Item 5.02 – Departure
of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
(c)
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Executive
Officer Appointments.
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Executive Chairperson Appointment.
On May 24, 2021, Riot Blockchain,
Inc. (“Riot,” “we,” “us,” “our,” or the “Corporation”)
announced the appointment of Mr. Benjamin Yi, currently serving as a member of the Corporation’s Board of Directors (the “Board”),
to serve as the Corporation’s Executive Chairperson, effective on the same date. In connection with his appointment as the Corporation’s
Executive Chairperson, Mr. Yi resigned, effective as of May 24, 2021, as a member of the Board’s Governance and Nominating Committee,
and as a member and the chairperson of the Board’s Compensation and Human Resources Committee and Audit Committee. However, Mr.
Yi will continue to serve on Riot’s Board as a non-independent executive director, without compensation.
Mr. Yi, 39, has served as
a director of the Corporation since October 2018 and as its Chairperson since November 2020. Mr. Yi brings significant corporate governance
experience to Riot, having served as an independent director and audit committee chair of several private and public companies. He also
brings over fifteen (15) years of unique capital markets experience to the Company, and a particular expertise in fintech, specialty finance,
and investing throughout a company’s capital structure. Prior to his appointment, Mr. Yi served as Head of Capital Markets at IOU
Financial Inc., an industry leader in online lending to small businesses across North America, where he specializes in capital markets
and corporate development. Previously, he served as Vice President of Corporate Development and Strategy at Dundee 360 Real Estate Corporation,
a real estate development and services subsidiary of Dundee Corporation, from September of 2015 to September of 2016. Prior to Dundee
360, Mr. Yi served in various progressively senior roles, including as an investment analyst at Dundee Corporation, from April of 2010
to August of 2015, and as senior analyst for product development and analytics at the predecessor to 1832 Asset Management L.P., the Canadian
subsidiary of Scotiabank, from July of 2006 to April of 2010.
In addition to his executive
and financial experience, Mr. Yi has substantial corporate governance experience: Mr. Yi served as an Independent Director and Chairperson
of the Corporate Governance and Remuneration Committee of PetroMaroc Corporation, plc, a UK-based energy company, from December 2013 to
December of 2016; as a member of the Board of Managers and Audit Committee of Android Industries, LLC, an Auburn Hills, Michigan-based
assembler of complex modules for the automotive industry, from January of 2014 to September of 2016; and, from October of 2013 to September
of 2015, as Independent Director and member (and occasional Chairperson) of the Audit Committee of Woulfe Mining Corporation, a publicly-traded
Vancouver-based mining company.
In connection with his appointment
as Executive Chairperson, Mr. Yi and the Corporation entered into an Executive Employment Agreement, dated as of May 24, 2021 (the “Yi
Employment Agreement”), pursuant to which Mr. Yi has agreed to serve as the Corporation’s Executive Chairperson for a
three- (3)-year term, which renews for successive one- (1)-year terms after the expiration of the initial term. As Executive Chairperson,
Mr. Yi will receive a prorated annual salary of $240,000, and 10 Bitcoin. Pursuant to the Yi Employment Agreement, Mr. Yi was also granted
an equity award of 15,000 restricted stock units (“RSUs”) under and pursuant to the Riot Blockchain, Inc. 2019 Equity
Incentive Plan, as amended (the “Plan”), which RSUs are eligible to vest in four (4) equal quarterly installments following
his appointment as Executive Chairperson.
The foregoing description
of the Yi Employment Agreement does not purport to be complete and is qualified in its entirety by reference to the complete text of the
Yi Employment Agreement, filed as Exhibit 10.1 to this Current Report on Form 8-K (this “Current Report”) and incorporated
by reference herein.
Other than the Yi Employment
Agreement, there is no arrangement or understanding between Mr. Yi and any other person pursuant to which Mr. Yi was appointed as Executive
Chairperson. There are no family relationships, as defined in Item 401 of Regulation S-K, between Mr. Yi and any of the Corporation’s
executive officers or directors or persons nominated or chosen to become a director or executive officer. There are no transactions in
which Mr. Yi has an interest requiring disclosure under Item 404(a) of Regulation S-K.
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(d)
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Election of Directors.
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Expansion
of the Board.
Effective as of May 24, 2021,
the Board, pursuant to its authority under the Corporation’s bylaws to fix the number of authorized directors on the Board from
time to time, unanimously approved the addition of one (1) additional seat on the Board and thereby to fix the number authorized directors
on the Board at five (5), at least three (3) of whom must qualify as “independent directors” under applicable NASDAQ listing
standards and Securities and Exchange Commission rules.
Election
of New Director.
Effective as of May 24, 2021,
to fill the vacancy created by the Board expansion, the Board unanimously approve the election and appointment of Mr. Lance D’Ambrosio
to the Board as an independent director, to serve until the 2021 annual meeting of Riot’s shareholders.
Mr. D’Ambrosio, 64, has
over thirty (30) years’ experience as a corporate officer and director, with experience in corporate governance, capital raising,
financial analysis, mergers and acquisitions, and complex international structuring. Mr. D’Ambrosio currently serves as the Managing
Partner of 4 D Investments, a company which focuses on technology and real estate investments. Prior to 4 D Investments, Mr. D’Ambrosio
served as the chairperson and chief executive officer of Crystal Peak Minerals, a Canadian public company focused on precious metals mining,
from 2010 to 2018. As a corporate executive, Mr. D'Ambrosio has guided both public and private companies through mergers and acquisitions,
capital raising campaigns, and other related transactions. He also has significant experience as entrepreneur, having founded and several
companies spanning a broad spectrum of industries, including the telecommunications, materials, and automotive sectors. Mr. D’Ambrosio
has been recognized as a recipient of the Ernst & Young and Merrill Lynch Entrepreneur of the Year Award in the category of e-Software
& Services, and he graduated from the University of Utah in 1979 as a member of the Dean’s Honor List with a Bachelor of Science
in Marketing and in Management.
Mr. D’Ambrosio will
receive cash and equity compensation in accordance with policies and procedures set by the Compensation and Human Resources Committee
for nonemployee directors of the Company, as reported by the Company on its periodic reports and in its proxy statements to its shareholders,
as may be adjusted by the Compensation and Human Resources Committee from time to time.
There is no arrangement or
understanding between Mr. D’Ambrosio and any other person pursuant to which Mr. D’Ambrosio was appointed as a director. There
are no family relationships, as defined in Item 401 of Regulation S-K, between Mr. D’Ambrosio and any of the Corporation’s
executive officers or directors or persons nominated or chosen to become a director or executive officer. There are no transactions in
which Mr. D’Ambrosio has an interest requiring disclosure under Item 404(a) of Regulation S-K. The Audit Committee has determined
Mr. D’Ambrosio qualifies as an “independent director” within the meaning of applicable NASDAQ listing standards and
Securities and Exchange Commission rules, including the expanded director independence requirements applicable to members of the Audit
Committee.
Committee
Appointments.
In connection with Mr. Yi’s
resignation from his positions on the Board’s three (3) standing committees upon his appointment as the Corporation’s Executive
Chairperson, the Board unanimously voted to appoint Mr. D’Ambrosio, effective as of May 24, 2021 to serve as a member of the Board’s
Governance and Nominating Committee, Compensation and Human Resources Committee, and as a member and chairperson of its Audit Committee.
The Board also unanimously voted to elect Ms. Hannah Cho to serve as chairperson of the Compensation and Human Resources Committee.
Each of Ms. Cho and Mr. D’Ambrosio
will receive cash and equity compensation in accordance with policies and procedures set by the Compensation and Human Resources Committee
for nonemployee directors of the Corporation, as reported by the Corporation on its periodic reports and in its proxy statements to its
shareholders, as may be adjusted from time to time.