marketing, live event, and online and emerging technology advisory firm, from 2009 to 2014. Between 2006 and 2008, Mr.Indursky was Director Acquisitions for RAL Companies where he purchased New York properties for development of luxury residential apartments and condominiums. Prior to that, Mr.Indursky served as Vice President of Sony Music Entertainment from 2001 to 2004 and was employed in various executive capacities with Sony Music since 1991. Mr.Indursky is a member of both the New York and New Jersey State Bars and received a JD in Law from Hofstra University and a BA in Liberal Arts from American University.
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Non-Employee Directors
Jay Krigsman. Please see bio above under “Proposal No. 1 — Election of Directors — General Information About the Board of Directors”.
Craig Foster. Please see bio above under “Proposal No. 1 — Election of Directors — General Information About the Board of Directors”.
Tim Spengler.
Ramin Arani.Please see bio above under “Proposal No. 1 — Election of Directors — General Information About the Board of Directors”.
Ramin Arani.
Patrick Wachsberger. Please see bio above under “Proposal No. 1 — Election of Directors — General Information About the Board of Directors”.
Patrick Wachsberger.
Kenneth Solomon. Please see bio above under “Proposal No. 1 — Election of Directors — General Information About the Board of Directors”.
Kenneth Solomon.
Bridget Baker. Please see bio above under “Proposal No. 1 — Election of Directors — General Information About the Board of Directors”.
Maria Garrido. Please see bio above under “Proposal No. 1 — Election of Directors — General Information About the Board of Directors”.
Kristopher Wright. Please see bio above under “Proposal No. 1 — Election of Directors — General Information About the Board of Directors”.
Advisory Board
To complement our management team and board of directors, we have an active Advisory Board, each of whom are renowned in their respective fields and are considered thought leaders in the entertainment industry by their peers, further enhance our credibility and provide invaluable strategic guidance and introductions to our Company. Members of the Advisory Board serve for a one-yearone-year term and in consideration for their services receive certain equity awards. The Advisory Board is available to provide advice, networking and guidance to our management on any number of issues in a particular field of expertise. Our Advisory Board members have experience in the media and entertainment industries as follows:
Steven Bornstein — Former Chief Executive Officer of ESPN and NFL Network.
Jason Flom — Chief Executive Officer of Lava Records; former Chief Executive Officer of Atlantic Records and Virgin Records.
Chris McGurk — Former Chief Operating Officer of MGM and Universal Pictures; former President of Walt Disney Motion Picture Group.
Hank Neuberger
Jules Haimovitz — Lead Producer of Coachella, Lollapalooza, Austin City Limits, Bonnaroo music festivals.
JulesMr. Haimovitz— Mr.Haimovitz has more than 35 years’ experience developing, managing and leading some of the most well-knownwell-known cable networks and production companies in entertainment, including Showtime, Lifetime, MGM, Dick Clark Productions, Viacom, Aaron Spelling Productions, Inc. and more.
Roger Werner— Mr.WernerMr. Werner has more than 30 years of experience in the television and digital industries, designing, building and managing some of world’s most successful networks, including ESPN and what is now Fox Sports West and Fox Sports Americas.
Terms of Office
Our directors are appointed for a one-yearone-year term to hold office until the next annual general meeting of our stockholders or until removed from office in accordance with our Bylaws and the provisions of the Delaware General Corporation Law. Our directors hold office after the expiration of his or her term until his or her successor is elected and qualified, or until his or her resignation, death or removal in accordance with our Bylaws or the Delaware General Corporation Law.
Our officers are appointed by our board of directors and hold office until removed by our board of directors at any time for any reason.
Family Relationships
There are no family relationships between or among any of our directors or executive officers or persons nominated or chosen by us to become directors or executive officers.
24
Director Independence
Please see bio above under “Corporate Governance — Director Independence”.
Board Committees
Please see bio above under “Proposal No. 1 — Election of Directors — Board Committees”.
Board Leadership Structure
Please see bio above under “Corporate Governance — Board Leadership Structure”.
Risk Oversight
Please see bio above under “Corporate Governance — Risk Oversight and Compensation Risk Assessment”.
Code of Ethics
Please see bio above under “Corporate Governance — Code of Ethics”.
Compensation Committee Interlocks and Insider Participation
No member of the Compensation Committee was at any time during 2019the 2021 fiscal year, or at any other time, an officer or employee of our Company, and no member had any relationship requiring disclosure under Item 404 of Regulation S-KS-K promulgated by the SEC. None of our executive officers (i) serves as a member of the compensation committee of any other company of which any member of the Compensation Committee or our board of directors is an executive officer, or (ii) serves as a member of the board of directors of any other company of which any member of the Compensation Committee is an executive officer.
Delinquent Section 16(A) Beneficial Ownership Reporting Compliance16(a) Reports
Section 16(a) of the Exchange Act requires our directors, executive officers, and persons who own more than 10% of our common stock to file initial reports of ownership and changes in ownership of our common stock and other equity securities with the SEC. These individuals are required by the regulations of the SEC to furnish us with copies of all Section 16(a) forms they file. Based solely on a review of the copies of the forms furnished to us, and written representations from reporting persons that no Forms 5 were required to report delinquent filings, we believe that all filing requirements applicable to our officers, directors and 10% beneficial owners were complied with during the fiscal years ended March31, 2019March 31, 2021 and 2018,2020, except that Mr.Ellin’sMr. Ellin’s Form 44s filed with the SEC on March28, 2018,June 18, 2020, September 22, 2020 (partially late) and September 25, 2020, and Mr. Bebel’s Form 44s filed with the SEC on April5, 2018,August 28, 2020 and December 3, 2020 were inadvertently filed late.
Nominations to the Board of Directors
General— Our directors take a critical role in guiding our strategic direction and oversee the management of the Company. Our board of directors’ candidates are considered based upon various criteria, such as their broad-basedbroad-based business and professional skills and experiences, a global business and social perspective, concern for the long-termlong-term interests of the shareholders, diversity, and personal integrity and judgment. In addition, directors must have time available to devote to our board of directors activities and to enhance their knowledge of our business. Accordingly, we seek to attract and retain highly qualified directors who have sufficient time to attend to their substantial duties and responsibilities to our Company.
Our Nominating Committee assists our board of directors in identifying qualified individuals to become board members, in determining the composition of the board and in monitoring the process to assess board effectiveness.
Changes to the Procedures by Which Security Holders May Recommend Nominees to Our Board of Directors — During the year ended March31, 2019,March 31, 2021, there were no material changes to the procedures by which our security holders may recommend nominees to our board of directors.
25
PROPOSAL NO. 2 — ADVISORY VOTE ON THE COMPANY’S EXECUTIVE COMPENSATION
In accordance with SEC rules, we are providing our stockholders the opportunity to vote at this Annual Meeting to approve the compensation paid to our Named Executive Officers, as disclosed in this Proxy Statement pursuant to the SEC’s rules. The stockholder vote on executive compensation is an advisory vote only, and it is not binding on the company or our board of directors.
Although the vote is nonbinding, our Compensation Committee and the board of directors value the opinions of our stockholders and will consider the outcome of the vote when making future compensation decisions. This proposal, commonly known as a “say-on-pay” proposal, gives our stockholders an opportunity to endorse or not endorse our executive officer pay program and policies through the following resolution:
“RESOLVED, that the stockholders approve, on an advisory basis, the compensation paid to LiveXLive Media, Inc.’s Named Executive Officers, as disclosed in the Company’s Proxy Statement for the 2021 Annual Meeting of Stockholders pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the 2021 Summary Compensation Table and the other related tables and disclosure.”
We encourage our stockholders to read the “Executive Compensation” section in this Proxy Statement beginning on page [__], including the compensation tables and the related narrative disclosure, which describes the structure and amounts of the compensation of our Named Executive Officers in fiscal year 2021. The compensation of our Named Executive Officers is designed to enable us to attract and retain talented and experienced executives to lead us successfully in a competitive environment. The Compensation Committee and our board of directors believe that our executive compensation strikes the appropriate balance between utilizing responsible, measured pay practices and effectively incentivizing our Named Executive Officers to dedicate themselves fully to value creation for our shareholders.
Vote Required
The advisory resolution on the Company’s executive compensation described in this Proposal No. 2 will be approved if the votes cast in favor of the proposal exceed the votes cast against the proposal. For purposes of this vote, abstentions and broker non-votes will have no effect on the outcome of this proposal. The results of this vote are not binding on our board of directors.
The Board of Directors Unanimously Recommends a Vote FOR the
Advisory Resolution Approving the Compensation Paid to the
Company’s Named Executive Officers.
PROPOSAL NO. 3 — RATIFICATION OF THE APPOINTMENT OF
THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Audit Committee of our board of directors has appointed BDO USA, LLP as our independent registered public accounting firm to audit our consolidated financial statements for the fiscal year ending March31, 2020.March 31, 2022. BDO USA, LLP (“BDO”) was engaged as our independent registered public accounting firm in July 2018. Weinberg & Company, P.A. was our independent registered public accounting firm during the 2018 fiscal year. Representatives of BDO are expected to be present at the Annual Meeting to respond to appropriate questions and will have the opportunity to make a statement if they so desire.
Stockholder ratification of the appointment of BDO is not required by our bylaws or otherwise. However, our board of directors is submitting the appointment of BDO to the stockholders for ratification as a matter of good corporate governance practice. If the stockholders fail to ratify the appointment, the Audit Committee will reconsider whether to retain BDO. Even if the appointment is ratified, the Audit Committee, in its discretion, may direct the appointment of a different independent registered public accounting firm at any time during the 20202022 fiscal year if it determines that such a change would be in the best interests of us and our stockholders.
Vote Required
The affirmative vote of a majority of the votes cast on this matter at the Annual meeting is required to ratify the appointment of BDO as our independent registered public accounting firm. For purposes of this vote, abstentions and broker non-votesnon-votes will have no effect on the outcome of this proposal.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTEThe Board of Directors Unanimously Recommends a Vote FOR THE RATIFICATION OF the Ratification of BDO USA, LLP AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM.as Our Independent Registered Public Accounting Firm.
Audit and Non-Audit Fees
The following table sets forth the aggregate fees billed by BDO USA, LLP (“BDO”), our independent registered public accounting firm, for the following services during the fiscal yearyears ended March31, 2019March 31, 2021 and Weinberg & Company, P.A., our prior independent registered public accounting firm (“Weinberg & Co.”), during the fiscal year ended March31, 20182020 (in thousands):
| | Year Ended March 31, |
Description of Service | | 2019 | | 2018 |
Audit Fees(1) | | $ | 526 | | $ | 88 |
Audit-Related Fees(2) | | | 22 | | | — |
Tax Fees(3) | | | 47 | | | 17 |
All Other Fees(4) | | | — | | | 239 |
Total Fees | | $ | 595 | | $ | 344 |
____________
| | | Year Ended March 31, | |
| Description of Service | | 2021 | | | 2020 | |
| Audit Fees(1) | | $ | 715 | | | $ | 469 | |
| Audit-Related Fees(2) | | | — | | | | — | |
| Tax Fees(3) | | | 52 | | | | 51 | |
| All Other Fees(4) | | | — | | | | — | |
| Total Fees | | $ | 767 | | | $ | 520 | |
(1) Audit Fees consist of fees for audit of our annual financial statements for the respective year, reviews of our quarterly financial statements, services provided in connection with statutory and regulatory filings.
(2) Audit-Related Fees consist of fees for accounting consultations.
| (1) | Audit Fees consist of fees for audit of our annual financial statements for the respective year, reviews of our quarterly financial statements, services provided in connection with statutory and regulatory filings. |
(3) Tax Fees consist of fees for professional services rendered for tax compliance.
| (2) | Audit-Related Fees consist of fees for accounting consultations. |
(4)
| (3) | Tax Fees consist of fees for professional services rendered for tax compliance. |
| (4) | Other fees consist of fees paid on acquisition related audits. |
Non-Audit Fees
Non-Audit Fees
There were no audit or non-auditnon-audit services provided to us for the years ended March31, 2019March 31, 2021 and 20182020 that were not approved by our board of directors. Our board of directors determined that the services rendered by BDO and Weinberg & Co. are compatible with maintaining their independence as our independent auditors.
26
Pre-Approval Policies and Procedures
Beginning April1,April 1, 2018, our Audit Committee became responsible, and prior to such period, our board of directors was responsible, for the pre-approvalpre-approval of all audits and permitted non-auditnon-audit services to be performed for our Company by our independent registered public accounting firm and any other independent accounting firms that we engage. The fees paid to BDO and Weinberg & Co. that are shown in the chart above for 20192021 and 20182020 fiscal years, respectively, were approved by our Audit Committee and our board of directors in accordance with the procedures described below.
Our Audit Committee reviews and approves all audit and non-auditnon-audit services proposed to be provided, other than de minimis non-auditnon-audit services which may instead by preapproved in accordance with applicable SEC rules.
Dismissal of Prior Independent Registered Public Accounting Firms
Dismissal of Weinberg & Company, P.A.
Effective as of July25, 2018, our board of directors dismissed Weinberg as our independent registered public accounting firm and engaged BDO USA, LLP to serve as our new independent registered public accounting firm effective as of the same date. The change of independent registered public accounting firms was made to more closely match our evolving business and not due to any disagreements with Weinberg. The decision to change principal accountants was also approved by the Audit Committee effective as of the same date.
Neither of Weinberg’s reports on our financial statements for each of the last two fiscal years ended March31, 2018 and 2017 contained an adverse opinion or a disclaimer of opinion, or was qualified or modified as to uncertainty, audit scope, or accounting principles, except that Weinberg’s report for our financial statements for the fiscal year ended March31, 2017 contained an explanatory paragraph in respect to uncertainty as to our ability to continue as a going concern. During our two most recent fiscal years ended March31, 2018 and 2017 and any subsequent interim period through the Effective Date, there were (i) no disagreements (as defined in Item 304(a)(1)(iv) of Regulation S-K) with Weinberg on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of Weinberg, would have caused Weinberg to make reference to the subject matter of the disagreements in their reports on our financial statements, and (ii) no reportable events (as described in paragraphs (a)(1)(v) (A) through (D) of Item 304 of Regulation S-K).
We provided Weinberg with a copy of the disclosures we made in our Current Report on Form 8-K filed with the SEC on July26, 2018 and requested that Weinberg furnish us with a letter addressed to the SEC stating whether they agree with the above statements. A copy of the requested letter received from Weinberg, dated July26, 2018, stating that they agree was filed as Exhibit 16.1 to such Form 8-K.
Engagement of New Independent Registered Public Accounting Firms
Engagement of BDO USA, LLP
Effective as of July25, 2018, the Board approved the engagement of BDO USA, LLP (“BDO”) to serve as our new independent registered public accounting firm effective as of the same date. The decision to engage BDO was also approved by the Audit Committee effective as of the same date. During the two most recent fiscal years ended March31, 2019 and 2018 and any subsequent interim period through July25, 2018, neither we nor anyone on our behalf consulted with BDO regarding: (i) the application of accounting principles to a specified transaction, either completed or proposed; (ii) the type of audit opinion that might be rendered on its financial statements by BDO, and neither a written report or oral advice was provided to us by BDO that BDO concluded was an important factor considered by us in reaching a decision as to any accounting, auditing or financial reporting issues; or (iii) any other matter that was the subject of a “disagreement” or “reportable event” (as such terms are described in Items 304(a)(1)(iv) and (v), respectively, of Regulation S-K) between our Company and our former independent registered public accounting firm, Weinberg.
27
REPORT OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS
This report of the audit committee is required by the SEC and, in accordance with the SEC’s rules, will not be deemed to be part of or incorporated by reference by any general statement incorporating by reference this proxy statement into any filing under the Securities Act, or under the Exchange Act, except to the extent that we specifically incorporate this information by reference, and will not otherwise be deemed “soliciting material” or “filed” under either the Securities Act or the Exchange Act.
The Audit Committee’s purpose is to assist our board of directors in its general oversight of our accounting, auditing and financial reporting practices. Management is primarily responsible for our financial statements, systems of internal controls and compliance with applicable legal and regulatory requirements. BDO was responsible for performing an independent audit of our consolidated financial statements and expressing an opinion on the conformity of those financial statements with accounting principles generally accepted in the United States, as well as expressing an opinion on the effectiveness of internal control over financial reporting.States.
The Audit Committee members are not professional accountants or auditors, and their functions are not intended to duplicate or to certify the activities of management and the independent registered public accounting firm, nor can the committee certify that our registered public accounting firm is “independent” under applicable rules. The Audit Committee serves a board-levelboard-level oversight role, in which it provides advice, counsel and direction to management and the independent registered public accounting firm on the basis of the information it receives, discussions with management and the independent registered public accounting firm and the experience of the committee’s members in business, financial and accounting matters.
The Audit Committee reviewed and discussed the audited financial statements for the fiscal year ended March31, 2019March 31, 2021 with our management. The Audit Committee discussed with our independent registered public accounting firm the matters required to be discussed by Auditing Standard No. 1301,Communications with Audit Committees, as adopted by the Public Company Accounting Oversight Board (“PCAOB”). The Audit Committee also received the written disclosures and the letter from our independent registered public accounting firm required by applicable requirements of the PCAOB regarding the independent accountants’ communications with the audit committee concerning independence and has discussed with our independent registered public accounting firm the accounting firm’s independence. Based on the foregoing, the Audit Committee has recommended to our board of directors that the audited financial statements be included, and such audited financial statements were included, in our Annual Report on Form 10-K10-K for the fiscal year ended March31, 2019,March 31, 2021, for filing with the SEC.
| | Respectfully submitted by: |
| | |
| The Audit Committee of the Board of Directors |
| | |
| Craig Foster (Chairman) Jay KrigsmanRamin Arani
Tim Spengler
Ramin Arani
Kenneth Solomon |
28
EXECUTIVE COMPENSATION
Our named executive officers, consisting of our principal executive officer and the next two most highly compensated executive officers as of March31, 2019March 31, 2021 (the “Named Executive Officers”), were:
•
| ● | Robert Ellin, Chief Executive Officer, Chairman and Director; |
| ● | Dermot McCormack, President; and |
| ● | Michael Quartieri, Chief Financial Officer. |
• Michael Zemetra, Chief Financial Officer; and
• Michael Bebel, Senior Executive Vice President.
20192021 Summary Compensation Table
The following table sets forth, for the fiscal years ended March31, 2019March 31, 2021 and 2018,2020, compensation awarded or paid to our Named Executive Officers.
Name and Principal Position | | Fiscal
Year
ended
March 31 | | Salary
($) | | Bonus
($) | | Stock
Awards
($)(4) | | Option
Awards
($)(4) | | Non-Equity Incentive Plan Compensation
($) | | Nonqualified Deferred Compensation Earnings
($) | | All Other Compensation ($)(1) | | Total
($) |
Robert Ellin, | | 2019 | | 500,000 | | | — | | — | | | — | | | — | | — | | 28,589 | (6) | | 528,589 |
CEO, Chairman & | | 2018 | | 397,849 | (3) | | — | | — | | | 5,201,328 | (5) | | — | | — | | 17,012 | (6) | | 5,616,189 |
Director(2) | | | | | | | | | | | | | | | | | | | | | | |
Michael Zemetra, | | 2019 | | 264,915 | (7) | | — | | 925,000 | (8) | | 425,122 | (8) | | — | | — | | 23,919 | (9) | | 1,638,956 |
CFO(7) | | 2018 | | — | | | — | | — | | | | | | — | | — | | — | | | — |
Michael Bebel, | | 2019 | | 281,296 | (10) | | — | | 2,790,000 | (11) | | 697,162 | (11) | | — | | — | | 11,550 | (12) | | 3,780,008 |
Senior Executive | | 2018 | | 16,825 | (10) | | — | | 30,000 | (13) | | — | | | — | | — | | — | | | 46,825 |
Vice President(10) | | | | | | | | | | | | | | | | | | | | | | |
____________
| Name and Principal Position | | Fiscal
Year
ended
March 31 | | Salary
($) | | | Bonus
($) | | | Stock
Awards
($)(3) | | | Option
Awards
($)(3) | | | Non-Equity Incentive Plan Compensation
($) | | | Nonqualified Deferred Compensation Earnings
($) | | | All Other Compensation ($)(1) | | | Total
($) | |
| Robert Ellin, | | 2021 | | | 382,990 | (2) | | | — | | | | 108,677 | (2) | | | — | | | | — | | | | — | | | | 66,182 | (4) | | | 557,849 | |
| CEO, Chairman & | | 2020 | | | 500,000 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 28,676 | (4) | | | 528,676 | |
| Director | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Dermot McCormack, | | 2021 | | | 391,323 | (2) | | | — | | | | 108,677 | (2) | | | — | | | | — | | | | — | | | | 44,652 | (5) | | | 544,652 | |
| President | | 2020 | | | 354,167 | | | | — | | | | 2,920,000 | (6) | | | — | | | | — | | | | — | | | | 143,347 | (5) | | | 3,417,514 | |
| Michael Quartieri, | | 2021 | | | 133,333 | (7) | | | — | | | | 1,250,000 | (8) | | | — | | | | — | | | | — | | | | 9,564 | (9) | | | 1,392,897 | |
| CFO(7) | | 2020 | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
(1)
| (1) | Unless otherwise indicated, the amount of perquisites and other personal benefits has been excluded as the total value of perquisites and other personal benefits for each Named Executive Officer per year was less than $10,000. |
| (2) | During the 2021 fiscal year, Messrs. Ellin and McCormack were each paid $108,677 of their base salary in shares of our common stock as a result of our executive officers and other senior management, desiring to demonstrate confidence in our Company and to assist our then near term objectives in light of the ongoing COVID-19 epidemic, agreeing to accept a reduction in their monthly base salaries for the months of April – June 2021 in exchange for shares of our common stock that will vest in full in calendar year 2021, which compensation is reflected in the “Stock Awards” column. In addition, effective as of August 1, 2020, Mr. Ellin, desiring to continue to demonstrate confidence in our Company and to assist our then near term objectives in light of the ongoing COVID-19 coronavirus pandemic, agreed to also forego his monthly base salary from August 1, 2021 through December 31, 2020. Accordingly, the amount shown the “Salary” column for the 2021 fiscal year includes the amount of $200,000 as Mr. Ellin’s salary to be paid at a future date in shares of our common stock that shall be issued and vest in accordance with the terms as determined by our board of directors or Compensation Committee. |
| (3) | Represents the aggregate grant date fair value computed in accordance with FASB ASC Topic 718. The assumptions used in calculating the amounts are discussed in Note 2 — Summary of Significant Accounting Policies — “Stock-Based Compensation” of our financial statements for the fiscal year ended March 31, 2021 included in our 2021 Annual Report on Form 10-K. |
| (4) | The amount for 2021 represents car lease payments of $16,578 and personal benefits consisting of health insurance and life, accidental death and dismemberment insurance in the amount of $44,855 and $4,749, respectively, paid by us on Mr. Ellin’s behalf. The amount for 2020 represents car lease payments of $15,249 and personal benefits consisting of health insurance and life, accidental death and dismemberment insurance in the amount of $11,955 and $1,472, respectively, paid by us on Mr. Ellin’s behalf. |
| (5) | The amount for 2021 represents personal benefits consisting of health insurance and life, accidental death and dismemberment insurance in the amount of $39,903 and $4,749, respectively, paid by us on Mr. McCormack’s behalf. The amount for 2020 represents (i) $130,000 as cash payments made to Mr. McCormack’s pursuant to his consulting agreement, which was in effect prior to the execution of his employment agreement, and (ii) personal benefits consisting of health insurance and life, accidental death and dismemberment insurance in the amount of $12,686 and $661, respectively, paid by us on Mr. McCormack’s behalf. |
| (6) | Represents Mr. McCormack’s grant of 1,000,000 restricted stock units, which one-time cliff vest on July 22, 2022, subject to Mr. McCormack’s continued employment with our Company through the vesting date, with each restricted stock unit to be settled by issuance to Mr. McCormack of one share of our common stock. See below table “Outstanding Equity Awards at Fiscal Year Ended” for the description of the vesting and any lock-up conditions applicable to such grant. |
| (7) | Mr. Quartieri was not one of our Named Executive Officers during the fiscal year ended March 31, 2020, as he was appointed as our Chief Financial Officer effective as of November 30, 2020. The amount shown in the “Salary” column represents salary payments prorated for the time that Mr. Quartieri was serving as our Chief Financial Officer during the fiscal year ended March 31, 2021. |
| (8) | Represents Mr. Quartieri’s grant of (i) 500,000 restricted stock units, with each vested restricted stock unit to be settled by issuance to Mr. Quartieri of one share of our common stock. See below table “Outstanding Equity Awards at Fiscal Year Ended” for the description of the vesting and lock-up conditions applicable to such grant. |
| |
| (9) | Represents personal benefits consisting of health insurance, life, accidental death and dismemberment insurance in the amount of $9,036 and $528, respectively, paid by us on Mr. Quartieri’s behalf. The amount shown in the “All Other Compensation” column represents personal benefit payments prorated for the time that Mr. Quartieri was serving as our Chief Financial Officer in the fiscal year ended March 31, 2021. |
2021 Outstanding Equity Awards at Fiscal Year Ended
The following table sets forth certain information with respect to grants of perquisites and other personal benefits has been excluded as the total value of perquisites and other personal benefitsplan-based awards for each Named Executive Officer per year was less than $10,000.
| | | Option awards | | | Stock awards | |
| Name | | Number of
securities
underlying
unexercised
options
(#)
exercisable | | | Number of
securities
underlying
unexercised
options
(#)
unexercisable | | | Equity
incentive
plan
awards:
Number of
securities
underlying
unexercised
unearned
options
(#) | | | Option
exercise
price
($) | | | Option
expiration
date | | | Number of
shares or
units of
stock
that have
not vested
(#) | | | Market
value of
shares of
units of
stock
that have
not vested
($) | | | Equity
incentive
plan
awards:
Number of
unearned
shares,
units or
other rights
that have
not vested
(#) | | | Equity
incentive
plan
awards:
Market or payout
value of
unearned
shares,
units or
other rights
that have
not vested
($)(5) | |
| Robert Ellin | | | 555,555 | (1) | | | 111,111 | (1) | | | — | | | | 4.00 | | | | 9/7/2027 | | | | — | | | | — | | | | — | | | | — | |
| | | | — | | | | — | | | | 500,000 | (2) | | | 4.00 | | | | 9/7/2027 | | | | — | | | | — | | | | — | | | | — | |
| Dermot McCormack | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 1,000,000 | (3) | | | 4,340,000 | |
| Michael Quartieri | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 500,000 | (4) | | | 2,170,000 | |
| (1) | Represents 666,666 stock options granted on September 7, 2017. The options vest in 1/12th increments every three months for a three-year period from September 7, 2017, subject to Mr. Ellin’s continued employment by our Company on each applicable vesting date, and have fully vested as of the date of this Proxy Statement. Each tranche of the options shall become exercisable one year after the date such tranche shall vest. In the event of a Change of Control (as defined in Mr. Ellin’s employment agreement), any unvested portion of the options shall vest and become exercisable effective immediately prior to such event. |
| (2) | Represents 500,000 stock options granted on September 7, 2017. The options shall 100% vest if prior to the third anniversary of September 7, 2017 the shares of our common stock shall have traded at a price of $30.00 per share or more for a period of 90 consecutive trading days during which an average of at least 166,667 shares are traded per day, subject to Mr. Ellin’s continued employment by us on such vesting date. The options shall become exercisable one year after the vesting date, provided that, in the event of a Change of Control, if the options have vested prior to such date, they shall be immediately exercisable upon such event. |
| (3) | Represents 1,000,000 restricted stock units, with each vested restricted stock unit to be settled by issuance to Mr. McCormack of one share of our common stock, which one-time cliff vest on July 15, 2022, subject to Mr. McCormack’s continued employment by our Company on such vesting date. In the event of a Change of Control (as defined in Mr. McCormack’s employment agreement), any unvested portion of the restricted stock units shall vest and become exercisable effective immediately prior to such event. |
| |
| (4) | Represents 500,000 restricted stock units, with each vested restricted stock unit to be settled by issuance to Mr. Quartieri of one share of our common stock, of which 50% of such restricted stock units shall vest during the first open trading window under our Insider Trading Policy which occurs after the first anniversary of the November 30, 2020 (the “Initial Vesting Date”), and the remainder of 50% of such restricted stock units shall vest upon each of the first four quarterly anniversaries of the Initial Vesting Date, with the last fourth vesting date being November 30, 2022, subject to Mr. Quartieri’s continued employment by our Company on each such vesting date. In the event of a Change of Control (as defined in Mr. Quartieri’s employment agreement), any unvested portion of the restricted stock units shall vest and become exercisable effective immediately prior to such event; provided, that in the event a Change of Control occurs as a result of a certain transaction, only 50% of then unvested restricted stock units shall vest in full effective immediately prior to such event. |
| (5) | The market value of unearned shares is based on the price of $4.34, the closing price of our common stock on March 31, 2021 (the last trading day of our 2021 fiscal year, as required under the applicable rules). |
Change in Control Provisions
For a more detailed description of the “change in control” provisions applicable to December 31, 2017. Mr. Ellin is the Managing Member of Trinad LLC. Pursuant to theour Named Executive Officers under their employment agreements, see “Named Executive Officer Employment Agreements” below.
Named Executive Officer Employment Agreements
The material terms of employment agreements with the Management Agreement, Trinad LLC provided certain management services to us, including, without limitation, relating to the sourcing, structuring and negotiation of a potential business combination involvingNamed Executive Officers previously entered into by our Company in consideration of (i) an aggregate cash fee of $2,080,000, which was payable in $90,000 increments in advance of each consecutive 3are described below.
-month period during the term of the ManagementEmployment Agreement and with $1,000,000 due at the end of the 3Robert S. Ellin
-year term, which was paid during March and April 2017, and (ii) the issuance of a warrant to purchase 750,000 shares of our common stock at an exercise price of $0.225 per share, which was issued in September 2011. In August 2016, the warrant was exercised in full on a cashless basis, resulting in the issuance of 716,216 shares of our common stock. The term of the Management Agreement expired on September 23, 2014, and Trinad Management continued to provide services to us for a cash fee of $30,000 per month on a month-to-month basis pursuant to an arrangement described below.
On September 7, 2017, we entered into an employment agreement with Mr. Ellin for a term of five years at an annual salary of $650,000 payable commencing on the day of the closing of the Public Offering, (December 27, 2017).which salary was lowered to $500,000 pursuant to Amendment No. 1 to Mr. Ellin’s employment agreement, dated as of December 14, 2017. Pursuant to Mr. Ellin’s employment agreement, we agreed to continue to pay to Trinad LLCManagement a cash fee at the rate of $30,000 per month (or pro-ratapro-rata thereof) until the completion of the Public Offering (December 27, 2017), consistent with the terms of the Management Agreement, whether such agreement was terminated or not prior to the date that the Public Offering was completed. On September 7, 2017, in connection with his employment agreement, we entered into an option award agreement with Mr. Ellin whereby we issued to him options to purchase 1,166,667 shares of our common stock at an exercise price of $4.00 per share (the offering price of our public offering completed in December 2017).
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30
2019 Outstanding Equity Awards at Fiscal Year Ended
The following table sets forth certain information with respect to grants of plan-based awards for the fiscal year ended March31, 2019 to our Named Executive Officers. Except as set forth below, all of the outstanding equity awards granted to our Named Executive Officers were fully vested as of March31, 2019.
| | Option awards | | Stock awards |
Name | | Number of
securities
underlying
unexercised
options
(#)
exercisable | | Number of
securities
underlying
unexercised
options
(#)
unexercisable | | Equity
incentive
plan
awards:
Number of
securities
underlying
unexercised
unearned
options
(#) | | Option
exercise
price
($) | | Option
expiration
date | | Number of
shares or
units of
stock
that have
not vested
(#) | | Market
value of
shares of
units of
stock
that have
not vested
($) | | Equity
incentive
plan
awards:
Number of
unearned
shares,
units or
other rights
that have
not vested
(#) | | Equity
incentive
plan
awards:
Market or payout
value of
unearned
shares,
units or
other rights
that have
not vested
($)(4) |
Robert Ellin | | 111,111 | (1) | | 222,222 | (1) | | 333,333 | (1) | | 5.01 | | 9/7/2027 | | — | | — | | — | | | — |
| | | — | | | — | | | 500,000 | (2) | | 5.01 | | 9/7/2027 | | — | | — | | — | | | — |
Michael Zemetra | | 93,750 | (3) | | — | | | 156,250 | (3) | | 3.83 | | 4/13/2028 | | | | — | | — | | | — |
| | | — | | | — | | | — | | | — | | — | | — | | — | | 250,000 | (5) | | 1,345,000 |
Michael Bebel | | 116,667 | (6) | | — | | | 233,333 | (6) | | — | | — | | — | | — | | — | | | — |
| | | | | | | | | | | | | | | | | | | | 500,000 | (7) | | 2,690,000 |
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Change in Control Provisions
For a more detailed description of the “change in control” provisions applicable to our Named Executive Officers under their employment agreements, see “Named Executive Officer Employment Agreements” below.
Named Executive Officer Employment Agreements
The material terms of employment agreements with the Named Executive Officers previously entered into by our Company are described below.
Employment Agreement with Robert S. Ellin
On September23, 2011, we entered into a Management Agreement with Trinad LLC, the manager of Trinad Capital, which is one of our principal stockholders. Mr.Ellin is the Managing Director and Portfolio Manager of Trinad LLC. Pursuant to the terms of the Management Agreement, Trinad Management provided certain management services to us, in consideration of (i) an aggregate cash fee of $2,080,000, which was payable in $90,000 increments in advance of each consecutive 3-month period during the term of the Management Agreement and with $1,000,000 due at the end of the initial 3-year term, which was paid during March and April 2017, and (ii) the issuance of a warrant to purchase 750,000shares of our common stock at an exercise price of $0.225 per share. In August 2016, the warrant was exercised in full on a cashless basis, resulting in the issuance of 716,216shares of our common stock. The initial term of the Management Agreement has expired and Trinad LLC continues to provide services to us for a cash fee of $30,000 a month, on a month-to-month basis pursuant to an unwritten arrangement. From April1, 2015 to March31, 2017, we incurred $720,000 of fees under the unwritten arrangement, and we incurred $150,000 of fees under the unwritten arrangement from April1, 2017 to August31, 2017. On September7, 2017, we entered into an employment agreement with Mr.Ellin for a term of five years at an annual salary of $650,000 payable commencing on the day of the closing of the Public Offering, which salary was lowered to $500,000 pursuant to Amendment No. 1 to Mr.Ellin’s employment agreement, dated as of December14, 2017. Pursuant to Mr.Ellin’s employment agreement, we agreed to continue to pay to Trinad Management a cash fee at the rate of $30,000 per month (or pro-rata thereof) until the completion of the Public Offering (December27, 2017), consistent with the terms of the Management Agreement, whether such agreement was terminated or not prior to the date that the Public Offering was completed. On September7, 2017, in connection with his employment agreement, we entered into an option award agreement whereby we issued stock options to purchase 1,166,667shares1,166,667 shares of our common stock with an exercise price of $4.00 per share (the offering price of our public offering completed in December 2017) (the “Ellin Options”). The Ellin Options were granted pursuant to our 2016 Equity Incentive Plan.Plan (as amended, the “2016 Plan”). The first tranche of 666,667shares666,667 shares underlying the Ellin Options (the “Ellin Service Options”) shall vestvests in one-twelfthone-twelfth increments every three months for a three year period from the effective date of his employment agreement. Each tranche of the Ellin Service Options shall become exercisable one year after the date such tranche shall vest. In the event of a Change of Control (as defined in his employment agreement), any unvested portion of the Ellin Service Options shall vest and become exercisable effective immediately prior to such event. The second tranche of 500,000shares500,000 shares underlying the Ellin Options shall 100% vest in full if prior to the third anniversary of the effective date of his employment agreement the shares of our common stock shall have traded at a price of $30.00 per share or more for a period of 90 consecutive trading days during which an average of at least 166,667shares166,667 shares are traded per day (the “Ellin Performance Options”). The Ellin Performance Options shall become exercisable one year after the vesting date, provided that, in the event of a Change of Control, if the Ellin Performance Options have vested prior to such date, they shall be immediately exercisable upon such event. Each tranche of the Ellin Options and the shares underlying such options is subject to a lock-uplock-up restriction for a period of 12months12 months from the date that such tranche of the options vests; provided, that such restriction period shall terminate with respect to all Ellin Options and the shares underlying such options 24months24 months from the effective date of Mr.Ellin’sMr. Ellin’s employment agreement.
If Mr.Ellin’sMr. Ellin’s employment is terminated by us “Without Cause” or by Mr.EllinMr. Ellin for “Good Reason” (each as defined in his employment agreement, subject to our right to cure), he will be entitled to termination benefits, pursuant to which (i) we will pay Mr.EllinMr. Ellin certain accrued obligations and prior year bonus amounts, if any; and (ii) subject to timely execution and non-revocationnon-revocation of a release as provided in his employment agreement (v) we will be required to pay Mr.EllinMr. Ellin a one-timeone-time payment of $10,000,000; (w) (i) unvested Ellin Service Options and Other Equity Awards (as defined in his employment agreement) (other than Ellin Performance Options) shall automatically accelerate and become vested and exercisable for a period of twelve months from the termination date, but in all events no later than the end of the applicable term for each such award, and (ii)the Ellin Performance Options shall continue to vest if, and only if, the performance criteria specified above are satisfied during the 12-month12-month period following the termination
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date; (x) any such accelerated Ellin Service Options, Ellin Performance Options and Other Equity Awards shall remain outstanding and be exercisable, to the extent applicable, for a period of twelve months from the later of the termination date or the date the award first becomes vested and exercisable, but in all events no later than the applicable term for each such award; (y) all restrictions on the Other Equity Awards shall automatically and immediately lapse; and (z) we will continue to cover costs for Mr.Ellin’sMr. Ellin’s and his dependents continued participation in our medical plans from the termination date through and inclusive of the lesser of twelve months or the period through the date on which he obtains other coverage. Mr.Ellin’sMr. Ellin’s employment agreement contains covenants for the benefit of our Company relating to non-competitionnon-competition during the term of his employment and protection of our confidential information, customary representations and warranties and indemnification obligations.
Employment Agreement with Michael ZemetraDermot McCormack
In April 2018,July 2019, we entered into an employment agreement with Mr.ZemetraMr. McCormack for a term of twothree years at an annual salary of $275,000. Mr.Zemetra$500,000. Mr. McCormack is also eligible to earn an annual fiscal year cash performance bonus for each whole or partial fiscal year of his employment period with the Companyus in accordance with the Company’sour annual bonus plan applicable to the Company’sour senior executive. Mr.Zemetra’sMr. McCormack’s “target” performance bonus shall be 100% of his average annualized base salary during the fiscal year for which the performance bonus is earned. Mr.ZemetraMr. McCormack was also granted stock options to purchase 250,000shares of the Company’s common stock at a price of $3.83 per share (the “Zemetra Options”) and 250,0001,000,000 restricted stock units (the “Zemetra“McCormack RSUs”). The Zemetra Options and the ZemetraMcCormack RSUs were granted pursuant to the Company’s 2016 Equity Incentive Plan (the “2016 Plan”).Plan. The Zemetra OptionsRSUs shall have a term of 10 years from the date of grant. 1/8th of the Zemetra Options shall vest every three months following the Effective Date during the Term, provided, that on each such vesting date Mr.Zemetra is employed by the Company and subject to the other provisions of his employment agreement. 156,250 of the Zemetra RSUs (the “First RSUs Tranche”) shallone-time cliff vest on June30, 2019 (the “Initial Vesting Date”) and the remainder of 93,750 of the Zemetra RSUs (the “Second RSUs Tranche”) shall vest upon each of the first three quarterly anniversaries of the Initial Vesting Date with the last third vesting date being the two-year anniversary of the Effective Date, (each, a “Subsequent Vesting Date”, subject to Mr.Zemetra’sMr. McCormack’s continued employment with the Companyus through the applicable vesting date. Each vested ZemetraMcCormack RSU shall be settled by delivery to Mr.ZemetraMr. McCormack of one share of the Company’sour common stock on the first to occur of: (i) the date of a Change of Control, (ii) the date that is ten business days following the expirationvesting of the Lock-up Period (as defined below),McCormack RSUs, and (iii) the date of Mr.Zemetra’sMr. McCormack’s death provided such event occurs after the expiration of the Lock-up Period, and (iv) the date of Mr.Zemetra’sor Disability (as defined in the Employment Agreement), provided such event occurs after the expiration of the Lock-up Periodhis employment agreement) (in any case, the “Settlement Date”). In the event of a “Change of Control” (as defined in Mr.Zemetra’s employment agreement) any unvested portion of the Zemetra Options and the Zemetra RSUs shall vest immediately prior to such event. Each Zemetra RSU grant will be evidenced by an award agreement that shall specify such other terms and conditions as the Board, in its sole discretion, will determine in accordance with the terms and conditions of the 2016 Plan, including all terms, conditions and restrictions related to the grant and the form of payout, which, subject to the 2016 Plan, may be left to the discretion of the Board. “Lock-up Period” means (i) with respect to the First RSUs Tranche, the period ended on December1, 2019, and (ii) with respect to the Second RSUs Tranche, the period ending on the earlier of: (x) one year after the Subsequent Vesting Date applicable to the Second RSUs Tranche, or (y) the second anniversary of the Effective Date. During the Lock-up Period, Mr.Zemetra agreed not to dispose or transfer any shares of the Company’s common stock underlying the Zemetra Options and Zemetra RSUs, if any, subject to certain standard exceptions.
If Mr.Zemetra’s employment is terminated by the Company without “Cause” or by Mr.Zemetra for “Good Reason” (each as defined in his employment agreement, subject to the Company’s right to cure), he will be entitled to termination benefits, pursuant to which (i) the Company will be obligated to pay Mr.Zemetra certain accrued obligations, any unpaid Prior Year Bonus and any Pro Rata Bonus (each as defined in his employment agreement); and (ii) if such termination occurs after the first six months from the Effective Date, (x) the Company will be obligated to continue to pay Mr.Zemetra his base salary and Pro Rata Bonus for a period from the termination date through the lesser of 6months or the period through and inclusive of the last day of the Term, (y) 50% of the unvested Zemetra Options and other equity awards (other than RSUs) shall automatically accelerate and become vested and exercisable for a period of 6months from the termination date or the date the award first becomes vested and exercisable, but in all events no later than the applicable term for each such award; and (z) (A) 1/8th of the RSUs shall automatically vest upon each quarterly anniversary of the Effective Date occurring during the period from the Effective Date through the termination date, and (B) 50% of the remaining unvested RSUs shall automatically and immediately become vested, as of the termination date, and such vested RSUs shall be settled as set forth in his employment agreement,
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and all restrictions on such equity awards shall automatically and immediately lapse. Mr.Zemetra’s employment agreement contains covenants for the benefit of the Company relating to non-interference with the Company’s business after termination of employment and protection of the Company’s confidential information, certain customary representations and warranties and standard Company indemnification obligations.
Employment Agreement with Michael Bebel
On February6, 2019 and effective as of January29, 2019 (the “Effective Date”), Michael Bebel was promoted to the role of the Senior Executive Vice President of our Company (previously our Executive Vice President of Corporate Development and Rights Management). In connection with such promotion, we entered into an employment agreement with Mr.Bebel, dated as of the Effective Date, for a term of three years at an annual salary of $275,000, which salary could be increased to $325,000 as provided in his employment agreement. We also agreed to reimburse Mr.Bebel for his relocation expenses in an amount not to exceed $35,000, as well as to pay him an additional amount to compensate him for tax payments due on such amount, such that the net after-tax proceeds to him of the reimbursement of his relocation expenses and such relocation tax gross-up equal to the amount of his reimbursable expenses. Subsequently, Mr.Bebel agreed to defer the increase of his salary, as well as the payment of his relocation expenses (and any reimbursement of taxes due on such amount) until a future date upon which the Salary Increase Event financing condition is satisfied (as set forth in his employment agreement). Mr.Bebel is eligible to earn an annual fiscal year cash performance bonus for each whole or partial fiscal year of his employment period with our Company in accordance with our annual bonus plan applicable to our senior executives. Mr.Bebel’s “target” performance bonus shall be 100% of his average annualized base salary during the fiscal year for which the performance bonus is earned. Pursuant to his employment agreement, Mr.Bebel was granted 500,000 restricted stock units of the Company (the “Bebel RSUs”) under the 2016 Plan. 83,105 of the Bebel RSUs shall vest on the later of (i) July28, 2019 and (ii) the earlier of (x) the expiration of any “lock up” agreement in respect of shares of our capital stock to which Mr.Bebel is subject and (y) June30, 2019, and the remainder of 416,895 of the Bebel RSUs shall vest in ten equal instalments every three months thereafter with the last vesting date being the three-year anniversary of the Effective Date, subject to Mr.Bebel’s continued employment with our Company through the applicable vesting date. Each vested Bebel RSU shall be settled by delivery to Mr.Bebel of one share of our common stock as soon as practicable after the applicable vesting. In the event of a “Change of Control” (as defined in his employment agreement) any unvested portion of the BebelMcCormack RSUs shall vest immediately prior to such event. Each Bebel RSUThe McCormack RSUs grant will bewas evidenced by an award agreement that will complyspecifies such other terms and conditions in accordance with the provisions2016 Plan, subject to the terms of his employment agreement applicable to the Bebel RSUs.agreement.
If Mr.Bebel’sMr. McCormack’s employment is terminated by us “Without Cause” or by Mr.BebelMr. McCormack for “Good Reason” (each as defined in his employment agreement, subject to our right to cure), he will be entitled to termination benefits, consisting ofpursuant to which we will be obligated to pay Mr. McCormack (i) payment to Mr.Bebel of his certain accrued obligations and any unpaid Prior Year Bonus, and (ii) his base salary, medical benefits and any Pro Rata Bonus (each as defined in his employment agreement); (ii) payment of his then annual base salary and his and his dependents continued participation in all of our medical benefit plans for a period of 12 months from the termination date, through the lesser of 12months or the period through and inclusive(y) 100% of the last day of the term of his employment agreement, and (iii) immediate vesting and exercisability of 100% of his unvested Bebel RSUs and any otherunvested equity awards with such awards to remainshall automatically accelerate and become vested as of the termination date and exercisable for a period of six12 months from the termination date or the date the award first becomes vested and exercisable, but in all events no later than the applicable term for each such award, and withdate. Any such McCormack RSUs that vest as a result of such accelerated vesting shall be settled as set forth in his employment agreement, and all restrictions on such RSUs and equity awards toand vested McCormack RSUs shall automatically and immediately lapse. If Mr.Bebel’s employment is terminated as a result of his death or Disability (as defined in his employment agreement, subject to our right to cure), he will be entitled to termination benefits, consisting of (i) payment to Mr.Bebel of his certain accrued obligations, any unpaid Prior Year Bonus and any Pro Rata Bonus (each as defined in his employment agreement); and (ii) immediate vesting and exercisability of such number of his unvested Bebel RSUs and any other equity awards that would have vested in the 12-month period following the termination date had Mr.Bebel’s employment with us continued, with such awards to remain exercisable for a period of 12months from the termination date or the date the award first becomes vested and exercisable, but in all events no laterlapse (other than the applicable term for each such award,Lock-Up Period and with all restrictions on such vested Bebel RSUs and equity awards to automatically and immediately lapse. Mr.Bebel’sDaily Trading Limit as discussed below). Mr. McCormack’s employment agreement also contains covenants for the benefit of our Company relating to non-interferencenon-interference with our business after termination of employment and protection of our confidential information, certain customary representations and warranties and standard Company indemnification obligations.
If Mr. McCormack receives any McCormack RSUs as a result of their accelerated vesting in the event of his death, Disability or his termination without “Cause” or for “Good Reason”, Mr. McCormack agreed to a lock-up period of 12 months from the applicable vesting date (the “Lock-Up Period”). During the Lock-up Period, Mr. McCormack agreed not to dispose or transfer any shares of our common stock received pursuant to his Employment Agreement, subject to certain standard exceptions. Subsequent to the expiration of the Lock-Up Period, for a period of one year, Mr. McCormack shall not have the right to sell on each trading day more than 10,000 shares of the Company’s common stock, as adjusted for any stock dividend, stock split or other reclassification affecting the Company’s equity securities occurring after the Effective Date (the “Daily Trading Limit”); provided, that (x) the Daily Trading Limit shall not apply to our equity securities obtained by Mr. McCormack in open market transactions and (y) such obligations with regard to the Daily Trading Limit shall terminate upon a Change of Control. If, after the Effective Date, any “C” level executive of our Company, who is a party to or who enters into an employment agreement with us, shall be afforded a more favorable provision (or provisions) with such terms not already included in such employment agreement as of the Effective Date with regard to the restrictions on the transfer of such executive’s shares during the Lock-Up Period (including without limitation as to the duration of, and termination of, the Lock-Up Period, and as to the Daily Trading Limit), the provisions of Mr. McCormack’s Employment Agreement applicable to such restrictions shall be deemed to be automatically amended to provide for such more favorable provision(s).
Employment Agreement with Michael Quartieri
In November 2020, we entered into an employment agreement (the “MQ Employment Agreement”) with Mr. Quartieri for a term of two years at an annual salary of $400,000. Mr. Quartieri is also eligible to earn an annual fiscal year cash performance bonus for each whole or partial fiscal year of his employment period with the Company in accordance with our annual bonus plan applicable to our senior executive. Mr. Quartieri’s “target” performance bonus shall be 100% of his average annualized base salary during the fiscal year for which the performance bonus is earned. Under the MQ Employment Agreement, Mr. Quartieri was also granted 500,000 restricted stock units of our Company (the “Quartieri RSUs”). The Quartieri RSUs were granted pursuant to the 2016 Plan. 50% of the Quartieri RSUs shall vest during the first open trading window under our Insider Trading Policy which occurs after the first anniversary of November 30, 2020 (the “Initial Vesting Date”), and the remainder of 50% of the Quartieri RSUs shall vest upon each of the first four quarterly anniversaries of the Initial Vesting Date, with the last fourth vesting date being November 30, 2022, subject to Mr. Quartieri’s continued employment with our Company through each applicable vesting date. Each vested Quartieri RSU shall be settled by delivery to Mr. Quartieri of one share of our Company.common stock on the first to occur of: (i) the date of a Change of Control, (ii) promptly following the applicable vesting date, (iii) the date of Mr. Quartieri’s death and (iv) the date of Mr. Quartieri’s Disability (as defined in the MQ Employment Agreement). In the event of a “Change of Control” (as defined in the MQ Employment Agreement) any unvested portion of the Quartieri RSUs shall vest effective immediately prior to such event; provided, that in the event a Change of Control occurs as a result of a certain transaction, only 50% of then unvested Quartieri RSUs shall vest in full effective immediately prior to such event. The Quartieri RSUs grant was evidenced by a standard Company award agreement that specifies such other terms and conditions as the Board, in its sole discretion, determined in accordance with the terms and conditions of the 2016 Plan, including all terms, conditions and restrictions related to the grant.
If Mr. Quartieri’s employment is terminated by us without “Cause” or by Mr. Quartieri for “Good Reason” (each as defined in the MQ Employment Agreement, subject to our right to cure), he will be entitled to termination benefits, pursuant to which (i) we will be obligated to pay Mr. Quartieri certain accrued obligations, any unpaid Prior Year Bonus and any Pro Rata Bonus (each as defined in the MQ Employment Agreement); and (ii) if such termination occurs after the first six months from the Effective Date, (x) we will be obligated to continue to pay Mr. Quartieri his base salary and Pro Rata Bonus for a period from the termination date through the lesser of 6 months or the period through and inclusive of the last day of the Term, 50% of the unvested Quartieri RSUs shall automatically and immediately become vested, as of the termination date, and such vested Quartieri RSUs shall be settled as set forth in the MQ Employment Agreement, and all restrictions on such equity awards shall automatically and immediately lapse (subject to the restrictions below). If Mr. Quartieri receives any vested Quartieri RSUs as a result of his termination without “Cause” or for “Good Reason”, the vested Quartieri RSUs shall be subject to a lock-up period of 12 months from the applicable vesting date (the “Lock-Up Period”). During the Lock-Up Period, Mr. Quartieri agreed not to dispose or transfer any Quartieri RSUs, subject to certain standard exceptions. After the expiration of the Lock-Up Period, for a period of one year, Mr. Quartieri shall not have the right to sell on each trading day shares of the Company’s common stock, received by him as a result of any accelerated vesting, that is more than the greater of (x) 10% of such trading day’s daily trading volume and (y) 10,000 shares, as adjusted for any stock dividend, stock split, combination of shares, reverse stock split, reorganization, recapitalization, or other reclassification affecting the Company’s equity securities (the “Daily Trading Limit”); provided, that the Daily Trading Limit shall not apply to the Company’s equity securities obtained by Mr. Quartieri in open market transactions and such obligations with regard to the Daily Trading Limit shall terminate upon a Change of Control.
Executive Officers Salary Reduction
On April 7, 2020, our executive officers and other senior management (including our Named Executive Officers), desiring to demonstrate confidence in our Company and to assist our near term objectives in light of the ongoing epidemic, agreed to accept a reduction in their monthly base salaries (as set forth below) in exchange for shares of our common stock that will vest in full in early calendar year 2021 (the “Vesting Shares”). This compensation adjustment is anticipated to be in place through the first fiscal quarter ended June 30, 2020, but may be extended for subsequent periods, subject to further review our board and executive management. During this period, our Named Executive Officers and other executive officers agreed to accept 50% of their monthly base salaries with Vesting Shares, and forego any cash bonuses that maybe owed to them with respect to our fiscal year ended March 31, 2020, with any such bonuses to be paid in Vesting Shares. In addition, our remaining employees received between 10% to 25% reductions in their monthly base salaries, to be paid in lieu in Vesting Shares, for the first fiscal quarter ended June 30, 2020.
In addition, effective as of August 1, 2020, Mr. Ellin, desiring to continue to demonstrate confidence in our Company and to assist our then near term objectives in light of the ongoing COVID-19 coronavirus pandemic, agreed to also forego his monthly base salary through December 31, 2020 in exchange for shares of our common stock that will vest in full in calendar year 2021.
Narrative Disclosure of Compensation Policies and Practices as They Relate to the Company’s Risk Management
We believe that our compensation policies and practices for all employees and other individual service providers, including executive officers, do not create risks that are reasonably likely to have a material adverse effect on us.
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2016 Equity Incentive Plan
On August29,
The summary of the principal features of the 2016 Plan is qualified in its entirety by reference to the full text of the 2016 Plan, which is incorporated by reference as Exhibit 10.2 to our board of directors and stockholders approved our 2016 Equity Incentive Plan (as amended,Annual Report on Form 10-K, filed with the “2016 Plan”). On September20, 2018, our board of directors approved Amendment No. 1SEC on July 14, 2021. Pursuant to the 2016 Plan, which was approved by our shareholders on November29, 2018, to increase the number of shares of common stock authorized for issuance under the 2016 Plan by 5,000,000shares to 12,600,000, and make a few additional changes which were not considered material. Such increase became effective on February11, 2019. As of March31, 2019, 4,981,668 stock options to purchasethere are 17,600,000 shares of our common stock 408,433shares ofreserved for future issuance to our common stockemployees, directors and 1,377,391 restricted stock units have been issued and outstanding under the 2016 Plan.consultants. As described below, incentive awards authorized under the 2016 Plan include, but are not limited to, incentive stock options within the meaning of Section 422 of the Code. If an incentive award granted under the 2016 Plan expires, terminates, is unexercised or is forfeited, or if any shares are surrendered to us in connection with the exercise of an incentive award, the shares subject to such award and the surrendered shares will become available for further awards under the 2016 Plan.
Administration —The compensation committee2016 Plan is administered by our Compensation Committee of our board of directors, or our board of directors in the absence of such a committee, will administer the 2016 Plan.committee. Subject to the terms of the 2016 Plan, the compensation committee or2016 Plan administrator may select participants to receive awards, determine fair market value of our board of directors has complete authority and discretion toshares, determine the types of awards and terms uponand conditions of awards and interpret provisions of the 2016 Plan, to institute an exchange program (without stockholder approval) pursuant to which outstanding awards may be surrendered or cancelled in exchange for awards of the same type (which may have lower exercise prices and different terms), awards of a different type, and/or cash (except that the 2016 Plan administrator may not, without stockholder approval, reprice any options or stock appreciation rights (“SARs”), or pay cash or issue new options or SARs in exchange for the surrender and cancellation of outstanding options or SARs), modify awards granted under the 2016 Plan, and make all other determinations deemed necessary or advisable for administering the 2016 Plan.
Grants — The 2016 Plan authorizes the grant to participants of nonqualified stock options, incentive stock options, restricted stock awards, restricted stock units, performance grants intended to comply with Section 162(m) of the Code and stock appreciation rights (“SARs”),SARs, as described below:
•
| ● | Options granted under the 2016 Plan entitle the grantee, upon exercise, to purchase up to a specified number of shares from us at a specified exercise price per share. The exercise price for shares of common stock covered by an option generally cannot be less than the fair market value of common stock on the date of grant unless agreed to otherwise at the time of the grant. In addition, in the case of an incentive stock option granted to an employee who, at the time the incentive stock option is granted, owns stock representing more than 10% of the voting power of all classes of stock of our Company or any parent or subsidiary, the per share exercise price will be no less than 110% of the fair market value of our common stock on the date of grant. |
| ● | Restricted stock awards and restricted stock units may be awarded on terms and conditions established by the compensation committee or our board of directors, which may include performance conditions for restricted stock awards and the lapse of restrictions on the achievement of one or more performance goals for restricted stock units. |
| ● | The compensation committee or our board of directors may make performance grants, each of which will contain performance goals for the award, including the performance criteria, the target and maximum amounts payable, and other terms and conditions. |
| ● | The 2016 Plan authorizes the granting of stock awards. The compensation committee or our board of directors will establish the number of shares of our common stock to be awarded (subject to the aggregate limit established under the 2016 Plan upon the number of shares of our common stock that may be awarded or sold under the 2016 Plan) and the terms applicable to each award, including performance restrictions. |
| ● | SARs entitle the participant to receive a distribution in an amount not to exceed the number of shares of our common stock subject to the portion of the SAR exercised multiplied by the difference between the market price of a share of our common stock on the date of exercise of the SAR and the market price of a share of our common stock on the date of grant of the SAR. |
Non-Transferability of Awards — Unless the 2016 Plan entitle the grantee, upon exercise, to purchase up to a specified number of shares from us at a specified exercise price per share. The exercise price for shares of common stock covered by an option generally cannot be less than the fair market value of common stock on the date of grant unless agreed to otherwise at the time of the grant. In addition, in the case of an incentive stock option granted to an employee who, at the time the incentive stock option is granted, owns stock representing more than 10% of the voting power of all classes of stock of our Company or any parent or subsidiary, the per share exercise price will be no less than 110% of the fair market value of our common stock on the date of grant.
• Restricted stock awards and restricted stock units may be awarded on terms and conditions established by the compensation committee or our board of directors, which may include performance conditions for restricted stock awards and the lapse of restrictions on the achievement of one or more performance goals for restricted stock units.
• The compensation committee or our board of directors may make performance grants, each of which will contain performance goals for the award, including the performance criteria, the target and maximum amounts payable, and other terms and conditions.
• The 2016 Plan authorizes the granting of stock awards. The compensation committee or our board of directors will establish the number of shares of our common stock to be awarded (subject to the aggregate limit established under the 2016 Plan upon the number of shares of our common stock that may be awarded or sold under the 2016 Plan) and the terms applicable to each award, including performance restrictions.
• SARs entitle the participant to receive a distribution in an amount not to exceed the number of shares of our common stock subject to the portion of the SAR exercised multiplied by the difference between the market price of a share of our common stock on the date of exercise of the SAR and the market price of a share of our common stock on the date of grant of the SAR.
Non-Transferability of Awards — Unless our compensation committeeadministrator provides otherwise, the 2016 Plan generally does not allow for the transfer of awards and only the recipient of an award may exercise an award during his or her lifetime.
Certain Adjustments — In the event of certain changes in our capitalization, to prevent diminution or enlargement of the benefits or potential benefits available under the 2016 Plan, the compensation committee2016 Plan administrator will adjust the number and class of shares that may be delivered under the 2016 Plan and/or the number, class and price of shares covered by each outstanding award, and the numerical share limits set forth in the 2016 Plan.
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Dissolution, Liquidation — The 2016 Plan provides that in the event of a proposed dissolution or liquidation of our Company, to the extent it has not been previously exercised, an award will terminate immediately prior to the consummation of such proposed action.
Dividends or Dividend Equivalents for Performance Awards. Notwithstanding anything to the foregoing herein, the right to receive dividends, dividend equivalents or distributions with respect to a performance award will only be granted to a participant if and to the extent that the underlying award is earned.
Merger, Change of Control— The 2016 Plan provides that in the event of a merger or a change of control, as defined under the 2016 Plan, each outstanding award will be treated as the compensation committee2016 Plan administrator determines, including, without limitation, that each award will be assumed or an equivalent option or right substituted by the successor corporation or a parent or subsidiary of the successor corporation.
Duration, Amendment, and Termination —Our board of directors has the power to amend, suspend or terminate the 2016 Plan without stockholder approval or ratification at any time or from time to time. No change may be made that increases the total number of shares of our common stock reserved for issuance pursuant to incentive awards or reduces the minimum exercise price for options or exchange of options for other incentive awards, unless such change is authorized by our stockholders within one year of such change. Unless sooner terminated, the 2016 Plan would terminate ten years after it was adopted.
Compliance with Section 162(m) of the Code. Section 162(m) of the Code generally precludes a tax deduction by any publicly-held company for compensation paid to any “covered employee” to the extent the compensation paid to such covered employee exceeds $1 million during any taxable year of the company. The recently-enacted Tax Cuts and Jobs Act of 2017 (the “2017 Tax Act”) included changes to Section 162(m) effective for years after 2017. Prior to 2018, “covered employees” included the Chief Executive Officer of the Company and the three other highest paid officers of the Company (other than the Chief Financial Officer). For 2018 and later years, “covered employees” will include the Chief Executive Officer of the Company, the Chief Financial Officer of the Company, the three highest paid officers of the Company (other than the Chief Executive Officer and the Chief Financial Officer) and any employee who qualified as a “covered employee” for any tax year beginning after 2016. For years beginning prior to January 1, 2018, the $1 million deduction limit did not apply to “qualified performance-based compensation” that was based on the attainment of pre-established, objective performance goals established under a stockholder-approved plan. Effective for the years beginning on or after January 1, 2018, there is no exception for “qualified performance-based compensation”; but a transition rule provides that the “qualified performance-based compensation” exemption will continue to apply to grandfathered arrangements made pursuant to a binding contract in effect on or before November 2, 2017 that is not materially modified thereafter. We believe that it is important to preserve flexibility in administering compensation programs to promote various corporate goals. Accordingly, we have not adopted a policy that all compensation must qualify as deductible under Section 162(m). Amounts paid under our compensation programs may not be deductible as the result of Section 162(m). While our policy has generally been to preserve corporate tax deductions by qualifying compensation over $1 million paid to executive officers as performance-based, the Compensation Committees may, from time to time, conclude that compensation arrangements are in our best interests and the best interests of our stockholders despite the fact that such arrangements may not, in whole or part, qualify for tax deductibility. Going forward, we intend to continue to design our executive compensation arrangements to be consistent with our best interests and those of our stockholders; accordingly, the Compensation Committees, while considering the tax deductibility as a factor in determining executive compensation, may not limit such compensation to those levels that will be deductible, particularly in light of the elimination of the expansion of the covered employee group and the elimination of the exception for performance-based compensation.
Forfeiture Provisions. The 2016 Plan administrator may provide by rule or regulation or in any award agreement, or may determine in any individual case, the circumstances in which awards shall be paid or forfeited in the event a participant ceases to be employed by us, or to provide services to us, prior to the end of a performance period, period of restriction or the exercise, vesting or settlement of such award. Except as set forth for options, generally awards will be forfeited if not earned or vested upon termination, unless otherwise provided for in an award agreement.
Adjustments for Stock Dividends and Similar Events. The 2016 Plan administrator will make appropriate adjustments in outstanding awards and the number of shares of common stock available for issuance under the 2016 Plan, including the individual limitations on awards, to reflect dividends, splits, extraordinary cash dividends and other similar events.
Equity Compensation Plan Information
The following table reflects the number of shares of our common stock issuable upon the exercise of awards granted under our equity compensation plans approved and not approved by shareholders and the weighted average exercise price for such awards as of March31, 2019.
Name of Plan | | Number of shares of common
stock to be issued upon exercise of outstanding options, warrants and rights | | Weighted-
Average Exercise
Price of
Outstanding Options
($) | | Number of
shares
remaining available for
issuance under equity compensations plans
(excluding the shares reflected in column(1) |
Equity compensation plans approved by security holders(1) | | 4,981,668 | | $ | 3.95 | | 5,832,508 |
Equity compensation plans not approved by security holders | | — | | | — | | — |
Total | | 4,981,668 | | | 3.95 | | 5,832,508 |
(1)
| Name of Plan | | Number of shares of common
stock to be issued
upon
exercise of outstanding options, warrants
and rights | | | Weighted - Average
Exercise
Price of Outstanding Options
($) | | | Number of shares
remaining available for issuance
under equity compensations plans
(excluding the shares
reflected in column(1) | |
| Equity compensation plans approved by security holders(1) | | | 3,946,584 | | | $ | 3.74 | | | | 5,599,030 | |
| Equity compensation plans not approved by security holders | | | — | | | | — | | | | — | |
| Total | | | 3,946,584 | | | | 3.74 | | | | 5,599,030 | |
| (1) | Represents securities issued under our 2016 Plan. |
On August29,August 29, 2016, our board of directors approved and adopted and our shareholders approved the 2016 Plan.Plan, as amended on February 11, 2019 and June 29, 2021. The 2016 Plan provides for the grant of incentive stock options, qualified stock options, restricted stock awards, restricted stock units, stock appreciation rights, and performance shares or units and cash awards. On September20, 2018, our board of directors approved Amendment No. 1 to the 2016 Plan, which was approved by our shareholders on November29, 2018, to increase the number of shares of common stock authorized for issuanceAwards may be granted under the 2016 Plan by 5million shares to 12,600,000,our employees, officers, directors and make a few additional changes which were not considered material. Such increase became effective on February11, 2019.consultants.
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CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
The following includes a summary of transactions since April1, 2018April 1, 2020 to which we have been a party, in which the amount involved in the transaction exceeded $120,000 (which was less than 1% of the average of our total assets at year-endyear-end for our last two completed fiscal years), and in which any of our directors, executive officers or, to our knowledge, beneficial owners of more than 5% of our capital stock or any member of the immediate family of any of the foregoing persons had or will have a direct or indirect material interest, other than equity and other compensation, termination, change in control and other arrangements, which are described in this Proxy Statement below under the section captioned “Executive Compensation.”
Amounts Due to Related Parties
Notes Issued to Related Parties and Related Warrants Exercise
As of March31, 2019March 31, 2021 and 2018,2020, we had the following outstanding notes payable to Trinad Capital, a fund wholly owned by Mr.Ellin,Mr. Ellin, our Chief Executive Officer, Chairman, director and principal stockholder, for both short- and long-termlong-term working capital requirements:
| | March 31,
2019 | | March 31,
2018 |
First Senior Note | | $ | — | | $ | — |
Second Senior Note | | | — | | | — |
7.5% Unsecured Convertible Note | | $ | 4,481,077 | | $ | 3,948,000 |
Total | | $ | 4,481,077 | | $ | 3,948,000 |
| | | March 31,
2021 | | | March 31,
2020 | |
| 8.5% Unsecured Convertible Note | | $ | 5,500,989 | | | $ | 5,154,674 | |
| Total | | $ | 5,500,989 | | | $ | 5,154,674 | |
As of March 31, 2021 and March 31, 2020, we had outstanding 8.5% (effective as of January 11, 2021, previously 7.5% Unsecured Convertible Notes —) unsecured convertible notes payable (the “Trinad Notes”) issued to Trinad Capital Master Fund —On February21, 2017, we issuedLtd. (“Trinad Capital”), a 6% unsecuredfund controlled by Mr. Ellin, the Company’s Chief Executive Officer, Chairman, director and principal stockholder as follows below. The Trinad Notes are convertible note payable to Trinad Capital to convert aggregate principal and interest of $3,581,077 under the First and Second Senior Notes with Trinad Capital. This convertible note is due on May31, 2019. Before its maturity, the noteholder shall in its sole discretion have the option to convert all outstanding principal and interest into shares of the Company’s common stock at a fixed conversion price of $3.00 per share based upon our then current valuation, as determined by our board of directors. Additionally, if the Company raises a minimum of $5,000,000 (excluding the amount converting pursuant to the note) of aggregate gross proceeds from an equity financing in one or more closings prior to the maturity date, the noteholder will have the rightshare.
The first Trinad Note was issued on February 21, 2017, to convert all outstanding noteaggregate principal and interest intoof $3.6 million under the same equity securities issued in such equity financing at 75% of the issuance price of the securities issued in such financing. In addition,first senior promissory note and second senior promissory note with Trinad Capital received 596,846 warrantspreviously issued on December 31, 2014 and April 8, 2015, respectively. The first Trinad Note was due on March 31, 2018 and was extended to purchase sharesMay 31, 2019 and further extended to May 31, 2021 (as discussed below). At March 31, 2021, the balance due of $4.4 million, which included $1.0 million of accrued interest, was outstanding under the Company’s common stock at an exercise pricefirst Trinad Note. At March 31, 2021, the balance due of $0.03 per share. The warrants were exercised on February28, 2017. On December27,$4.1 million, which included $0.5 million of accrued interest, was outstanding under the first Trinad Note.
Between October 27, 2017 we completed the Public Offering and the conversion price for all notes issued to Trinad Capital became fixed at $3.00 per share.
On October27,December 18, 2017, we issued 6%six unsecured convertible notes payable to Trinad Capital for aaggregate total principal amount of $650,000. These$0.9 million. The notes were originally due September30, 2018. Before their maturity,on various dates through December 31, 2018 and were extended to May 31, 2019 and further extended to May 31, 2022 (as discussed below). For the noteholder in its sole discretion hasyear ended March 31, 2021, we amortized less than $0.1 million of discount to interest expense, and the option to convert all outstanding principal andunamortized discount was fully amortized as of March 31, 2021. As of March 31, 2021, $0.1 million of accrued interest into our common stock at a conversion price per share based upon our current valuation, as determined by the board of directors. If we raise a minimum of $5,000,000 (excluding the amount converting pursuantwas added to the note) of aggregate gross proceeds from an equity financing in one or more closings prior to the maturity date, the noteholder will have the right to convert all outstanding note principal and interest into the same equity securities issued in such equity financing at 75% of the issuance price of the securities issued in such financing. In addition, the noteholder received 325,000 warrants to purchase shares of our common stock at an exercise price of $0.01 per share. The warrants were exercised as of November16, 2017. On December27, 2017, we completed the Public Offering and the conversion price for all notes issued to Trinad Capital became fixed at $3.00 per share.balance.
On December5, 2017 and December7, 2017, we issued 6% unsecured convertible notes payable to Trinad Capital for a total principal amount of $200,000. These notes will be due May31, 2019. Before their maturity, the noteholder in its sole discretion has the option to convert all outstanding principal and interest into our common stock at a conversion price per share based upon our current valuation, as determined by the board of directors. If we raise a minimum of $5,000,000 (excluding the amount converting pursuant to the note) of aggregate gross proceeds from an equity financing in one or more closings prior to the maturity date, the noteholder will have the right to convert all outstanding note principal and interest into the same equity securities issued in such equity financing at 75% of the issuance price of the securities issued in such financing. In addition, the noteholder received 100,000 warrants
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to purchase shares of our common stock at an exercise price of $0.01 per share. The warrants were exercised as of December13, 2017. On December27, 2017, we completed the Public Offering and the conversion price for all notes issued to Trinad Capital became fixed at $3.00 per share.
On March30, 2018,January 11, 2021, we entered into an Amendment of Notes Agreement (the “Amendment Agreement”) with Trinad Capital pursuant to which the maturity datesdate of all of our 6% notesUnsecured Convertible Notes issued to Trinad Capital werewas extended to May31, 2019. InMay 31, 2022, and in consideration of the maturity datesuch extension, the interest rate payable under thesuch notes was increased from 6.0% to 7.5% beginning on April1, 2018,8.5%, and the immediate payment of $0.3million, representing the aggregate amount of accrued interest due under the noteswe issued to Trinad Capital as of March31, 2018. On March31, 2019, we entered into a subsequent Amendment of Notes Agreement with Trinad Capital pursuant to which the maturity dates of all of our 7.5% notes issued to Trinad Capital were extended to May31, 2021.
In addition, we had the following outstanding notes payable to other related parties:
Convertible Note — Marvin Ellin —On January4, 2017, we issued a 6% unsecured convertible note payable to Marvin Ellin, the father of Robert Ellin, our Chairman (formerly with the title Executive Chairman), Chief Executive Officer (formerly with the title President), director and principal stockholder, in the principal amount of $50,000. This note was due on September13, 2018. If we raised a minimum of $5,000,000 (excluding the amount converting pursuant to the note) of aggregate gross proceeds from an equity financing in one or more closings prior to the maturity date, the noteholder had the right to convert all outstanding note principal and interest into the same equity securities issued in such equity financing at 75% of the issuance price of the securities issued in such financing. The noteholder had in his sole discretion the option to convert all outstanding principal and interest into280,000 shares of our common stock at a conversion price per share based upon our then current valuation, as determined by our boardstock.
We may not redeem any of directors, before the maturity date. In addition, the noteholder received 8,333 warrants to purchase shares of our common stock at an exercise price of $0.03 per share. On December27, 2017, we completed the Public Offering and the conversion price became fixed at $3.00 per share. On March12, 2018, the noteholder converted the note in full and received 17,850shares and 3,570 three-year warrants, with an exercise price of $4.00 per share.
Convertible Note — Marvin Ellin —On June29, 2017, we issued a 6% unsecured convertible note payable to Marvin Ellin in the principal amount of $50,000. This note was due on June28, 2018. If we raised a minimum of $5,000,000 (excluding the amount converting pursuant to the note) of aggregate gross proceeds from an equity financing in one or more closingsTrinad Notes prior to the maturity date, the noteholder had the right to convert all outstanding note principal and interest into the same equity securities issued in such equity financing at 75% of the issuance price of the securities issued in such financing. The noteholder had in his sole discretion the option to convert all outstanding principal and interest into our common stock at a conversion price per share based upon our then current valuation, as determined by our board of directors, before the maturity date. In addition, the noteholder received 8,333 warrants to purchase shares of our common stock at an exercise price of $0.03 per share. On December27, 2017, we completed the Public Offering and the conversion price became fixed at $3.00 per share. On March12, 2018, the noteholder converted the note in full and received 17,368shares and 3,474 three-year warrants, with an exercise price of $4.00 per share.May 31, 2022 without Trinad Capital’s consent.
Employment Arrangements
The relationships and related party transactions described herein are in addition to any employment arrangements with our executive officers and directors, which are described in this Proxy Statement below under “Executive Compensation — Named Executive Officer Employment Agreements.”
Recent Employment Agreements and Amendments
Employment Agreement with Jerome N. Gold (Chief Strategy Officer and EVP) —In April 2018, we entered into Amendment No. 2 to the amended and restated employment agreement with Mr.Gold, as amended. Pursuant to the amendment, (i) Mr.Gold continued to receive an annual salary of $300,000 from December27, 2017 until April30, 2018, and from and after May1, 2018, shall receive an annual salary of $180,000, and (ii) Mr.Gold was granted 250,000 restricted stock units (the “Gold RSUs”). The Gold RSUs were granted pursuant to the 2016 Plan. 50% of the Gold RSUs shall vest on June30, 2019 and the remaining 50% of the RSUs shall vest on June30, 2020, subject to Mr.Gold’s continued employment with our Company through the applicable vesting date; provided, that in the event of a “Change of Control” (as defined in the amendment) any unvested portion of the RSUs shall vest immediately prior to such event. Each vested Gold RSU shall be settled by delivery to Mr.Gold of one share of our common stock on the first to occur of: (i) the date of a Change of Control, (ii) the date that is ten business days after
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June30, 2019 (the period until June30, 2019, the “Lock-up Period”), (iii) the date of Mr.Gold’s death, provided such event occurs after the expiration of the Lock-up Period, and (iv) the date of Mr.Gold’s Disability (as defined in his Employment Agreement), provided such event occurs after the expiration of the Lock-up Period. In the event of a “Change of Control” any unvested portion of Gold RSUs shall vest immediately prior to such event. Each Gold RSU grant will be evidenced by an award agreement that shall specify such other terms and conditions as the Board, in its sole discretion, will determine in accordance with the terms and conditions of the 2016 Plan, including all terms, conditions and restrictions related to the grant and the form of payout, which, subject to the 2016 Plan, may be left to the discretion of the Board.
Employment Agreement with Dermot McCormack (President) —In July 2019, we entered into an employment agreement with Mr.McCormack for a term of three years at an annual salary of $500,000. Mr.McCormack is also eligible to earn an annual fiscal year cash performance bonus for each whole or partial fiscal year of his employment period with the Company in accordance with the Company’s annual bonus plan applicable to the Company’s senior executive. Mr.McCormack’s “target” performance bonus shall be 100% of his average annualized base salary during the fiscal year for which the performance bonus is earned. Mr.McCormack was also granted 1,000,000 restricted stock units (the “RSUs”). The RSUs were granted pursuant to the Company’s 2016 Equity Incentive Plan (the “2016 Plan”). The RSUs shall one-time cliff vest on the third anniversary of the Effective Date, subject to Mr.McCormack’s continued employment with the Company through the vesting date. Each vested RSU shall be settled by delivery to Mr.McCormack of one share of the Company’s common stock on the first to occur of: (i) the date of a Change of Control, (ii) the date that is ten days following the vesting of the RSUs, and (iii) the date of Mr.McCormack’s death or Disability (as defined in the Employment Agreement) (in any case, the “Settlement Date”). In the event of a “Change of Control” (as defined in the Employment Agreement) any unvested portion of the RSUs shall vest immediately prior to such event. The RSUs grant was evidenced by an award agreement that specifies such other terms and conditions in accordance with the 2016 Plan, subject to the terms of the Employment Agreement.
If Mr.McCormack’s employment is terminated by the Company “Without Cause” or by Mr.McCormack for “Good Reason” (each as defined in the Employment Agreement, subject to the Company’s right to cure), he will be entitled to termination benefits, pursuant to which (i) the Company will be obligated to pay Mr.McCormack certain accrued obligations and any unpaid Prior Year Bonus; (ii) if such termination occurs after the first three months from the Effective Date, (x) the Company will be obligated to continue to pay Mr.McCormack his base salary, medical benefits and any Pro Rata Bonus (as defined in the Employment Agreement) for a period of six months from the termination date, and (y) 50% of the RSUs and any unvested equity awards shall automatically accelerate and become vested as of the termination date and exercisable for a period of 12months from the termination date or the date the award first becomes vested and exercisable, but in all events no later than the applicable term for each such award, and date; and (iii) if such termination occurs after the first six months from the Effective Date, (x) the Company will be obligated to continue to pay Mr.McCormack his base salary, medical benefits and any Pro Rata Bonus for a period of 12months from the termination date, and (y) 100% of the RSUs and any unvested equity awards shall automatically accelerate and become vested as of the termination date and exercisable for a period of 12months from the termination date or the date the award first becomes vested and exercisable, but in all events no later than the applicable term for each such award, and date. Any such RSUs that vest as a result of such accelerated vesting shall be settled as set forth in the Employment Agreement, and all restrictions on such equity awards and vested RSUs shall automatically and immediately lapse (other than the Lock-Up Period and Daily Trading Limit as discussed below). The Employment Agreement contains covenants for the benefit of the Company relating to non-interference with the Company’s business after termination of employment and protection of the Company’s confidential information, certain customary representations and warranties and standard Company indemnification obligations.
If Mr.McCormack receives any RSUs as a result of their accelerated vesting in the event of his death, Disability or his termination without “Cause” or for “Good Reason”, Mr.McCormack agreed to a lock-up period of 12months from the applicable vesting date (the “Lock-Up Period”). During the Lock-up Period, Mr.McCormack agreed not to dispose or transfer any shares of the Company’s common stock received pursuant to his Employment Agreement, subject to certain standard exceptions. Subsequent to the expiration of the Lock-Up Period, for a period of one year, Mr.McCormack shall not have the right to sell on each trading day more than 10,000shares of the Company’s common stock, as adjusted for any stock dividend, stock split or other reclassification affecting the Company’s equity securities occurring after the Effective Date (the “Daily Trading Limit”); provided, that (x) the Daily Trading Limit shall not apply to the Company’s equity securities obtained by Mr.McCormack in open market transactions and (y) such obligations with regard to the Daily Trading Limit shall terminate upon a Change of Control. If, after the Effective Date, any “C” level executive of the Company, who is a party to or who enters into an employment agreement
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with the Company, shall be afforded a more favorable provision (or provisions) with such terms not already included in such employment agreement as of the Effective Date with regard to the restrictions on the transfer of such executive’s shares during the Lock-Up Period (including without limitation as to the duration of, and termination of, the Lock-Up Period, and as to the Daily Trading Limit), the provisions of the Employment Agreement applicable to such restrictions shall be deemed to be automatically amended to provide for such more favorable provision(s).
Indemnification Agreements
Our Bylaws provide that none of our officers or directors shall be personally liable for any obligations of our Company or for any duties or obligations arising out of any acts or conduct of said officer or director performed for or on behalf of our Company, including without limitation, acts of negligence or contributory negligence. In addition, our Bylaws provide that we shall indemnify and hold harmless each person and their heirs and administrators who shall serve at any time hereafter as a director or officer of our Company from and against any and all claims, judgments and liabilities to which such persons shall become subject by reason of their having heretofore or hereafter been a director or officer of our Company, or by reason of any action alleged to have heretofore or hereafter taken or omitted to have been taken by him or her as such director or officer, and that we shall reimburse each such person for all legal and other expenses reasonably incurred by him or her in connection with any such claim, judgment or liability, including our power to defend such persons from all suits or claims as provided for under the provisions of the Delaware General Corporation Law; provided, however, that no such persons shall be indemnified against, or be reimbursed for, any expense incurred in connection with any claim or liability arising out of his (or her) own willful misconduct. In addition, we intend to enter into indemnification agreements with our directors and officers and some of our executives may have certain indemnification rights arising under their employment agreements with us. We believe that these bylaw provisions and indemnification agreements are necessary to attract and retain qualified persons as directors and officers.
The limitation of liability and indemnification provisions in our Bylaws may discourage stockholders from bringing a lawsuit against our directors for breach of their fiduciary duties. They may also reduce the likelihood of derivative litigation against our directors and officers, even though an action, if successful, might benefit us and our stockholders. A stockholder’s investment may be harmed to the extent we pay the costs of settlement and damage awards against directors and officers pursuant to these indemnification provisions.
Policies and Procedures for Transactions with Related Persons
We intend to adopt a written related-personrelated-person transactions policy that will set forth our policies and procedures regarding the identification, review, consideration and oversight of “related-person“related-person transactions.” For purposes of this policy only, a “related-person“related-person transaction” shall be a transaction, arrangement or relationship (or any series of similar transactions, arrangements or relationships) in which we and any “related person” are participants involving an amount that exceeds $120,000.
We are in the process of adopting a written Related-PersonRelated-Person Transactions Policy that will set forth our policies and procedures regarding the identification, review, consideration and oversight of “related-person“related-person transactions.” Our Audit Committee is charged with the responsibility of reviewing, approving and overseeing all related-personrelated-person transactions, as defined in the SEC regulations. This responsibility will be set forth, in part, in our Related-PersonRelated-Person Transactions Policy and is set forth in the Audit Committee Charter.
Generally, the policy will cover any transaction in which we were or will be a participant, the amount involved exceeds $120,000 and any “related person” had, or will have, a direct or indirect material interest in the transaction. “Related person” includes, generally, any of our Company’s (i) directors or executive officers, (ii) nominees for director, (iii) stockholders who beneficially own more than 5% of any class of our voting securities and (iv) family members of any of the persons set forth in (i) through (iii) above.
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OTHER INFORMATION
Deadline for Submission of Stockholder Proposals and Nomination of Directors for Next Year’s Annual Meeting
Stockholder Proposals for the 20202022 Annual Meeting
You may submit proposals for consideration at future stockholder meetings. For a stockholder proposal to be considered for inclusion in our proxy materials for our 20202022 Annual Meeting of Stockholders, the proposal must (i) be delivered to us on or before 30 or more days before we begin to print and send our proxy materials for our 2020 Annual Meeting of Stockholdersno later than March 31, 2022 and (ii) comply with all applicable SEC rules and regulations, including Rule 14a-814a-8 of the Exchange Act. Since our 2019 Annual Meeting of Stockholders will be held more than 30 days before the anniversary date of our 2018 Annual Meeting of Stockholders, we believe such deadline provides our stockholders a reasonable time to submit proposals for consideration at our 2020 Annual Meeting of Stockholders. We will include the specific deadline in one of our future Quarterly Reports on Form 10-Q. Any proposals not received by this deadline will be untimely and not included in our 2020 proxy materials.
Alternatively, under our Bylaws, since our 2019 Annual Meeting of Stockholders will be held more than 30 days before the anniversary date of our 2018 Annual Meeting of Stockholders, a stockholder may bring a proposal before our 20202022 Annual Meeting of Stockholders, without including the proposal in our proxy materials, if (i) the stockholder provides us notice of the proposal no earlier than the 120th day prior to our 2020 Annual Meeting of Stockholdersbetween May 18, 2022 and not later than the 90th day prior to our 2020 Annual Meeting of Stockholders or, if later, the tenth day following the day on which public disclosure of the date of our 2020 Annual Meeting of Stockholders is first madeJune 17, 2022, and (ii) the proposal concerns a matter that may be properly considered and acted upon at the annual meeting in accordance with our Bylaws and corporate governance policies. Any such proposal not received by this deadline will be considered untimely and will not be considered at our 20202021 Annual Meeting of Stockholders. Stockholders are advised to review our Bylaws, which contain additional requirements with respect to advance notice of stockholder proposals. Our bylaws are publicly available in the “SEC Filings” section of our investor relations/corporate governance website athttp://ir.livexlive.com/ir-homeir-home.
Proposals should be addressed to:
LiveXLive Media, Inc.
269 South Beverly Drive, Suite #14501450
Beverly Hills, CA 90212
Attention: Office Manager
Nomination of Directors for the 20202022 Annual Meeting
You may propose a director nominee for consideration at the next annual meeting of our stockholders by complying with our Bylaws, which provide for a notice that must (i) be delivered to us at our principal executive offices set forth immediately above no earlier than the 12090th day prior to September 16, 2022 (the first anniversary of our 20202021 Annual Meeting of StockholdersStockholders) and not later than the 90120th day prior to September 16, 2022 (the first anniversary of our 20202021 Annual Meeting of Stockholders or, if later, the tenth day following the day on which public disclosure of the date of our 2020 Annual Meeting of Stockholders is first made,Stockholders), (ii) provide all information relating to the director nominee that is required to be disclosed in a solicitation of proxies for the election of directors in an election contest, or that is otherwise required, in each case pursuant to Regulation 14A under the Exchange Act, and (iii) provide the director nominee’s written consent to serve as a director if elected. Stockholders are advised to review our Bylaws with respect to director nominations. These documents are publicly available in the “SEC Filings” section of our investor relations/corporate governance website athttp://ir.livexlive.com/ir-home.ir-home.
Participants in the Solicitation
Under applicable regulations of the SEC, directors and certain officers of our Company may be deemed to be “participants” in the solicitation of proxies by our board of directors in connection with the Annual Meeting.
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Expenses of Solicitation
All costs of solicitations of proxies will be borne by us. In addition to solicitations by mail, our directors, officers and regular employees, without additional remuneration, may solicit proxies by telephone, telecopy, e-mail,e-mail, personal interviews, and other means. Brokers, custodians and fiduciaries will be requested to forward proxy soliciting material to the owners of stock held in their names, and we will reimburse them for their out-of-pocketout-of-pocket expenses in connection therewith.
Other Matters
Other than as set forth above, the board of directors is not aware of any other business that may be brought before the Annual Meeting. If any other matters are properly brought before the Annual Meeting, it is the intention of the designated proxy holders, Mr.EllinMr. Ellin and Mr.Zemetra,Mr. Quartieri, to vote on such matters in accordance with their best judgment.
YOUR VOTE IS IMPORTANT. Accordingly, you are urged to sign and return the accompanying proxy card or voting instruction card, as the case may be, whether or not you plan to attend the Annual Meeting.
Annual Report on Form 10-K
An electronic copy of our Annual Report on Form 10-K10-K for the year ended March31, 2019,March 31, 2021, as filed with the SEC on June24, 2019,July 14, 2021, is available free of charge in the “SEC Filings” section of our investor relations/corporate governance website athttp://ir.livexlive.com/ir-home.ir-home. A paper copy of the Annual Report may be obtained upon written request to: LiveXLive Media, Inc., 269 South Beverly Drive, Suite #1450,1450, Beverly Hills, CA 90212, attention: Office Manager. Exhibits will be provided upon written request and payment of an appropriate processing fee.
“Householding” of Proxy Materials
The SEC has adopted rules that permit companies and intermediaries, such as brokers, banks and other nominees, to satisfy the delivery requirements for proxy materials with respect to two or more stockholders sharing the same address by delivering a single copy of proxy materials, other than the proxy card, to those stockholders. This process is commonly referred to as “householding.” Your nominee may engage in householding. Through householding, beneficial owners who have the same address and last name will receive only one copy of the proxy materials unless one or more of these owners notifies us or their nominee that they wish to continue receiving individual copies. Beneficial owners who participate in householding will receive separate proxy cards. This procedure will reduce printing costs and postage fees.
To commence or discontinue householding, please notify your broker, bank or other nominee. Alternatively, you may direct such requests in writing to LiveXLive Media, Inc., 269 South Beverly Drive, Suite #1450,1450, Beverly Hills, CA 90212, Attention: Office Manager, or by phone at (310) 601-2500.601-2505. Individual copies of the proxy materials also may be requested at any time at this same address and telephone number.
| | By Order of the Board of Directors, |
| | |
| /s/ Robert S. Ellin |
| Robert S. Ellin |
| Chairman and Chief Executive Officer |
| | |
Robert S. Ellin
| Beverly Hills, California |
| | | Chairman and Chief Executive Officer
|
| | Beverly Hills, California
|
| | July26, 2019
July 29, 2021 |
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LIVEXLIVE MEDIA, INC.
2021 Annual Meeting of Stockholders
September 15, 2021
Important Notice Regarding the Availability of Proxy Materials for the 2021 Annual Meeting of Stockholders
to Be Held on September 15, 2021
The Company’s Notice of Annual Meeting of Stockholders and Proxy Statement, form of Proxy Card and 2021 Annual Report are available electronically at
https://xbrlfinancialwidget.com/default.aspx?CIKNum=1491419&view=All
LIVEXLIVE MEDIA, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned, revoking all prior proxies, hereby appoints Robert S. Ellin and Michael Quartieri, or any of them, each with full power of substitution, as proxy to represent and vote all shares of common stock, of LiveXLive Media, Inc. (the “Company”) beginning on July 30, 2021 in connection with the solicitation of proxies by the Company’s Board of Directors (the “Board of Directors”) to be used at the Company’s 2021 Annual Meeting of Stockholders (the “Annual Meeting”) to be held on September 15, 2021 at 10:00 A.M. (Pacific Daylight Time) and at any postponement of adjournment thereof. The Annual Meeting will be held at the principal executive offices of PodcastOne located at 335 North Maple Drive, Suite 127, Beverly Hills, CA 90210.
This proxy, when properly executed, will be voted as directed. If no direction is made, the proxy shall be voted FOR the election of all Company director nominees, FOR approval of the advisory vote to approve the compensation of the Company’s named executive officers, FOR the ratification of BDO USA, LLP as the Company’s independent registered public accounting firm for the fiscal year ending March 31, 2022, and, in the case of other matters that legally come before the meeting, as said proxy(ies) may deem advisable.
Please check here if you plan to attend the Annual Meeting of Stockholders on September 15, 2021 at 10:00 a.m. (PDT). ☐
PLEASE INDICATE YOUR VOTE ON THE REVERSE SIDE
(Continued and to be signed on Reverse Side)
