ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
The following table and paragraphs set forth information regarding our executive officers and directors, including the business experience for the past five years (and, in some instances, for prior years) of each such executive officer and director.
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Name
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Age
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Position
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Kai-Shing Tao
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44
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Chief Executive Officer and Chairman of the Board
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Theodore P. Botts
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75
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Director and Chairman of the Audit Committee
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Elizabeth Xu
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56
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Director
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Brett Ratner
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52
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Director and Chairman of the Compensation Committee
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Daniel Stein
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45
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Director and Chairman of the Nominating and Governance Committee
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Executive Officer
Kai-Shing Tao has served as our Chief Executive Officer since December 2012, previously serving as Co-Chief Executive Officer since October 2012, and as a member of our board of directors (the “Board”) since 2007 and Chairman of the Board since October 2012. Mr. Tao also has served as Chairman and Chief Investment Officer of Pacific Star Capital Management, L.P. (“Pacific Star Capital”), a private investment group, since January 2004. Prior to founding Pacific Star Capital, Mr. Tao was a Partner at FALA Capital Group, a single-family investment office, where he headed the global liquid investments outside the operating companies. Mr. Tao has been a director of Paradise Entertainment Limited (SEHK: 1180), a Hong-Kong-Stock-Exchange-traded company engaged in casino services and the development, supply and sales of electronic gaming systems, since April 2014. Mr. Tao previously was a director of Playboy Enterprises, Inc. from May 2010 to March 2011. Mr. Tao is a graduate of the New York University Stern School of Business.
Non-Employee Directors
Theodore P. Botts has served as a member of our Board since 2007. Mr. Botts has been the President of Kensington Gate Capital, LLC, a private corporate finance advisory firm, since April 2001. Previously, Mr. Botts served as Chief Financial Officer of StereoVision Entertainment, Inc., a film entertainment company, from July 2007 until September 2008. Prior to 2000, Mr. Botts served in executive capacities at UBS Group and Goldman Sachs in London and New York. Mr. Botts also served on the board of directors and as chairman of the audit committee of INTAC International, Inc. from 2002 until its merger with a predecessor of Remark in 2006. Mr. Botts served as a member of the board and chairman of both the compensation and audit committees of Crystal Peak Minerals (CPMMF) from 2012 to 2018. Mr. Botts also served as a member of the Board of Trustees and head of development for REACH Prep, a non-profit organization serving the educational needs of underprivileged African-American and Latino children in Fairfield and Westchester counties, from 2003 to 2012. Mr. Botts graduated with highest honors from Williams College and received an MBA from the New York University Stern School of Business.
Brett Ratner has been a member of our Board since March 2017. Mr. Ratner is one of Hollywood's most successful filmmakers. His films have grossed more than $2 billion at the global box office. He has served as an executive producer on films such as the Golden-Globe-winning and Oscar-winning The Revenant, starring Leonardo DiCaprio, executive producer and director of the Golden Globe-nominated FOX series Prison Break, and executive producer of the television series Rush Hour, based on his hit films. Mr. Ratner, along with his business partner James Packer, formed RatPac Entertainment, a film finance and media company, in 2013. Since inception, RatPac Entertainment has co-financed 63 theatrically-released motion pictures exceeding $11.6 billion in worldwide box office receipts. In 2017, he received a coveted star on the Hollywood Walk of Fame. Mr. Ratner received a Bachelor in Fine Arts degree from New York University’s Tisch School of the Arts. He is currently attending Harvard University’s Business School Graduate Program.
Daniel Stein has served as a member of our Board since March 2017. Daniel Stein is currently Senior Vice President of Partnerships, Crossix Analytics (which is part of Veeva Systems) where he oversees all media, enablement and product partnerships. He previously served since 2012 as Senior Vice President of Analytics Services & Product Strategy at Crossix Solutions, Inc., a healthcare and analytics and data company, where he was responsible for driving innovation across the Crossix product suite, including digital and TV-based solutions. Prior to joining Crossix, Mr. Stein spent eight years at Digitas and Digitas Health, an advertising agency, where he led the Strategy and Analysis group in New York. At Digitas Health, he built a team focused on leveraging analytics to help pharmaceutical and health-focused clients optimize their marketing plans and partnerships. Mr. Stein brings over 20 years of media, marketing, healthcare and agency experience focusing on products,
marketing and innovation. Previously, he worked at Scholastic, where he developed interactive and direct marketing plans to support teachers and parents, and he gained additional healthcare experience at PricewaterhouseCoopers, where he designed
and built comprehensive health & welfare systems for large companies. Mr. Stein graduated from the University of Pennsylvania with a B.A. in Economics. He has not served on any other boards or committees in the last five years.
Dr. Elizabeth Xu is an international transformational technology leader and senior business executive with more than 20 years of experience that includes digital transformation through the application of artificial intelligence, Internet-of-Things, and other enterprise technology to multiple businesses. She was a Stanford University lecturer for six years, and she currently serves as an Innovation and Entrepreneurship Advisor at MIT and Chairman of the APAC advisory board of Women in Technology International (WITI.com). Currently, Dr. Xu is the CEO of A2C Leadership Group which offers online personalized training and boot camps for corporations, executives, working professionals, and middle/high school students, focusing on innovation and leadership. From 2018 to 2019, Dr. Xu served as the Group CTO at Thailand-based Charoen Pokphand Group (CP Group), one of the world's largest conglomerates, where she drove the company's technology strategy and advancement and oversaw workforce re-training for more than 200 of the company's subsidiaries in various industries. During that time period, she also served as CEO of the CP Group subsidiaries in Thailand and the United States that conducted CP Group's research and development. From 2014 to 2017, Dr. Xu held several leadership roles, including serving as CTO, with BMC Software, Inc. (“BMC”), a global leader in information technology service management. At BMC, she was responsible for the company's Central Technology Organization and Digital Service Management BU Engineering Organization. Before joining BMC, Dr. Xu held senior management positions at several other organizations, including Group Vice President of product engineering at LiveRamp Holdings, Inc. (formerly known as Acxiom Corporation), Global Senior Vice President of product development at Deem (formerly known as Rearden Commerce) and Global Senior Vice President of product development at Vitria Technology. She started her management career at IBM in 1996, where she developed the IBM Content Management Suite and DB2. Dr. Xu earned a B.S. degree and an M.S. degree from Peking University, as well as an M.S. in Computer Science and a Ph.D. in Atmospheric Science from the University of Nevada, Reno. She has also completed advanced executive-education programs at Stanford Business School and earned a board certificate from Harvard Business School.
Director Qualifications
The Board comprises a diverse group of leaders in their respective fields. Some of the current directors have senior leadership experience at major domestic and international corporations. In these positions, they have gained experience in core management skills, such as strategic and financial planning, public company financial reporting, compliance, risk management, and leadership development. Some of our directors also have experience serving on boards of directors and board committees of other public companies, and have an understanding of corporate governance practices and trends, which provides an understanding of different business processes, challenges, and strategies. Other directors have experience as principals in private investment and advisory firms, which brings financial expertise and unique perspectives to the Board. Our directors also have other experience that makes them valuable members, such as experience managing technology and media companies, or developing and pursuing investment or business opportunities in international markets, which provides insight into strategic and operational issues faced by Remark.
The Nominating and Governance Committee believes that the above-mentioned attributes, along with the leadership skills and other experiences of the directors described below, provide us with a diverse range of perspectives and judgment necessary to guide our strategies and monitor their execution.
Kai-Shing Tao
•Knowledge and experience regarding Remark from serving as our Chief Executive Officer since December 2012
•Global financial industry and investment experience and extensive knowledge of Asian markets as Chief Investment Officer of Pacific Star Capital and a former member of the U.S.-China and U.S.-Taiwan Business Council
•Outside public company board experience as a former director of Playboy Enterprises, Inc.
Theodore P. Botts
•Global financial advisory experience and extensive knowledge of the technology sector as President of Kensington Gate Capital, LLC
•Outside board experience as a director and chairman of the audit committee of INTAC International
•Global financial industry experience as an executive at UBS Group and Goldman Sachs
Brett Ratner
•Extensive experience in the entertainment industry, including co-founding and operating a successful film finance and media company
Daniel Stein
•Operational experience leading data monetization efforts for analytics companies, leveraging partnerships with top digital, television and media companies
•Oversaw all product strategy for Crossix, a leading technology company currently focused in healthcare
•More than 20 years of media, marketing and agency experience focusing on innovation
Elizabeth Xu
•Senior executive experience as former Group CTO of CP Group and CEO of CP R&D Thailand and USA companies
•Global business experience in operational and governance roles for technology businesses
•Harvard Business School certified board member
Family Relationships
There are no family relationships among our executive officers and directors.
Section 16(a) Beneficial Ownership Reporting Compliance
Under §16(a) of the Exchange Act, our directors, executive officers and holders of more than 10% of our common stock, must file initial reports of ownership and reports of changes in ownership with the SEC, and under SEC regulations, they must furnish us with copies of all §16(a) forms filed.
Delinquent Section 16(a) Reports. To our knowledge, based solely upon our review of the copies of the forms furnished to us, we believe that our directors, executive officers and holders of more than 10% of our common stock complied with all §16(a) filing requirements during 2020, except that on August 5, 2020, Messrs. Botts, Stein and Ratner, and Dr. Xu, directors of
Remark, each filed a Statement of Changes in Beneficial Ownership on Form 4 covering one transaction that occurred on July 27, 2020.
Code of Business Conduct and Ethics
We have adopted a Code of Business Conduct and Ethics (the “Code of Ethics”) that applies to all of our employees, officers and directors. A copy of the Code of Ethics is publicly available on our website at ir.remarkholdings.com/corporate-governance. Amendments to the Code of Ethics or any grant of a waiver from a provision of the Code of Ethics requiring disclosure under applicable SEC rules will also be disclosed on our website.
Audit Committee
The Audit Committee of our Board is comprised of Messrs. Botts and Stein and Dr. Xu, each of whom is independent under applicable NASDAQ listing standards. Mr. Botts serves as Chairman of the Audit Committee.
The Board determined that Mr. Botts qualifies as an “audit committee financial expert”, as defined under the Exchange Act. The Board made a qualitative assessment of Mr. Botts’ level of knowledge and experience based on a number of factors, including his experience as a financial professional.
ITEM 11. EXECUTIVE COMPENSATION
Summary Compensation Table
The following table presents the dollar amounts of salary (the only form of compensation during the years noted) earned by our named executive officer (“NEO”):
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Kai-Shing Tao
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Year ended December 31, 2020
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$
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350,000
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Year ended December 31, 2019
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350,000
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Employment Agreements
Mr. Tao is an “at will” employee and we do not have employment agreement with him.
Outstanding Equity Awards at Fiscal Year End
The following table presents information regarding our NEO’s unexercised options to purchase our common stock as of December 31, 2020 (all stock awards to our NEO had vested as of December 31, 2020):
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Option Awards
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Name
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Number of Securities Underlying Unexercised Options Exercisable
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Option Exercise Price
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Option Expiration Date
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Kai-Shing Tao
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1,300,000
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$
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7.81
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01/19/2028
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180,000
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1.99
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06/20/2027
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1,500,000
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4.04
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11/09/2026
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350,000
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4.10
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08/18/2025
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650,000
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4.29
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07/28/2025
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442,750
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6.30
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02/17/2024
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Equity Incentive Plans
We have granted stock options and restricted stock under our 2010 Equity Incentive Plan adopted June 15, 2010, our 2014 Incentive Plan adopted on February 17, 2014 and amended on December 23, 2014 and January 11, 2016, and our 2017 Incentive Plan adopted on January 19, 2018. The amount of stock options or shares of stock we grant to recipients generally depends upon their particular position with Remark and their achievement of certain performance metrics established by the Board. The Compensation Committee must approve all grants.
Director Compensation
The following table presents a summary of the compensation earned by each non-employee director who served on the Board during the fiscal year ended December 31, 2020:
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Name
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Cash Compensation
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Option Awards 1
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Total
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Theodore Botts 2
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$
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50,000
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$
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208,418
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$
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258,418
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Brett Ratner
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—
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208,418
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208,418
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Daniel Stein
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—
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208,418
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208,418
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Elizabeth Xu
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—
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138,945
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138,945
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Note: The Option Awards column in the table above reflects the aggregate grant date fair value of the respective awards granted. For a discussion of the assumptions and methodologies used to calculate these amounts, please see Note 2 and Note 14 in the Notes to Consolidated Financial Statements included in Item 8 in the Original Filing.
1.On July 27, 2020, under the 2017 Incentive Plan, we granted to each non-employee director serving on our Board options to purchase shares of our common stock at an exercise price of $1.37 in compensation for their service on our Board. Under the July 27, 2020 grant, each of Messrs. Botts, Stein and Ratner received an option to purchase 225,000 shares of our common stock, and Dr. Xu received an option to purchase 150,000 shares of our common stock. Half of the awards vested on July 27, 2020 (the grant date), and one-fourth vested on each of September 30, 2020 and December 31, 2020 provided, however, that the options are not exercisable unless and until the Company's stockholders have approved an amendment to the Company's Amended and Restated Certificate of Incorporation to increase the number of authorized shares of the Company's common
stock in an amount sufficient to allow for the exercise of the options and the Company has filed a corresponding Certificate of Amendment to its Amended and Restated Certificate of Incorporation reflecting such increase in the number of authorized shares of common stock.
2.For serving as the Chairman of the Audit Committee of our Board, we paid cash of $50,000 to Mr. Botts.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
Security Ownership of Certain Beneficial Owners and Management
The following table presents information with respect to the beneficial ownership of our common stock as of April 27, 2021, by:
•each person, or group of affiliated persons, known to us to beneficially own more than 5% of the outstanding common stock;
•each of our directors and NEOs; and
•all of our directors and executive officers as a group.
The amounts and percentages of beneficially-owned common stock are reported based upon SEC rules governing the determination of beneficial ownership of securities. The SEC rules:
•deem a person a “beneficial owner” of a security if that person has or shares voting power, which includes the power to vote or direct the voting of a security, or if that person has or shares investment power, which includes the power to dispose of or to direct the disposition of a security;
•deem a person a beneficial owner of any securities of which that person has a right to acquire beneficial ownership within 60 days, and securities that can be so acquired are deemed to be outstanding for purposes of computing such person’s ownership percentage, but not for purposes of computing any other person’s ownership percentage; and
•may deem more than one person a beneficial owner of the same securities, and may deem a person a beneficial owner of securities as to which such person has no economic interest.
Except as otherwise indicated in these footnotes, each of the beneficial owners listed has, to our knowledge, sole voting and investment power with respect to the indicated shares of common stock. The information relating to our 5% beneficial owners is based on information we received from such holders. The percentage of beneficial ownership is based on 99,916,941 shares of common stock outstanding as of April 27, 2021.
Except as otherwise noted below, the address of persons listed in the following table is:
c/o Remark Holdings, Inc.
800 S Commerce St
Las Vegas, Nevada 89106
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Number of Common Stock Shares
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Percentage of Outstanding Common Stock Shares
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Persons known to beneficially own more than 5%
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Lawrence Rosen 1
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5,418,616
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5.4
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%
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Digipac LLC 2
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5,246,314
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5.3
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%
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Directors and NEOs
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Kai-Shing Tao 3
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10,200,634
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9.8
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%
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Theodore Botts 4
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519,184
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*
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Brett Ratner 5
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350,000
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*
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Daniel Stein 5
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300,000
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*
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Elizabeth Xu 5
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150,000
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*
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All executive officers and directors as a group (5 persons) 6
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11,519,818
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10.9
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%
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* Represents holdings of less than 1% of shares outstanding.
1.Consists of shares of common stock. The address of Mr. Rosen is 1578 Sussex Turnpike (Bldg. 5), Randolph, NJ 07869. This disclosure is based on information contained in a Schedule 13G/A filed by Mr. Rosen with the SEC on February 22, 2021.
2.Consists of shares of common stock. Mr. Tao, as the manager and a member of Digipac, LLC (“Digipac”), may be deemed to beneficially own the shares of common stock beneficially owned by Digipac. Mr. Tao disclaims beneficial ownership of such shares, except to the extent of his pecuniary interest therein. The address of Digipac is One Hughes Center Drive, Unit 1601, Las Vegas, Nevada 89169.
3.Consists of (i) 234,749 shares of common stock held by Mr. Tao, (ii) 4,422,750 shares of common stock issuable upon exercise of options held by Mr. Tao, (iii) 5,246,314 shares of common stock held by Digipac, (iv) 275,000 shares of common stock held by Pacific Star Capital and (v) 21,821 shares of common stock held by Pacific Star HSW LLC (“Pacific Star HSW”). Mr. Tao, as the manager and a member of Digipac, the Chief Investment Officer and sole owner of Pacific Star Capital, and the control person of Pacific Star HSW, may be deemed to beneficially own the shares of common stock beneficially owned by Digipac, Pacific Star Capital and Pacific Star HSW. Mr. Tao disclaims beneficial ownership of the shares of common stock beneficially owned by Digipac and Pacific Star HSW, except to the extent of his pecuniary interest therein.
4.Includes 477,857 shares of common stock issuable upon exercise of options.
5.Consists of shares of common stock issuable upon exercise of options.
6.Consists of 5,819,211 shares of common stock and 5,700,607 shares of common stock issuable upon exercise of options.
Securities Authorized for Issuance Under Equity Compensation Plans
We incorporate the required information regarding securities authorized for issuance under equity compensation plans by reference to the subsection entitled Securities Authorized for Issuance Under Equity Compensation Plans in Part III, Item 12 of the Original Filing.