UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
SCHEDULE 14A
Rule
14a-101
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the
Securities Exchange Act of 1934
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] Preliminary Proxy
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for Use of the Commission Only (as permitted by Rule 14a-6(e)
(2))
[X] Definitive Proxy
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[ ] Definitive
Additional Materials
[ ]
Soliciting Material Under §240.14a -12
YOU ON DEMAND HOLDINGS,
INC.
(Name of Registrant as Specified In Its Charter)
N/A
(Name of Person(s) Filing Proxy
Statement, if other than the Registrant)
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YOU ON DEMAND HOLDINGS, INC.
October 27, 2014
Dear Stockholder:
You are invited to attend YOU On Demand Holdings, Inc.s (the Company) Annual
Meeting of Stockholders on Thursday, November 20, 2014, at 10:00 AM, local time
(Beijing Time), at the Kerry Centre Hotel, 1 Guanghua Rd, Chaoyang, Beijing,
China. Registration will begin at 9:30 AM, local time (Beijing Time).
Details of the business to be conducted at the Annual Meeting are included in
the attached Notice of Annual Meeting of Stockholders and Proxy Statement.
Whether or not you plan to attend in person, your vote is important and you are
encouraged to vote promptly. If you received a paper copy of the proxy card by
mail, you may sign, date and return the proxy card in the enclosed envelope. If
you attend the Annual Meeting, you may revoke your proxy and vote in person.
Very truly yours,
__________________________
Marc Urbach
President and Chief
Financial Officer
YOU ON DEMAND HOLDINGS, INC.
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NOTICE OF ANNUAL MEETING OF
STOCKHOLDERS
TO BE HELD ON NOVEMBER 20, 2014
October 27, 2014
TO THE STOCKHOLDERS OF YOU ON DEMAND HOLDINGS, INC.:
You are cordially invited to attend the annual meeting of
stockholders of YOU On Demand Holdings, Inc., a Nevada corporation (the
Company), to be held on Thursday, November 20, 2014, at 10:00 AM, local time
(Beijing Time), at the Kerry Centre Hotel, 1 Guanghua Rd, Chaoyang, Beijing,
China. At this years annual meeting, we are asking stockholders to:
1. |
Elect the seven directors named in the attached Proxy
Statement to serve for one-year term to expire at the 2015 annual meeting
of stockholders or until their respective successors are duly elected and
qualified, as follows: |
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a. |
six directors, including, Shane McMahon, Weicheng Liu,
James S. Cassano, Clifford Higgerson, Jin Shi and Arthur Wong to be elected by the holders of
the Companys common stock, Series A preferred stock and Series E
preferred stock, voting together as a single class; and |
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one director, Xuesong Song, to be elected by the holders of the Companys Series E
preferred stock, voting as a separate class; |
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Ratify the appointment of KPMG Huazhen (Special General
Partnership) as the independent registered public accounting firm of the
Company for the fiscal year ending December 31, 2014; |
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3. |
Consider and approve an advisory (non-binding) resolution
regarding the compensation of our named executive officers; |
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4. |
Consider and act upon an advisory (non-binding) vote on
the frequency at which the Company should include an advisory vote
regarding the compensation of our named executive officers in its future
proxy statements for stockholder consideration; and |
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Transact such other business as may properly come before
the meeting or any adjournment or postponement
thereof. |
This notice of meeting, Proxy Statement, proxy card and copy of
the Annual Report to Stockholders for the year ended December 31, 2013 are being
distributed on or about October 29, 2014. The foregoing items of business
are more fully described in the attached Proxy Statement. Stockholders of record
at the close of business on October 17, 2014, the record date, are entitled to
notice of and to vote at the annual meeting and any adjournment thereof.
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BY ORDER OF THE BOARD OF |
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DIRECTORS |
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Marc Urbach |
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President and Chief Financial Officer
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IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIAL
FOR THE ANNUAL MEETING TO BE HELD ON NOVEMBER 20, 2014
The
Notice of Meeting, Proxy Statement, Proxy Card and Annual Report are available
on the internet at:.
http://transferonline.com/ProxyDocs/YouOnDemandHoldings/
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YOU ON DEMAND HOLDINGS, INC.
27 Union Square West, Suite 502,
New York, New York
10003
PROXY STATEMENT
2014 ANNUAL MEETING OF STOCKHOLDERS
This Proxy Statement and accompanying proxy was first mailed to
stockholders on or about October 29, 2014, in connection with the
solicitation of proxies by the Board of Directors (Board) of YOU On Demand
Holdings, Inc., a Nevada corporation (we, us, the Company or YOU On
Demand), for use at the annual meeting of stockholders to be held on Thursday,
November 20, 2014, at 10:00 AM, local time (Beijing Time), at the Kerry Centre
Hotel, 1 Guanghua Rd, Chaoyang, Beijing, China, or at any adjournment or
postponement thereof, for the purposes set forth herein and in the accompanying
Notice of Annual Meeting of Stockholders (the Annual Meeting). Our telephone
number at our principal executive offices is (212) 206-1216.
INFORMATION CONCERNING SOLICITATION AND VOTING
Record Date and Share Ownership
Stockholders of record at the close of business on October 17,
2014, which date is referred to herein as the record date, are entitled to
notice of and to vote at the Annual Meeting. As of the record date: 23,732,003
shares of our common stock, par value $0.001 per share (Common Stock) were
issued and outstanding and held of record by approximately 333 stockholders of
record, with each of those shares being entitled to one (1) vote; 7,000,000
shares of our Series A preferred stock, par value $0.001 per share (Series A
Preferred Stock) were issued and outstanding and held of record by one
stockholders of record, with the holders thereof being entitled to ten (10)
votes for each share of Common Stock that is issuable upon conversion of a share
of Series A Preferred Stock; and 7,426,428 shares of our Series E preferred
stock, par value $0.001 per share (Series E Preferred Stock) were issued and
outstanding and held of record by approximately 14 stockholders of record, with
the holders thereof being entitled to the number of votes equal to the lesser of
(i) the number of whole shares of Common Stock into which such shares of Series
E Preferred Stock are convertible at October 17, 2014, the record date, and (ii)
the number of whole shares of Common Stock issuable based on the conversion
price of $3.03, the closing trading price of the Companys Common Stock as of
the end of the trading day immediately preceding the closing date of the
financing contemplated by certain Series E Preferred Stock Purchase Agreement by
and among the Company, C Media Limited and certain other purchasers, dated
January 31, 2014.
A list of these stockholders will be available for inspection
during ordinary business hours at our principal executive offices, at 27 Union
Square West, Suite 502, New York, New York 10003 for at least ten days prior to
the annual meeting. The list will also be available for inspection at the annual
meeting.
Voting, Solicitation and Revocability of Proxy
Registered stockholders can vote by mail. If your shares are
held in the name of a bank, broker or other nominee, follow the voting
instructions on the form you receive from your bank, broker or other
nominee.
In order to ensure that your vote is counted, please return
your proxy card, properly signed, and the shares represented will be voted in
accordance with your directions. You can specify your choices by marking the
appropriate boxes on the proxy card. If your proxy card is signed and returned
without specifying choices, the shares will be voted in line with the Boards
recommendations for Proposals 1, 2, 3 and 4.
You may revoke your proxy at any time before it is voted at the
Annual Meeting by executing a later-voted proxy by mail, by voting by ballot at
the Annual Meeting, or by providing written notice of the revocation to our
Secretary at our principal executive offices.
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IMPORTANT: All stockholders are cordially invited to
attend the annual meeting in person. To assure your representation at the annual
meeting, you are urged to vote your shares by signing and returning the enclosed
proxy card as promptly as possible in the enclosed self-addressed envelope. Any
stockholder attending the annual meeting may vote in person even if he or she
returned a proxy. However, if a stockholders shares are held of record by a
broker, bank or other nominee and the stockholder wishes to vote at the annual
meeting, the stockholder must obtain from the record holder a proxy issued in
his or her name.
Your vote is important. Accordingly, regardless of whether
you plan to attend the Annual Meeting, you are urged to vote by signing and
returning the accompanying proxy card.
Attendance at the Annual Meeting is generally limited to our
stockholders and their authorized representatives. All stockholders must bring
an acceptable form of identification, such as a drivers license, in order to
attend the Annual Meeting in person. In addition, if you hold stock in street
name and would like to attend the Annual Meeting, you will need to bring an
account statement or other acceptable evidence of ownership of shares as of the
close of business on the record date, however, those who hold shares in street
name cannot vote their shares at the meeting. If your shares are held in
street name in a brokerage account by a bank, broker or by another nominee,
you are considered the beneficial owner of those shares. As the beneficial
owner of those shares, you have the right to direct your broker, bank or nominee
how to vote and you also are invited to attend the Annual Meeting. However,
because a beneficial owner is not the stockholder of record, you may not vote
these shares in person at the meeting unless you obtain a legal proxy from the
bank, broker, or nominee that holds your shares, giving you the right to vote
the shares at the Annual Meeting.
If you do attend, you may vote by ballot at the Annual Meeting,
thereby canceling any proxy previously given. However, attendance at the Annual
Meeting will not revoke a proxy unless you actually vote in person at the Annual
Meeting.
In the event that any matter not described in this Proxy
Statement properly comes before the Annual Meeting, the proxy holders named in
the accompanying proxy will vote the shares represented by the proxy in their
discretion. As of the date of this Proxy Statement, we are not aware of any
other matter that might be presented at the Annual Meeting.
The presence in person or by proxy of the holders of the Common
stock, the Series A Preferred Stock and the Series E preferred Stock entitled to
cast a majority of all the votes entitled to be cast at the Annual Meeting is
necessary to constitute a quorum. If, however, such quorum shall not be present
or represented at the Annual Meeting, the stockholders entitled to vote thereat,
present in person or represented by proxy, shall have power to adjourn the
meeting from time to time, without notice other than announcement at the
meeting, until a quorum shall be present or represented. If the adjournment is
for more than 30 days, or if after the adjournment a new record date is fixed
for the adjourned meeting, a notice of the adjourned meeting shall be given to
each stockholder of record entitled to vote at the meeting. At such adjourned
meeting at which a quorum shall be present or represented, any business may be
transacted which might have been transacted at the meeting as originally
notified.
Assuming a quorum is present, under Nevada law, and our Articles of Incorporation, as amended, and Second Amended and Restated Bylaws (the “Bylaws”), with respect to Proposal 1(a) and 1(b) directors are to be elected by a plurality of the votes of the shares present in person or represented by proxy at the Annual Meeting and entitled to vote on the election of directors. This means that for Proposal 1(a) the six (6) candidates receiving the highest number of affirmative votes of the issued and outstanding Common Stock, Series A Preferred Stock and Series E Preferred Stock, voting together as a single class on an as-converted basis at the Annual Meeting and for Proposal 1 (b) the one receiving the highest number of affirmative votes of the issued and outstanding Series E Preferred Stock, voting together as a separate class, will be elected as directors. Only shares that are voted in favor of a particular nominee will be counted toward that nominee’s achievement of a plurality. Shares present at the Annual Meeting that are not voted for a particular nominee or shares present by proxy where the shareholder properly withheld authority to vote for such nominee will not be counted toward that nominee’s achievement of a plurality. With respect to Proposal 2, Proposal 3 and Proposal 4, the affirmative vote of the holders of at least a majority of the issued and outstanding Common Stock, Series A Preferred Stock and Series E Preferred Stock, voting together as a single class on an as-converted basis, is required to approve Proposal 2, Proposal 3 and Proposal 4.
The inspector of election appointed for the Annual Meeting will
determine the existence of a quorum and will tabulate the votes cast at the
Annual Meeting. For purposes of determining the presence of a quorum,
abstentions and broker non-votes (shares held by a bank, broker or other
nominee that does not have the authority, either express or discretionary, to
vote on a particular matter) will be counted by us as present at the Annual
Meeting. Abstentions and broker non-votes, however, do not technically
constitute a vote cast (affirmatively or negatively) on any matter and thus
will be disregarded in the calculation of votes cast and whether stockholder
approval of the matter has been obtained. Therefore, an abstention or broker
non-vote will not have the effect of a vote for or against the proposal and will not be counted in determining the number
of votes required for approval, though they will be counted as present at the
Annual Meeting in determining the presence of a quorum.
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Under the NASDAQ rules regulating banks, brokers or other
nominees and under applicable rules of the U.S. Securities and Exchange
Commission, or the Commission, brokers, banks or other nominees that have not
received voting instructions from a customer ten days prior to the meeting date
may only vote the customers shares in discretion of the bank, broker or other
nominee on proposals regarding routine matters, which in most cases includes
the ratification of the appointment of the independent registered public
accounting firm. However, without your specific instructions, your bank, broker,
or other nominee may not vote your shares in the election of directors.
The cost of soliciting proxies will be borne by us. In addition
to the solicitation of proxies by mail, we may utilize some of the officers and
employees (who will receive no compensation in addition to their regular
salaries), to solicit proxies personally and by telephone. Currently, we do not
intend to retain a solicitation firm to assist in the solicitation of proxies.
We may request banks, brokers and other custodians, nominees and fiduciaries to
forward copies of the proxy materials to their principals and to request
authority for the execution of proxies and will reimburse such persons for their
expenses in so doing.
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MATTERS TO BE CONSIDERED AT
THE ANNUAL
MEETING
PROPOSAL NO. 1:
ELECTION OF DIRECTORS
General
Our Board consists of one class of directors, which currently
includes seven members: Xuesong Song, Shane McMahon, Weicheng Liu, James
Cassano, Clifford Higgerson, Jin Shi and Arthur Wong. Each director serves from
the date of his election until the end of his term and until his successor is
elected and qualified.
All of the seven directors listed above have been nominated as
candidates for election as directors, as follows:
Proposal 1(a):
Six directors, including, Shane McMahon, Weicheng Liu, James S. Cassano, Clifford Higgerson, Jin Shi and Arthur Wong, to be elected by the holders of the Companys Common Stock,
Series A Preferred Stock and Series E Preferred Stock, voting together as a
single class.
Proposal 1(b):
One director, Xuesong Song, to be elected
by the holders of the Companys Series E Preferred Stock, voting as a separate
class.
If elected, the directors will hold office until the next
annual meeting and until their respective successor is elected and qualified.
Unless authority is withheld, the proxies solicited by the board of directors
will be voted FOR the election of the nominee. In case the nominee
becomes unavailable for election to the board of directors, an event that is not
anticipated, the persons named as proxies, or their substitutes, will have full
discretion and authority to vote or refrain from voting for any other candidate
in accordance with their judgment.
The following paragraphs set forth information regarding the
current ages, positions, and business experience of the nominees.
Board Nominees
Xuesong Song
Director Since: July
2013 Age: 46
Mr. Song was appointed as our Executive Chairman in February
2014 and as a member of our Board of Directors on July 5, 2013. Mr. Song
currently serves as the chairman of the board of directors and chief executive
officer of C Media Limited and the chairman of the board of directors and chief
financial officer of China Growth Equity Investment Ltd., positions he has held
since the companys inception in January 2010. From May 2006 through January
2009, Mr. Song served as the chairman of ChinaGrowth North Acquisition
Corporation, a special purpose acquisition company, which acquired UIB Group
Limited in January 2009, the second largest insurance brokerage firm in China.
Following the acquisition, Mr. Song served as a director of UIB Group Limited
from January 2009 through May 2010. From May 2006 through January 2009, Mr. Song
also served as the executive vice president of business development and a
director of the board of ChinaGrowth South Acquisition Corporation, a special
purpose acquisition company, which acquired Olympia Media Holdings Ltd. in
January 2009, the largest privately owned newspaper aggregator and operator in
China. Mr. Song has been a principal of Chum Capital Group Limited since August
2001, a merchant banking firm that invests in growth Chinese companies and
advises them in financings, mergers & acquisitions and restructurings, and
chief executive officer of Beijing Chum Investment Co., Ltd. since December
2001. From April 2005 to May 2010, Mr. Song served as the chairman and chief
executive officer of Shanghai Jinqiaotong Enterprise Developments Corporation
Ltd., a direct investment company. Mr. Song has also served as a director of
Mobile Vision Communication Ltd. since July 2004. Mr. Song received his M.B.A.
from Oklahoma City/Tianjin Program and an Associates Degree in electrical
engineering from Civil Aviation University of China.
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Mr. Song has significant senior executive experience including
roles as Chairman and Chief Executive Officers of various companies and provides
the Board with financial and strategic planning expertise. In light of our
business and structure, Mr. Songs extensive executive experience led us to the
conclusion that he should serve as a director of our Company.
Shane McMahon
Director Since: July
2010 Age: 44
Mr. McMahon has served as our Chairman since July 30, 2010.
Prior to joining us, from 2000 to December 31, 2009, Mr. McMahon served in
various executive level positions with World Wrestling Entertainment, Inc.
(NYSE: WWE). Mr. McMahon has significant marketing and promotion experience and
has been instrumental in exploiting pay-per-view and video on demand programming
on a global basis. Mr. McMahon also sits on the Boards of Directors of
International Sports Management (USA) Inc., a Delaware corporation, and Global
Power of Literacy, a New York not-for-profit corporation.
Mr. McMahon has significant marketing and promotion experience
and has been instrumental in exploiting pay-per-view programming on a global
basis. In light of our business and structure, Mr. McMahons extensive executive
and industry experience led us to the conclusion that he should serve as a
director of our Company.
Weicheng Liu
Director Since: July
2010 Age: 56
Mr. Liu was appointed as our Chief Executive Officer on July 5,
2013 and as a member of our Board of Directors on July 30, 2010. Prior to
joining us, Mr. Liu founded Sinotop Beijing and served as its sole officer and
director until his resignation on July 30, 2010. Mr. Liu is currently a
non-executive director of Codent Networks (Shanghai) Co. Ltd., a mobile software
company in China founded by Mr. Liu, and has served in that position since 2011,
prior to which he served as the Chairman and CEO since 2003. Overall, Mr. Liu
has almost twenty years of experience in the telecommunications and network
technology industries. Mr. Liu received a degree in engineering physics from
Tsinghua University and a Ph.D. from the University of Waterloo. Lius extensive
industry experience, as noted above, along with his management experience of
Sinotop Beijing, led us to the conclusion that he should serve as a director of
our Company, in light of our business and structure.
Mr. Liu has almost twenty years of experience in the
telecommunications and network technology industries, and has significant
experience serving in senior executive positions, including chief executive
officer. In light of our business and structure, Mr. Lius extensive industry
and management experience led us to the conclusion that he should serve as a
director of our Company.
James S. Cassano*
Director Since: January
2008 Age: 66
Mr. Cassano was appointed as director of the Company effective
as of January 11, 2008. Mr. Cassano is currently a Partner & Chief Financial
Officer of CoActive Health Solutions, LLC, a worldwide contract research
organization, supporting the pharmaceutical and biotechnology industries. Mr.
Cassano has served as executive vice president, chief financial officer,
secretary and director of Jaguar Acquisition Corporation a Delaware corporation
(OTCBB: JGAC), a blank check company, since its formation in June 2005. Mr.
Cassano has served as a managing director of Katalyst LLC, a company which
provides certain administrative services to Jaguar Acquisition Corporation,
since January 2005. In June 1998, Mr. Cassano founded New Forum Publishers, an
electronic publisher of educational material for secondary schools, and served
as its chairman of the Board and chief executive officer until it was sold to
Apex Learning, Inc., a company controlled by Warburg Pincus, in August 2003. He
remained with Apex until November 2003 in transition as vice president business
development and served as a consultant to the company through February 2004. In
June 1995, Mr. Cassano co-founded Advantix, Inc., a high volume electronic
ticketing software and transaction services company which handled event related
client and customer payments, that was renamed Tickets.com and went public
through an IPO in 1999. From March 1987 to June 1995, Mr. Cassano served as
senior vice president and chief financial officer of the Hill Group, Inc., a
privately-held engineering and consulting organization, and from February 1986
to March 1987, Mr. Cassano served as vice president of investments and acquisitions for Safeguard Scientifics, Inc., a
public venture development company. From May 1973 to February 1986, Mr. Cassano
served as partner and director of strategic management services (Europe) for the
strategic management group of Hay Associates. Mr. Cassano received a B.S. in
Aeronautics and Astronautics from Purdue University and an M.B.A. from Wharton
Graduate School at the University of Pennsylvania. Mr. Cassanos extensive
executive experience, as noted above, along with his educational background, led
us to the conclusion that he should serve as a director of our Company, in light
of our business and structure.
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Mr. Cassano has significant senior management experience,
including service as chief executive officer, executive vice president, chief
financial officer, secretary and director. In light of our business and
structure, Mr. Cassanos extensive executive experience and his educational
background led us to the conclusion that he should serve as a director of our
Company.
Clifford Higgerson*
Director Since: February
2014 Age: 74
Mr. Higgerson was appointed as director of the Company in
February 2014. Mr. Higgerson has more than 40 years of experience in research,
consulting, planning and venture investing primarily in the telecommunications
industry, with an emphasis on carrier systems and equipment. In 2006, he became
a partner with Walden International, a global venture capital firm focused on
four key industry sectors: communications, electronics/digital consumer software
and IT services, and semiconductors. Mr. Higgerson was a founding partner of
ComVentures from 1986 to 2005, and has been a general partner with Vanguard
Venture Partners since 1991. He currently serves as a member of the board of
directors of Aviat Networks, Inc., Kotura Inc., Xtera Communications Inc.,
Ygnition Networks, Inc., Ormet Circuits, Inc., Thrupoint, Inc. and Geronimo
Windpower. He served as a member of the Stratex board of directors from March
2006 to January 2007 and served on the Compensation and Strategic Business
Development Committees. He previously served as a member of the board of
directors of Hatteras Networks Inc. and World of Good. Mr. Higgerson holds an
MBA from the University of California at Berkeley, and a BS from the University
of Illinois.
Mr. Higgerson has more than 40 years of experience in research,
consulting, planning and venture investing primarily in the telecommunications
industry. He also serves as a member of the board of directors of many
companies. In light of our business and structure, Mr. Higgersons extensive
industry and directorship experience and his educational background led us to
the conclusion that he should serve as a director of our Company.
Jin Shi*
Director Since:
February2014 Age: 45
Mr. Shi was appointed as director of the Company in February
2014. Mr. Shi has been a managing partner of Chum Capital Group Limited since
2007, a merchant banking firm that invests in Chinese growth companies and
advises them on financings, mergers & acquisitions and restructurings. He is
also the independent director of Pingtan Marine Enterprise Limited (Pingtan
Marine), one of the largest deep-sea fishing companies in China. From 2011
through 2013, Mr. Shi served as the chief executive officer and a director on
the board of China Growth Equity Investment Limited, which acquired Pingtan
Marine in February 2013. From 2010 through 2011, he served as the vice-chairman
and a director of the board of China Growth Equity Investment Limited. From 2006
through 2009, Mr. Shi served as the chief executive officer and a director of
the board of ChinaGrowth North Acquisition Corporation, which acquired UIB Group
Limited in January 2009, the second largest insurance brokerage firm in China.
From 2006 through 2009, Mr. Shi also served as the chief financial officer and a
director of the board of ChinaGrowth South Acquisition Corporation, which
acquired Olympia Media Holdings Ltd. in January 2009, the largest
privately-owned newspaper aggregator and operator in China. Mr. Shi has also
been the chairman of Shanghai RayChem Industries Co., Ltd., a research &
development based active pharmaceutical ingredient producer, since he founded
the company in 2005. Mr. Shi is also the president of PharmaSource Inc., a
company he founded in 1997. Mr. Shi received an EMBA from Guanghua School of
Management, Peking University and a BS degree in Chemical Engineering from
Tianjin University.
Mr. Shi provides our Board with significant executive-level
leadership expertise as well as extensive experience as directors of various
companies. In light of our business and structure, Mr. Shis business experience
and education background led us to the conclusion that he should serve as a
director of our Company.
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Arthur Wong*
Director Since: February
2014 Age: 54
Mr. Wong was appointed as director of the Company in February
2014. Mr. Wong is CFO of Beijing Radio Cultural Transmission Company Limited
(Beijing Radio). Prior to joining Beijing Radio, Mr. Wong served as CFO of
GreenTree Inns Hotel Management Group, Nobao Renewable Energy and Asia
New-Energy. From 1982 to 2008, Mr. Wong spent 26 years at Deloitte, including in
Hong Kong, San Jose and Beijing holding several positions including TMT
(Technology, Media, Telecom) leader for northern China, and audit leader for
northern China. In addition to his role at Beijing Radio, Mr. Wong serves as a
board member and chairperson of the audit committee of the following companies:
VisionChina Media Inc. (NASDAQ: VISN), China Automotive Systems, Inc. (NASDAQ:
CAAS), Daqo New Energy Corp. (NYSE: DQ), and Petro-king Oilfield Services
Limited (SEHK: 2178). Mr. Wong is a member of the American Institute of
Certified Public Accountants, the Hong Kong Institute of Certified Public
Accountants and the Chartered Association of Certified Accountants. Mr. Wong
holds a Bachelor of Science in Applied Economics from University of San
Francisco and a Higher Diploma of Accountancy from The Hong Kong Polytechnic
University.
Mr. Wong has an in-depth understanding of the preparation and
analysis of financial statements, and is considered an "audit committee
financial expert" under SEC rules, based on his lengthy experience as a
certified public accountant practicing public accounting. In light of our
business and structure, Mr. Wongs extensive accounting and financial knowledge
is an invaluable asset to the Board in its oversight of the integrity of our
financial statements, the financial reporting process and our system of internal
controls, which led us to the conclusion that he should serve as a director of
our Company.
Except as noted above, the above persons do not hold any other
directorships in any company with a class of securities registered pursuant to
Section 12 of the Exchange Act or subject to the requirements of Section 15(d)
of the Exchange Act.
* Indicates Independent Director / Nominee
Vote Required
The election of the nominees listed in Proposal 1(a) requires a plurality of the issued and outstanding Common Stock, Series A Preferred Stock and Series E Preferred Stock, entitled to vote and voting together as a single class on an as-converted basis at the Annual Meeting vote “FOR” the proposal.
The election of the nominees listed in Proposal 1(b) requires a plurality of the issued and outstanding Series E Preferred Stock, entitled to vote and voting together as a separate class at the Annual Meeting vote “FOR” the proposal.
Recommendation of Our Board
Our Board recommends that the Companys stockholders vote
FOR the election of the nominees listed in Proposal 1(a) and Proposal
1(b) above.
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CORPORATE GOVERNANCE
Director Independence
In considering and making decisions as to the independence of
each of the directors of the Company, the Board considered transactions and
relationships between the Company (and its subsidiaries) and each director (and
each member of such directors immediate family and any entity with which the
director or family member has an affiliation such that the director or family
member may have a material indirect interest in a transaction or relationship
with such entity). The Board has determined that James Cassano, Clifford
Higgerson, Jin Shi and Arthur Wong are independent as defined in applicable SEC
and NASDAQ rules and regulations, and that each constitutes an Independent
Director as defined in NASDAQ Listing Rule 5605.
Board Leadership Structure and Corporate Governance
Our current corporate governance practices and policies are
designed to promote stockholder value and we are committed to the highest
standards of corporate ethics and diligent compliance with financial accounting
and reporting rules. Our Board provides independent leadership in the exercise
of its responsibilities. Our management oversees a system of internal controls
and compliance with corporate policies and applicable laws and regulations, and
our employees operate in a climate of responsibility, candor and integrity.
Corporate Governance Guidelines
We and our Board are committed to high standards of corporate
governance as an important component in building and maintaining stockholder
value. To this end, we regularly review our corporate governance policies and
practices to ensure that they are consistent with the high standards of other
companies. We also closely monitor guidance issued or proposed by the Securities
and Exchange Commission (the SEC) and the provisions of the Sarbanes-Oxley
Act, as well as the emerging best practices of other companies. The current
corporate governance guidelines are available on the Companys website
www.yod.com. Printed copies of our corporate governance guidelines may be
obtained, without charge, by contacting our Corporate Secretary at 27 Union
Square West, Suite 502, New York, New York 10003.
The Board and Committees of the Board
The Company is governed by the Board that currently consists of
seven members: Xuesong Song, Shane McMahon, Weicheng Liu, James Cassano,
Clifford Higgerson, Jin Shi and Arthur Wong. The Board has established three
Committees: the Audit Committee, the Compensation Committee and the Nominating
and Governance Committee. Each of the Audit Committee, Compensation Committee
and Nominating and Governance Committee are comprised entirely of independent
directors. From time to time, the Board may establish other committees. The
Board has adopted a written charter for each of the Committees which are
available on the Companys website http://corporate.yod.com. Printed copies of
these charters may be obtained, without charge, by contacting our Corporate
Secretary at 27 Union Square West, Suite 502, New York, New York 10003.
Governance Structure
Our Board of Directors is responsible for corporate governance
in compliance with reporting laws and for representing the interests of our
stockholders. As of February 2014, the Board was composed of seven members, four
of whom are considered independent, non-executive directors. Details on Board
membership, oversight and activity are reported below.
We encourage our stockholders to learn more about our Companys
governance practices at our website, http://corporate.yod.com.
Audit Committee
Our Audit Committee consists of James Cassano, Clifford
Higgerson and Arthur Wong with Mr. Wong acting as Chair. The Audit Committee
oversees our accounting and financial reporting processes and the audits of the
financial statements of our company. Mr. Cassano and Mr. Wong serve as our Audit
Committee financial experts as that term is defined by the applicable SEC rules.
The Audit Committee is responsible for, among other things:
- 8 -
-
selecting our independent auditors and pre-approving all auditing and
non-auditing services permitted to be performed by our independent auditors;
-
reviewing with our independent auditors any audit problems or difficulties
and managements response;
-
reviewing and approving all proposed related-party transactions, as defined
in Item 404 of Regulation S-K under the Securities Act of 1933, as amended;
-
discussing the annual audited financial statements with management and our
independent auditors;
-
reviewing major issues as to the adequacy of our internal controls and any
special audit steps adopted in light of significant internal control
deficiencies;
-
annually reviewing and reassessing the adequacy of our Audit Committee
charter;
-
overseeing the work of our independent auditor, including resolution of
disagreements between management and the independent auditor regarding
financial reporting;
-
reporting regularly to and reviewing with the full Board any issues that
arise with respect to the quality or integrity of the Companys financial
statements, the performance and independence of the independent auditors and
any other matters that the Audit Committee deems appropriate or is requested
to review for the benefit of the Board.
The Audit Committee may engage independent counsel and such
other advisors it deems necessary to carry out its responsibilities and powers,
and, if such counsel or other advisors are engaged, shall determine the
compensation or fees payable to such counsel or other advisors. The Audit
Committee may form and delegate authority to subcommittees consisting of one or
more of its members as the Audit Committee deems appropriate to carry out its
responsibilities and exercise its powers.
Compensation Committee
Our Compensation Committee consists of Jin Shi, Clifford
Higgerson and James Cassano with Mr. Shi acting as Chair. Our Compensation
Committee assists the Board in reviewing and approving the compensation
structure of our directors and executive officers, including all forms of
compensation to be provided to our directors and executive officers. The
Compensation Committee is responsible for, among other things:
-
reviewing and approving corporate goals and objectives relevant to the
compensation of our chief executive officer, evaluating the performance of our
chief executive officer in light of those goals and objectives, and setting
the compensation level of our chief executive officer based on this
evaluation;
-
reviewing and making recommendations to the Board with regard to the
compensation of other executive officers;
-
reviewing and making recommendations to the Board with respect to the
compensation of our directors; and
-
reviewing and making recommendations to the Board regarding all
incentive-based compensation plans and equity-based plans.
The Compensation Committee has sole authority to retain and
terminate retain and terminate any consulting firm or other outside advisor on
compensation matters that is to be used by the Company or the Compensation
Committee to assist in the evaluation of director, chief executive officer or
senior executive compensation, including sole authority to approve the firms'
fees and other retention terms. The Compensation Committee may also form and
delegate authority to subcommittees consisting of one or more members of the
Compensation Committee.
- 9 -
Governance and Nominating Committee
Our Governance and Nominating Committee consists of Clifford
Higgerson, Arthur Wong and Jin Shi with Mr. Higgerson acting as Chair. The
Governance and Nominating Committee assists the Board of Directors in
identifying individuals qualified to become our directors and in determining the
composition of the Board and its committees. The Governance and Nominating
Committee is responsible for, among other things:
-
identifying and recommending to the Board nominees for election or
re-election to the Board, or for appointment to fill any vacancy;
-
selecting directors for appointment to committees of the Board; and
-
overseeing annual evaluation of the Board and its committees for the prior
fiscal year
The Governance and Nominating Committee has sole authority to
retain and terminate retain and terminate any search firm that is to be used by
the Company to assist in identifying director candidates, including sole
authority to approve the firms' fees and other retention terms. The Governance
and Nominating Committee may also form and delegate authority to subcommittees
consisting of one or more members of the Governance and Nominating
Committee.
Director Qualifications
Directors are responsible for overseeing the Companys business
consistent with their fiduciary duty to shareowners. This significant
responsibility requires highly-skilled individuals with various qualities,
attributes and professional experience. The Board believes that there are
general requirements for service on the Companys Board of Directors that are
applicable to all directors and that there are other skills and experience that
should be represented on the Board as a whole but not necessarily by each
director. The Board and the Governance and Nominating Committee of the Board
consider the qualifications of directors and director candidates individually
and in the broader context of the Boards overall composition and the Companys
current and future needs.
Qualifications for All Directors
In its assessment of each potential candidate, including those
recommended by shareowners, the Governance and Nominating Committee considers
the nominees judgment, integrity, experience, independence, understanding of
the Companys business or other related industries and such other factors the
Governance and Nominating Committee determines are pertinent in light of the
current needs of the Board. The Governance and Nominating Committee also takes
into account the ability of a director to devote the time and effort necessary
to fulfill his or her responsibilities to the Company.
The Board and the Governance and Nominating Committee require
that each director be a recognized person of high integrity with a proven record
of success in his or her field. Each director must demonstrate innovative
thinking, familiarity with and respect for corporate governance requirements and
practices, an appreciation of multiple cultures and a commitment to
sustainability and to dealing responsibly with social issues. In addition to the
qualifications required of all directors, the Board assesses intangible
qualities including the individuals ability to ask difficult questions and,
simultaneously, to work collegially.
The Board does not have a specific diversity policy, but
considers diversity of race, ethnicity, gender, age, cultural background and
professional experiences in evaluating candidates for Board membership.
Diversity is important because a variety of points of view contribute to a more
effective decision-making process.
Qualifications, Attributes, Skills and Experience to be
Represented on the Board as a Whole
The Board has identified particular qualifications, attributes,
skills and experience that are important to be represented on the Board as a
whole, in light of the Companys current needs and business priorities. The
Companys services are performed in areas of future growth located outside of
the United States. Accordingly, the Board believes that international experience
or specific knowledge of key geographic growth areas and diversity of
professional experiences should be represented on the Board. In addition, the
Companys business is multifaceted and involves complex financial transactions. Therefore, the
Board believes that the Board should include some directors with a high level of
financial literacy and some directors who possess relevant business experience
as a Chief Executive Officer or President. Our business involves complex
technologies in a highly specialized industry. Therefore, the Board believes
that extensive knowledge of the Companys business and industry should be
represented on the Board.
- 10 -
Summary of Qualifications of Current Directors
For a summary of qualifications of current directors, please
see the section above entitled Proposal No. 1: Election of Directors Board
Nominees.
Boards Role in Risk Oversight
The Board oversees that the assets of the Company are properly
safeguarded, that the appropriate financial and other controls are maintained,
and that the Companys business is conducted wisely and in compliance with
applicable laws and regulations and proper governance. Included in these
responsibilities is the Board of Directors oversight of the various risks
facing the Company. In this regard, the Board seeks to understand and oversee
critical business risks. The Board does not view risk in isolation. Risks are
considered in virtually every business decision and as part of the Companys
business strategy. The Board recognizes that it is neither possible nor prudent
to eliminate all risk. Indeed, purposeful and appropriate risk-taking is
essential for the Company to be competitive on a global basis and to achieve its
objectives.
While the Board oversees risk management, Company management is
charged with managing risk. The Company has robust internal processes and a
strong internal control environment to identify and manage risks and to
communicate with the Board. The Board and the Audit Committee monitor and
evaluate the effectiveness of the internal controls and the risk management
program at least annually. Management communicates routinely with the Board,
Board committees and individual directors on the significant risks identified
and how they are being managed. Directors are free to, and indeed often do,
communicate directly with senior management.
The Board implements its risk oversight function both as a
whole and through Committees. Much of the work is delegated to various
Committees, which meet regularly and report back to the full Board. All
Committees play significant roles in carrying out the risk oversight function.
In particular:
-
The Audit Committee oversees risks related to the Companys financial
statements, the financial reporting process, accounting and legal matters. The
Audit Committee members meet separately with representatives of the
independent auditing firm.
-
The Compensation Committee evaluates the risks and rewards associated with
the Companys compensation philosophy and programs. The Compensation Committee
reviews and approves compensation programs with features that mitigate risk
without diminishing the incentive nature of the compensation. Management
discusses with the Compensation Committee the procedures that have been put in
place to identify and mitigate potential risks in compensation.
Committees and Meeting Attendance
Our Board held 1 meeting and acted 6 times by unanimous written
consent in connection with matters related to the fiscal year ended December 31,
2013. Our Board has an Audit Committee, a Compensation Committee and a
Governance and Nominating Committee. None of the committees held any meetings
during the fiscal year ended December 31, 2013. The Audit Committee acted 4
times by unanimous written consent in connection with matters related to the
fiscal year ended December 31, 2013.
During 2013, each member of the Board attended or participated
in 75% or more of the aggregate of (i) the total number of meetings of the Board
(held during the period for which such person has been a director) and (ii) the
total number of meetings held by all committees of the Board on which such
person served (during the periods that such person served). Our Bylaws provide
that the Executive Chairman (and in his absence, the Chairman) shall preside at
all meetings of our stockholders and the Board. Each director is expected to
make reasonable efforts to attend Board meetings, meetings of committees of
which such director is a member and the Annual Meetings of Stockholders. The
Annual Meeting on November 20, 2014 will be our first annual meeting of
stockholders.
- 11 -
Code of Ethics
To date, we have not adopted a Code of Ethics as described in
Item 406 of Regulation S-K. However, we intend to adopt a code of ethics as soon
as practicable.
Communications by Stockholders with Directors
The Chairman of our Board may receive and distribute to our
Board, and arrange for responses to, communications from stockholders.
Stockholders may communicate with any and all of our directors by transmitting
correspondence by mail, facsimile or email, addressed as follows:
c/o Corporate Secretary
27 Union
Square West, Suite 502
New York, New York 10003
Email Address:
ir@yod.com
Our Corporate Secretary maintains a log of such communications
and transmits as soon as practicable such communications to the Chairman and the
identified director addressee(s), unless there are safety or security concerns
that mitigate against further transmission of the communications, as determined
by the Corporate Secretary. Our Board or individual directors so addressed are
advised of any communication withheld for safety or security reasons as soon as
practicable. The mailing envelope should contain a clear notation indicating
that the enclosed letter is a Board Communication or Director Communication.
All such letters must clearly state whether the intended recipients are all
members of the Board or just certain specified directors. The Corporate
Secretary relays all communications to directors absent safety or security
issues.
- 12 -
PROPOSAL NO. 2:
RATIFICATION OF APPOINTMENT OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
General
Our Board has appointed of KPMG Huazhen (Special General
Partnership) (KPMG), as our independent registered public accounting for the
fiscal year ending December 31, 2014, and recommends that stockholders vote for
ratification of this appointment.
Stockholder ratification of the appointment of KPMG as our
independent registered public accounting firm is not required by our Bylaws or
otherwise; however, our Board is submitting the appointment of KPMG to our
stockholders for ratification as a matter of good corporate practice. If our
stockholders fail to ratify the appointment, our Audit Committee and our Board
will reconsider whether or not to retain KPMG. Even if the appointment is
ratified, our Board in its discretion may direct the appointment of a different
independent registered public accounting firm at any time during the year if it
determines that such change would be in the best interests of us and our
stockholders.
On June 24, 2014, our Audit Committee authorized the dismissal
of UHY LLP (UHY) as the Companys independent registered public accounting
firm. The dismissal became effective on June 25, 2014. On June 25, 2014, the
Board authorized the engagement of KPMG as our independent registered public
accounting firm effective July 1, 2014.
Contemporaneous with dismissal of UHY, the Audit Committee
appointed KPMG as our independent registered public accounting firm for the year
ending December 31, 2014. During the fiscal years ended December 31, 2013 and
2012 and through July 1, 2014, the Company did not consult with KPMG regarding
any of the matters or events set forth in item 304(a)(2)(i) and (ii) of
Regulation S-K.
UHY served as the independent auditor for the Company since
August, 1, 2007. UHYs audit reports on the Companys financial statements for
the fiscal years ended December 31, 2013 and 2012 did not contain an adverse
opinion or disclaimer of opinion, nor were they qualified or modified as to
uncertainty, audit scope, or accounting principles, except that both reports
contain an explanatory paragraph regarding the going concern assumption. During
the years ended December 31, 2013 and 2012, and through July 1, 2014, there were
(i) no disagreements with UHY on any matters of accounting principles or
practices, financial statement disclosure, or auditing scope or procedure which,
if not resolved to UHYs satisfaction, would have caused them to make reference
to the subject matter in connection with their report on the Companys financial
statements for such years, and (ii) no reportable events, as defined in Item
304(a)(1)(v) of Regulation S-K, except that for the fiscal years ended December
31, 2013 and 2012, the Companys Board of Directors discussed with UHY the
existence of a material weakness in the Companys internal control over
financial reporting, as more fully described in the Companys Annual Reports on
Form 10-K for the years ended December 31, 2013 and December 31, 2012, filed on
March 31, 2014 and April 8, 2013, respectively, with the SEC. The Company
provided UHY with a copy of the disclosures it expected to make in the Current
Report on Form 8-K and requested from UHY a letter addressed to the SEC
indicating whether or not it agrees with the above disclosures. A copy of UHYs
letter dated July 1, 2014 is attached as Exhibit 16.1 to the Companys Current
Report on Form 8-K filed on July 1, 2014.
Representatives of KPMG are expected to be present at the
Annual Meeting and will have the opportunity to make a statement if they desire
to do so, and we expect that they will be available to respond to appropriate
questions.
Representatives of UHY are not expected to be present at the Annual
Meeting, but if they are present they will have the opportunity to make a
statement if they desire to do so, and we expect that they will be available to
respond to appropriate questions.
- 13 -
Fees Paid to Our Independent Registered Public Accounting
Firm
KPMG did not provide any services to the Company in 2013 or
2012. The following table sets forth aggregate fees for professional services
rendered by UHY for the years ended December 31, 2013 and 2012.
|
|
|
2013 |
|
|
2012 |
|
|
Audit Fees (1) |
$ |
336,504 |
|
$ |
252,639 |
|
|
Audit-Related Fees (2) |
$ |
60,272 |
|
$ |
53,553 |
|
|
Tax Fees |
|
- |
|
|
- |
|
|
Other Fees |
|
- |
|
|
- |
|
|
|
|
|
|
|
|
|
|
Total
Fees |
$ |
396,776 |
|
$ |
306,192 |
|
(1) Comprised of the audit of our annual financial
statements and reviews of our quarterly financial statements and
registration statements. |
(2) Comprised of services in relation to a private
placement. |
|
Audit and Non-Audit Services Pre-Approval Policy
The Audit Committee has responsibility for appointing, setting
compensation of and overseeing the work of the independent registered public
accounting firm. In accordance with its charter, the Audit Committee shall
pre-approve all audit and permitted non-audit services performed by the
Companys independent registered public accounting firm. The authority to
pre-approve non-audit services may be delegated to one or more members of the
Audit Committee, who shall present all decisions to pre-approve an activity to
the full Audit Committee at its first meeting following such decision.
The Audit Committee has considered the non-audit services
provided by UHY as described above and believes that they are compatible with
maintaining UHYs independence as our independent registered public accounting
firm.
Vote Required
Approval of the ratification of KPMG as our independent
registered public accounting firm for the fiscal year ending December 31, 2014
requires the holders of a majority of the issued and outstanding Common Stock,
Series A Preferred Stock and Series E Preferred Stock, entitled to vote and
voting together as a single class on an as-converted basis at the Annual Meeting
vote For the proposal.
Recommendation
Our Board recommends that the stockholders vote FOR the
ratification of the appointment of KPMG as our independent registered public
accounting firm for the fiscal year ending December 31, 2014.
- 14 -
MANAGEMENT
Board of Directors and Executive Officers
The following sets forth the name and position of each of our
current executive officers and directors.
NAME |
|
AGE |
|
POSITION |
Xuesong Song |
|
46 |
|
Executive
Chairman and Director |
Shane McMahon |
|
44 |
|
Chairman |
Weicheng Liu |
|
56 |
|
Chief Executive
Officer and Director |
Marc Urbach |
|
41 |
|
President, Chief Financial
Officer |
James Cassano |
|
66 |
|
Director |
Clifford Higgerson |
|
74 |
|
Director |
Jin Shi |
|
45 |
|
Director |
Arthur Wong |
|
54 |
|
Director
|
Marc Urbach. Mr. Urbach has over fifteen years of
accounting, finance, and operations experience in both large and small
companies. He was the Executive Vice President and Chief Financial Officer of
Profile Home Inc., a privately held importer and distributor of home furnishings
from September 2004 until February 2008. He additionally served on the Board and
was part owner of Tri-state Trading LLC, a related import company during that
same time period. Mr. Urbach was a Director of Finance at Mercer Inc., a Marsh
& McLennan Company from 2002 to 2004. He was a Finance Manager at Small
World Media from 2000 until 2002 and held a similar position at The Walt Disney
Company from 1998 to 2000. He started his career at Arthur Andersen LLP as a
senior auditor from 1995 to 1998. Mr. Urbach received his Bachelor of Science in
Accounting from Babson College in 1995.
For biographical summary of the directors, please see the
section above entitled Proposal No. 1: Election of Directors Board Nominees.
There are no agreements or understandings for any of our executive officers or
directors to resign at the request of another person and no officer or director
is acting on behalf of nor will any of them act at the direction of any other
person.
Directors are elected until their successors are duly elected
and qualified.
Family Relationships
There are no family relationships among our directors or
officers.
Involvement in Certain Legal Proceedings
To the best of our knowledge, none of our directors or
executive officers has, during the past ten years:
- been convicted in a criminal proceeding or been subject to a pending
criminal proceeding (excluding traffic violations and other minor offences);
- 15 -
-
had any bankruptcy petition filed by or against the business or property of
the person, or of any partnership, corporation or business association of
which he was a general partner or executive officer, either at the time of the
bankruptcy filing or within two years prior to that time;
-
been subject to any order, judgment, or decree, not subsequently reversed,
suspended or vacated, of any court of competent jurisdiction or federal or
state authority, permanently or temporarily enjoining, barring, suspending or
otherwise limiting, his involvement in any type of business, securities,
futures, commodities, investment, banking, savings and loan, or insurance
activities, or to be associated with persons engaged in any such activity;
-
been found by a court of competent jurisdiction in a civil action or by the
Securities and Exchange Commission or the Commodity Futures Trading Commission
to have violated a federal or state securities or commodities law, and the
judgment has not been reversed, suspended, or vacated;
-
been the subject of, or a party to, any federal or state judicial or
administrative order, judgment, decree, or finding, not subsequently reversed,
suspended or vacated (not including any settlement of a civil proceeding among
private litigants), relating to an alleged violation of any federal or state
securities or commodities law or regulation, any law or regulation respecting
financial institutions or insurance companies including, but not limited to, a
temporary or permanent injunction, order of disgorgement or restitution, civil
money penalty or temporary or permanent cease-and-desist order, or removal or
prohibition order, or any law or regulation prohibiting mail or wire fraud or
fraud in connection with any business entity; or
-
been the subject of, or a party to, any sanction or order, not subsequently
reversed, suspended or vacated, of any self-regulatory organization (as
defined in Section 3(a)(26) of the Exchange Act (15 U.S.C. 78c(a)(26))), any
registered entity (as defined in Section 1(a)(29) of the Commodity Exchange
Act (7 U.S.C. 1(a)(29))), or any equivalent exchange, association, entity or
organization that has disciplinary authority over its members or persons
associated with a member.
- 16 -
EXECUTIVE COMPENSATION
The following table sets forth information concerning all cash
and non-cash compensation awarded to, earned by or paid to the named persons for
services rendered in all capacities during the noted periods.
|
|
|
|
Stock |
Option |
|
|
|
Salary |
Bonus |
Awards |
Awards |
Total |
Name and
Principal Position |
Year |
($) |
($) |
($) |
($) |
($) |
Shane McMahon |
2013 |
255,000 (1) |
- |
- |
- |
255,000 (1) |
Chairman |
2012 |
255,000 (1) |
- |
- |
141,536 |
396,536(1) |
Weicheng Liu |
2013 |
276,476 |
- |
- |
- |
276,476 |
Chief Executive Officer |
2012 |
270,039 |
- |
- |
141,536 |
411,575 |
Marc Urbach |
2013 |
229,900 |
- |
- |
214,795 |
444,695 |
President and Chief Financial Officer |
2012 |
229,075 |
- |
- |
28,544 |
257,619 |
(1) As of October 1, 2012, in an effort to conserve
the Companys working capital, Mr. McMahon elected to cease collecting salary
until such time as the Company has sufficient revenues from operations. During
2012, the Company paid to Mr. McMahon $191,250. The remaining $63,750 due from
2012 and $255,000 due from 2013 will be paid in 2014 to Mr. McMahon pursuant to
his employment agreement dated January 31, 2014.
Employment Agreements
On January 31, 2014, we entered into an employment agreement
with our Chairman, Shane McMahon. The agreement is for a term of two years,
which will automatically be extended for additional one year terms unless
terminated earlier. Mr. McMahon is also eligible to receive a bonus at the sole
discretion of our Board of Directors, and is entitled to participate in all of
the benefit plans of the Company. In the event that Mr. McMahon is terminated
without cause, he would be entitled to eighteen months of severance pay if
within the initial two years of the term and twelve months if after the initial
two years of the term. The agreement also contains customary restrictive
covenants regarding non-competition relating to the pay-per-view business in the
PRC, non-solicitation of employees and customers and confidentiality.
On January 31, 2014, we entered into an employment agreement
with our Chief Executive Officer, Weicheng Liu. The agreement is for a term of
one year, which will automatically be extended for additional one year terms
unless terminated earlier by either party. Mr. Liu is also eligible to receive a
bonus at the sole discretion of the Board of Directors of the Company, and is
entitled to participate in all of the benefit plans of the Company. In the event
Mr. Liu is terminated without cause, he would be entitled to eighteen months of
severance pay if within the initial two years of the term and twelve months if
after the initial two years of the term. The Liu Agreement also contains
customary restrictive covenants regarding non-competition relating to the
pay-per-view business in the PRC, non-solicitation of employees and customers
and confidentiality.
On January 31, 2014, we entered into an employment agreement
with our President and CFO, Marc Urbach. The agreement is for a term of one
year, which will automatically be extended for additional one year terms unless
terminated earlier. Mr. Urbach is also eligible to receive a bonus at the sole
discretion of our Board of Directors, and is entitled to participate in all of
the benefit plans of the Company. In the event that Mr. Urbach is terminated
without cause, he would be entitled to eighteen months of severance pay if
within the initial two years of the term and twelve months if after the initial
two years of the term. The agreement also contains customary restrictive covenants regarding non-competition relating to the
pay-per-view business in the PRC, non-solicitation of employees and customers
and confidentiality. Mr. Urbach does not receive any compensation for service as
member of the Companys Board of Directors.
- 17 -
We have not provided retirement benefits (other than a state
pension scheme in which all of our employees in China participate) or change of
control benefits to our named executive officers.
Outstanding Equity Awards at Year End
The following table sets forth the equity awards outstanding at
December 31, 2013.
Name |
Option Awards |
Stock Awards |
Number of
securities underlying unexercised
options (#) exercisable |
Number of
securities underlying unexercised
options (#) unexercisable |
Equity
incentive plan awards: Number
of ecurities underlying
unexercised unearned options
(#) |
Option
exercise price ($) |
Number of shares
or units of stock that have
not vested (#) |
Market value of
shares of units of stock
that have not vested
($) |
Equity
incentive plan awards: Number
of unearned
shares, units or other
rights that have not vested
(#) |
Equity
incentive plan awards: Market or
payout value of unearned shares,
units or other rights that have
not vested ($) |
Shane McMahon
|
127,778 444,444 20,000 |
38,888 88,889 20,000 |
- - - |
2.00 3.00 4.50 |
- - - |
- - - |
- - - |
- - - |
Weicheng Liu |
293,334 20,000 |
- 20,000 |
- - |
3.75 4.50 |
- - |
- - |
- - |
- - |
Marc Urbach
|
10,625 280,000 1,333 |
159,375 13,334 - |
- - - |
1.65 2.00 75.00 |
- - - |
- - - |
- - - |
- - - |
James Cassano |
11,111 |
2,222 |
- |
2.00 |
- |
- |
- |
- |
Compensation of Directors
The following table sets forth certain information concerning
the compensation paid to our directors for services rendered to us during the
fiscal year ended December 31, 2013. Neither Mr. McMahon nor Mr. Liu was
compensated for their service as directors in 2013.
- 18 -
|
|
Fees Earned or |
|
|
|
|
|
|
|
|
|
|
|
|
Paid in Cash |
|
|
Stock Awards |
|
|
Option Awards |
|
|
Total |
|
Name |
|
($) |
|
|
($) |
|
|
($) |
|
|
($) |
|
Michael Birkin(1)
|
$ |
- |
|
$ |
26,250 |
|
|
- |
|
$ |
26,250 |
|
James Cassano |
$ |
7,592 |
|
$ |
26,250 |
|
|
- |
|
$ |
33,842 |
|
Michael Jackson (1)
|
$ |
21,882 |
|
$ |
26,250 |
|
|
- |
|
$ |
48,132 |
|
(1) |
Upon the closing of Series E
Financing on January 31, 2014, Mr. Michael Birkin and Mr. Michael Jackson
resigned from the board of directors of the Company. Mr. Birkins and Mr.
Jacksons resignations were not as a result of any disagreement with the
Company on any matter relating to the Companys operations, policies or
practices. |
- 19 -
PROPOSAL NO. 3:
ADVISORY VOTE ON EXECUTIVE
COMPENSATION
Background
Section 14A of the Exchange Act, which was added by the
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, requires
that, not less frequently than once every three years, we provide stockholders
with an advisory vote on the compensation of our named executive officers as
disclosed herein. Accordingly, we are requesting your advisory (non-binding)
approval of the compensation of our named executive officers as disclosed in the
Executive Compensation section in this Proxy Statement. This non-binding
advisory vote is commonly referred to as a Say-on-Pay vote. Please read the
Executive Compensation section of this Proxy Statement for a detailed discussion
about our executive compensation programs, including information about the
fiscal 2013 compensation of our named executive officers.
Our compensation program is designed to reward each individual
named executive officers contribution to the advancement of our overall
performance and execution of our goals, ideas and objectives. It is designed to
reward and encourage exceptional performance at the individual level in the
areas of organization, creativity and responsibility while supporting our core
values and ambitions. This in turn aligns the interest of our executive officers
with the interests of our stockholders, and thus with our interests.
Stockholders are encouraged to read the Executive Compensation section and other
compensation related sections of this Proxy Statement
Our Compensation Committee and our Board believe that these
policies and procedures are effective in implementing our compensation
philosophy and in achieving our goals.
We are asking you to indicate your support for the compensation
of our named executive officers as described in this Proxy Statement. This vote
is not intended to address any specific item of compensation, our general
compensation policies, the compensation of our Board, or our compensation
policies as they relate to risk management. Rather, this vote relates to the
overall compensation of our named executive officers and the philosophy,
policies and practices described in this Proxy Statement. Accordingly, we are
asking you to vote, on an advisory basis, For the following resolution at the
Annual Meeting:
RESOLVED, that the stockholders of YOU
On Demand Holdings, Inc. (the Company) hereby approve, on an advisory basis,
the compensation paid to the Companys named executive officers, as disclosed in
the Executive Compensation section in this Proxy Statement.
As an advisory vote, this proposal is not binding on YOU On
Demand, and will not require us to take any action or overrule any decisions we
have made. Furthermore, because this advisory vote primarily relates to
compensation that has already been paid or contractually committed to our named
executive officers, there is generally no opportunity for us to revisit these
decisions. However, our Board, including our Compensation Committee, values the
opinions of our stockholders and, to the extent there is any significant vote
against the compensation of named executive officers as disclosed in this Proxy
Statement, we will consider our stockholders concerns and evaluate what
actions, if any, may be appropriate to address those concerns.
Vote Required
Approval of this resolution requires the holders of a majority
of the issued and outstanding Common Stock, Series A Preferred Stock and Series
E Preferred Stock, entitled to vote and voting together as a single class on an
as-converted basis at the Annual Meeting vote For the proposal.
Recommendation
Our Board unanimously recommends a vote FOR approval of
the foregoing resolution. Proxies will be so voted unless stockholders specify
otherwise in their proxies.
- 20 -
PROPOSAL NO. 4:
ADVISORY VOTE ON THE FREQUENCY OF
AN ADVISORY VOTE ON
EXECUTIVE COMPENSATION
As described in Proposal No. 3 above, stockholders are being
provided the opportunity to cast an advisory vote on our executive compensation
program, commonly referred to as a Say-on-Pay Vote. This Proposal No. 4
affords stockholders the opportunity to cast an advisory vote on how often we
should include a Say-on-Pay Vote in our proxy materials for future annual
stockholder meetings. Stockholders may vote to have the Say-on-Pay Vote every
year, every two years or every three years.
Accordingly, we are requesting an advisory, non-binding vote on
how frequently we should seek an advisory Say-on-Pay vote from our stockholders.
This non-binding advisory vote is commonly referred to as a Say-on-Frequency
vote. You have the option to vote for any one of the three options, or to
abstain on the matter. For the reasons described below, our Board recommends
that our stockholders select a frequency of three years, or a triennial vote.
Our Board has determined that an advisory vote on executive compensation every
three years is the best approach for us based on a number of considerations,
including the following:
-
Our compensation program does not change significantly from year to year
and is designed to induce performance over a multi-year period. A vote held
every three years would be more consistent with, and provide better input on,
our long-term compensation, which constitutes a significant portion of the
compensation of our named executive officers;
-
A three-year vote cycle gives our Board and the Compensation Committee
sufficient time to thoughtfully consider the results of the advisory vote, to
engage with stockholders to understand and respond to the vote results and
effectively implement any appropriate changes to our executive compensation
policies and procedures;
-
A three-year vote cycle will provide stockholders with a more complete view
of the amount and mix of components of the compensation paid to our named
executive officers;
-
A three-year period between votes will give stockholders sufficient time to
evaluate the effectiveness of our short-term and long-term compensation
strategies and the related business outcomes of the company, and whether the
components of the compensation paid to our named executive officers have
achieved positive results for the company; and
-
Many large stockholders rely on proxy advisory firms for vote
recommendations. We believe that a triennial vote on executive compensation,
rather than an annual or biennial vote, will help proxy advisory firms provide
more detailed and thorough analyses and recommendations. Less frequent
Say-on-Pay votes will improve the ability of institutional stockholders to
exercise their voting rights in a more deliberate, thoughtful and informed way
that is in the best interests of stockholders.
Our stockholders also have the opportunity to provide
additional feedback on important matters involving executive compensation even
in the years when Say-on-Pay votes do not occur. For example, the rules of the
NASDAQ Stock Market require that we seek stockholder approval for new employee
equity compensation plans and material revisions thereto. Further, as discussed
above under Communications by Stockholders with Directors, we provide
stockholders with an opportunity to communicate directly with our Board,
including on issues of executive compensation.
We understand that our stockholders may have different views as
to what is the best approach for us, and we look forward to hearing from our
stockholders on this Proposal No. 4. You may cast your vote on your preferred
voting frequency by choosing the option of three years, two years, one year, or
abstain from voting when you vote in response to the resolution set forth
below:
- 21 -
RESOLVED, that the stockholders of YOU
On Demand Holdings, Inc. (the Company) hereby approve, on an advisory basis,
that the frequency with which they prefer to have a Say-on-Pay vote is:
-
Every three years;
-
Every two years;
-
Every year; or
-
Abstain from voting.
You are not voting to approve or disapprove our Boards
recommendation. While this advisory Say-on-Frequency vote is non-binding on us,
and we may hold Say-on-Pay vote more or less frequently than the preference
receiving the highest number of votes of our stockholders, our Board and
Compensation Committee will give careful consideration to the choice that
receives the most votes when considering the frequency of future Say-on-Pay
Votes.
Vote Required
Generally, approval of any matter presented to stockholders at
this Annual Meeting, except Proposal 1(a) and (b), requires the holders of a majority of
the issued and outstanding Common Stock, Series A Preferred Stock and Series E
Preferred Stock, entitled to vote and voting together as a single class on an
as-converted basis at the Annual Meeting vote For such proposal. However,
given that this vote is advisory and non-binding, if none of the frequency
options receive a majority of the votes cast, the option receiving the greatest
number of votes will be considered the frequency recommended by the
stockholders. In such instance, while none of the three alternatives will have
been approved, stockholders will still have the ability to communicate their
preference with respect to this vote.
Recommendation
Our Board unanimously recommends that an advisory vote
regarding the compensation of our named executive officers be included in the
companys proxy statement for stockholder consideration every three calendar
years. Proxies will be so voted unless stockholders specify otherwise in their
proxies.
- 22 -
AUDIT COMMITTEE REPORT
The following is the report of the Audit Committee with
respect to the Companys audited financial statements for the year ended
December 31, 2013. The information contained in this report shall not be deemed
soliciting material or otherwise considered filed with the SEC, and such
information shall not be incorporated by reference into any future filing under
the Securities Act or the Exchange Act except to the extent that the Company
specifically incorporates such information by reference in such filing.
The Audit Committee consists of three members: James Cassano,
Clifford Higgerson and Arthur Wong with Mr. Wong acting as Chair. All of the
members are independent directors under the NASDAQ and SEC audit committee
structure and membership requirements. The Audit Committee has certain duties
and powers as described in its written charter adopted by the Board.
The Audit Committee is responsible primarily for assisting the
Board in fulfilling its oversight responsibility of reviewing the financial
information that will be provided to stockholders and others, appointing the
independent registered public accounting firm, reviewing the services performed
by the Companys independent registered public accounting firm and internal
audit department, evaluating the Companys accounting policies and the Companys
system of internal controls that management and the Board have established, and
reviewing significant financial transactions. The Audit Committee does not
itself prepare financial statements or perform audits, and its members are not
auditors or certifiers of the Companys financial statements.
In fulfilling its oversight responsibility of appointing and
reviewing the services performed by the Companys independent registered public
accounting firm, the Audit Committee carefully reviews the policies and
procedures for the engagement of the independent registered public accounting
firm, including the scope of the audit, audit fees, auditor independence matters
and the extent to which the independent registered public accounting firm may be
retained to perform non-audit related services.
The Company maintains an auditor independence policy that bans
its auditors from performing non-financial consulting services, such as
information technology consulting and internal audit services. This policy
mandates that the Audit Committee approve the audit and non-audit services and
related budget in advance, and that the Audit Committee be provided with
quarterly reporting on actual spending. This policy also mandates that the
Company may not enter into auditor engagements for non-audit services without
the express approval of the Audit Committee.
The Audit Committee has reviewed
and discussed the audited financial statements for the year ended December 31,
2013 with the Companys management and UHY LLP, the Companys independent
registered public accounting firm (UHY). The Audit Committee has also
discussed with UHY the matters required to be discussed by Auditing Standards
No. 16, Communication with Audit Committees, issued by the Public Company
Accounting Oversight Board (United States).
The Audit Committee also has received and reviewed the written
disclosures and the letter from UHY required by applicable requirements of the
Public Company Accounting Oversight Board regarding UHYs communications with
the Audit Committee concerning independence, and has discussed with UHY its
independence from the Company.
Submitted by the Audit Committee of the Board of Directors
James Cassano
Clifford
Higgerson
Arthur Wong
- 23 -
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Transactions with Related Persons
We have established procedures for identifying related parties
and related party transactions, and for ensuring that any changes in the status
of related parties are brought to the attention of the Board and management in a
timely manner. For transactions with related parties in the ordinary course of
business, such as customer sales, supply purchases, subcontracting or consulting
services, we apply the same review and approval process as we would in the
context of other commercial agreements. All such transactions with related
parties are summarized and provided to our Audit Committee for review. For
transactions with related parties outside the ordinary course of business, such
as significant capital expenditures, capital raising activities and mergers and
acquisitions, the transactions must be approved by our Audit Committee.
The following includes a summary of transactions since the
beginning of the 2013 fiscal year, or any currently proposed transaction, in
which we were or are to be a participant and the amount involved exceeded or
exceeds the lesser of $120,000 or one percent of the average of our total assets
at year-end for the last two completed years, and in which any related person
had or will have a direct or indirect material interest (other than compensation
described under Item entitled Executive Compensation). We believe the terms
obtained or consideration that we paid or received, as applicable, in connection
with the transactions described below were comparable to terms available or the
amounts that would be paid or received, as applicable, in arms-length
transactions.
On May 10, 2012, at the Companys
request, our Chairman and Chief Executive Officer, Shane McMahon, made a loan to
the Company in the amount of $3,000,000. In consideration for the loan, the
Company issued a convertible note to Mr. McMahon in the aggregate principal
amount of $3,000,000 with interest rate at 4% annually. Effective on January 31,
2014, the Company and Mr. McMahon entered into amendment to the McMahon Note
pursuant to which the McMahon Note will be, at Mr. McMahons option, payable on
demand or convertible on demand into shares of Series E Preferred Stock at a
conversion price of $1.75, until December 31, 2014.
Except as set forth in our discussion above, none of our
Directors, director nominees or executive officers has been involved in any
transactions with us or any of our Directors, executive officers, affiliates or
associates which are required to be disclosed pursuant to the rules and
regulations of the SEC.
Promoters and Certain Control Persons
We did not have any promoters at any time during the past five
fiscal years.
- 24 -
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
The following table sets forth information regarding beneficial
ownership of our Common Stock as of October 23, 2014 (i) by each person who is
known by us to beneficially own more than 5% of our Common Stock; (ii) by each
of our officers and directors; and (iii) by all of our officers and directors as
a group. Unless otherwise specified, the address of each of the persons set
forth below is in care of YOU On Demand Holdings, Inc., 27 Union Square West,
Suite 502, New York, New York, 10003.
|
|
Shares Beneficially Owned(1) |
|
|
|
|
|
|
|
|
Combined |
|
|
|
|
|
|
|
Common Stock, Series |
Name and |
|
|
|
Series A Preferred |
Series E Preferred |
A, |
Address of |
|
Common Stock(2) |
Stock(3) |
Stock(4) |
and Series E((5) |
Beneficial |
Office, If |
|
% of |
|
% of |
|
% of |
|
|
Owner |
Any |
Shares |
Class |
Shares |
Class |
Shares |
Class |
Votes(2)(3)(4) |
Percentage |
|
|
|
|
|
|
|
|
|
|
Directors and Officers |
|
|
|
|
|
|
|
|
|
Xuesong Song
|
Executive Chairman and
Director |
0 |
* |
7,000,000(7) |
100% |
5,923,807(7) |
79.8% |
12,754,671 |
34.1% |
Shane McMahon |
Chairman |
3,046,571(6) |
12.5% |
0 |
* |
2,829,288(6) |
30.3% |
4,680,648 |
11.7% |
Weicheng Liu |
CEO and Director |
2,946,621(8) |
12.2% |
0 |
* |
0 |
* |
2,946,621 |
7.8% |
Marc Urbach |
President and CFO |
342,063(9) |
1.4% |
0 |
* |
0 |
* |
342,063 |
* |
James Cassano |
Director |
46,518(10) |
* |
0 |
* |
0 |
* |
46,518 |
* |
Clifford Higgerson |
Director |
21,097 |
* |
0 |
* |
0 |
* |
21,097 |
* |
Jin Shi |
Director |
21,097 |
* |
0 |
* |
0 |
* |
21,097 |
* |
Arthur Wong |
Director |
18,529(11) |
* |
0 |
* |
0 |
* |
18,529 |
* |
All officers and directors as a group (8
persons named above) |
|
6,442,496 |
25.6% |
7,000,000 |
100% |
8,753,095 |
93.9% |
20,973,245 |
51.5% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5% Securities Holders |
Xuesong Song |
|
0 |
* |
7,000,000(7) |
100% |
5,923,807(7) |
79.8% |
12,754,671 |
34.1% |
Shane McMahon |
|
3,046,571(6) |
12.5% |
0 |
* |
2,829,288(6) |
30.3% |
4,680,648 |
11.7% |
Weicheng Liu |
CEO and Director |
2,946,621(8) |
12.2% |
0 |
* |
0 |
* |
2,946,621 |
7.8% |
C Media Limited |
|
0 |
* |
7,000,000(7) |
100% |
5,923,807(7) |
79.8% |
12,754,671 |
34.1% |
- 25 -
* Less than 1%.
(1) |
Beneficial Ownership is determined in accordance with the
rules of the SEC and generally includes voting or investment power with
respect to securities. Each of the beneficial owners listed above has
direct ownership of and sole voting power and investment power with
respect to our securities. For each beneficial owner above, any options
exercisable within 60 days have been included in the denominator.
|
|
|
(2) |
A total of 23,732,003 shares of our Common Stock are
considered to be outstanding pursuant to SEC Rule 13d-3(d)(1) as of
October 23, 2014. |
|
|
(3) |
Based on 7,000,000 shares of Series A Preferred Stock
issued and outstanding as of October 23, 2014, with the holders thereof
being entitled to cast ten (10) votes for every share of Common Stock that
is issuable upon conversion of a share of Series A Preferred Stock (each
share of Series A Preferred Stock is convertible into 0.1333333 shares of
Common Stock), or a total of 9,333,330 votes. |
|
|
(4)
|
Based on 7,426,428 shares of Series E Preferred Stock
issued and outstanding as of October 23, 2014. Each share of Series E
Preferred Stock is initially convertible into one share of Common Stock,
subject to certain adjustment. The holders of Series E Preferred Stock are
entitled to vote on all matters submitted to a vote of the Companys
stockholders and entitled to the number of votes equal to the lesser of
(i) the number of whole shares of Common Stock into which such shares of
Series E Preferred Stock are convertible at the record date for the
determination of stockholders entitled to vote on such matters, and (ii)
the number of whole shares of Common Stock issuable based on the
conversion price of $3.03, the closing trading price of the Companys
Common Stock as of the end of the trading day immediately preceding the
closing date of the financing contemplated by certain Series E Preferred
Stock Purchase Agreement by and among the Company, C Media Limited and
certain other purchasers, dated January 31, 2014. |
|
|
(5) |
Represents total voting power with respect to all shares
of our Common Stock, Series A Preferred Stock and Series E Preferred
Stock. |
|
|
(6)
|
Includes (i) 2,324,600 shares of Common Stock, (ii)
533,333 shares of Common Stock underlying options exercisable within 60
days at $3.00 per share, (iii) 30,167 shares of Common Stock underlying
options exercisable within 60 days at $4.50 per share; and (iv) 158,472
shares of Common Stock underlying options exercisable within 60 days at
$2.00 per share. In addition, Mr. McMahons Series E Preferred Shares
includes 933,335 shares of Series E Preferred Stock and 1,895,953 shares
of Series E Preferred Stock, issuable within 60 days, underlying a
promissory note which is convertible at any time between January 31, 2014
and December 31, 2014, at a price of $1.75 per share at the option of Mr.
McMahon. |
|
|
(7) |
Includes 7,000,000 shares of Series A Preferred Stock and
5,923,807 shares of Series E Preferred Stock directly owned by C Media
Limited of which Mr. Song is the Chairman and Chief Executive Officer.
|
|
|
(8) |
Includes 320,000 shares underlying options exercisable
within 60 days at $3.75 per share and 30,167 shares underlying options
exercisable within 60 days at $4.50 per share. |
|
|
(9) |
Includes 1,333 shares underlying options exercisable
within 60 days at $75.00 per share, 286,778 shares underlying options
exercisable within 60 days at $2.00 per share, and 53,951 shares
underlying options exercisable within 60 days at $1.65 per share.
|
|
|
(10) |
Includes 13,333 shares underlying options exercisable
within 60 days at $2.00 per share and 2,088 shares underlying options
exercisable within 60 days at $2.91 per share. |
|
|
(11) |
Includes 18,529 shares underlying options exercisable
within 60 days at $2.52 per share. |
- 26 -
Changes in Control
There are no arrangements known to us, including any pledge by
any person of our securities, the operation of which may at a subsequent date
result in a change in control of the Company.
Securities Authorized for Issuance Under Equity Compensation
Plans
The following table includes the information as of December 31,
2013 for each category of our equity compensation plan:
|
|
|
|
|
|
|
|
Number of securities remaining |
|
|
|
Number of securities to |
|
|
Weighted-average |
|
|
available for future issuance |
|
|
|
be issued upon exercise |
|
|
exercise price of |
|
|
under equity compensation |
|
|
|
of outstanding options, |
|
|
outstanding options, |
|
|
plans (excluding securities |
|
Plan category
|
|
warrants and rights (a) |
|
|
warrants and rights (b) |
|
|
reflected in column (a)) (c) |
|
|
|
|
|
|
|
|
|
|
|
Equity compensation plans approved by
security holders(1) |
|
2,065,003 |
|
$ |
2.54 |
|
|
1,934,997 |
|
|
|
|
|
|
|
|
|
|
|
Equity compensation plans not approved by
security holders |
|
- |
|
|
- |
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
Total |
|
2,065,003 |
|
|
|
|
|
1,934,997 |
|
(1) |
On December 3, 2010, our Board of Directors approved the
YOU On Demand Holdings, Inc. 2010 Equity Incentive Plan, or the Plan,
pursuant to which incentive stock options, nonstatutory stock options,
restricted stock, restricted stock units, stock appreciation rights,
performance units and performance shares may be granted to employees,
directors and consultants of the Company and its subsidiaries. The maximum
aggregate number of shares of our Common Stock that may be issued under
the Plan is 4,000,000 shares. The Plan was also approved by our majority
stockholders on December 3, 2010. |
Section 16(a) Beneficial Ownership Reporting Compliance
Under U.S. securities laws, Directors, certain executive
officers and persons holding more than 10% of our Common Stock must report their
initial ownership of the Common Stock, and any changes in that ownership, to the
SEC. The SEC has designated specific due dates for these reports. Based solely
on our review of copies of such reports filed with the SEC by and written
representations of our Directors and executive offers, except as follows we
believe that our Directors and executive offers filed the required reports on
time during 2013: both Mr. Xuesong Song and C Media Limited were late in filing
a Form 3 after they became a reporting person pursuant to Section 16(A) of the
Exchange Act.
- 27 -
DEADLINE FOR RECEIPT OF STOCKHOLDER PROPOSALS FOR
2015
Stockholder proposals which are intended to be presented by
such stockholders at our 2015 annual meeting of stockholders must be received by
the our Corporate Secretary at our principal executive offices no later than 120
calendar days in advance of the one year anniversary of the date our proxy
statement was released to stockholders in order to be considered for inclusion
in the proxy statement and form of proxy/voting instruction card relating to
that meeting pursuant to Rule 14a-8 under the Exchange Act. Under the rules of
the SEC, stockholders who wish to submit proposals for inclusion in the Proxy
Statement for the 2015 Annual Meeting of Stockholders must submit such proposals
to YOU On Demand by July 1, 2015.
OTHER MATTERS
Our Board knows of no other matters to be submitted to the
Annual Meeting. If any other matters properly come before the Annual Meeting,
then the persons named in the enclosed form of proxy will vote the shares they
represent in their discretion.
The SEC has adopted rules that permit companies and
intermediaries (e.g., brokers, banks and nominees) to satisfy the delivery
requirements for proxy statements and annual reports with respect to two or more
stockholders sharing the same address by delivering a single proxy statement and
annual report addressed to those stockholders. This process, which is commonly
referred to as householding, potentially means extra convenience for
stockholders and cost savings for companies and intermediaries.
This year, a number of brokers, banks and nominees with account
holders who are our stockholders may be householding our proxy materials. In
such circumstances, a single proxy statement will be delivered to multiple
stockholders sharing an address unless contrary instructions have been received
by the broker, bank or nominee from one or more of the affected stockholders. We
have not initiated householding with respect to the small number of our record
holders, because such householding would increase our costs. If, at any time,
you would like to receive a separate copy of our proxy statement and annual
report, we will promptly send you an additional copy upon written or oral
request directed to our Secretary. If you are a beneficial owner, you can
request additional copies of the proxy statement and the Annual Report on Form
10-K for the fiscal year ended December 31, 2013. If your shares are held in
street name, you can request a change in your householding status by notifying
your broker, bank or nominee.
To the extent that this Proxy Statement is incorporated by
reference into any other filing by us under the Securities Act or the Exchange
Act, the section of this Proxy Statement entitled Audit Committee Report (to
the extent permitted by the rules of the SEC) will not be deemed incorporated
unless specifically provided otherwise in such filing.
The final results of the balloting at the Annual Meeting will
appear in our Current Report on Form 8-K within four business days of the annual
meeting.
- 28 -
YOU On Demand Holdings, Inc.
Proxy Card
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS FOR THE
ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON NOVEMBER 20, 2014.
The stockholder(s) whose
signature(s) appear(s) on the reverse side of this proxy form hereby appoint(s)
Weicheng Liu and Marc Urbach or either of them as proxies, with full power of
substitution, and hereby authorize(s) them to represent and vote all shares of
common stock, Series A preferred stock and Series E preferred stock of You On
Demand Holdings, Inc. which the stockholder(s) would be entitled to vote on all
matters which may come before the Annual Meeting of Stockholders to be held at
Kerry Centre Hotel, 1 Guanghua Rd, Chaoyand, Beijing, China, or at any
adjournment thereof. The proxies shall vote subject to the directions indicated
on the reverse side of this card and the proxies are authorized to vote in their
discretion upon such other business as may properly come before the meeting and
any adjournments or postponements thereof. The proxies will vote as the Board of
Directors recommends where a choice is not specified. Stockholders of record at
the close of business on October 17, 2014, the record date, are entitled to
notice of and to vote at the annual meeting and any adjournment thereof.
Please complete, sign, date and
mail this proxy form in the accompanying envelope as soon as possible even if
you intend to be present at the meeting. You may also grant your Proxy via the
Internet by following the instructions on below on this Proxy Card.
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIAL
FOR THE ANNUAL MEETING TO BE HELD ON NOVEMBER 20, 2014
The
Notice of Meeting, Proxy Statement, Proxy Card and Annual Report are available
on
the internet at:
http://transferonline.com/ProxyDocs/YouOnDemandHoldings/
VOTE BY INTERNET
It is fast, convenient, and your
vote is immediately confirmed and posted.
Proxy ID: (TOL INSERTS) Authorization Code: (TOL INSERTS)
Instructions for voting electronically:
1. Read the
accompanying Proxy Statement and Proxy Card.
2. Go to
www.transferonline.com/proxy
3. Enter your Proxy ID and
Authorization Code
4. Press Continue
5. Make your selections
6. Press Vote Now
Our Board recommends that the
Companys stockholders vote FOR the election of the nominees listed in Proposal
1(a) and Proposal 1(b), FOR Proposals 2 and 3 and THREE YEARS on Proposal 4.
PROPOSAL 1a: ELECTION OF DIRECTORS (to be elected by the
holders of the Companys Common Stock, Series A Preferred Stock and Series E
Preferred Stock, voting together as a single class).
|
Shane McMahon |
James S Cassano |
|
Weicheng Liu |
Clifford Higgerson |
|
Arthur Wong |
Jin Shi |
[ ] FOR the nominees
listed above.
[ ] FOR the nominees listed above EXCEPT:
________________________________
[ ] WITHHOLD AUTHORITY to
vote for all nominees listed above.
PROPOSAL 1b: ELECTION OF DIRECTORS (to be elected by the
holders of the Companys Series E Preferred Stock, voting as a separate class).
[ ] FOR the nominees
listed above.
[ ] FOR the nominees listed above EXCEPT:
________________________________
[ ] WITHHOLD AUTHORITY to
vote for all nominees listed above.
PROPOSAL 2: RATIFICATION OF APPOINTMENT OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM.
Ratification of the appointment of KPMG Huazhen (Special
General Partnership) as our independent registered public accounting firm for
the fiscal year ending December 31, 2014.
[ ]
FOR [ ]
AGAINST [ ]
ABSTAIN
PROPOSAL 3: ADVISORY VOTE ON EXECUTIVE COMPENSATION
[ ]
FOR [ ]
AGAINST [ ]
ABSTAIN
PROPOSAL 4: ADVISORY VOTE ON THE FREQUENCY OF ADVISORY VOTE
ON EXECUTIVE COMPENSATION
[ ] ONE
YEAR [ ]
TWO
YEAR [ ]
THREE
YEAR [ ]
ABSTAIN
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED AS
DIRECTED OR, IF NO DIRECTION IS GIVEN, WILL BE VOTED FOR PROPOSALs 1 THROUGH 3
AND FOR THREE YEARS ON PROPOSAL 4.
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Signature |
Date: |
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Signature if held jointly |
Date: |
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Print Name: |
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Print Name: |
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Please sign exactly as your name(s) appear on Proxy. When
shares are held by joint tenants, both should sign. When signing as attorney,
executor, administrator, trustee or guardian, please give full title as such. If
a corporation, please sign in full corporate name by president or other
authorized officer. If a partnership, please sign in partnership name by
authorized person.
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