Item 5.02 Departure of Directors or Certain Officers;
Election of Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers.
On March 28, 2016, the Board of
Directors (the “
Board
”) of YOU On Demand Holdings, Inc. (the
“
Company
”) appointed Ms. Mei Chen as the new CFO and principal
accounting officer of the Company, effective April 1, 2016, and entered into an
employment agreement with Ms. Chen on such date. Further, the Board appointed
Mr. Bing Yang as President of YOU On Demand’s newly formed E-Commerce division,
effective April 26, 2016, and entered into an employment agreement with Mr. Yang
on such date.
Mei Chen CFO Employment Agreement
As noted above, on March 28, 2016, the
Company announced the appointment of Ms. Mei Chen as CFO effective as of April
1st, and entered into an employment agreement with Ms. Chen effective as of
April 1, 2016. Ms. Chen, age 46, comes to the Company with more than twenty
years of management and operating experience, and a keen understanding and
extensive background in corporate finance, financial planning and analysis,
treasury, strategic planning, risk management, controls and compliance. Prior to
joining the Company, from December 2015 to March 2016, Ms. Chen was the CFO of
Beijing Sun Seven Star Culture Development Co Ltd., a private media and
investment company in China. Between November 2012 and December 2015, Ms. Chen
served as Senior Controller of the PSG segment of Microsoft (China) Co., Ltd.,
and prior to that she was a Senior Controller for Cisco Systems (China)
Networking Technology Co. Ms. Chen holds a Bachelor’s Degree from the Harbin
Institute of Technology, a Bachelor’s Degree in Accounting from The People’s
University and an MBA in Finance from Hong Kong Chinese University.
Ms. Chen’s employment agreement has an
initial term of two years, with automatic one-year extensions thereafter unless
written notice of non-renewal is given by either party not less than 90 days
prior to the end of the then current term.
Ms. Chen will be paid an initial base
salary of RMB 1,008,000 per year, which will be subject to annual review by the
CEO and Compensation Committee of the Board and may be adjusted. In addition, so
long as she remains employed and achieves annual performance objectives, Ms.
Chen is entitled to receive 25,000 shares of restricted stock per year under the
Company’s 2010 Equity Incentive Plan to be issued on or around April 1, 2016,
April 1, 2017 and April 1, 2018, respectively. Ms. Chen will also be entitled to
participate in all employee benefit plans, policies practices of the Company
generally available to any of its senior executive employees.
Upon a termination of Ms. Chen’s
employment without “cause,” with “good reason” (each as defined in the
employment agreement) or via a non-renewal of the employment agreement by the
Company, Ms. Chen will be entitled to severance pay and benefits as follows: (i)
one month of Ms. Chen’s salary per each full year of employment with the
Company; (ii) reimbursement of all unpaid business-related expenses incurred or
paid by Ms. Chen during her employment; (iii) any earned but ungranted
restricted stock awards; (iv) all previously earned, accrued, and unpaid
benefits from the Company and its employee benefit plans; and (v) accelerated
vesting of any unvested equity awards.
Upon a termination of Ms. Chen’s
employment for “cause” (as defined in the employment agreement), upon Ms. Chen’s
death or disability, or if Ms. Chen elects not to renew the agreement, Ms. Chen
will be entitled to severance pay and benefits as follows: (i) reimbursement of
all unpaid business-related expenses incurred or paid by Ms. Chen during her
employment; (ii) any earned but ungranted restricted stock awards; and (iii) all
previously earned, accrued, and unpaid benefits from the Company and its
employee benefit plans.
Certain severance payments and
benefits under the employment agreement are subject to the execution of a
general release agreement by Ms. Chen containing, among other provisions, a
general release of claims in favor of the Company. The employment agreement does
not provide for any tax gross-up payments.
In light of the appointment of
Ms. Chen as CFO and principal accounting officer, Ms. Grace He, the Company’s VP
of Finance, will no longer be principal accounting officer effective April 1,
2016. Ms. He will remain VP of Finance and continue in her current position with
the Company.
Bing Yang Employment Agreement
As noted above, on March 28,
2016, the Company announced the appointment of Mr. Bing Yang as President of YOU
On Demand’s newly formed E-Commerce division effective as of April 26th, and
entered into an employment agreement with Mr. Yang effective as of April 26,
2016. Mr. Yang, age 53, comes to the Company with a wide range of experience in
research & development, product development and sales and marketing. Most
recently, between May 2015 and March 2016, he served as CEO for On-Ramp Service,
Inc., a high end life-style cross border online retail platform. From
October 2014 to May 2015, Mr. Yang was the CEO of KJT.com, a pioneer of the cross border e-commerce in China
based in Shanghai. Prior to KJT, Mr. Yang held various executive level positions
throughout his thirty-year career at companies such as Cisco and Convergent
Networks, a pioneer in VoIP technologies. He was a General Manager for Cisco
Systems (Shanghai) Video Technology Corp. Ltd between June 2011 and October
2014, and managing director Cisco System, R&D Center between February 2008
and October 2014. Mr. Yang earned a Bachelor of Science in Electrical
Engineering from the University of Texas at Austin and a Master of Science in
Electrical Engineering from the University of New Hampshire.
Mr. Yang’s employment agreement has an
initial term of two years, with automatic one-year extensions thereafter unless
written notice of non-renewal is given by either party not less than 90 days
prior to the end of the then current term.
Mr. Yang will be paid an initial base
salary of $180,000 per year, which will be subject to annual review by the CEO
and Compensation Committee of the Board and may be adjusted. Mr. Yang will also
receive a one-time sign-on bonus of $20,000 In addition, so long as he remains
employed and achieves annual performance objectives, Mr. Yang is entitled to
receive 100,000 shares of restricted stock per year under the Company’s 2010
Equity Incentive Plan to be issued on or around April 26, 2016, April 26, 2017
and April 26, 2018, respectively. Mr. Yang will also be entitled to participate
in all employee benefit plans, policies practices of the Company generally
available to any of its senior executive employees.
Upon a termination of Mr. Yang’s
employment without “cause,” with “good reason” (each as defined in the
employment agreement) or via a non-renewal of the employment agreement by the
Company, Mr. Yang will be entitled to severance pay and benefits as follows: (i)
one month of Mr. Yang’s salary per each full year of employment with the
Company; (ii) reimbursement of all unpaid business-related expenses incurred or
paid by Mr. Yang during his employment; (iii) any earned but ungranted
restricted stock awards; (iv) all previously earned, accrued, and unpaid
benefits from the Company and its employee benefit plans; and (v) accelerated
vesting of any unvested equity awards.
Upon a termination of Mr. Yang’s
employment for “cause” (as defined in the employment agreement), upon Mr. Yang’s
death or disability, or if Mr. Yang elects not to renew the agreement, Mr. Yang
will be entitled to severance pay and benefits as follows: (i) reimbursement of
all unpaid business-related expenses incurred or paid by Mr. Yang during his
employment; (ii) any earned but ungranted restricted stock awards; and (iii) all
previously earned, accrued, and unpaid benefits from the Company and its
employee benefit plans.
Certain severance payments and
benefits under the employment agreement are subject to the execution of a
general release agreement by Mr. Yang containing, among other provisions, a
general release of claims in favor of the Company. The employment agreement does
not provide for any tax gross-up payments.
The foregoing description of Ms.
Chen and Mr. Yang’s Employment Agreements is not purported to be complete and is
qualified in its entirety by reference to the complete text of such Employment
Agreements attached hereto as Exhibits 10.1 and 10.2, respectively.
* * * * *
On March 28, 2016, the Company issued
a press release announcing the appointment of Ms. Chen as CFO and Mr. Yang’s as
President of YOU On Demand’s E-Commerce division, a copy of which is filed as
Exhibit 99.1 hereto.