UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. __)
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NATIONAL HOLDINGS CORPORATION |
(Name of Registrant as Specified In Its Charter) |
(Name of Person(s) Filing Proxy Statement, if other than the Registrant) |
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Holdings
Holdings Corporation
NATIONAL HOLDINGS CORPORATION
200 Vesey Street
25th Floor
New York, NY 10281
Dear Stockholder:
You are cordially invited to the Annual Meeting of Stockholders (the “Annual“Annual Meeting”) of National Holdings Corporation (“National” or the “Company”), to be held at 10:00 a.m. local time, on Thursday, February 8, 2018,April 2, 2020, at the offices of our legal counsel, Alston & BirdWilmer Cutler Pickering Hale and Dorr LLP, located at 90 Park Avenue,7 World Trade Center, 250 Greenwich Street, New York, New York 10016.10007. At the meeting, the stockholders will be asked to (i) elect two directors for a term of three years, (ii) approve, on an advisory basis, the compensation paid to the Company's named executive officers, and (iii) ratify the appointment of EisnerAmper LLP as our independent registered public accounting firm for the fiscal year ended September 30, 2018 and (iii) approve an Amendment to the National Holdings Corporation 2013 Omnibus Incentive Plan to increase the number of shares of our common stock authorized for issuance thereunder by 2,500,000 shares, and extend the expiration of the Plan by three years until 2021.2020. You will also have the opportunity to ask questions and make comments at the meeting.
In accordance with the rules and regulations of the Securities and Exchange Commission, we are also furnishing our proxy statement and annual report to stockholders for the fiscal year ended September 30, 20172019 on the Internet.
It is important that your stock be represented at the meeting regardless of the number of shares you hold.hold. You are encouraged to specify your voting preferences by marking our proxy card and returning it as directed. If you do attend the meeting and wish to vote in person, you may revoke your proxy at the meeting.
If you have any questions about the proxy statement or the accompanying 20172019 Annual Report, please contact Glenn C. Worman, our President and Chief Financial Officer, at (212) 417-8000.
We look forward to seeing you at the Annual Meeting.
Sincerely,
/s/ Michael A. Mullen
Michael A. Mullen
President and Chief Executive Officer
January 17, 2018
Sincerely, |
Holdings
Corporation
NATIONAL HOLDINGS CORPORATION
200 Vesey Street
25th Floor
New York, NY 10281
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
The Annual Meeting of Stockholders of National Holdings Corporation will be held at the offices of our legal counsel, Alston & BirdWilmer Cutler Pickering Hale and Dorr LLP, located at 90 Park Avenue,7 World Trade Center, 250 Greenwich Street, New York, New York 10016,10007, on Thursday, February 8, 2018,April 2, 2020, at 10:00 a.m., local time. At the meeting, stockholders will consider and act on the following items:
1. | Elect two directors for a term of three |
2. | Approve, on an advisory basis, the compensation paid to the Company's named executive officers; |
3. | Ratify the appointment of EisnerAmper LLP as our independent registered public accounting firm for the fiscal year ended September 30, |
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4. | Transact any other business that may properly come before the Annual Meeting or any adjournment of the Annual Meeting. |
Only those stockholders of record as of the close of business on December 26, 2017,March 4, 2020, are entitled to vote at the Annual Meeting or any postponements or adjournments thereof. A complete list of stockholders entitled to vote at the Annual Meeting will be available for your inspection beginning January 17, 2018,March 16, 2020, at our offices located at 200 Vesey Street, 25th Floor, New York, NY 10281, between the hours of 10:00 a.m. and 5:00 p.m., local time, each business day.
YOUR VOTE IS IMPORTANT!
YouYou may vote your shares by completing and returning the proxy card enclosed with this notice and proxy statement or by following the instructions for online voting.
Submitting your proxy does not affect your right to vote in person if you decide to attend the Annual Meeting.Meeting. You are urged to submit your proxy as soon as possible, regardless of whether or not you expect to attend the Annual Meeting. You may revoke your proxy at any time before it is voted at the Annual Meeting by (i) delivering written notice to our Corporate Secretary, John C. DeSena, at our address above, (ii) submitting a later dated proxy card, or (iii) attending the Annual Meeting and voting in person. No revocation under (i) or (ii) will be effective unless written notice or the proxy card is received by our Corporate Secretary at or before the Annual Meeting.
When you submit your proxy, you authorize Michael A. Mullen and Glenn C. Worman to vote your shares at the Annual Meeting and on any adjournments of the Annual Meeting in accordance with your instructions.
By Order of the Board of Directors,
/s/ John C. DeSena
John C. DeSena
Corporate Secretary
January 17, 2018
By Order of the Board of Directors, |
Holdings
Corporation
NATIONAL HOLDINGS CORPORATION
200 Vesey Street, 25th Floor
New York, NY 10281
PROXY STATEMENT
This proxy statement is being made available to the owners of shares of common stock of National Holdings Corporation (the “Company,“Company,”“our, “our,”“we, “we,” or “National”“National”) as of December 26,March 4, 2020 2017in connection with the solicitation of proxies by our Board of Directors for our 20120820 Annual Meeting of Stockholders (the “Annual Meeting”“Annual Meeting”).
The Annual Meeting will take place at the offices of our legal counsel, Alston & BirdWilmer Cutler Pickering Hale and Dorr LLP, located at 90 Park Avenue,7 World Trade Center, 250 Greenwich Street, New York, New York 1001610007 on Thursday, February 8, 2018,April 2, 2020, at 10:00 a.m., local time. Our Board of Directors encourages you to read this document thoroughly and take this opportunity to vote, via proxy, on the matters to be decided at the Annual Meeting. As discussed below, you may revoke your proxy at any time before your shares are voted at the Annual Meeting.
Table of Contents
QUESTIONS AND ANSWERS | 1 | |
Q. | Why did I receive an | 1 |
Q. | What is the purpose of the Annual Meeting? | 1 |
Q. | Who is entitled to vote at our Annual Meeting? | 1 |
Q. | How do I vote? | 1 |
Q. | What is a proxy? |
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Q. | How will my shares be voted if I vote by |
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Q. | How do I revoke my proxy? | 2 |
Q. | Is my vote confidential? | 2 |
Q. | How are votes counted? | 2 |
Q. | What constitutes a quorum at the Annual Meeting? |
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Q. | What vote is required to elect our directors for a three-year term? |
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Q. | What vote is required to approve, on an advisory basis, the compensation paid to the Company's named executive officers? | 3 |
Q. | What vote is required to ratify EisnerAmper LLP as our independent registered public accounting firm for the fiscal year ended September 30, |
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What percentage of our outstanding common stock do our directors and executive officers own? | 3 | |
Q. | Who was our independent public accountant for the fiscal year ended September 30, | 4 |
Q. | How can I obtain a copy of our annual report on Form 10-K? |
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CORPORATE GOVERNANCE |
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Class III Director Nominees |
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Directors Continuing in Office |
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Board Leadership Structure | 8 |
Oversight of Risk | 8 |
Director Nomination Process | 9 |
Board Determination of Independence | 10 |
Board Meetings and Attendance | 10 |
Director Attendance at Annual Meeting of Stockholders | 10 |
Communicating with the Board of Directors |
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Nominating |
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INDEPENDENT |
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Audit Fees |
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Audit-Related Fees |
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Tax Fees | 14 |
Pre-Approval of Services | 14 |
REPORT OF THE AUDIT COMMITTEE |
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OUR EXECUTIVE OFFICERS | |
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COMPENSATION DISCUSSION AND ANALYSIS |
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Compensation Philosophy and Objectives |
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Determining Executive Compensation |
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Elements of Compensation |
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Consideration of Prior Advisory Stockholder Vote on Executive Compensation |
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Perquisites and Other Executive Benefits |
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Severance Benefits |
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REPORT OF THE COMPENSATION COMMITTEE |
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EXECUTIVE COMPENSATION |
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Summary Compensation Table |
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CEO Pay Ratio | 23 |
Grants of Plan-Based Awards in Fiscal 2019 | 23 |
DIRECTOR COMPENSATION |
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Director Compensation Table for |
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COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION |
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SECTION 16(a) |
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RELATED-PERSON TRANSACTIONS |
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STOCK OWNERSHIP OF OUR DIRECTORS, EXECUTIVE OFFICERS AND 5% BENEFICIAL OWNERS |
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PROPOSAL ONE: ELECTION OF CLASS III DIRECTORS; NOMINEES |
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PROPOSAL TWO: APPROVAL, ON AN ADVISORY BASIS, OF THE COMPENSATION PAID TO THE COMPANY'S NAMED EXECUTIVE OFFICERS | 34 |
PROPOSAL THREE: RATIFICATION OF APPOINTMENT OF |
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ADDITIONAL INFORMATION | 36 |
Householding of Annual Meeting Materials | 36 |
Stockholder Proposals for Our | 36 |
Other Matters | 36 |
Solicitation of Proxies | 36 |
Incorporation of Information by Reference | 36 |
QUESTIONS AND ANSWERS
Q. | Why did I receive an “Important Notice Regarding the Availability of Proxy Materials”? |
A. | In accordance with Securities and Exchange Commission (“SEC”) rules, |
Q. | What is the purpose of the Annual Meeting? |
A. | At the Annual Meeting, our stockholders will act upon the matters outlined in the Notice of Annual Meeting of Stockholders accompanying this proxy statement, including (i) the election of two directors for a term of three years, (ii) approving, on an advisory basis, the compensation paid to the Company's named executive officers, (iii) ratifying the appointment of EisnerAmper LLP as our independent registered public accounting firm for the fiscal year ended September 30, |
Q. | Who is entitled to vote at our Annual Meeting? |
A. | The record holders of our common stock at the close of business on the record date, |
Q. | How do I vote? |
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If your shares are held in “street name,” meaning they are held for your account by an intermediary, such as a broker, then you are deemed to be the beneficial owner of your shares and the broker that actually holds the shares for you is the record holder and is required to vote the shares it holds on your behalf according to your instructions. The proxy materials, as well as voting and revocation instructions, should have been forwarded to you by the broker that holds your shares. In order to vote your shares, you will need to follow the instructions that your broker provides you. Many brokers solicit voting instructions over the Internet or by telephone. If you do not give instructions to your broker, your broker will still be able to vote your shares with respect to certain “discretionary” items. The ratification of the appointment of EisnerAmper LLP as our independent registered public accounting firm (Proposal 3) is considered a discretionary item. Accordingly, your broker may vote your shares in its discretion with respect to that matter even if you do not give voting instructions on Proposal 3. Regardless of whether your shares are held in street name, you are welcome to attend the meeting. You may not vote shares held in street name in person at the meeting, however, unless you obtain a legal proxy, executed in your favor, from the holder of record (i.e., your broker). A legal proxy is not the form of proxy included with this proxy statement.
Q. | What is a proxy? |
A. | A proxy is a person you appoint to vote your shares on your |
Q. | How will my shares be voted if I vote by proxy? |
A. | Your proxy will be voted according to the instructions you |
Q. | How do I revoke my proxy? |
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If your shares are held in street name you may submit new voting instructions by contacting your broker or other nominee. You may also vote in person at the Annual Meeting if you obtain a legal proxy as described in the answer above.
Q. | Is my vote confidential? |
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Q. | How are votes counted? |
A. | Before the Annual Meeting, our Board of Directors will appoint one or more inspectors of election for the |
Abstentions and votes withheld, and shares represented by proxies reflecting abstentions or votes withheld, will be treated as present for purposes of determining the existence of a quorum at the Annual Meeting.Meeting. They will not be considered as votes “for” or “against” any matter for which the stockholder has indicated their intention to abstain or withhold their vote. Broker or nominee non-votes, which occur when shares held in “street name” by brokers or nominees who indicate that they do not have discretionary authority to vote on a particular matter, will not be considered as votes “for” or “against” that particular matter. Broker and nominee non-votes will be treated as present for purposes of determining the existence of a quorum, and may be entitled to vote on certain routine matters at the Annual Meeting. Only Proposal 3, the ratification of the selection of EisnerAmper LLP, is considered a routine matter where brokers are permitted to vote shares held by them without instruction. If your shares are held through a broker, those shares will not be voted for any other proposal unless you affirmatively provide the broker instructions on how to vote.
Q. | What constitutes a quorum at the Annual Meeting? |
A. | In accordance with Delaware law (the law under which we are incorporated) and our Amended and Restated Bylaws, as amended (the “Bylaws”), the presence at the Annual Meeting, by proxy or in person, of the holders of a majority of the outstanding shares of the capital stock entitled to vote at the Annual Meeting constitutes a quorum, thereby permitting the stockholders to conduct business at the Annual Meeting. Abstentions, votes withheld, and broker or nominee non-votes will be included in the calculation of the number of shares considered present at the Annual Meeting for purposes of determining the existence of a quorum. |
If a quorum is not present at the Annual Meeting, a majority of the stockholders present in person and by proxy may adjourn the meeting to another date.date. If an adjournment is for more than 30thirty (30) days or a new record date is fixed for the adjourned meeting by our Board, we will provide notice of the adjourned meeting to each stockholder of record entitled to vote at the adjourned meeting. At any adjourned meeting at which a quorum is present, any business may be transacted that might have been transacted at the originally called meeting.
Q. | What vote is required to elect our directors for a three-year term? |
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A. | The affirmative vote of a majority of the shares present, in person or by proxy, and entitled to vote at the Annual Meeting is required |
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Q. | What vote is required to approve, on an advisory basis, the compensation paid to the Company's named executive officers? |
A. | The affirmative vote of a majority of the shares present, in person or by proxy, and entitled to vote at the Annual Meeting is required to approve, on an advisory basis, the compensation paid to the Company's named executive officers. Abstentions will have the same effect as a negative vote. However, broker or nominee non-votes, and shares represented by proxies reflecting broker or nominee non-votes, will not have the effect of a vote against this proposal as they are not considered to be present and entitled to vote on this matter. |
Q. | What vote is required to ratify EisnerAmper LLP as our independent registered public accounting firm for the fiscal year ended September 30, 2020? |
A. | The affirmative vote of a majority of the shares present, in person or by proxy, and entitled to vote at the Annual Meeting is required to approve the ratification of EisnerAmper LLP as our independent registered public accounting firm for the fiscal year ended September 30, 2020. Abstentions will have the same effect as a negative vote. However, broker or nominee non-votes, and shares represented by proxies reflecting broker or nominee non-votes, will not have the effect of a vote against this proposal as they are not considered to be entitled to vote on this matter. |
Q. | What percentage of our outstanding common stock do our directors and executive officers own? |
A. | As of |
Q. | Who was our independent public accountant for the fiscal year ended September 30, |
A. | EisnerAmper LLP is the independent registered public accounting firm that audited our financial statements for the fiscal year ended September 30, |
Q. | How can I obtain a copy of our annual report on Form 10-K? |
A. | We have filed our annual report on Form 10-K for the fiscal year ended September 30, |
CORPORATE GOVERNANCE
Our Board believes that good corporate governance is important to ensure that National is managed for the long-term benefit of stockholders. We have adopted the National Holdings Corporation Code of Ethics and Business Conduct (the “Code of Conduct”), which applies to our directors, officers (including our chief executive officer, chief financial officer, controller and any person performing similar functions) and employees. We will provide a copy of the Code of Conduct, without charge, to any person who requests such copy by delivering written notice to our Corporate Secretary, John C. DeSena, at our address above.
OurMembers of the Board of Directors
Our Bylaws provide that theour Board of Directors (the “Board”) shall consist of one or more members, as determined from time to time by resolution of the Board. Currently, ourOur Board is divided into three classes, with members of each class holding office for staggered three-year terms. There are currently two class III directors, whose terms expire at the Annual Meeting; two class I directors, whose terms expire at the 2021 annual meeting; and three class II directors, whose terms expire at the 2022 annual meeting (in all cases subject to the election and qualification of their successors or to either earlier death, resignation or removal).
Our Board currently consists of sixseven members. The following individualsIn February 2019, Neil Herskowitz and Eli Salig resigned from our Board. Their resignations were not a result of any disagreement with National Holdings on any matter relating to National Holdings’ operations, policies or practices. Our Board filled the two vacancies by electing by unanimous vote Barbara Creagh and Jeff Gary to serve as Class II and Class III directors, respectively. Ms. Creagh was elected to serve as a Class II director at the 2019 annual meeting. Mr. Gary is a nominee for election at the Annual Meeting.
Set forth below are being nominatedthe names and certain information about each of our directors, including the nominees to serve on our Board, as of March 16, 2020 (See “Proposal 1 – Election of Directors; Nominees”):
Nominees for Director |
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Name | Age | Director | Class and Term End |
Robert B. Fagenson | 69 | 2012 | Class I, 2017 |
Michael E. Singer (3) | 51 | 2017 | Class I, 2017 |
Class II Director Nominees | |||
Name | Age | Director Since | Class and Term End |
Jeff Gary (1) | 57 | 2019 | Class III, 2020 |
Michael A. Mullen | 53 | 2018 | Class III, 2020 |
Directors Continuing in Office | |||
Name | Age | Director Since | Class and Term End |
Barbara Creagh (1)(2) | 53 | 2019 | Class II, 2022 |
Robert B. Fagenson | 71 | 2012 | Class I, 2021 |
Daniel Hume (1)(2)(3) | 53 | 2016 | Class II, 2022 |
Nassos Michas (2)(3) | 75 | 2018 | Class II, 2022 |
Michael E. Singer | 53 | 2017 | Class I, 2021 |
Directors Continuing in Office
Name | Age | Director | Class and Term End |
Daniel Hume (1)(2)(3) | 51 | 2016 | Class II, 2018 |
Neil Herskowitz (1)(2) | 60 | 2016 | Class II, 2018 |
Michael S. Weiss | 51 | 2016 | Class II, 2018 |
Eli Salig (1) | 68 | 2016 | Class III, 2019 |
(1) Member of Audit Committee
(2) Member of Compensation Committee
(3) Member of the LegalAudit Committee
(2) Member of the Compensation Committee
(3) Member of the Nominating and Corporate Governance Committee
The Board does not have a formal policy regarding the separation of the roles of Chief Executive Officer and Chairman, as the Board believes that it is in the best interests of the Company to make that determination based on the direction of the Company and the current membership of the Board. Mr. Mullen, our Chief Executive Officer, presently does not serve as a director on the Board.
Nationalhas a risk management program overseen by Mr. Mullen and the Board. Mr. Mullen and management identify material risks and prioritize them for our Board. Our Board regularly reviews information regarding our credit, liquidity, operations, and compliance as well as the risks associated with each.
The following biographies set forth the namespresent information about each of our directors and director nominees, including their ages, the year in which they first became directors, their positions with us, their principal occupations and employers for at least the past five years, any other directorships held by them during the past five years in companies that are subject to the reporting requirements of the Securities Exchange Act of 1934, as amended (the “Exchange“Exchange Act”), or any company registered as an investment company under the Investment Company Act of 1940, and additional information. The information presented below regarding the specific experience, qualifications, attributes and skills of each director and nominee led our Board to conclude that he or she should serve as well as additional information,a director. In addition, we believe that all of which we believe sets forth each director nominee’s qualifications to serveour directors and nominees possess the attributes or characteristics described in “Director Nomination Process” on the Board.page 9 of this proxy statement. There is no family relationship between and among any of our executive officers or directors. There are no arrangements or understandings between any of our executive officers or directors and any other person pursuant to which any of them are elected as an officer or director, except as disclosed below.
Class III Director Nominees
NomineesJeff Gary, 57, has served as a member of the Board since February 2019. Mr. Gary has worked in the financial services industry for Directorover 30 years. He currently serves on the Board of Directors for the Axonic Alternative Income Fund where he is the Chairman of the Valuation Committee and a member of the Audit Committee. Before retiring in 2018, Mr. Gary joined Avenue Capital Group in 2012 as a Senior Portfolio Manager responsible for managing mutual funds and CLO accounts. Prior to this, Mr. Gary was a Portfolio Manager at Third Avenue Management, LLC. From 2003 to 2008, he was Co-Head of the High Yield and Distressed investment team at BlackRock, Inc. He was also a team member to launch BlackRock Capital Investment Corporation (NASDAQ: BKCC) and served on the Investment Committee for four years. From 1998 to 2003, he was a Senior Portfolio Manager at American General/AIG Investment Group. Earlier in his career, Mr. Gary served as Portfolio Manager at Koch Industries, Inc., Vice President of Corporate Finance at Mesirow Financial Holdings, Inc., Senior Analyst at Citigroup, Inc., and Senior Auditor at PricewaterhouseCoopers LLP. He received an M.B.A. from Northwestern University’s Kellogg School of Management, a B.S. in Accounting from Penn State University and his CPA license in Illinois. The Board believes that Mr. Gary’s experience in the financial services industry qualifies him to serve as a member of the Board.
Michael A. Mullen, 5Robert B. Fagenson, 69,3, has served as Chief Executive Officer since January 31, 2017 and Chairman of the Board since June 2018. He has been a member of the Board since June 2018 and served as our Co-Chief Executive Officer from January 3, 2017 to January 31, 2017. He has also served as Chairman of the board of directors of each of National’s operating companies since January 2017: National Securities Corporation, National Asset Management, Inc., National Insurance Corporation and National Tax and Financial Services, Inc. He has served as the Chief Executive Officer of National Insurance Corporation and National Tax and Financial Services, Inc. since January 2017, of National Securities Corporation since December 2018 and of Winslow, Evans & Crocker, Inc. since December 2019. Mr. Mullen began his career in 1986 and has since developed a broad and deep understanding of the financial services industry, with a focus on investing in biotechnology companies. He brings this expertise to his leadership of the National Family of Companies. Mr. Mullen holds his Series 4, 7, 24, 63, 65, 99 and Life and Health Insurance and Variable Annuity Licenses. The Board believes that his experience in the securities industry and knowledge of the Company as its Chief Executive Officer qualifies him to serve as a member of the Board.
Directors Continuing in Office
Barbara Creagh, 53, has served as a member of the Board since February 2019. Ms. Creagh has extensive experience as a chief human resources executive. Ms. Creagh has served as Chief Talent Officer at Greenwich Associates, a leading provider of data, analytics and insights to the financial services industry, since January 2012. Prior to joining Greenwich Associates in 2012, Ms. Creagh held the position of SVP of Talent for MDC Partners, a publicly traded holding company with over 10,000 people worldwide, as well as the position of North American Talent leader for Deloitte LLP. Earlier in her career, she spent 10 years in strategy consulting with Ernst & Young. Ms. Creagh is a Certified Public Accountant and earned her MBA in Finance and her International Management degree summa cum laude from Fordham University. The Board believes that Ms. Creagh’s experience in the financial services industry and as a human resources executive qualifies her to serve as a member of the Board.
Robert B. Fagenson, 71,has served as a member of the Board since March 2012 and has served as Vice Chairman of the Board since September 2016. HeMr. Fagenson served as Co-Chief Executive Officer from January 3, 2017 to January 31, 2017, as Chief Executive Officer and Executive Chairman of the Board from December 2014 to September 2016, and as Executive Co-ChairmanVice-Chairman of the Board from July 2012 to December 2014. Mr. Fagenson has been a Branch Owner at National Securities Corporation, an operating company of National, since 2012, and President of Fagenson & Co., Inc., a family investment company, since 1982. Mr. Fagenson spent the majority of his career at the New York Stock Exchange (NYSE), where he was Managing Partner of one of the exchange’s largest specialist firms. During his career as a member ofWhile at the NYSE, Mr. Fagenson served as a Governor on the trading floor and was elected to the NYSE Board of Directors in 1993, where he served for six years, eventually becoming Vice Chairman of the NYSE Board inof Directors from 1998 to 1999.1999 and 2003 to 2004. Mr. Fagenson has served on the boards of a number of public companies and presently is the Non-Executive Chairman of Document Security Systems, Inc. (NYSEMKT: DSS) and a member of the Board of Cash Technologies Corp. He is also aas Director of the National Organization of Investment Professionals (NOIP). In addition, Mr. Fagenson serves as Vice President and a Director of New York Services for the Handicapped, TreasurerCity Police Museum since 2005, and Director of the Centurion Foundation,as Director of the Federal Law Enforcement Officers Association Foundation Treasurersince 2009. He has also served on the board of directors of Sigma Alpha Mu Foundation since 2011 and Directoron the board of the New York City Police Museum and as a Member of the Boarddirectors of the Sports and Arts in Schools Foundation.Foundation since 2015. In addition, Mr. Fagenson served as the Non-Executive Chairman of Document Security Systems, Inc. from 2012 to 2018 (NYSEMKT: DSS). He is currently a Membermember of the alumni boards of both the Whitman School of Business and the Athletic Department at Syracuse University. Mr. Fagenson received his B.S. degree in Transportation Sciences & Finance from Syracuse University in 1970.1970. The Board believes that Mr. Fagenson’s experience in the securities industry and knowledge of the Company as its former Chief Executive Officer qualifies him to serve as a member of the Board.
Daniel HumeMichael E. Singer, 51,, 53, has served as a member of the Board since September 2016. He also serves on the LegalAudit Committee, Compensation Committee and Nominating and Corporate Governance Committee. Mr. Hume is currently a managing partner at Kirby McInerney LLP, and has served in this capacity since 2012. Mr. Hume’s law practice focuses on securities law and regulation, structured finance, antitrust, and other complex financial litigation, corporate governance, and corporate disclosure rules. He joined Kirby McInerney LLP in 1995. Mr. Hume serves on the board of directors at two late clinical stage biopharmaceutical companies, Stemline Therapeutics, Inc. (NASDAQ: STML) and TG Therapeutics, Inc. (NASDAQ: TGTX). Mr. Hume is admitted to the New York State Bar and federal courts around the country, including the United States Supreme Court. Mr. Hume received his J.D. from Columbia Law School and his B.A. from the State University of New York at Albany. The Board believes that Mr. Hume’s experience in the securities industry qualifies him to serve as a member of the Board.
Nassos Michas, 75,has served as a member of the Board since June 2018. Mr. Michas brings more than thirty years of financial services experience to the Board. He is serving as the Chairman of the Advisory Board to Juniper Investment Company, LLC since 2007 and is President of Masons Island LLC, a personal holding company. Prior to joining National, Holdings’he served on the board of directors at Ramius Archview Fund from 2016 to 2017. He was President and Chief Executive Officer of Robeco USA, Inc. (Weiss, Peck & Greer), a $30 billion investment manager, from 2001 to 2004. He has held a number of senior management positions at Merrill Lynch and Co., including Chairman of Merrill Lynch Banks. He joined Merrill Lynch and Co. in 1974 as an analyst. He currently serves on the board of directors for the American School of Classical Studies at Athens. Mr. Michas is a chartered financial analyst (CFA), and holds a B.S. in Electrical Engineering from the University of Utah, an M.S. in Systems Theory and Control from the University of California at Berkeley and an M.B.A. from the Harvard Business School. The Board believes that Mr. Michas’s financial services experience qualifies him to serve as a member of the Board.
Michael E. Singer, 53, has served as a member of the Board since May 2017 and as Executive Vice Chairman of the Board since June 2018. He also serves as Head of Strategy for National Holdings. Mr. Singer most recentlyhas over twenty-years’ experience leading alternative investment management firms. Prior to joining National in June 2018, he served as CEO and President of Ramius, at its peak, a $13 billionLLC, an alternative investment advisory platform. As CEO ofplatform, from 2012 to 2017. At Ramius, Mr. Singer directed strategy and execution of the firm's business plan. During his tenure, he created a salesforce which raised more than $5 billion for the firm's investment teams and closed dealsPrior to onboard to the platform five talented hedge fund teams including Margate Capital.joining Ramius, Mr. Singer was Co-President of Ivy Asset Management, a Fundhedge fund of Hedge Fundsfunds business, with over $15 billion in assets.from 2004 to 2009. At Ivy, Mr. Singer established the firm’s strategic plan and ran the day-to-day activities. He began his career at Weiss, Peck & Greer, a $17 billion asset management firm, where he spent nine years and served as Senior Managing Director and Executive Committee Member. He oversaw day-to-day operations, new product development, client relationship management, hedge fund sales and risk functions. In addition, Mr. Singer served as the Chairman of the board of directors of FC Global Realty Inc. (OTCMKTS: FCRE) from July to October 2018. Mr. Singer is a certified public accountant (CPA) and received his J.D. from Emory University School of Law and his B.S. from Penn State University.
Directors Continuing in Office
Daniel Hume, 51, has been a member of ourUniversity. The Board since September 2016.He also serves on both the Audit and Compensation Committees, and Chairs the Legal Committee of National Holdings’ Board. Mr. Hume is currently a partner in Kirby McInerney, LLP's New York office and is a member of the firm's management committee. Mr. Hume's law practice focuses onbelieves that his securities structured finance, and antitrust litigation and regulation. He joined Kirby McInerney, LLP in 1995. Since then, Mr. Hume has advised corporate, public, and individual clients, including some of the largest institutional investors in the world, and helped them recover billions of dollars in losses throughout the course of his career. His work has earnedexpertise qualifies him assorted honors and recognition. Mr. Hume also serves on the Board of Directors of TG Therapeutics Inc. (NASDAQ:TGTX), an affiliated company of Fortress Biotech, Inc. Mr. Hume received his J.D. from Columbia Law School and his B.A. from the State University of New York at Albany.
Neil Herskowitz, 60, has been a member of our Board since September 2016. Mr. Herskowitz also serves on the company’s Compensation Committee and Chairs the Audit Committee of National Holdings’ Board. Mr. Herskowitz’s financial experience is vast as he has been the President of Riverside Claims LLC, since June 2004. Mr. Herskowitz has been the President of Riverside Contracting LLC since June 1998. He has been a Managing Member of ReGen Partners LLC since 1998 which includes ReGen Capital Investments LLC and Riverside Claims Investments LLC. Mr. Herskowitz serves as a Managing Member of Riverside Contracting LLC. In addition, he serves as Chairman of the Board of Directors of Starting Point Services for Children. Mr. Herskowitz also serves on the Board of Directors of Checkpoint Therapeutics, Inc. (NASDAQ:CKPT) and Avenue Therapeutics, Inc. (NASDAQ:ATXI) which are both affiliated companies of Fortress Biotech Inc. (NASDAQ:FBIO) Mr. Herskowitz received his B.B.A. in Finance from Bernard M. Baruch College.
Eli Salig, 68, has been a member of our Board since September 2016. Mr. Salig also serves on the Audit Committee of National Holdings’ Board. Mr. Salig is currently an independent business consultant who provides mentoring and guidance to incubators and start-ups primarily on human resource issues including executive coaching and talent acquisition and management. Mr. Salig was President and Chief Operating Officer of ASI Solutions, Inc. (ASIS), a human resources consulting and outsourcing firm he co-founded in 1978. With prestigious clients such as Hewlett-Packard, Verizon and Morgan Stanley, and key acquisitions, ASIS grew to a major factor in the industry with over 1,600 employees world-wide and in excess of $100 million in annual revenue when it was acquired in 2001 by AON Consulting. Following the sale Mr. Salig was Executive Vice President of AON Consulting until 2004. Mr. Salig was Executive Vice President of Human Resources Outsourcing for AON Consulting from 2001 to 2007. Mr. Salig serves on the board of Robot Galaxy, a children's toy and experience company and is involved in local charitable activities. Mr. Salig began his professional career in the financial services industry serving in various Human Resources functions including recruitment & employment, compensation & benefits, and related regulatory & compliance areas. Mr. Salig is a graduate of Columbia College, and his Master's Degrees from Columbia University and New York University Graduate School of Business.
Michael S. Weiss, 51, has been a member of our Board since September 2016, and has served as Chairman of the Board since September 2016. Mr. Weiss has also servedserve as a member of the Board of Directors of Fortress Biotech since December 2013 and as Executive Vice Chairman, Strategic Development of Fortress since February 2014. Mr. Weiss served as Co-Vice Chairman of the Board of Fortress from December 2013 until January 2014. Fortress Biotech is a majority shareholder of National Holdings Corp. (NASDAQ:NHLD) Mr. Weiss also serves as Executive Chairman of Mustang Bio (NASDAQ:MBIO) and Checkpoint Therapeutics (NASDAQ:CKPT). Since 2009, Mr. Weiss has served as Co-Portfolio Manager and Partner of Opus Point Partners. In 2011, Mr. Weiss co-founded TG Therapeutics, Inc. (NASDAQ: TGTX), a publicly-traded biotechnology company focused on acquiring, developing and commercializing drugs for the treatment of b-cell malignancies. Mr. Weiss currently serves as TG’s Chairman, President and Chief Executive Officer. Prior to 2009, Mr. Weiss was Chairman and CEO of Keryx Biopharmaceuticals, Inc. (NASDAQ: KERX) where he helped the company acquire and develop its lead drug Zerenex. Mr. Weiss began his professional career as a lawyer with Cravath, Swaine & Moore LLP in NYC. Mr. Weiss earned his J.D. from Columbia Law School and his B.S. in Finance from The University at Albany.
During 2017, our Board held five meetings. During the fiscal year ended September 30, 2017, each incumbent director who served his full term and is standing for election attended at least 75% of the meetings of the Board of Directors and the meetings of those committees on which each incumbent director served, in each case during the period that such person was a director. The permanent committees established by our Board of Directors are the Audit Committee, the Compensation Committee and the Legal Committee, descriptions of which are set forth in more detail below. Our directors are expected to attend each Annual Meeting of Stockholders, and it is our expectation that all of the directors standing for election will attend this year’s Annual Meeting. Last year, all of our directors attended the 2017 Annual Meeting of Stockholders.Board.
CommunicatingBoard Leadership Structure
Michael A. Mullen, our Chief Executive Officer, is also the Chairman of the Board. Our Board has determined that having the same individual hold both positions is in the best interests of National and our stockholders and consistent with good corporate governance for the following reasons:
● | Our Chief Executive Officer is more familiar with our business and strategy than an independent, non-employee Chairman would be and is thus better positioned to focus our Board’s agenda on the key issues facing the Company; |
● | A single Chairman and Chief Executive Officer provides strong and consistent leadership for National, without risking overlap or conflict of roles; |
● | Oversight of the Company is the responsibility of our Board as a whole, and this responsibility can be properly discharged without an independent Chairman; and |
● | Our Lead Director can provide similar benefits to those associated with an independent Chairman. |
Since June 2018, Mr. Michas has served as our Lead Director. Mr. Michas is an independent director within the meaning of Nasdaq Stock Market (“Nasdaq”) rules. As our Lead Director, Mr. Michas’s responsibilities include the following, among others:
● | Chairing any meeting of the independent directors of our board in executive session; |
● | Meeting with any director who is not adequately performing his or her duties as a member of our board or any committee; |
● | Facilitating communications between other members of our board and our Chairman and Chief Executive Officer; |
● | Monitoring, with the assistance of our Corporate Secretary or Chief Financial Officer, communications from stockholders and other interested parties and providing copies or summaries to the other directors as he considers appropriate; |
● | Working with our Chairman and Chief Executive Officer in the preparation of the agenda for each board meeting and in determining the need for special meetings of the board; and |
● | Otherwise consulting with our Chairman and Chief Executive Officer on matters relating to corporate governance and board performance. |
We believe this structure represents an appropriate allocation of roles and responsibilities for the Company at this time. Our Board evaluates our board leadership structure from time to time and may recommend further alterations of Directorsthis structure in the future.
Oversight of Risk
Our Board has establishedoversees our risk management processes directly and through its committees. Our management is responsible for risk management on a process by which stockholders can send communications to the Board. You may communicate with the Board as a group, or to specific directors, by writing to John C. DeSena, our Corporate Secretary, at our offices located at 200 Vesey Street, 25th Floor, New York, NY 10281.day-to-day basis. The Corporate Secretary will review all such correspondence and regularly forward to the Board a summary of all correspondence and copies of all correspondence that deals with the functions of the Board or committees thereof or that otherwise requires their attention. Directors may at any time review a log of all correspondence we receive that is addressed to membersrole of our Board and request copiesits committees is to oversee the risk management activities of any such correspondence. Concernsmanagement. They fulfill this duty by discussing with management the policies and practices utilized by management in assessing and managing risks and providing input on those polices and risks. Mr. Mullen and management identify material risks and prioritize them for our Board.
In general, our Board oversees risk management activities relating to accounting, internal controls, or auditing matters may be communicated in this manner, or may be submitted on an anonymous basis via e-mail at ir@nhldcorp.com. These concerns will be immediately brought to the attention ofbusiness strategy, acquisitions, capital allocation, organizational structure and certain operational risks; our Audit Committee oversees risk management activities related to financial controls and resolved in accordance with procedures established bylegal and compliance risks; our Audit Committee.
AuditCompensation Committee
The Audit oversees risk management activities relating to our compensation policies and practices; and our Nominating and Corporate Governance Committee currently consists of Neil Herskowitz (chairman), Daniel Humeoversees risk management activities relating to Board composition and Eli Salig.
The Audit Committee held four meetings during the fiscal year ended September 30, 2017. The duties and responsibilities of the Audit Committee are set forth in the Charter of the Audit Committee which was recently reviewed by our Audit Committee. Our Audit Committee determined that minor revisions needed to be mademanagement succession planning. Each committee reports to the charter and approved an Amended and Restated Charter of the Audit Committee. A copy of the Charter of the Audit Committee is availablefull Board on our website, located at www.nhldcorp.com. Among other matters, the duties and responsibilities of the Audit Committee include reviewing and monitoring our financial statements and internal accounting procedures, the selection of our independent registered public accounting firm and consulting with and reviewing the services provided by our independent registered public accounting firm. Our Audit Committee has sole discretion over the retention, compensation, evaluation and oversight of our independent registered public accounting firm.
The SEC and the NASDAQ Stock Market (“Nasdaq”) have established rules and regulations regarding the composition of audit committees and the qualifications of audit committee members. Our Board of Directors has examined the composition of our Audit Committee and the qualifications of our Audit Committee members in light of the current rules and regulations governing audit committees. Based upon this examination, our Board of Directors has determined that each member of our Audit Committee is independent and is otherwise qualified to be a member of our Audit Committee in accordance with the rules of the SEC and Nasdaq.
Additionally, the SEC requires that at least one member of the Audit Committee have a “heightened” level of financial and accounting sophistication. Such a person is known as the “audit committee financial expert” under the SEC’s rules. Our Board has determined that Mr. Herskowitz is an “audit committee financial expert,” as the SEC defines that term, and is an independent member of our Board of Directors and our Audit Committee. Please see the biography or Mr. Herskowitz on page 5 for a description of his relevant experience.
The report of the Audit Committee can be found on page 10 of this proxy statement.
Compensation Committee
The Compensation Committee held one meeting during the fiscal year ended September 30, 2017. The Compensation Committee currently consists of Neil Herskowitz and Daniel Hume. The duties and responsibilities of the Compensation Committee are set forth in the Charter of the Compensation Committee. A copy of the Charter of the Compensation Committee is available on our website, located at www.nhldcorp.com. As discussed in its charter, among other things, the duties and responsibilities of the Compensation Committee include evaluating the performance of our Chief Executive Officer and other executive officers, determining the overall compensation of the Chief Executive Officer and other executive officers and administering all executive compensation programs,regular basis, including but not limited to, our incentive and equity-based plans. The Compensation Committee evaluates the performance of the Chief Executive Officer and other executive officers on an annual basis and reviews and approves on an annual basis all compensation programs and awards relating to such officers. The Compensation Committee applies discretion in the determination of individual executive compensation packages to ensure compliance with the Company’s compensation philosophy. The Chief Executive Officer makes recommendations to the Compensation Committeereports with respect to the compensation packages for officers other than himself. The Compensation Committee may delegate its authority to grant awards to certain employees, and within specified parameters under the National Holdings Corporation 2013 Omnibus Incentive Plan, to a special committee consisting of one or more directors who may but need not be officers of the Company. During fiscal year 2018, however, the Compensation Committee did not delegate any such authority.
Nasdaq has established rules and regulations regarding the composition of compensation committees and the qualifications of compensation committee members. Our Board of Directors has examined the composition of our Compensation Committee and the qualifications of our Compensation Committee members in light of the current rules and regulations governing compensation committees. Based upon this examination, our Board of Directors has determined that each member of our Compensation Committee is independent and is otherwise qualified to be a member of our Compensation Committee in accordance with such rules.committee’s risk oversight activities as appropriate.
The report of the Compensation Committee can be found on page 14 of this proxy statement. Additional information regarding the Compensation Committee’s processes and procedures for consideration of executive compensation can be found in the Compensation Discussion and Analysis beginning on page 11 of this proxy statement.
Legal Committee
The Legal Committee, established in August 2017, held two meetings during the fiscal year ended September 30, 2017. The Legal Committee currently consists of Daniel Hume and Michael Singer. The duties and responsibilities of the Legal Committee are to review and assess any pending legal proceedings with a potential risk exposure in excess of $750,000.
NominatingDirector Nomination Process
In connection with the executionWe formed our Nominating and delivery of the Agreement and Plan of Merger dated as of April 27, 2016 (as amended, the “Merger Agreement”) among our company, Fortress and FBIO Acquisition, Inc. (“FBIO”), we entered into a Stockholder Rights Agreement with FBIO, which became effective September 12, 2016, and which provides FBIO with certain director nomination rights with respect to our Board (“Corporate Governance Committee in February 2019. The Stockholder Rights Agreement”). Specifically, commencing with our 2017 annual meeting of our stockholders and continuing through September 12, 2019, for so long as FBIO holds any shares of our common stock, FBIO will have the right to designate for nomination by our Board (or the relevant committee thereof, if applicable) all directors to be elected at any annual or special meeting of our stockholders. As a result of the rights granted to FBIO under the Stockholder Rights Agreement, FBIO will be able to control the composition of our Board, and thereby will be able to significantly influence our corporate actions.
We do not currently have a nominating committee or any other committee serving a similar function. Subject to the Stockholder Rights Agreement, director nominations are approved by a vote of a majority of our independent directors as required under the Nasdaq rules and regulations. We believe that the current process in place functions effectively to select director nominees who will be valuable members of our Board of Directors.
We identifyCommittee identifies potential nominees to serve as directors through a variety of business contacts, including current executive officers, directors, community leaders and stockholders. Westockholders. The Committee may, to the extent they deemit deems appropriate, retain a professional search firm and other advisors to identify potential nominees.
We willOur Nominating and Corporate Governance Committee also considerconsiders candidates recommended by stockholders for nomination to our Board.Board. A stockholder who wishes to recommend a candidate for nomination to our Board must submit such recommendation to our Corporate Secretary, John C. DeSena, at our offices located at 200 Vesey Street, 25th Floor, New York, NY 10281. Any recommendation must be received not less than 60thirty calendar days nor more than 90ninety calendar days before the anniversary date of the previous year’s annual meeting. All stockholder recommendations of candidates for nomination for election to our Board must be in writing and must set forth the following: (i) the candidate’s name, age, business address, and other contact information, (ii) the number of shares of common stock beneficially owned by the candidate, (iii) a complete description of the candidate’s qualifications, experience, background and affiliations, as would be required to be disclosed in the proxy statement pursuant to Schedule 14A under the Exchange Act, (iv) a sworn or certified statement by the candidate in which he or she consents to being named in the proxy statement as a nominee and to serve as director if elected and (v) the name and address of the stockholder(s) of record making such a recommendation.
We believe that our Board as a whole should encompass a range of talent, skill, and expertise enabling it to provide sound guidance with respect to our operations and interests.interests. Our independent directors evaluateNominating and Corporate Governance Committee evaluates all candidates to our Board by reviewing their biographical information and qualifications. If the independent directors determineCommittee determines that a candidate is qualified to serve on our Board, such candidate is interviewed by at least one of the independent directorsmembers of the Committee and our Chief Executive Officer. Other members of the Board also have an opportunity to interview qualified candidates. The independent directorsCommittee then determine,determines, based on the background information and the information obtained in the interviews, whether to recommend to the Board that the candidate be nominated for approval by the stockholders to fill a directorship. With respect to an incumbent director whom the independent directors areCommittee is considering as a potential nominee for re-election, the independent directors reviewCommittee reviews and considerconsiders the incumbent director’s service during his or her term, including the number of meetings attended, level of participation, and overall contribution to the Board. The manner in which the independent directors evaluateCommittee evaluates a potential nominee will not differ based on whether the candidate is recommended by our directors or stockholders.
We consider the following qualifications, among others, when making a determinationdeciding as to whether a person should be nominated to our Board: the independence of the director nominee; the nominee’snominee’s character and integrity; financial literacy; level of education and business experience; whether the nominee has sufficient time to devote to our Board; and the nominee’s commitment to represent the long-term interests of our stockholders. We reviewOur Nominating and Corporate Governance Committee reviews candidates in the context of the current composition of the Board and the evolving needs of our business. We believe that each of the current members of our Board (who are also our director nominees) has the requisite business, financial or managerial experience to serve as a member of the Board, as described above in their biographies under the heading “Our Board of Directors.” We also believe that each of the current members of our Board has other key attributes that are important to an effective board, including integrity, high ethical standards, sound judgment, analytical skills, and the commitment to devote significant time and energy to service on the Board and its committees.
We doOur Nominating and Corporate Governance Committee does not have a formal policy in place with regard to diversity in considering candidates for our Board, but the BoardCommittee strives to nominate candidates with a variety of complementary skills so that, as a group, the Board will possess the appropriate talent, skills and expertise to oversee our business.
CodeBoard Determination of Business Conduct and EthicsIndependence
WeUnder applicable Nasdaq rules, a director will only qualify as an “independent director” if, in the opinion of our Board, that person does not have a relationship which would interfere with the exercise of independent judgment in carrying out the responsibilities of a director.
Our Board has determined that none of Barbara Creagh, Jeff Gary, Daniel Hume, or Nassos Michas has a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director and that each of these directors is an “independent director” as defined under Rule 5605(a)(2) of the Nasdaq Stock Market, Inc. Marketplace Rules. The Board reached a similar determination with respect to Neil Herskowitz and Eli Salig, who each served as a director until February 14, 2019. In determining the independence of the directors listed above, our Board considered each of the transactions discussed in the section titled “Related-Person Transactions,” beginning on page 31 of this proxy statement.
Board Meetings and Attendance
Our Board met thirteen times during the fiscal year ended September 30, 2019. During the fiscal year ended September 30, 2019, each director who served his or her full term attended at least 75% of the aggregate of the number of Board meetings and the number of meetings held by all committees on which he or she then served.
Director Attendance at Annual Meeting of Stockholders
Last year, two of our directors attended the 2019 Annual Meeting of Stockholders.
Communicating with the Board of Directors
Our Board has established a process by which stockholders can send communications to the Board. You may communicate with the Board as a group, or to specific directors, by writing to John C. DeSena, our Corporate Secretary, at our offices located at 200 Vesey Street, 25th Floor, New York, NY 10281. The Corporate Secretary will review all such correspondence and regularly forward to the Board a summary of all correspondence and copies of all correspondence that deals with the functions of the Board or committees thereof or that otherwise requires their attention. Directors may at any time review a log of all correspondence we receive that is addressed to members of our Board and request copies of any such correspondence. Concerns relating to accounting, internal controls, or auditing matters may be communicated in this manner, or may be submitted on an anonymous basis via e-mail at ir@yournational.com. These concerns will be immediately brought to the attention of our Audit Committee and resolved in accordance with procedures established by our Audit Committee.
Board Committees
The Board currently has three standing committees: the Audit Committee, the Compensation Committee and the Nominating and Corporate Governance Committee. In addition, the Board previously had a Legal Committee, which ceased to exist in February 2019. The Board has adopted charters for each of the Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee that comply with the applicable requirements of current Nasdaq rules. Copies of each charter are available on the investor relations portion of the Company’s website, located at www.yournational.com.
Audit Committee
The Audit Committee held four meetings during the fiscal year ended September 30, 2019. The Audit Committee currently consists of Jeff Gary, Daniel Hume and Barbara Creagh. Mr. Gary serves as the chair of the Audit Committee. Our Board has determined that each member of the Audit Committee is independent and otherwise qualified to be a member of the Audit Committee in accordance with the rules and regulations of the SEC and Nasdaq.
The SEC further requires that at least one member of the Audit Committee have a “heightened” level of financial and accounting sophistication. Such a person is known as the “audit committee financial expert” under the SEC’s rules. The Board has determined that Mr. Gary is an “audit committee financial expert,” as the SEC defines that term, and is an independent member of our Board and our Audit Committee. Please see the biography of Mr. Gary on page 6 of this proxy statement for a description of his relevant experience.
The duties and responsibilities of the Audit Committee are set forth in the Charter of the Audit Committee. A copy of the Charter of the Audit Committee is available on the investor relations portion of the Company’s website, located at www.yournational.com. The duties and responsibilities of the Audit Committee include, among other things:
● | Reviewing and monitoring our financial statements and internal accounting procedures; |
● | Selecting our independent registered public accounting firm; and |
● | Consulting with and reviewing the services provided by such accounting firm. |
Our Audit Committee has sole discretion over the retention, compensation, evaluation and oversight of our independent registered public accounting firm. The report of the Audit Committee can be found on page 15 of this proxy statement.
Compensation Committee
The Compensation Committee held one meeting during the fiscal year ended September 30, 2019. The Compensation Committee currently consists of Nassos Michas, Daniel Hume, and Barbara Creagh. Mr. Michas serves as the chair of the Compensation Committee. Our Board has determined that each member of our Compensation Committee meets the requirements for independence under current Nasdaq and SEC rules and regulations.
The duties and responsibilities of the Compensation Committee are set forth in the Charter of the Compensation Committee, as amended and restated on February 13, 2019. A copy of the Charter of the Compensation Committee is available on our website, located at www.yournational.com. As discussed in its charter, the duties and responsibilities of the Compensation Committee include, among other things:
● | Evaluating the performance of the Chief Executive Officer and other executive officers; |
● | Determining the overall compensation of the Chief Executive Officer and other executive officers; and |
● | Administering all executive compensation programs, including, but not limited to, incentive and equity-based plans. |
The Compensation Committee evaluates the performance of the Chief Executive Officer and other executive officers on an annual basis and reviews and approves on an annual basis all compensation programs and awards relating to such officers. The Compensation Committee applies discretion in the determination of individual executive compensation packages to ensure compliance with the Company’s compensation philosophy. The Chief Executive Officer makes recommendations to the Compensation Committee with respect to the compensation packages for officers other than himself. The Compensation Committee may delegate its authority to grant awards to certain employees, and within specified parameters under the National Holdings Corporation Code2013 Omnibus Incentive Plan, to a special committee consisting of Ethicsone or more directors who may but need not be officers of the Company. For the fiscal year ended September 30, 2019, the Compensation Committee delegated to Mr. Mullen the responsibility for allocating restricted stock unit, or RSU, awards among executive officers other than the named executive officers, and Business Conduct (the “Codeamong other employees of Conduct”), which applies tothe Company.
The report of the Compensation Committee can be found on page 21 of this proxy statement. Additional information regarding the Compensation Committee’s processes and procedures for consideration of executive compensation can be found in the section titled “Compensation Discussion and Analysis,” beginning on page 17 of this proxy statement.
Nominating and Corporate Governance Committee
The Nominating and Corporate Governance Committee was formed on February 8, 2019. The Nominating and Corporate Governance Committee currently consists of Nassos Michas and Daniel Hume. Mr. Michas serves as the chair of the Nominating and Corporate Governance Committee. Our Board has determined that each member of our directors, officers (including our chief executive officer, chief financial officer, chief accounting officer, controllerNominating and any person performing similar functions)Corporate Governance Committee meets the requirements for independence under current Nasdaq and employees. SEC rules and regulations.
The Codeduties and responsibilities of Conductthe Nominating and Corporate Governance Committee are set forth in the Charter of the Nominating and Corporate Governance Committee. A copy of the Charter of the Nominating and Corporate Governance Committee is publicly available on our website, located at www.nhldcorp.comwww.yournational.com. As discussed in its charter, the duties and responsibilities of the Nominating and Corporate Governance Committee include, among other things:
● | Evaluating identifying individuals qualified to become Board members; |
● | Recommending to our Board the persons to be nominated for election as directors and to each of our Board’s committees; |
● | Reviewing and making recommendations to our Board with respect to our Board leadership structure; |
● | Reviewing and making recommendations to our Board with respect to management succession planning; |
● | Developing and recommending to our Board corporate governance principles; and |
● | Overseeing a periodic evaluation of our Board. |
The processes and procedures followed by our Nominating and Corporate Governance Committee in identifying and evaluating director candidates are described below under the heading “Director Nomination Process”.
Legal Committee
The Legal Committee, established in August 2017 and terminated in February 2019, held no meetings during the fiscal year ended September 30, 2019. The Legal Committee consisted of Daniel Hume and Michael Singer. The duties and responsibilities of the Legal Committee were to review and assess any pending legal proceedings with a potential risk exposure in excess of $750,000 and to advise on any material legal matters as required by the executive team.
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FEES AND OTHER MATTERS
EisnerAmper LLP,, the independent registered public accounting firm that audited our financial statements for the fiscal yearsyear ended September 30, 2017 and 2016,2019, has served as our independent registered public accounting firm since 2014.July 17, 2019, and previously served as our independent registered public accounting firm from 2014 to May 31, 2018. BDO USA, LLP served as our independent registered public accounting firm from May 31, 2018 to July 17, 2019. We expect a representative of EisnerAmper LLP to be present at the Annual Meeting. The representative will have an opportunity to make a statement and will be available to answer your questions.
Our Board has asked the stockholders to ratify the selection of EisnerAmper LLP as our independent registered public accounting firm. See “Proposal Two:Three: Ratification of Appointment of EisnerAmper LLP as Our Independent Registered Public Accounting Firm” on page 2736 of this proxy statement. The Board has reviewed the fees described below and concluded that the payment of such fees is compatible with maintaining EisnerAmper LLP’s independence. All proposed engagements of EisnerAmper LLP and BDO USA, LLP, whether for audit services, audit-related services, tax services, or permissible non-audit services, were pre-approved by our Audit Committee.
The following table summarizes the fees billed to us for each of the last two fiscal years.
Services Provided | Fiscal 2018 Fees to EisnerAmper LLP | Fiscal 2018 Fees to BDO USA, LLP | Fiscal 2019 Fees to EisnerAmper LLP | Fiscal 2019 Fees to BDO USA, LLP | ||||||||||||
Audit Fees | $ | 315,000 | $ | 355,000 | $ | 403,000 | $ | 337,000 | ||||||||
Audit-Related Fees | $ | 7,000 | $ | - | $ | 27,000 | $ | 6,000 | ||||||||
Tax Fees | $ | 5,000 | $ | 100,000 | $ | 100,000 | $ | - | ||||||||
Total Fees | $ | 327,000 | $ | 455,000 | $ | 530,000 | $ | 343,000 | ||||||||
Audit Fees
For the fiscal years ended September 30, 20172019 and 2016,2018, EisnerAmper LLP billed us an aggregate of $528,000$403,000 and $490,000,$315,000, respectively, for professional services in connection with the auditsaudit of our annual financial statements included in our Annual ReportsReport on Form 10-K for those twothe fiscal years,year ended September 30, 2019, the review of our financial statements included in our Quarterly ReportsReport on Form 10-Q during those two fiscal years,for the third quarter of 2019 and the first and second quarter of 2018 and other services provided in connection with registration statements.
Audit-Related Fees
For the fiscal years ended September 30, 20172019 and 2016, EisnerAmper 2018, BDO USA, LLP billed us an aggregate of $8,000$337,000 and $0,$355,000, respectively, for professional services in connection with the audit of our annual financial statements included in our Annual Report on Form 10-K for the fiscal year ended September 30, 2018, the review of our financial statements included in our Quarterly Report on Form 10-Q for the first and second quarter of 2019 and the third quarter of 2018 and other services provided in connection with registration statements.
Audit-Related Fees
For the fiscal years ended September 30, 2019 and 2018, EisnerAmper LLP billed us an aggregate of $27,000 and $7,000, respectively, for audit-related services reasonably related to the performance of the auditsaudit and reviews for those two fiscal years, in addition to the fees described above under the heading “Audit Fees.”
For the fiscal years ended September 30, 2019 and 2018, BDO USA, LLP billed us an aggregate of $6,000 and $0, respectively, for audit-related services reasonably related to the performance of the audit and reviews for those two fiscal years, in addition to the fees described above under the heading “Audit Fees.”
Tax Fees
Aggregate fees inFor the fiscal years 2017ended September 30, 2019 and 20162018, EisnerAmper LLP billed us an aggregate of $100,000 and $5,000, respectively, for tax compliance, tax advice or tax planning amounted to $132,000planning. For the fiscal years ended September 30, 2019 and $108,000, respectively.2018, BDO USA, LLP billed us an aggregate of $0 and $100,000, respectively, for tax compliance, tax advice or tax planning.
All Other Fees
Fees paid to EisnerAmper LLP in 2017 and 2016 for acquisition-related matters amounted to $6,000 and $23,000, respectively.
Pre-Approval of Services
Our Audit Committee has established a policy setting forth the procedures under which services provided by our independent registered public accounting firm will be pre-approved by our Audit Committee.Committee. Pursuant to the rules and regulations of the SEC, before our independent public accountant is engaged to render audit or non-audit services, the Audit Committee must pre-approve the engagement. The Audit Committee shall establish pre-approval policies and procedures regarding the Company’s engagement of the independent auditor for audit or permitted non-audit services. The Audit Committee may delegate to one or more designated members of the Audit Committee the authority to grant pre-approvals, provided such approvals are presented to the Audit Committee at a subsequent meeting. Audit Committee pre-approval of permitted non-audit services (other than review and attest services) also will not be required if such services fall within available exceptions established by the SEC.
REPORT OF THE AUDIT COMMITTEECOMMITTEE
In monitoring the preparation of our financial statements, the Audit Committee met with both management and EisnerAmper LLP, our independent registered public accounting firm for the fiscal year ended September 30, 2017,2019, to review and discuss all financial statements prior to their issuance and to discuss any and all significant accounting issues. Management and our independent registered public accounting firm advised the Audit Committee that each of the financial statements were prepared in accordance with generally accepted accounting principles. The Audit Committee’s review included a discussion of the matters required to be discussed pursuant to Public Company Accounting Oversight Board (United States) (the “PCAOB”) Auditing Standard 1301 (Communication with Audit Committees). Auditing Standard 1301 requires our independent registered public accounting firm to discuss with the Audit Committee, among other things, the following:
● | Methods used to account for significant or unusual transactions; |
● | The effect of any accounting policies in controversial or emerging areas for which there is a lack of authoritative guidance or consensus; |
● | The process used by management to formulate sensitive accounting estimates and the basis for the independent registered public accounting |
● | Any disagreements with management over the application of accounting principles, the basis for |
The Audit Committee has discussed the independence of EisnerAmper LLP, our independent registered public accounting firm for the fiscal year ended September 30, 2017,2019, including the written disclosures made by EisnerAmper LLP to the Audit Committee, as required by PCAOB Rule 3526, “Communication with Audit Committees Concerning Independence.” PCAOB Rule 3526 requires the independent registered public accounting firm to (i) disclose in writing all relationships that, in the independent registered public accounting firm’s professional opinion, may reasonably be thought to bear on independence, (ii) confirm their perceived independence, and (iii) engage in a discussion of independence with the Audit Committee.
Finally, the Audit Committee continues to monitor the scope and adequacy of our internal controls and other procedures, including any and all proposals for adequate staffing and for strengthening internal procedures and controls where appropriate and necessary.
On the basis of these reviews and discussions, the Audit Committee recommended to the Board that it approve the inclusion of our audited financial statements in our Annual Report on Form 10-K for the fiscal year ended September 30, 2017,2019, for filing with the SEC.
By the Audit Committee of the Board of Directors
Dated |
OUR EXECUTIVE OFFICERS
Our current executive officers are as follows:
Name |
| Position | ||||||||||||||
Michael A. Mullen | 53 | Chief Executive | ||||||||||||||
Glenn C. Worman |
| |||||||||||||||
John C. DeSena |
| Chief Operating Officer and Corporate Secretary |
The following biographies present information about each of our executive officers, including their ages, their positions and offices and their term of office as an officer. Michael A. Mullen, 53, serves as our Chief Executive Officer and Chairman of the Board. For Mr. Mullen’s biography, see the section titled “Directors Continuing in Office,” beginning on page 6 of this proxy statement. No executive officer is related by blood, marriage or adoption to any other director or executive officer.
Glenn C. Worman, 61, has served as President since July 2018 and Chief Financial Officer since October 2016. He served as Chief Operating Officer from October 2015 to July 2018 and Director of Finance from May 2015 to September 2016. In addition, he has served on the board of directors of many of National’s operating companies: he has served on the board of directors of National Asset Management, Inc., National Insurance Corporation and National Tax and Financial Services, Inc. since October 2016, on the board of directors of Winslow, Evans & Crocker, Inc. since December 2019 and on the board of directors of National Securities Corporation since January 2020. He also served on the board of directors of vFinance Corporation from October 2016 to February 2018. Prior to joining National, Mr. Worman held various senior financial positions at ICAP plc, Deutsche Bank, Morgan Stanley and Merrill Lynch. He has a background in corporate finance, global fixed income and global equity trading finance, wealth management, investment management and inter-dealer broker finance. Mr. Worman received his MBA from Fairleigh Dickinson University and his B.B.A from Ramapo College. Mr. Worman holds his Series 99 License.
John C. DeSena,52, has served as Chief Operating Officer since July 2018 and Corporate Secretary since February 2019. He also served as our Head of Financial Planning & Analysis from January 2016 to July 2018. In addition, he has served on the board of directors of many of National’s operating companies: he has served on the board of directors of National Asset Management, Inc. and National Insurance Corporation since January 2017, on the board of directors of Winslow, Evans & Crocker, Inc. since December 2019 and on the board of directors of National Securities Corporation and National Tax and Financial Services, Inc. since January 2020. Mr. DeSena has vast operational and management experience. Prior to joining National, Mr. DeSena worked at Deutsche Bank from April 2010 to January 2016, where he served as the Chief Operating Officer and Head of Operational Excellence for Group Technology & Operations Americas and the Head of Americas Finance Infrastructure. He also worked at Merrill Lynch for fifteen years until 2010, where he served as the Head of Global Markets & Investment Banking and Chief Financial Officer of Americas Investment Banking. Mr. DeSena holds his Series 99 License.
COMPENSATION DISCUSSION AND ANALYSIS
This Compensation Discussion and Analysis is intended to assist our stockholders in understanding our executive compensation program by providing an overview of our executive compensation-related policies, practices and decisions for the fiscal year ended September 30, 2019. It also explains how we determined the material elements of compensation for our chief executive officer, our chief financial officer and our chief operating officer, whom we refer to as our “Named Executive Officers,” or “NEOs.” For the fiscal year ended September 30, 2019, our NEOs were:
● | Michael A. Mullen, |
● | Glenn C. Worman, our President and Chief |
| John C.
Determining Executive Compensation Role of the Compensation Committee and the Company’s Named Executive Officers The Compensation Committee oversees our executive compensation programs, including approving incentive programs, granting equity awards and determining appropriate levels of compensation for our NEOs. Information about the Compensation Committee and its composition and responsibilities can be found in the section titled “Compensation Committee,” beginning on page 11 of this proxy statement. The Compensation Committee meets with our Chief Executive Officer to discuss his own compensation and that of our other NEOs based upon a subjective assessment of individual and Company performance during the prior year, achievement of any pre-set goals and objectives and overall trends in the marketplace. Our Chief Executive Officer makes recommendations regarding salary adjustments, bonus payouts and equity awards, and the Compensation Committee evaluates and modifies these recommendations, if it deems appropriate. Ultimately, decisions regarding the compensation of NEOs are made by the Compensation Committee, meeting in executive session, based upon the Compensation Committee’s deliberations. Decisions regarding other executive officers are made by the Compensation Committee after considering recommendations from the Chief Executive Officer. Elements of Compensation Our compensation program includes a mix of value opportunities and performance considerations. Our executive compensation program for the fiscal year ended September 30, 2019 consisted of the following components:
Our annual cash bonus awards and our annual equity awards are based partially upon the Compensation Committee’s subjective assessment of both the Company’s performance and each individual executive’s contribution to the Company’s performance. Our equity awards (stock options and restrictive stock unit awards) are designed to vest based on a mix of time-based factors and our profitability and market capitalization. We feel strongly that executive compensation and accountability be tied to the performance of our stakeholders. As such, we increased our profitability and market capitalization vesting targets for new grants this past fiscal year ended September 30, 2019. Specifically, we increased our profitability targets, which are measured in reference to adjusted EBITDA (“AEBITDA”), from $12,000,000, $18,000,000 and $30,000,000 to $14,400,000, $21,600,000 and $36,000,000, respectively. See “Non-GAAP Information” in our Annual Report on Form 10-K for the fiscal year ended September 30, 2019 for further information on our calculation of AEBITDA. Similarly, we increased our market capitalization targets from $90,000,000, $120,000,000 and $180,000,000 to $108,000,000, $144,000,000 and $216,000,000, respectively. The Compensation Committee retains the discretion to reduce or eliminate the payment that otherwise might be payable to our executives based upon unforeseen events occurring during the year or its assessment of the Company’s or our executives’ performance in general. Consideration of Prior Advisory Stockholder Vote on Executive Compensation At the 2019 Annual Meeting of Stockholders, our stockholders voted to approve the compensation of the Company’s NEOs, as discussed and disclosed in the 2019 Proxy Statement. In considering the results of this advisory vote on executive compensation, the Compensation Committee concluded that the compensation paid to our NEOs and the Company’s executive pay practices enjoyed stockholder support. In light of this support, the Compensation Committee decided to retain the core design of our executive compensation program, with an emphasis on short and long-term incentive compensation that rewards our executives when they and the Company perform well and, in turn, deliver value for our stockholders. At the 2019 Annual Meeting of Stockholders, our stockholders expressed a preference that advisory votes on executive compensation be held every year. Consistent with this preference, the Board decided to implement an advisory vote on executive compensation every year until the next required vote on the frequency of stockholder votes on the compensation of executive officers, which will occur at our 2024 Annual Meeting of Stockholders. - 18 - Fiscal Year 2019 Executive Compensation Base Salary A competitive base salary is a necessary element to attract and retain an experienced and talented management team. As fixed cash compensation, a base salary provides financial stability and security for performing job responsibilities. The base salaries of our NEOs are set based on their respective responsibilities, performance and competitive market for similar executives. The Compensation Committee reviews the base salaries of our NEOs on an annual basis and makes adjustments as appropriate, subject to any terms of the NEOs’ employment agreements. The table below outlines the base salaries for our NEOs in the fiscal year ended September 30, 2019, pursuant to each NEO’s respective employment agreement.
Cash Bonus Mr. Mullen is eligible to earn an annual cash bonus, which may be conditioned upon the achievement of annual performance goals and objectives established by agreement between Mr. Mullen and the Compensation Committee. Mr. Mullen’s target annual bonus opportunity is equal to 100% of his base salary. Each of Mr. Worman and Mr. DeSena participates in a bonus pool for our senior executive officers and have cash bonus targets set by management and approved by the Compensation Committee. After consideration of the Company’s performance and individual performance for Mr. Mullen, Mr. Worman and Mr. DeSena during fiscal year 2019, the Compensation Committee authorized bonuses for Mr. Mullen, Mr. Worman and Mr. DeSena in the amounts outlined in the below table. These bonuses were paid in January 2020.
- 19 - Long-Term Equity Incentive Awards In November 2018, the Compensation Committee granted to each of Mr. Mullen, Mr. Worman and Mr. DeSena RSUs. The following table outlines the RSUs granted.
Each of these awards vests as follows:
For the profitability and market capitalization targets used during the fiscal year ended September 30, 2019, see page 17 in the “Elements of Compensation” section of this proxy statement. Vesting of the performance-based portions of such RSUs require certification by the Compensation Committee that such performance goals have been met and shall occur on the date of certification. For additional information regarding our NEOs’ equity awards, see the “Summary Compensation Table” on page 22 of this proxy statement, the “Grants of Plan-Based Awards in Fiscal 2019” table on page 23 of this proxy statement and the “Outstanding Equity Awards at Fiscal Year End” table on page 25 of this proxy statement. Perquisites and Other Executive Benefits We offer Mr. Mullen, Mr. Worman and Mr. DeSena an annual medical benefits allowance. See the “Summary Compensation Table” for additional information regarding other executive benefits. Severance Benefits We have employment agreements with our NEOs that provide, among other things, payment and benefits upon certain terminations of employment. We believe the severance benefits components of these agreements are an important component to recruiting and retaining high quality executive officers. For more information on Mr. Mullen, Mr. Worman’s and Mr. DeSena’s employment agreements see the “Potential Termination and Change in Control Payments” section under “Executive Compensation” beginning on page 26 of this proxy statement. - 20 -
REPORT OF THE COMPENSATION COMMITTEE
The Compensation Committee of
- 21 -
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table sets forth the cash and other compensation that we paid to our current
- 22 -
CEO Pay Ratio The following is a reasonable estimate, prepared under applicable SEC rules, of the ratio of the annual total compensation of our Chief Executive Officer to the median of the annual total compensation of our other employees. As is permitted under the SEC rules, we used cash compensation paid in 2019 to determine our median employee definition and not total compensation as set forth in our Summary Compensation Table. We annualized pay for those who commenced employment during fiscal year 2019. Using the fiscal year end date of September 30, 2019, we calculated the median cash compensation of our employee population of 472. We then produced a sample of employees who were paid within a 5% range of that median cash compensation and selected an employee from within that group as our median employee. We then determined that this median employee's total compensation for fiscal year 2019 was $48,906. The Chief Executive Officer's total compensation for fiscal year 2019 was $2,789,333 as disclosed in the Summary Compensation Table. Therefore, our estimate of the ratio of Chief Executive Officer pay to median employee pay is 57:1. Given the different methodologies that various public companies will use to determine an estimate of their pay ratio, the ratio reported above should not be used as a basis for comparison between companies. Grants of Plan-Based Awards in Fiscal
The following table summarizes grants made to the named executive officers in fiscal year
Narrative to Summary Compensation Table
Employment Agreements
Michael A. Mullen. On January 3, 2017, we entered into an employment agreement with Michael A. Mullen as our Co-Chief Executive Officer (the “Mullen Agreement”) providing for the term of his employment for a period beginning on January 3, 2017, until such time as the other Co-Chief Executive Officer of the Company (Robert B. Fagenson) was removed or resigned, in which case Mr. Mullen would automatically assume the title and duties of Chief Executive Officer under the terms of his employment agreement. In addition, Mr. Mullen is the Chairman of the Board of each of Company’s operating subsidiaries including but not limited Corporation. Under the terms of the Mullen Agreement, Mr. Mullen earns a base salary of $360,000 per year. In addition to his base salary, Mr. Mullen is eligible to earn an annual cash bonus, conditioned upon the achievement of annual performance goals and objectives established by agreement between Mr. Mullen and the Board. Mr. Mullen’s target annual bonus opportunity is equal to 100% of his base salary.
- 23 -
On
Glenn C. Worman. On May 7, 2015, we entered into an employment agreement with Glenn C. Worman (the “Worman Agreement”) providing for the term of his employment for a period beginning on May 7, 2015 (the “Effective Date”) and ending on May 5, 2017 (the “Worman Term”). The Worman Agreement
John C. DeSena. On December 31, 2018, we entered into a new employment agreement with Mr. DeSena (the “2018 DeSena Agreement”). Under the terms of the
- 24 -
Outstanding
The following table summarizes the outstanding equity awards held by each
The following table summarizes the option exercises and stock vested for each NEO during the fiscal year ended September 30, 2019:
- 25 - Potential Termination and Change in Control Payments
Michael A. Mullen, Glenn C. Worman and John C. DeSena. Under each of the Amended Mullen Agreement, the 2018 Worman Agreement and the 2018 DeSena Agreement, if
If
If
“Cause” under each of the Amended Mullen Agreement, the 2018 Worman Agreement and the 2018 DeSena Agreement means: (i)
“Good Reason” under each of the Amended Mullen Agreement, the 2018 Worman Agreement and the 2018 DeSena Agreement means the occurrence of any of the following without
- 26 -
The Amended Mullen Agreement,
The following table sets forth the estimated amount of the payments and benefits each that Mr. Mullen, Mr. Worman and Mr.
- 27 -
DIRECTOR COMPENSATION
Cash Compensation.Our non-employee directors are to receive the following cash compensation: (i) $50,000 annual retainer; and (ii) $10,000 additional retainer for service as Chairman of the Board, Vice-Chairman of the Board, and Chairman of the Audit Committee. Each non-employee director receives reimbursement for reasonable travel expenses incurred in attending meetings of our Board
Equity Compensation. Our non-employee directors are to receive the following equity compensation under the 2013 Omnibus Incentive Plan.
Our
Director Compensation Table for
- 28 -
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The current members of our Compensation Committee are
During the
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Exchange Act requires our directors, executive officers and persons who own more than 10% of the shares of our common stock to file an initial report of ownership on Form 3 and changes in ownership on Form 4 or Form 5 with the Based solely on a review of copies of
- 29 -
Review, approval or notification of transactions with related persons
Our Board
Certain Relationships and Related Transactions
Arrangements Regarding Robert B. Fagenson
Mr. Fagenson is a party to an Independent Contractor Agreement, dated
Arrangements Regarding Michael A. Mullen
- 30 -
STOCK OWNERSHIP OF OUR DIRECTORS, EXECUTIVE OFFICERS
The following table shows information, as of
As of Beneficial ownership is determined in accordance with the rules of the SEC and includes voting or investment power with respect to the shares of our common stock. Unless we have indicated otherwise, each person named in the table below has sole voting power and investment power for the shares listed opposite such person’s name, except to the extent authority is shared by spouses under community property laws.
* Less than 1%
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PROPOSAL
Our Amended and Restated Bylaws,
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE
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PROPOSAL The Board is committed to excellence in governance. As part of that commitment, and as required by Section 14A(a)(1) of the Exchange Act, the Board is providing the stockholders with an opportunity to provide an advisory vote related to the compensation of the Company’s named executive officers. As described above under “Compensation Discussion and Analysis”, we have developed a compensation policy that is designed to attract and retain key executives responsible for our success and motivate management to enhance long-term stockholder value. We believe our compensation policy strikes an appropriate balance between the implementation of responsible, measured compensation practices and the effective provision of incentives for our named executive officers to exert their best efforts for our success. For the reasons discussed above, the Board unanimously recommends that stockholders vote in favor of the following resolution: “RESOLVED, that the Company’s stockholders hereby approve, on an advisory basis, the compensation of the named executive officers, as disclosed in the Company’s proxy statement for the 2020 Annual Meeting of Stockholders pursuant to the compensation disclosure rules of the SEC, including the Compensation Discussion and Analysis, Summary Compensation Table and the other compensation related tables and disclosure.” As this vote is advisory, it will not be binding upon the Board or the Compensation Committee and neither the Board nor the Compensation Committee will be required to take any action as a result of the outcome of this vote. However, the Compensation Committee will carefully consider the outcome of this vote when considering future executive compensation policies. THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE APPROVAL, ON AN ADVISORY BASIS, OF THE COMPENSATION PAID TO THE COMPANY'S NAMED EXECUTIVE OFFICERS. THE AFFIRMATIVE VOTE OF THE MAJORITY OF SHARES PRESENT IN PERSON OR REPRESENTED BY PROXY AT THE MEETING AND ENTITLED TO VOTE ON THE SUBJECT MATTER IS REQUIRED FOR THE APPROVAL OF THE AMENDMENT. - 34 - PROPOSAL THREE:
The Board is submitting the selection of EisnerAmper LLP as our independent registered public accounting firm to the stockholders for ratification at our Annual Meeting. Stockholder ratification of our independent registered public accounting firm is not required by our Amended and Restated Bylaws, as amended, or otherwise. The Board has not determined what action it would take if the stockholders do not approve the selection of EisnerAmper LLP and may reconsider its selection if the stockholders’ action so warrants. Even if the selection is ratified, the Audit Committee, exercising its own discretion, may select different auditors at any time during the year if it determines that such a change would be in our best interests and in the best interests of our stockholders.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE
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Householding of Annual Meeting Materials
Some banks, brokers and other nominee record holders may be participating in the practice of
If you want to receive separate copies of the proxy statement and annual report in the future, or if you are receiving multiple copies and would like to receive only one copy for your household, you should contact your bank, broker, or other nominee record holder, or you may contact us at the above address or phone number.
Stockholder Proposals for Our
Only proper proposals under Rule 14a-8 of the Exchange Act which are timely received will be included in the proxy materials for our next annual meeting. In order to be considered timely, such proposal must be received by our Corporate Secretary, John C. DeSena, at 200 Vesey Street, 25th Floor, New York, NY 10281, no later than
Our Bylaws require stockholders to provide advance notice to the Company of any stockholder director nomination(s) and any other matter a stockholder wishes to present for action at an annual meeting of stockholders (other than matters to be included in our proxy statement, which are discussed in the previous paragraph). In order to properly bring business before an annual meeting, our Bylaws require, among other things, that the stockholder submit written notice thereof complying with our Bylaws to John C. DeSena, our Corporate Secretary, at the above address, not less than
Other Matters
Our Board does not know of any other matters to be presented for action at the Annual Meeting other than as set forth in this Proxy Statement. However, if any other matters are properly presented to the meeting, it is the intention of the person named in the accompanying proxy card to vote, or otherwise act, in accordance with their judgment on such matters.
Solicitation of Proxies
We will bear the cost of solicitation of proxies. In addition to the solicitation of proxies by mail, our officers and employees may solicit proxies in person or by telephone. We may reimburse brokers or persons holding stock in their names, or in the names of their nominees, for their expenses in sending proxies and proxy material to beneficial owners.
Incorporation of Information by Reference
The Audit Committee Report contained in this proxy statement is not deemed filed with the SEC and shall not be deemed incorporated by reference into any prior or future filings made by us under the Securities Act of 1933, as amended or the Exchange Act, except to the extent that we specifically incorporate such information by reference. Our Annual Report on Form 10-K for the fiscal year ended September 30,
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