You are cordially invited to attend the Annual Meeting of Stockholders of Liberated Syndication Inc., which will be held on Wednesday, June 28, 2017, starting at 10:00 a.m., Eastern Daylight Time, at the West Palm Beach Marriott, 1001 Okeechobee Boulevard, West Palm Beach, FL 33401. In addition to the matters to be acted upon at the meeting, which are described in the attached Notice of Annual Meeting of Stockholders and Proxy Statement, there will be an opportunity for you to ask questions and conduct any other business that may properly come before the Annual Meeting.
Whether or not you plan to attend the meeting, the prompt execution of your proxy card will both assure that your shares are represented at the meeting and minimize the cost of proxy solicitation.
The Proxy Statement contains a more extensive discussion of each proposal and therefore you should read the Proxy Statement carefully.
The Board of Directors unanimously recommends that you approve all proposals.
Only stockholders of record at the close of business on May 1, 2017 are entitled to vote at the meeting. You are cordially invited to attend the meeting in person.
PROXY STATEMENT TABLE OF CONTENTS
QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING
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EXECUTIVE OFFICERS
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CORPORATE GOVERNANCE
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Board Leadership Structure and Risk Oversight
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Committees of the Board of Directors
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Communicating Concerns to Directors
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Board and Committee Meetings
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Nominating Committee Report
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Audit Committee Report
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Compensation Committee Interlocks and Insider Participation
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DIRECTOR COMPENSATION
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PROPOSAL NO. 1 – ELECTION OF DIRECTORS
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PROPOSAL NO. 2 – RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS.
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PROXY STATEMENT
Annual Meeting of Stockholders
To Be Held on June 28, 2017
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GENERAL INFORMATION
This proxy statement is being furnished to the stockholders of Liberated Syndication Inc. (libsyn), a Nevada corporation, in connection with the solicitation of proxies on behalf of the Board of Directors of libsyn for use at libsyn’s Annual Meeting of Stockholders and any and all adjournments or continuations of the annual meeting, to be held Wednesday, June 28, 2017, starting at 10:00 a.m., Eastern Daylight Time, at the West Palm Beach Marriott, 1001 Okeechobee Boulevard, West Palm Beach, FL 33401, for the purposes set forth in the accompanying Notice of Annual Meeting of Stockholders. These materials will be first mailed to stockholders on or about May 15, 2017.
When we use “libsyn,” “we,” “us,” “our” or the “Company,” we are referring to Liberated Syndication Inc.
This Proxy Statement is also available at:
www.proxyvote.com.
QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING
What is the purpose of the annual meeting?
At the annual meeting, our stockholders will act upon the matters described in this proxy statement. These actions include: (i) the election of four directors to serve a one year term from the date of the Annual Meeting of Stockholders, or until their prior resignation or termination and the election and qualification of their successors; and (ii) the ratification of Gregory & Associates, LLC as independent auditors of Liberated Syndication Inc. for the fiscal year ending December 31, 2017. An additional purpose of the Annual Meeting is to transact any other business that may properly come before the Annual Meeting and any and all adjournments or postponements thereof.
Who can attend the annual meeting?
All stockholders of record at the close of business on the record date, or their duly appointed proxies, may attend the annual meeting. Our Board of Directors has chosen the close of business on May 1, 2017, as the record date for determining the stockholders entitled to notice of, and to vote at, the Annual Meeting. Only stockholders of record as of the record date are entitled to notice of, and to vote at, the Annual Meeting and any adjournments or postponements thereof.
What proposals will be voted on at the annual meeting?
Stockholders will vote on two proposals at the annual meeting:
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the election of four directors to serve a one year term from the date of the Annual Meeting, or until their prior resignation or termination and the election and qualification of their successors;
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the ratification of Gregory & Associates, LLC as independent auditors of Liberated Syndication Inc. for the fiscal year ending December 31, 2017;
What are the Board’s recommendations?
Our Board recommends that you vote:
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the election of four nominated directors;
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FOR
the ratification of Gregory & Associates, LLC as independent auditors of Liberated Syndication Inc. for the fiscal year ending December 31, 2017.
Will there be any other business on the agenda?
The Board knows of no other matters that are likely to be brought before the Annual Meeting. If any other matters properly come before the Annual Meeting, however, the persons named in the enclosed proxy, or their duly appointed substitute acting at the Annual Meeting, will be authorized to vote or otherwise act on those matters in accordance with their judgment.
Who is entitled to vote?
Only stockholders of record at the close of business on May 1, 2017, which we refer to as the “record date,” are entitled to notice of, and to vote at, the Annual Meeting. As of the record date, there were 24,455,860 shares of our common stock outstanding. Holders of common stock as of the record date are entitled to one vote for each share held for each of the proposals.
What is the difference between holding shares as a stockholder of record and as a beneficial owner?
Stockholder of Record.
If your shares are registered directly in your name with our transfer agent, Interwest Transfer Company, Inc., you are considered, with respect to those shares, the “stockholder of record.” The proxy statement and proxy card have been sent directly to you by us.
Beneficial Owner.
If your shares are held in a stock brokerage account or by a bank or other nominee, you are considered the “beneficial owner” of shares held in street name. The proxy statement has been forwarded to you by your broker, bank or nominee who is considered, with respect to those shares, the stockholder of record. As the beneficial owner, you have the right to direct your broker, bank or nominee how to vote your shares by using the voting instruction form included in the mailing.
How do I vote my shares?
All stockholders who receive proxy materials will receive instructions for voting by mail, telephone, or by using the Internet.
What constitutes a quorum?
A quorum is the presence, in person or by proxy, of the holders of a majority of the shares of the common stock entitled to vote. Under Nevada law, an abstaining vote and a broker “non-vote” are counted as present and are, therefore, included for purposes of determining whether a quorum of shares is present at the Annual Meeting.
What is a broker “non-vote” and what is its effect on voting?
A broker “non-vote” occurs when a nominee holding shares for a beneficial owner does not vote on a particular proposal because the nominee does not have the discretionary voting authority with respect to that item and has not received instructions from the beneficial owner. Generally, shares held by brokers who do not have discretionary authority to vote on a particular matter and have not received voting instructions from their customers are not counted or deemed to be present or represented for purposes of determining whether
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stockholders have approved that matter. More specifically, broker “non-votes” are not included in the tabulation of the voting results on the election of directors or issues requiring approval of a majority of the shares present or represented by proxy and entitled to vote at the Annual Meeting and, therefore, do not have an effect on the outcome of any of the proposals.
What is required to approve each item?
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For Proposal 1 (election of directors), a plurality of the votes duly cast is required for the election of directors (that is, the nominees receiving the greatest number of votes will be elected). Abstentions are not counted for purposes of the election of directors.
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For Proposal 2 (ratification of the selection of the independent auditors), the affirmative vote of the holders of a majority of the stockholders’ shares present in person or represented by proxy at the meeting and entitled to vote, is required.
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For any other matters (other than the election of directors) on which stockholders of libsyn are entitled to vote, the affirmative vote of the holders of a majority of the stockholders’ shares present in person or represented by proxy at the meeting and entitled to vote, is required.
For the purpose of determining whether the stockholders have approved matters other than the election of directors, abstentions are treated as shares present or represented and voting, so abstaining has the same effect as a negative vote. If stockholders hold their shares through a broker, bank or other nominee and do not instruct them how to vote, the broker may have authority to vote the shares.
How will shares of common stock represented by properly executed proxies be voted?
All shares of common stock represented by properly executed proxies will, unless such proxies have previously been revoked, be voted in accordance with the instructions indicated in such proxies. If you do not provide voting instructions, your shares will be voted in accordance with the Board’s recommendations on the items listed in the Notice of Annual Meeting. In addition, if any other matters properly come before the Annual Meeting, the persons named in the enclosed proxy, or their duly appointed substitute acting at the Annual Meeting, will be authorized to vote or otherwise act on those matters in accordance with their judgment.
Can I change my vote or revoke my proxy?
Any stockholder executing a proxy has the power to revoke such proxy at any time prior to its exercise. You may revoke your proxy prior to exercise by:
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filing with us a written notice of revocation of your proxy,
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submitting a properly signed proxy card bearing a later date,
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voting in person at the annual meeting.
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What does it mean if I receive more than one proxy card?
If your shares are registered under different names or are in more than one account, you will receive more than one proxy card. To ensure that all your shares are voted, please sign and return all proxy cards, or if you choose, vote by telephone or through the Internet using the personal identification number printed on each proxy card. We encourage you to have all accounts registered in the same name and address (whenever possible). You can accomplish this by contacting our transfer agent, Interwest Transfer Company, Inc.
Who paid for this proxy solicitation?
This proxy solicitation is made by the Company. The cost of preparing, printing, assembling and mailing this proxy statement and other material furnished to stockholders in connection with the solicitation of proxies will be borne by us.
How are proxies solicited?
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In addition to the mail solicitation of proxies, our officers, directors, employees and agents may solicit proxies by written communication, telephone or personal call. These persons will receive no special compensation for any solicitation activities. We will reimburse banks, brokers and other persons holding common stock for their expenses in forwarding proxy solicitation materials to beneficial owners of our common stock.
What is “householding?”
“Householding” means that we deliver a single set of proxy materials to households with multiple stockholders, provided certain conditions are met. Householding reduces our printing and mailing costs.
If you or another stockholder of record sharing your address would like to receive an additional copy of this Proxy Statement, we will promptly deliver it to you upon your request in one of the following manners:
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by sending a written request by mail to:
Liberated Syndication Inc.
Attn: Chief Financial Officer
5001 Baum Blvd, Suite 770
Pittsburgh, PA 15213
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by calling our Chief Financial Officer, at (412) 621-0902.
If you would like to opt out of householding in future mailings, or if you are currently receiving multiple mailings at one address and would like to request householded mailings, you may do so by contacting the Chief Financial Officer, at (412) 621-0902.
Can I receive future stockholder communications electronically through the Internet?
Yes. You may elect to receive future notices of meetings and proxy materials electronically through the Internet. To consent to electronic delivery, you must vote your shares using the Internet. At the end of the Internet voting procedure, the on-screen Internet voting instructions will tell you how to request future stockholder communications be sent to you electronically.
Once you consent to electronic delivery, you must vote your shares using the Internet and your consent will remain in effect until withdrawn. You may withdraw this consent at any time and resume receiving stockholder communications in print form.
What are the requirements for presenting stockholder proposals?
Stockholders may submit proposals on matters appropriate for stockholder action at our annual meeting, including the submission of nominees for election to the Board of Directors, consistent with regulations adopted by the Securities and Exchange Commission (the “SEC”) and our Bylaws. For such proposals to be considered for inclusion in the proxy statement and form of proxy relating to the 2018 annual meeting, we must receive them not later than January 2, 2018, or such later date as we may specify in our SEC filings. Your proposals should be addressed to Liberated Syndication Inc at 5001 Baum Blvd, Suite 770, Pittsburgh, PA 15213, Attn: Corporate Secretary.
We anticipate that proxies solicited in connection with our 2017 Annual Meeting will confer discretionary authority to vote on matters, among others, of which we do not receive notice prior to March 1, 2017.
Am I entitled to dissenter’s rights?
Under Nevada law, stockholders are not entitled to dissenter’s rights in connection with any of the matters described in this proxy statement.
What are the interests of the Company’s directors and officers in the matters to be acted upon?
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Except as indicated below, none of our directors, executive officers, or any of their associates has any substantial interest, direct or indirect, by security holdings or otherwise, in any of the matters to be acted upon.
Whom may I contact for further assistance?
If you have any questions about giving your proxy or require any assistance, please contact our Chief Financial Officer:
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by mail, to:
Liberated Syndication Inc.
Attn: Chief Financial Officer
5001 Baum Blvd, Suite 770
Pittsburgh, PA 15213
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by telephone, at (412) 621-0902
EMERGING GROWTH COMPANY STATUS
We are an “emerging growth company” under applicable federal securities laws and therefore are permitted to take advantage of certain reduced public company reporting requirements. As an emerging growth company, we provide in this 2017 Proxy Statement the scaled disclosure permitted under the Jumpstart Our Business Startups Act of 2012 and rules of the SEC, including the scaled executive compensation disclosure. In addition, as an emerging growth company, we are not required to conduct votes seeking approval, on an advisory basis, of the compensation of our Named Executive Officers (as defined herein) or the frequency with which such votes must be conducted. We will remain an emerging growth company until the earliest of (1) the last day of the fiscal year in which we have total annual gross revenues of $1 billion or more, (2) December 31, 2021, (3) the date on which we have issued more than $1 billion in nonconvertible debt during the previous three years, or (4) the date on which we are deemed to be a large accelerated filer under the rules of the SEC.
EXECUTIVE OFFICERS
The following table sets forth:
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the names of our current executive officers,
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their ages as of the record date for the annual meeting and
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the capacities in which they currently serve libsyn:
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Name
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Age
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Position(s)
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Officer Since
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Christopher J. Spencer
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Chief Executive Officer and Director
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2012
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John Busshaus
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Chief Financial Officer
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2012
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See “Proposal No. 1 — Election of Directors” for biographical information regarding Mr. Spencer and each of our other current directors.
John Busshaus
has served Chief Financial Officer of Libsyn since its inceptions on September 29, 2015. Mr. Busshaus has served as Chief Financial Officer of Future Healthcare of America since June 22, 2012. Mr. Busshaus has served as the Chief Financial Officer of FAB Universal Corp. since January 29, 2007. From 2004 to 2006, Mr. Busshaus was an independent business consultant. Mr. Busshaus’ efforts were assisting organizations with the implementation of Sarbanes Oxley, filing of SEC reports, and taking a company through an IPO. Mr. Busshaus worked for Talanga International from 2001 to 2004, where he was the Chief Financial Officer for the company. From 1999 to 2000, Mr. Busshaus worked for Mellon Bank as Controller and Vice President, and was responsible for strategic planning and managing the annual and monthly budgeting within Global Security Services. From 1994 to 1998, Mr. Busshaus worked for PepsiCo as Senior Business Planner, and was responsible for annual and quarterly budgets planning, as well as weekly, monthly, and quarterly
reporting of results. As a member of management, Mr. Busshaus' efforts contributed to the revenue growth and market share increases in a market that was categorized as saturated.
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CORPORATE GOVERNANCE
We uphold a set of basic values to guide our actions and are committed to maintaining the highest standards of business conduct and corporate governance. We have adopted a Code of Business Conduct and Ethics for directors, officers (including our principal executive officer and principal financial officer) and employees, which, in conjunction with our Certificate of Incorporation, Bylaws and Board of Directors committee charters, form the framework for governance of libsyn. The Code of Ethics and Business Conduct can be found on our website at: investor.libsy.com. Also, the Code of Ethics and Business Conduct, Board of Directors committee charters, Bylaws and Certificate of Incorporation are available at our corporate offices. Stockholders may request free printed copies of these documents from:
Liberated Syndication Inc.
Attn: Secretary
5001 Baum Blvd., Suite 770
Pittsburgh, PA 15213
(412) 621-0902
Board Leadership Structure and Risk Oversight
Our company is led by Mr. Christopher Spencer, who has served as chief executive officer and member of the Board of Directors since inception of the Company. Our Board of Directors is comprised of Mr. Spencer and three independent directors. The Board has four standing independent committees—the audit, compensation, nominating, and corporate governance and risk committees. Each of the Board committees is comprised solely of independent directors. Our risk committee is responsible for overseeing risk management, and our full Board regularly engages in discussions of risk management. Each of our other Board committees also considers the risk within its area of responsibilities. Our corporate governance guidelines provide that our non-management directors will meet in executive session at each Board meeting.
Our corporate leadership structure is commonly utilized by other public companies in the United States, and we believe that this leadership structure has been effective for the Company. We believe that having the roles of Chairman and CEO as one person, and only independent Board members for each of our Board committees, provides the right form of leadership for our Company. We believe that our Chairman and CEO, together with the risk committee, the audit committee and the full Board of Directors, provide effective oversight of the risk management function.
Committees of the Board of Directors
The Board of Directors has adopted written charters for two standing committees: the Nominating Committee and the Audit Committee. The Board has determined that all members of the Nominating and Audit Committees are independent and satisfy the relevant SEC independence requirements for members of such committees.
Nominating Committee
. The Nominating Committee currently consists of Mr. Polinsky as chair, Mr. Yevstifeyev, and Mr. Smith. This committee provides assistance to the Board in identifies individuals qualified to become members of the Board of Directors consistent with Board criteria. The committee also oversees the evaluation of the Board of Directors and management.
Audit Committee
. The Audit Committee currently consists of Mr. Yevstifeyev, as chair, Mr. Polinsky and Mr. Smith. Mr. Yevstifeyev, the Board of Directors has determined, is an “audit committee financial expert” as defined under SEC rules. This committee oversees the integrity of our financial statements, disclosure controls and procedures, the systems of internal accounting and financial controls, compliance with legal and regulatory requirements, the qualifications and independence of the independent auditors and the performance of our internal audit function and independent auditors, and the quarterly reviews and annual independent audit of our financial statements. The Audit Committee’s report appears hereafter. Gregory & Associates, LLC, our independent auditors, reports directly to the Audit Committee.
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We will provide a free printed copy of any of the charters of any Board committee to any stockholder on request.
Compensation Committee
. The Compensation Committee currently consists of Mr. Smith, as chair, Mr. Yevstifeyev, and Mr. Polinsky. This committee provides assistance to the Board of Directors in overseeing our compensation policies and practices. It reviews and approves the compensation levels and policies for the Board of Directors; reviews and approves corporate goals and objectives with respect to CEO compensation and, based upon these evaluations, determines and approves the CEO’s compensation. The Compensation Committee also has the responsibility to provide the report to stockholders on executive officer compensation.
Communicating Concerns to Directors
The non-employee directors have established procedures to enable anyone wishing to communicate with our Board of Directors in the following way:
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Writing to the directors, at the following address:
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Board of Directors
Liberated Syndication Inc.
c/o Corporate Secretary
5001 Baum Blvd
Suite 770
Pittsburgh, PA 15213
The Audit Committee has established procedures for employees who have a concern about our accounting, internal accounting controls or auditing matters, to communicate that concern directly to the Audit Committee in one of the following ways:
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Calling the whistle blowing hotline @ (877) 350-0004
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Writing to the Audit Committee, at the following address:
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Chair of the libsyn Audit Committee
5001 Baum Blvd
Suite 770
Pittsburgh PA 15213
The Hotline service will forward any communications related to our accounting, internal accounting controls, or auditing matters to the Chair of the Audit Committee. Communications may be anonymous.
Board and Committee Meetings
We encourage but do not require Board member attendance at our Annual Meeting. The Audit Committee held four meeting in fiscal 2016. Each director attended at least 75% of the aggregate of the total number of board and applicable committee meetings.
Nominating Committee Report
The Nominating Committee provides assistance to the Board in evaluating and selecting director nominees of the Company to be considered for election at the annual meeting of stockholders and takes such other actions within the scope of its charter as the committee deems necessary or appropriate.
The Nominating Committee has responsibility for identifying and evaluating new nominees to the Board. In evaluating director nominees, the committee will, as described in the committee’s charter, consider various criteria, including relevant industry experience, general business experience, relevant financial experience, and compliance with independence and other qualifications necessary to comply with any applicable tax and securities laws. In addition, directors must have time available to devote to Board activities and to enhance their knowledge of our business. We therefore seek to attract and retain qualified directors who have sufficient time to devote to their responsibilities and duties to us and our stockholders.
Between annual meetings of stockholders, the Board may elect directors to serve until the next annual meeting. Nominees for directorship will be selected by the Nominating Committee, in accordance with the
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policies and principles in its charter, and nominated by the Board for stockholder elections. To date, we have not engaged third parties to identify or evaluate or assist in identifying potential director nominees, although we may do so in the future.
To date, we have not received any recommendations from stockholders requesting the Board or any of its committees to consider a nominee for inclusion among the Board’s slate of nominees in our proxy statement for our annual meeting. However, our stockholders may recommend director nominees, and the committee will consider nominees recommended by stockholders. A stockholder wishing to submit such a recommendation should send a letter to the Corporate Secretary at our principal executive offices in accordance with the provisions of our Bylaws and the provisions set forth in the Questions and Answers about the Annual Meeting section under the question, “What are the requirements for presenting stockholder proposals?” The mailing envelope must contain a clear notation indicating that the enclosed letter is a “Director Nominee Recommendation.” The letter must identify the author as a stockholder and provide a brief summary of the nominee’s qualifications, including such information about the nominee as would have been required to be included in a proxy statement filed pursuant to the rules of the SEC had such nominee been nominated by the Board, as well as contact information for both the nominee and the stockholder. Nominees should at a minimum have relevant business and financial experience and must be able to read and understand fundamental financial statements. We anticipate that nominees recommended by stockholders will be evaluated in the same manner as nominees recommended by anyone else, although, the committee may prefer nominees who are personally known to the existing directors and whose reputations are highly regarded. The committee will consider all relevant qualifications as well as our needs in terms of compliance with listing standards and SEC rules.
All of the nominees for directors being voted upon at the annual meeting are directors standing for reelection.
The Nominating and Corporate Governance Committee assisted the Board and each of its committees in conducting self-evaluations of their functioning and effectiveness.
Nominating Committee
Douglas Polinsky
Denis Yevstifeyev
J. Greg Smith
Audit Committee
. The Audit Committee currently consists of Denis Yevstifeyev as chair, Douglas Polinsky, and J. Gregory Smith. Mr. Yevstifeyev, the Board of Directors has determined, is an “audit committee financial expert” as defined under SEC rules. This committee oversees the integrity of our financial statements, disclosure controls and procedures, the systems of internal accounting and financial controls, compliance with legal and regulatory requirements, the qualifications and independence of the independent auditors and the performance of our internal audit function and independent auditors, and the quarterly reviews and annual independent audit of our financial statements. The Audit Committee’s report appears hereafter. Gregory & Associates, LLC, our independent auditor, reports directly to the Audit Committee.
The Board of Directors has determined that each of J. Gregory Smith, Denis Yevstifeyev and Douglas Polinsky has no material relationship with us (either directly or as a partner, stockholder or officer of an organization that has a relationship with us) and satisfies the independence requirements required by the SEC.