UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
SCHEDULE
14A
(RULE
14a-101)
SCHEDULE
14A INFORMATION
PROXY
STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed
by the Registrant
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[X]
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Filed
by a Party other than the Registrant
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Check
the appropriate box:
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[X]
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Preliminary
Proxy Statement
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Confidential,
For Use of the Commission Only (as Permitted by Rule 14a-6(e)(2))
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Definitive
Proxy Statement
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Definitive
Additional Materials
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Soliciting
Material under §240.14a-12
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VISLINK
TECHNOLOGIES, INC.
(Name
of Registrant as Specified In Its Charter)
(Name
of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment
of Filing Fee (Check the appropriate box):
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[X]
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No
fee required
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Fee
computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11
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(1)
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Title
of each class of securities to which transaction applies:
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(2)
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Aggregate
number of securities to which transaction applies:
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(3)
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Per
unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
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(4)
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Proposed
maximum aggregate value of transaction:
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(5)
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Total
fee paid:
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Fee
paid previously with preliminary materials.
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Check
box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date
of its filing.
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(1)
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Amount
Previously Paid:
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(2)
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Form,
Schedule or Registration Statement No.:
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(3)
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Filing
Party:
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(4)
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Date
Filed:
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1515
Ringling Blvd., Suite 310
Sarasota,
FL 34236
(941)
953-9035
Important
Notice Regarding the Availability of Proxy Materials
for
the Annual Meeting of Stockholders to Be Held on April 17, 2020
The
Notice of Annual Meeting and Proxy Statement
are
available at: https://www.cstproxy.com/vislink/2019
NOTICE
OF ANNUAL MEETING OF STOCKHOLDERS
TO
BE HELD ON APRIL 17, 2020
To
the Stockholders of Vislink Technologies, Inc.:
NOTICE
IS HEREBY GIVEN that an Annual Meeting of Stockholders (the “Annual Meeting”) of Vislink Technologies, Inc., a
Delaware corporation (the “Company”, “we”, “us” and “our”), will be held on April
17, 2020 at 9:00 a.m. (Eastern Time) at the Company’s offices at 101 Bilby Road, Suite 15, Building 2, Hackettstown, NJ
07840, for the following purposes:
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1.
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To
elect five (5) members of the Company’s Board of Directors (the “Board”), each to serve until the next Annual
Meeting of Stockholders and until their successors are elected and qualified or until their earlier resignation or removal
(“Proposal No. 1”).
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2.
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To
consider and vote on a proposal to ratify the Board’s selection of Marcum LLP as the Company’s independent registered
public accountants for the fiscal year ending December 31, 2020 (“Proposal No. 2”).
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3.
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To
approve an amendment to the Company’s Certificate of Incorporation, as amended (the “Certificate of Incorporation”),
to effect a reverse stock split of all of the outstanding shares of the Company’s common stock, par value $0.00001 per
share (the “Common Stock”) at a specific ratio within a range from one-for-___ to one-for-___, and to grant authorization
to the Company’s board of directors to determine, in its sole discretion, the specific ratio and timing of the reverse
stock split any time before October 11, 2020 (“Proposal No. 3”).
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The
foregoing items of business are more fully described in the Proxy Statement that is attached and made a part of this Notice (the
“Proxy Statement”). Only stockholders of record of our Common Stock at the close of business on February 20, 2020
(the “Record Date”), will be entitled to notice of, and to vote at, the Annual Meeting or any adjournment thereof.
All
of our stockholders are cordially invited to attend the Annual Meeting in person. Your vote is important regardless of the number
of shares that you own. Only record or beneficial owners of our Common Stock as of the Record Date may attend the Annual Meeting
in person. When you arrive at the Annual Meeting, you must present photo identification, such as a driver’s license. Beneficial
owners also must provide evidence of Common Stock holdings as of the Record Date, such as a recent brokerage account or bank statement.
Whether
or not you expect to attend the Annual Meeting, please complete, sign, date, and return the enclosed proxy card in the enclosed
postage-paid envelope in order to ensure representation of your shares of Common Stock. It will help in our preparations for the
meeting if you would check the box on the form of proxy card if you plan on attending the Annual Meeting. Your proxy is revocable
in accordance with the procedures set forth in the Proxy Statement.
Sarasota,
Florida
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By
Order of the Board of Directors,
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March
___, 2020
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/s/
Susan Swenson
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Name:
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Susan
Swenson
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Title:
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Chairman
of the Board of Directors
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WHETHER
OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE PROMPTLY COMPLETE, SIGN, DATE AND RETURN THE ENCLOSED PROXY CARD IN THE ACCOMPANYING
ENVELOPE. NO POSTAGE NEED BE AFFIXED IF THE PROXY CARD IS MAILED IN THE UNITED STATES.
TABLE
OF CONTENTS
PROXY
STATEMENT FOR ANNUAL MEETING OF STOCKHOLDERS
In
this Proxy Statement, Vislink Technologies, Inc., a Delaware corporation, is referred to as the “Company,” “we,”
“us” and “our.”
Information
Concerning the Proxy Materials and the Annual Meeting
Proxies
in the form enclosed with this Proxy Statement are being solicited by our board of directors (the “Board”) for use
at our Annual Meeting of Stockholders (the “Annual Meeting”) to be held at 9:00 a.m. (Eastern Time) on April 17, 2020,
at the Company’s offices at 101 Bilby Road, Suite 15, Building 2, Hackettstown, NJ 07840, and at any adjournment thereof.
Your vote is very important. For this reason, our Board is requesting that you permit your common stock, par value $0.00001 per
share, of the Company (the “Common Stock”), to be represented at the Annual Meeting by the proxies named on the enclosed
proxy card. This Proxy Statement contains important information for you to consider when deciding how to vote on the matters brought
before the meeting. Please read it carefully.
Voting
materials, which include this Proxy Statement and the enclosed proxy card, will be first mailed to stockholders on or about April
___, 2019.
Only
stockholders of record as of the close of business on February 20, 2020, (the “Record Date”) of our Common Stock will
be entitled to notice of, and to vote at, the Annual Meeting. As of February 20, 2020, 53,141,462 shares of Common Stock were
issued and outstanding. Holders of Common Stock are entitled to one vote per share held by them. Stockholders may vote in person
or by proxy, however, granting a proxy does not in any way affect a stockholder’s right to attend the Annual Meeting and
vote in person. Any stockholder giving a proxy has the right to revoke that proxy by (i) filing a later-dated proxy or a written
notice of revocation with us at our principal office at any time before the original proxy is exercised or (ii) attending the
Annual Meeting and voting in person.
Carleton
M. Miller and Susan Swenson are named as attorneys-in-fact in the proxy. Mr. Miller is our Chief Executive Officer. Ms. Swenson
is our Chairman of the Board of Directors. Mr. Miller or Ms. Swenson will vote all shares of Common Stock represented by properly
executed proxies returned in time to be counted at the Annual Meeting, as described below under “Voting Procedures”.
Where a vote has been specified in the Proxy Statement with respect to the matters identified in the notice of the Annual Meeting,
the shares of Common Stock represented by the proxy will be voted in accordance with those voting specifications. If no voting
instructions are indicated, your shares of Common Stock will be voted as recommended by our Board of Directors on all matters,
and as the proxy holders may determine in their discretion with respect to any other matters properly presented for a vote before
the Annual Meeting.
Our
stockholders will consider and vote upon (i) a proposal to elect five (5) members of the Board, each to serve until the 2021 Annual
Meeting of Stockholders and until their successors are elected and qualified or until their earlier resignation or removal (“Proposal
No. 1”); (ii) a proposal to ratify the Board’s selection of Marcum LLP as our independent registered public accountants
for the fiscal year ending December 31, 2020 (“Proposal No. 2”); and (iii) a proposal to approve an amendment to the
Company’s Certificate of Incorporation, as amended (the “Certificate of Incorporation”), to effect a reverse
stock split of all of our outstanding shares of Common Stock at a specific ratio within a range from one-for-___ to one-for-___
(the “Reverse Stock Split”), to grant authorization to the Board to determine, in its sole discretion, the specific
ratio and timing of the reverse stock split any time before October 11, 2020 (“Proposal No. 3”). Stockholders also
will consider and act upon such other business as may properly come before the Annual Meeting.
Voting
Procedures and Vote Required
Mr.
Miller and/or Ms. Swenson will vote all shares of Common Stock represented by properly executed proxies returned in time to be
counted at the Annual Meeting. The presence, in person or by proxy, of at least one-third (1/3) of the issued and outstanding
shares of Common Stock entitled to vote at the Annual Meeting is necessary to establish a quorum for the transaction of business.
Shares of Common Stock represented by proxies which contain an abstention, as well as “broker non-vote” shares of
Common Stock (described below) are counted as present for purposes of determining the presence or absence of a quorum for the
Annual Meeting, but will not be counted in favor of any of the proposal in the Proxy Statement. Accordingly, an abstention with
respect to any proposal in this Proxy Statement will have the same effect as a vote “AGAINST” such proposal.
All
properly executed proxies delivered pursuant to this solicitation and not revoked will be voted at the Annual Meeting as specified
in such proxies.
Vote
Required for Election of Directors (Proposal No. 1). Our Certificate of Incorporation does not authorize cumulative voting.
Our amended and restated by-laws (our “By-laws”) provide that directors are to be elected by a plurality of the votes
of the shares of Common Stock present in person or represented by proxy at the Annual Meeting and entitled to vote on the election
of directors. This means that the five (5) candidates receiving the highest number of affirmative votes at the Annual Meeting
will be elected as directors. Only shares of Common Stock that are voted in favor of a particular nominee will be counted toward
that nominee’s achievement of a plurality. Shares of Common Stock present at the Annual Meeting that are not voted for a
particular nominee or shares of Common Stock present by proxy where the stockholder properly withheld authority to vote for such
nominee will not be counted toward that nominee’s achievement of a plurality.
Vote
Required for Ratification of Independent Registered Public Accountants (Proposal No. 2). Our By-laws provide that, on all
matters (other than the election of directors and except to the extent otherwise required by our Certificate of Incorporation
or applicable Delaware law), the affirmative vote of a majority of the shares of Common Stock outstanding and entitled to vote
on the matter will be required for approval. Accordingly, the affirmative vote of a majority of the shares of Common Stock outstanding
on the Record Date and entitled to vote on the matter will be required to the Board’s selection of Marcum LLP as our independent
registered public accountants for the fiscal year ending December 31, 2020.
Vote
Required for the Reverse Stock Split (Proposal No. 3). Delaware law provides that the affirmative vote of the holders of a
majority of our Common Stock is required to approve the amendment to our Certificate of Incorporation to give effect to the Reverse
Stock Split. Accordingly, the affirmative vote of the holders of a majority of our Common Stock will be required to approve the
Reverse Stock Split.
With
respect to “routine” matters, a bank, brokerage firm, or other nominee has the authority (but is not required) under
the rules governing self-regulatory organizations (“SRO Rules”), including the NYSE, to vote its clients’ shares
if the clients do not provide instructions. When a bank, brokerage firm, or other nominee votes its clients’ shares on routine
matters without receiving voting instructions, these shares are counted both for establishing a quorum to conduct business at
the meeting and in determining the number of shares voted FOR, AGAINST or ABSTAINING with respect to such routine matters. Proposal
No. 2 and Proposal No. 3 are considered “routine” matters.
With
respect to “non-routine” matters, a bank, brokerage firm, or other nominee is not permitted under the SRO Rules to
vote its clients’ shares if the clients do not provide instructions. The bank, brokerage firm, or other nominee will so
note on the voting instruction form, and this constitutes a “broker non-vote.” “Broker non-votes” will
be counted for purposes of establishing a quorum to conduct business at the meeting, but not for determining the number of shares
voted FOR, AGAINST, ABSTAINING or WITHHELD FROM with respect to such non-routine matters. Proposal No. 1 is considered a “non-routine”
matter.
Abstentions
are counted as “shares present” at the Annual Meeting for purposes of determining the presence of a quorum but are
not counted in the calculation of the vote.
Votes
at the meeting will be tabulated by one or more inspectors of election appointed by the Company’s Chief Executive Officer.
Our
stockholders will not be entitled to dissenter’s rights with respect to any matter to be considered at the Annual Meeting.
Delivery
of Documents to Security Holders Sharing an Address
We
will send only one set of Annual Meeting materials and other corporate mailings to our stockholders who share a single address
unless we received contrary instructions from any stockholder at that address. This practice, known as “householding”,
is designed to reduce our printing and postage costs. However, we will deliver promptly upon written or oral request a separate
copy of the Annual Meeting materials to a stockholder at a shared address to which a single copy of the Annual Meeting materials
was delivered. You may make such a written or oral request by (a) sending a written notification stating (i) your name, (ii) your
shared address and (iii) the address to which we should direct the additional copy of the Annual Meeting materials, to the Company’s
Secretary at 1515 Ringling Blvd., Suite 310, Sarasota, FL 34236, telephone: (941) 953-9035.
If
multiple stockholders sharing an address have received one copy of the Annual Meeting materials or any other corporate mailing
and would prefer that we mail each stockholder a separate copy of future mailings, you may send notification to or call our principal
executive offices. Additionally, if current stockholders with a shared address received multiple copies of the Annual Meeting
materials or other corporate mailings and would prefer that we mail one copy of future mailings to stockholders at the shared
address, notification of such request may also be made by mail or telephone to our principal executive offices.
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The
following table sets forth, as of February 20, 2020, information regarding beneficial ownership of our capital stock by:
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each
person, or group of affiliated persons, known by us to beneficially own more than 5% of our common stock;
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each
of our named executive officers;
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each
of our directors; and
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all
of our current executive officers and directors as a group.
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Beneficial
ownership is determined according to the rules of the U.S. Securities and Exchange Commission (the “SEC’) and generally
means that a person has beneficial ownership of a security if he, she or it possesses sole or shared voting or investment power
of that security, including options that are currently exercisable or exercisable within sixty (60) days of February 20, 2020.
Except as indicated by the footnotes below, we believe, based on the information furnished to us, that the persons named in the
table below have sole voting and investment power with respect to all shares of common stock shown that they beneficially own,
subject to community property laws where applicable.
Common
Stock subject to stock options currently exercisable or exercisable within sixty (60) days of February 20, 2020, are deemed to
be outstanding for computing the percentage ownership of the person holding these options and the percentage ownership of any
group of which the holder is a member but are not deemed outstanding for computing the percentage of any other person.
Unless
otherwise indicated, the address of each beneficial owner listed in the table below is c/o Vislink Technologies, Inc., 1515 Ringling
Blvd., Suite 310 Sarasota, FL 34236.
Name and Address of Beneficial Owner:
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Amount and
Nature of
Beneficial
Ownership
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Percent
of Class of
Common Stock(1)
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5% Stockholders:
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Iroquois Capital Management, LLC(2)
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9,894,112
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9.99
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Named Executive Officers and Directors:
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George F. Schmitt(3)
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89,707
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*
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Roger G. Branton(4)
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23,537
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*
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Jude T. Panetta
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—
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—
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Richard L. Mooers(5)
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44,524
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*
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Ralph Faison
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—
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—
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General James T. Conway(6)
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14,803
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*
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Susan Swenson
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7,031
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*
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Carleton M. Miller(7)
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—
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—
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Brian K. Krolicki(8)
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—
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—
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All Executive Officers and Directors as a Group (9 Persons) (9):
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179,602
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*
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*
Less than 1%
(1)
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Based
on 53,141,462 shares of Common Stock issued and outstanding as of February 20, 2020. Shares of Common Stock subject to options
or warrants currently exercisable or exercisable within sixty (60) days of February 20, 2020, are deemed outstanding for purposes
of computing the percentage of the person holding such options or warrants, but are not deemed outstanding for purposes of
computing the percentage of any other person.
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(2)
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Based
upon information provided in a Schedule 13G filed with the SEC on February 19, 2020. Iroquois Capital Management, LLC reported
that (a) Iroquois Master Fund Ltd. held 5,300,719 shares of Common Stock and warrants to purchase 4,547,311 shares of Common
Stock, and (b) Iroquois Capital Investment Group LLC held warrants to purchase 46,082 shares of Common Stock (collectively,
“Iroquois”). Pursuant to the terms of such warrants, Iroquois cannot exercise such warrants to the extent Iroquois
would beneficially own, after any such exercise, more than 9.99% of the outstanding shares of Common Stock (other than certain
warrants which are subject to a 4.99% blocker), and the percentage set forth in the table gives effect to such blockers and
is based on 40,680,508 shares of Common Stock issued and outstanding as of January 31, 2020, as represented in the Company’s
Registration Statement on Form S-1 filed with the SEC on February 3, 2020, and assumes the exercise of such warrants. The
principal business office of Iroquois is 125 Park Avenue, 25th Floor, New York, NY 10017.
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(3)
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Includes
(a) 10,000 shares of Common Stock underlying options that are presently exercisable and held directly by Mr. Schmitt, and
(b) 15,954 shares of Common Stock beneficially owned through MB Technology Holdings, LLC (“MBTH”), an entity in
which Mr. Schmitt has a direct 79.22% ownership interest. Mr. Schmitt will not stand for re-election as a director at the
Annual Meeting and will no longer serve as a director after the Annual Meeting.
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(4)
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Includes
(a) 13,535 shares of Common Stock beneficially owned through Branton Partners, LLC, of which various family entities, including
Mr. Branton’s spouse, children and trusts for the benefit of Mr. Branton’s children, beneficially own 100%, (b)
10,000 shares of Common Stock underlying options that are presently exercisable and held directly by Mr. Branton, and (c)
two (2) shares of Common Stock beneficially owned through Mooers Branton and Company (“MBC”), of which Mr. Branton
is a 20% owner. Mr. Branton will not stand for re-election as a director at the Annual Meeting and will no longer serve as
a director after the Annual Meeting.
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(5)
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Includes
5,000 shares of Common Stock underlying options that are presently exercisable and held directly by Mr. Mooers. Mr. Mooers’
family entities and trusts for the benefit of his wife and his wife’s children hold 80% of the share capital of MBC.
MBC directly owns two (2) shares of Common Stock. Mr. Mooers will not stand for re-election as a director at the Annual Meeting
and will no longer serve as a director after the Annual Meeting.
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(6)
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Includes
5,000 shares of Common Stock underlying options that are presently exercisable and held directly by General Conway.
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(7)
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Excludes
(a) performance-vested options to purchase 1,500,000 shares of Common Stock outside of the Company’s existing equity compensation
plans, which vest in three equal tranches of 500,000 shares upon the Company’s attainment, on or before the fifth anniversary
of such date, of specified cumulative EBITDA performance conditions, subject in each case to Mr. Miller’s continued employment
with the Company on the applicable vesting date, and (b) time-vested options to purchase 2,155,481 shares of Common Stock outside
of the Company’s existing equity compensation plans, 25% of which vest on January 22, 2021 and the remaining 75% of which
vest in substantially equal monthly installments over the 36-month period following such date, subject to Mr. Miller’s continued
employment with the Company on the applicable vesting date.
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(8)
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Mr.
Krolicki will not stand for re-election as a director at the Annual Meeting and will no longer serve as a director after the
Annual Meeting.
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(9)
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Does
not include Michael Bond who is expected to become the Company’s Chief Financial Officer on April 1, 2020.
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ELECTION
OF DIRECTORS
(Proposal
No. 1)
The
following individuals have been nominated as members of our Board, each to serve until the 2021 Annual Meeting, until their successors
are elected and qualified or until their earlier resignation or removal. Pursuant to Delaware law and our By-laws, directors are
to be elected by a plurality of the votes of the shares of Common Stock present in person or represented by proxy at the Annual
Meeting and entitled to vote on the election of directors.
This
means that the five (5) candidates receiving the highest number of affirmative votes at the Annual Meeting will be elected as
directors. Only shares of Common Stock that are voted in favor of a particular nominee will be counted toward that nominee’s
achievement of a plurality. Shares of Common Stock present at the Annual Meeting that are not voted for a particular nominee or
shares of Common Stock present by proxy where the stockholder properly withheld authority to vote for such nominee will not be
counted toward that nominee’s achievement of a plurality.
Information
about each nominee, including biographical data for at least the last five (5) years, follows. Should one or more of these nominees
become unavailable to accept nomination or election as a director, the individuals named as proxies on the enclosed proxy card
will vote the shares of Common Stock that they represent for the election of such other persons as the Board may recommend, unless
the Board reduces the number of directors. We have no reason to believe that any nominee will be unable or unwilling to serve
if elected as a director.
Name
of Director
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Age
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Director
Since
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Carleton
M. Miller
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56
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January
15, 2020
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Susan
Swenson
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71
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October
31, 2018
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General
James T. Conway
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71
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January
6, 2015
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Jude
T. Panetta
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60
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May
1, 2019
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Ralph
Faison
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61
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January
1, 2020
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Carleton
M. Miller, Chief Executive Officer, President and Director
Mr.
Miller’s appointment to the roles of Chief Executive Officer of the Company and a member of the Board became effective on
January 15, 2020. Mr. Miller has been appointed to the role of President of the Company, effective March 19, 2020. Mr. Miller
is performing the services and duties that are normally and customarily associated with the Chief Executive Officer and President
positions, as well as other duties as the Board reasonably determines. From 2010 to 2016, Mr. Miller was a co-founder, chief executive
officer, president and a member of the board of directors of BLiNQ Networks, Inc. (“BLiNQ”), an innovator of wireless
connectivity solutions for the communications market. Mr. Miller launched BLiNQ with a vision to create a new market category
for mobile operators to build scalable high-density wireless broadband networks. He raised approximately $35 million from venture
capital and individual investors over three accretive rounds. Mr. Miller sold BLiNQ to Communications Components, Inc. in November
2016.
Mr.
Miller received his B.S. in industrial engineering from the University of Missouri in 1985, his M.B.A. in finance and marketing
from Rockhurst College in 1989, and completed the corporate finance program at the London Business School in 1995.
Susan
Swenson, Executive Chairman of the Board
Ms.
Swenson’s appointment to Executive Chairman of the Board became effective on October 31, 2018. Ms. Swenson has several decades
of operating experience in wireless telecom, video technologies and digital media, as well as telematics and small business software.
Ms. Swenson currently serves on the board of Harmonic, Inc. and chairs the Governance and Nominating Committee. Harmonic, Inc.
is the worldwide leader in video delivery technology and services enabling media companies and service providers to deliver ultra-high-quality
broadcast and OTT video services to consumers globally.
From
August 2012 to August 2018 Ms. Swenson served on the board of the First Responder Network Authority and chaired the board from
2014 to 2018. This independent authority within NTIA/Department of Commerce established a single nationwide public safety broadband
network enabling first responders to have voice and data communications across all 56 states, territories and commonwealths.
From
October 2015 to June 2017, Ms. Swenson served as Chair and Chief Executive Officer of Inseego Corp. (previously Novatel Wireless,
Inc), a wireless internet solutions and telematics provider, and served as the board chair from April 2014 to June 2017 after
joining the board in 2012. From March 2008 to April 2011, Ms. Swenson served as President and Chief Executive Officer of Sage
Software-North America, a division of The Sage Group PLC, a global supplier of business management software and services.
From
August 2007 to March 2008, she was Chief Operating Officer at Atrinsic, Inc. a digital content company. Prior to joining Atrinsic,
Inc., she served as Chief Operating Officer of Amp’d Mobile, Inc, a mobile virtual network start-up, from 2006 to 2007.
Ms. Swenson was the President and Chief Operating Officer of T-Mobile USA from 2004 to 2005 and of Leap Wireless International,
Inc. from 1999 to 2004. She served as the President and Chief Executive Officer of Cellular One from 1994 to 1999. From 1979 to
1994 she served in various management capacities at Pacific Bell, ultimately serving as President and Chief Operating Officer
of PacTel Cellular and Vice President, Pacific Bell - Northern California Business Unit. Ms. Swenson holds a B.A. in French from
San Diego State University.
Mr.
Swenson was selected to serve on our Board based on her extensive experience with technology and networking companies and broad
experience in the telecommunications industry.
General
James T. Conway, Director
General
Conway retired from active military duty in 2010. Since retiring, General Conway has consulted for several corporate and non-profit
boards, including Textron Inc., Colt Defense and General Dynamics. General Conway also co-chairs the Energy Security Leadership
Council, a non-partisan energy policy think tank. Prior to his retirement, General Conway served as the 34th Commandant of the
U.S. Marine Corps for four years. Prior to becoming Commandant, General Conway served for four years on the Joint Chiefs of Staff
as Senior Operations Officer in the U.S. military, where he oversaw the war efforts in Iraq and Afghanistan. As a member of the
Joint Chiefs of Staff, General Conway functioned as a military advisor to the Secretary of Defense, the National Security Council,
and the President.
General
Conway was selected to serve on our Board based on his significant experience assessing and implementing military technology operations.
Jude
T. Panetta, Director
Jude
Panetta was most recently with Hale Capital as an Operating Partner from 2017 to 2019. Prior to Hale Capital, he had a 30 plus
year career leading technology companies in the Telecommunications, Satellite, Wireless and Power Industries. Jude Panetta served
as: Vice President of Strategy and Technology at Comtech TCS; Vice President of Government Systems at TeleCommunication Systems
Inc.; President and Chief Executive Officer of ASC Signal Corporation; Group President of Andrew Corp.; VP of Operations at Celiant
(acquired by Andrew Corp.), VP of Operations at Adtran Corp.; and Director of Operations at Exide Electronics Corporation. During
his career, Jude has held a leading role in over a dozen acquisitions and divestitures. He is a Graduate of GE’s Manufacturing
Management Program and holds a Bachelor of Science (BS) in Mechanical Engineering from the University of Virginia. Jude recently
retired from firefighting. He served as a Lieutenant in the St James, NC Fire Department.
Mr.
Panetta was selected to serve on our Board based on his operating background in the satellite and telecom industries as well as
his broad experience in operations and finance.
Ralph
Faison, Director
Mr.
Faison currently serves as Chairman of Arlo Technologies, Inc., a home automation company that offers a cloud-based platform with
a variety of connected devices. He is also on the boards of the following companies: Wilson Electronics, a global designer and
manufacturer of cellular signal boosters, antennas and related components; and GiGA IO Networks, a privately held startup providing
breakthrough interconnect performance to cluster-based computing.
Mr.
Faison previously served as a director of Amber Road, Inc., a cloud-based global trade management software-as-a-service (SaaS)
provider, Director of Netgear Corp., Executive Chairman of Blinq Networks, Chairman, President & Chief Executive Officer of
Pulse Electronics Corp., President, Chief Executive Officer and Director at Andrew Corp., President, Chief Executive Officer and
director at Celiant Corp., and Vice President—New Ventures Group at Lucent Technologies, Inc. Prior to joining Lucent, Mr.
Faison held various executive positions at AT&T, including Vice President and General Manager of AT&T’s Wireless
Business Unit and manufacturing Vice President for its consumer products unit in Bangkok, Thailand.
Mr.
Faison received an undergraduate degree from Georgia State University and a graduate degree from Stanford University.
Mr.
Faison has extensive experience in leading and managing large international companies. He is well versed in the complex manufacturing
and distribution systems that today’s multinational companies implement. Mr. Faison, as a recent public company chair and
chief executive officer, is able to advise the Company on many aspects of public company governance and management and is qualified
to serve as a member of our Board.
Vote
Required and Recommendation
Our
Certificate of Incorporation does not authorize cumulative voting. Our By-laws provide that 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 the five (5) candidates receiving the highest number of affirmative votes at the Annual Meeting
will be elected as directors. Only shares of Common Stock that are voted in favor of a particular nominee will be counted toward
that nominee’s achievement of a plurality. Shares of Common Stock present at the Annual Meeting that are not voted for a
particular nominee or shares of Common Stock present by proxy where the stockholder properly withheld authority to vote for such
nominee will not be counted toward that nominee’s achievement of a plurality
At
the Annual Meeting a vote will be taken on a proposal to approve the election of the five (5) director nominees.
THE
BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS
A
VOTE FOR THE ELECTION OF THE FIVE (5) DIRECTOR NOMINEES.
CORPORATE
GOVERNANCE
Board
of Directors
The
Board oversees our business affairs and monitors the performance of our management. In accordance with our corporate governance
principles, the Board does not involve itself in day-to-day operations. The directors keep themselves informed through discussions
with the Chief Executive Officer, other key executives and by reading the reports and other materials sent to them and by participating
in Board and committee meetings. Our directors hold office until the next Annual Meeting of Stockholders and until their successors
are elected and qualified or until their earlier resignation or removal, or if for some other reason they are unable to serve
in the capacity of director.
Our
Board currently consists of nine (9) members: Carleton M. Miller, Roger G. Branton; Susan Swenson; Richard L. Mooers; George F.
Schmitt; Jude T. Panetta; General James T. Conway, Ralph Faison and Brian K. Krolicki. All of our directors will serve until our
next Annual Meeting of Stockholders and until their successors are duly elected and qualified, except for Roger G. Branton, Richard
L. Mooers, George F. Schmitt and Brian K. Krolicki, none of whom will stand for re-election as a director. There were no disagreements
between the Company and Mr. Branton, Mr. Mooers, Mr. Schmitt or Brian K. Krolicki.
On
March 10, 2020, the Board voted to move to a five-member Board consisting of four independent directors and one non-independent
director. The Board also adopted the recommendation of the Governance and Nomination Committee to propose a slate consisting of
the following: Susan Swenson, General James T. Conway, Jude T. Panetta, and Ralph Faison as independent, and the company’s
CEO, Carleton M. Miller, as non-independent.
Director
Independence
As
we are listed on the Nasdaq Capital Market, our determination of independence of directors is made using the definition of
“independent director” contained in Rule 5605(a)(2) of the Marketplace Rules of the Nasdaq Stock Market LLC (“Nasdaq”)
(“Nasdaq Rule 5605(a)(2)”). As of the date of this Proxy Statement, our Board affirmatively determined that Susan
Swenson, General James T. Conway, Jude T. Panetta, Ralph Faison and Brian K. Krolicki are “independent directors”
within the meaning of Nasdaq Rule 5605(a)(2). As of the date of this Proxy Statement, we intend the five (5) director nominees,
if all elected, to constitute a majority independent board under Rule 5605(b)(1) of the Marketplace Rules of Nasdaq and as such,
we will be in compliance with the Marketplace Rules of Nasdaq.
Board
Meetings and Attendance
During fiscal year 2019, the Board held twelve
(12) physical and telephonic meetings. No incumbent director attended, either in person or via telephone, fewer than 75% of the
aggregate of all meetings of the Board and the committees of the Board on which such director served during the period the director
was on the Board or committee, other than George F. Schmitt, who attended approximately 67% of such meetings, and Jude
T. Panetta, who attended approximately 73% of such meetings. The Board also approved certain actions by unanimous written
consent.
Annual
Meeting Attendance
The
Company held its 2019 Annual Meeting of Stockholders on April 30, 2019, which was attended by Roger Branton.
Stockholder
Communications with the Board
Stockholders
wishing to communicate with the Board, the non-management directors, or with an individual Board member may do so by writing to
the Board, to the non-management directors, or to the particular Board member, and mailing the correspondence to: c/o Carleton
M. Miller, Vislink Technologies, Inc., 101 Bilby Road, Suite 15, Building 2, Hackettstown, NJ 07840. The envelope should indicate
that it contains a stockholder communication. All such stockholder communications will be forwarded to the director or directors
to whom the communications are addressed.
Board
Committees
Our
Board has an Audit Committee, a Compensation Committee and a Governance and Nomination Committee. Each committee has a charter,
which is attached as an appendix to this Proxy Statement. Each of the board committees has the composition and responsibilities
described below. As of March 10, 2020, the members of these committees are:
Audit
Committee
|
|
Compensation
Committee
|
|
Governance
and Nomination Committee
|
|
|
|
|
|
Susan
Swenson*(1)
|
|
Ralph
Faison*
|
|
General
James T. Conway*
|
|
|
|
|
|
Ralph
Faison
|
|
General
James T. Conway
|
|
Jude
T. Panetta
|
|
|
|
|
|
Brian
K. Krolicki(2)
|
|
Jude
T. Panetta
|
|
|
*Denotes
Chairman of Committee.
(1)
Indicates Audit Committee Financial Expert.
(2)
Mr. Krolicki will no longer serve as a member of the Audit Committee following the Annual Meeting and will be replaced by
the Board.
Audit
Committee
We
have an Audit Committee established in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934, as amended
(the “Exchange Act”). The members of our Audit Committee are Susan Swenson, Ralph Faison and Brian K. Krolicki. Susan
Swenson, Ralph Faison and Brian K. Krolicki are “independent directors” within the meaning of Rule 10A-3 under the
Exchange Act and Nasdaq Rule 5605(a)(2). Susan Swenson serves as chairman of our Audit Committee. The Board has determined that
Susan Swenson is an “audit committee financial expert” as defined under Item 5(a)(ii) and (iii) of Regulation S-K.
The
Audit Committee oversees our accounting and financial reporting processes and oversees the audit of our financial statements and
the effectiveness of our internal control over financial reporting. The specific functions of the Audit Committee include:
●Selecting
and recommending to our Board the appointment of an independent registered public accounting firm and overseeing the engagement
of such firm;
●Approving
the fees to be paid to the independent registered public accounting firm;
●Helping
to ensure the independence of our independent registered public accounting firm;
●Overseeing
the integrity of our financial statements;
●Preparing
an audit committee report as required by the SEC to be included in our annual proxy statement;
●Reviewing
major changes to our auditing and accounting principles and practices as suggested by our Company’s independent registered
public accounting firm, internal auditors (if any) or management;
●Reviewing
and approving all related party transactions; and
●Overseeing
our compliance with legal and regulatory requirements.
In
2019, the Audit Committee held four (4) physical and telephonic meetings, three of which all three (3) members of the then current
Audit Committee were present, and one of which two (2) members of the then current Audit Committee were present.
The
Audit Committee’s charter is attached as Appendix A to this Proxy Statement.
Compensation
Committee
The
members of our Compensation Committee are Ralph Faison, General James T. Conway and Jude T. Panetta. Each member of the Compensation
Committee is “independent” within the meaning of Nasdaq Rule 5605(a)(2). In addition, each member of our Compensation
Committee qualifies as a “non-employee director” under Rule 16b-3 of the Exchange Act. Our Compensation Committee
assists the Board in the discharge of its responsibilities relating to the compensation of the members of the Board and our executive
officers. Ralph Faison serves as Chairman of our Compensation Committee.
The
Compensation Committee’s compensation-related responsibilities include:
●Assisting
our Board in developing and evaluating potential candidates for executive positions and overseeing the development of executive
succession plans;
●Reviewing
and approving on an annual basis the corporate goals and objectives with respect to compensation for our Chief Executive Officer;
●Reviewing,
approving and recommending to our Board on an annual basis the evaluation process and compensation structure for our other executive
officers;
●Providing
oversight of management’s decisions concerning the performance and compensation of other company officers, employees, consultants
and advisors;
●Reviewing
our incentive compensation and other stock-based plans and recommending changes in such plans to our Board as needed, and exercising
all the authority of our Board with respect to the administration of such plans;
●Reviewing
and recommending to our Board the compensation of independent directors, including incentive and equity-based compensation; and
●Selecting,
retaining and terminating such compensation consultants, outside counsel and other advisors as it deems necessary or appropriate.
In
2019, the Compensation Committee held five (5) physical and telephonic meetings, four of which all of the members of the then
current Compensation Committee were present, and one of which 75% of the members of the then current Compensation Committee were
present.
The
Compensation Committee’s charter is attached as Appendix B to this Proxy Statement.
Governance
and Nomination Committee
The
members of our Governance and Nomination Committee are General James T. Conway and Jude T. Panetta. Each member of the Governance
and Nomination Committee is “independent” within the meaning of Nasdaq Rule 5605(a)(2). The purpose of the Governance
and Nomination Committee is to recommend to the Board nominees for election as directors and persons to be elected to fill any
vacancies on the Board, develop and recommend a set of corporate governance principles and oversee the performance of the Board.
General James T. Conway serves as chairman of our Governance and Nomination Committee.
The
Governance and Nomination Committee’s responsibilities include:
●Selecting
director nominees. The Governance and Nomination Committee recommends to the Board nominees for election as directors at any
meeting of stockholders and nominees to fill vacancies on the Board. The Governance and Nomination Committee will consider candidates
proposed by stockholders and will apply the same criteria and follow substantially the same process in considering such candidates
as it does when considering other candidates. The Governance and Nomination Committee may adopt, in its discretion, separate procedures
regarding director candidates proposed by our stockholders. Director recommendations by stockholders must be in writing, include
a resume of the candidate’s business and personal background and include a signed consent that the candidate would be willing
to be considered as a nominee to the Board and, if elected, would serve. Such recommendation must be sent to the Company’s
Secretary at the Company’s executive offices. When it seeks nominees for directors, our Governance and Nomination Committee
takes into account a variety of factors including (a) ensuring that the Board, as a whole, is diverse and consists of individuals
with varied and relevant career experience, relevant technical skills, industry knowledge and experience, financial expertise
(including expertise that could qualify a director as a “financial expert”, as that term is defined by the rules of
the SEC), local or community ties and (b) minimum individual qualifications, including strength of character, mature judgment,
familiarity with the Company’s business and industry, independence of thought and an ability to work collegially. The Company
is of the view that the continuing service of qualified incumbents promotes stability and continuity in the board room, contributing
to the ability of the Board to work as a collective body, while giving the Company the benefit of the familiarity and insight
into the Company’s affairs that its directors have accumulated during their tenure. Accordingly, the process of the Governance
and Nomination Committee for identifying nominees reflects the Company’s practice of re-nominating incumbent directors who
continue to satisfy the committee’s criteria for membership on the Board whom the committee believes continue to make important
contributions to the Board and who consent to continue their service on the Board. The Board has not adopted a formal policy with
respect to its consideration of diversity and does not follow any ratio or formula to determine the appropriate mix; rather, it
uses its judgment to identify nominees whose backgrounds, attributes and experiences, taken as a whole, will contribute to the
high standards of Board service. The Governance and Nomination Committee may adopt, and periodically review and revise as it deems
appropriate, procedures regarding director candidates proposed by stockholders;
●Reviewing
requisite skills and criteria for new Board members and Board composition. The Governance and Nomination Committee reviews
with the entire Board, on an annual basis, the requisite skills and criteria for Board candidates and the composition of the Board
as a whole;
●Hiring
of search firms to identify director nominees. The Governance and Nomination Committee has the authority to retain search
firms to assist in identifying Board candidates, approve the terms of the search firm’s engagement, and cause the Company
to pay the engaged search firm’s engagement fee;
●Selection
of committee members. The Governance and Nomination Committee recommends to the Board on an annual basis the directors to
be appointed to each committee of the Board;
●Evaluation
of the Board. The Governance and Nomination Committee will oversee an annual self-evaluation of the Board and its committees
to determine whether it and its committees are functioning effectively;
●Development
of corporate governance guidelines. The Governance and Nomination Committee will develop and recommend to the Board a set
of corporate governance guidelines applicable to the Company.
The
Governance and Nomination Committee may delegate any of its responsibilities to subcommittees as it deems appropriate. The Governance
and Nomination Committee is authorized to retain independent legal and other advisors and conduct or authorize investigations
into any matter within the scope of its duties.
In
2019, the Governance and Nomination Committee held two (2) physical and telephonic meetings, at which all of the members of the
then current Governance and Nomination Committee were present.
The
Governance and Nomination Committee’s charter, revised as of August 8, 2019, is attached as Appendix C to this Proxy
Statement.
Director
Nominating Procedures
Since
May 22, 2017, there have been no material changes to the procedures by which our security holders may recommend nominees to our
Board of Directors.
Family
Relationships
There
are no relationships between any of the officers or directors of the Company.
Involvement
in Certain Legal Proceedings
To
the best of our knowledge, none of our directors or executive officers has, during the past ten (10) years:
●Been
convicted in a criminal proceeding or been subject to a pending criminal proceeding (excluding traffic violations and other minor
offenses);
●Had
any petition under federal or state bankruptcy laws filed by or against, or a receiver, fiscal agent or similar officer was appointed
by a court for, the business or property of the person, or 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 (2) 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 SEC 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), any registered entity (as defined in Section 1(a)(29) of the
Commodity Exchange Act), or any equivalent exchange, association, entity or organization that has disciplinary authority over
its members or persons associated with a member.
Except
as set forth in our discussion below in “Certain Relationships and Related Transactions,” none of our directors 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.
Leadership
Structure of the Board
The
Board does not currently have a policy on whether the same person should serve as both the Chief Executive Officer and Executive
Chairman of the Board or, if the roles are separate, whether the Executive Chairman of the Board should be selected from the non-employee
directors or should be an employee. The Board believes that it should have the flexibility to make these determinations at any
given point in time in the way that it believes best to provide appropriate leadership for the Company at that time.
Risk
Oversight
The
Board oversees risk management directly and through its committees associated with their respective subject matter areas. Generally,
the Board oversees risks that may affect the business of the Company as a whole, including operational matters. The Audit Committee
is responsible for oversight of the Company’s accounting and financial reporting processes and also discusses with management
the Company’s financial statements, internal controls and other accounting and related matters. The Compensation Committee
oversees certain risks related to compensation programs and the Governance and Nomination Committee oversees certain corporate
governance risks. As part of their roles in overseeing risk management, these committees periodically report to the Board regarding
briefings provided by management and advisors as well as the committees’ own analysis and conclusions regarding certain
risks faced by the Company. Management is responsible for implementing the risk management strategy and developing policies, controls,
processes and procedures to identify and manage risks.
Code
of Ethics
The
Board has adopted a Code of Business Ethics and Conduct (the “Code of Conduct”) which constitutes a “code of
ethics” as defined by applicable SEC rules and a “code of conduct” as defined by applicable rules of Nasdaq.
We require all employees, directors and officers, including our principal executive officer and principal financial officer, to
adhere to the Code of Conduct in addressing legal and ethical issues encountered in conducting their work. The Code of Conduct
requires that these individuals avoid conflicts of interest, comply with all laws and other legal requirements, conduct business
in an honest and ethical manner and otherwise act with integrity. The Code of Conduct contains additional provisions that apply
specifically to our Chief Executive Officer, Chief Financial Officer and other finance department personnel with respect to accurate
reporting. The Code of Conduct is available on our website at www.vislinktechnologies.com. Information contained in our
website does not form part of this Proxy Statement and is intended for informational purposes only. The Company will post any
amendments to the Code of Conduct, as well as any waivers that are required to be disclosed by the rules of the SEC on such website.
Information contained on our website is not a part of, and is not incorporated into, this Proxy Statement, and the inclusion of
our website address in this Proxy Statement is an inactive textual reference only.
DIRECTOR
COMPENSATION FOR FISCAL YEAR 2019
The
Company compensates our non-employee directors on a negotiated basis including expenses for their service. In the fiscal year
ended December 31, 2019, each of these directors received compensation in the amount of $25,000 or $30,000, annually,
based on committee responsibilities, payable quarterly in cash or the same value in shares of Common Stock of the Company, based
on the director’s determination. Each award has a vesting schedule of one-third vesting each year on the anniversary date
over three (3) years. The table below summarizes the compensation earned by our non-employee directors for the fiscal year ended
December 31, 2019.
Name
|
|
Fees
earned
or paid
in cash
($)
|
|
|
Stock
Awards
($)
|
|
|
Option
Awards
($)(6)(7)
|
|
|
Non-equity
incentive
plan
compensation
($)
|
|
|
Change in
pension value
and
nonqualified
deferred
compensation
earnings ($)
|
|
|
All Other
Compensation
($)
|
|
|
Total ($)
|
|
Jude T. Panetta
|
|
|
10,417
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
10,417
|
(1)
|
Richard Mooers
|
|
|
15,625
|
|
|
|
9,375
|
|
|
|
38,873
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
63,873
|
(2)
|
Raymond Sidney
|
|
|
18,125
|
|
|
|
9,375
|
|
|
|
38,873
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
66,373
|
(3)
|
General James T. Conway
|
|
|
18,750
|
|
|
|
11,250
|
|
|
|
38,873
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
68,873
|
|
George F. Schmitt
|
|
|
18,750
|
|
|
|
6,250
|
|
|
|
77,467
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
102,467
|
(4)
|
John C. Coleman
|
|
|
—
|
|
|
|
11,458
|
|
|
|
77,746
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
89,204
|
(5)
|
Susan Swenson
|
|
|
18,750
|
|
|
|
11,250
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
30,000
|
|
|
(1)
|
Mr.
Panetta was appointed director of the Company, effective May 1, 2019. Mr. Panetta’s compensation was pro-rated in the
amount of $16,666.67, which is $25,000 on an annualized basis. Of the $16,666.67 that Mr. Panetta earned in director compensation
for 2019, $6,249.67 was paid in 2020.
|
|
|
|
|
(2)
|
Mr.
Mooers will not stand for re-election as a director at the Annual Meeting and will no longer serve as a director after the
Annual Meeting.
|
|
|
|
|
(3)
|
Raymond
M. Sidney resigned as a member of the Company’s Board of Directors, effective January 1, 2020.
|
|
|
|
|
(4)
|
Mr.
Schmitt will not stand for re-election as a director at the Annual Meeting and will no longer serve as a director after the
Annual Meeting.
|
|
|
|
|
(5)
|
Mr.
Coleman did not stand for re-election as a director of the Company, effective May 1, 2019. Mr. Coleman’s compensation
was pro-rated on an annualized basis.
|
|
|
|
|
(6)
|
Amounts
relate to grants of stock options made under the 2015 and 2016 Incentive Compensation Plans. With respect to each stock option
grant, the amounts disclosed generally reflect the grant date fair value computed in accordance with FASB ASC Topic 718 “Stock
Compensation.”
|
|
|
|
|
(7)
|
Except
for George F. Schmitt and John C. Coleman, each director had 2,500 outstanding option awards as of December 31, 2019. George
F. Schmitt and John C. Coleman each had 5,000 outstanding option awards as of December 31, 2019.
|
Narrative
Disclosure to Director Compensation Table
The
Board authorized cancellation of all of the outstanding options granted under its equity compensation plans, including those held
by its non-employee directors, because such options were out-of-the-money and the Company is planning to replace those options
with incentive compensation on a more cash-based award system. As of the date of this prospectus, none of those options have been
cancelled.
INFORMATION
ABOUT OUR EXECUTIVE OFFICERS
Our
current executive officers are:
Name
|
|
Age
|
|
Position
|
Carleton M. Miller (1)
|
|
56
|
|
Chief Executive Officer and President
|
Roger G. Branton (2)
|
|
52
|
|
Chief Financial Officer and Treasurer
|
Michael Bond (3)
|
|
62
|
|
Chief Financial Officer and Treasurer
|
John B. Payne IV (4)
|
|
50
|
|
President and Chief Operating Officer
|
(1)
|
Mr.
Miller replaced Roger Branton as the Company’s Chief Executive Officer on January 15, 2020 and he will replace John
Payne as the Company’s President on March 19, 2020.
|
(2)
|
Mr.
Branton will be stepping down as the Company’s Chief Financial Officer and Treasurer and is expected to conclude his
employment with the Company on March 31, 2020.
|
(3)
|
Mr.
Bond has entered into an Employment Agreement with the Company, dated February 27, 2020, which becomes effective on April
1, 2020, on which date he will become the Company’s Chief Financial Officer and Treasurer, replacing Mr. Branton.
|
(4)
|
Mr.
Payne resigned as the Company’s President and Chief Operating Officer on February 24, 2020, and he is expected to conclude
his employment with the Company on March 19, 2020.
|
Biographical
information about Carleton M. Miller appears above on page 5.
Roger
G. Branton, Chief Financial Officer, Treasurer and Director
Mr.
Branton, together with Richard Mooers, co-founded the Company in August 2002, and he has served as Chief Financial Officer and
Treasurer of the Company since August 26, 2002. Mr. Branton previously served as Chief Executive Officer from July 19, 2018 until
the Company accepted his resignation from his position as Chief Executive Officer of the Company, effective January 15, 2020.
Mr. Branton will be stepping down as Chief Financial Officer and Treasurer of the Company, effective as of March 31, 2020. Neither
Mr. Branton’s resignation as Chief Executive Officer, nor his stepping down as Chief Financial Officer and Treasurer, were
a result of any disagreements with the Company. Mr. Branton will remain as the Company’s Chief Financial Officer and Treasurer
through March 31, 2020. Effective April 1, 2020, Michael Bond will replace Mr. Branton as the Company’s Chief Financial
Officer and Treasurer. Mr. Branton graduated from West Chester University in Pennsylvania with a Bachelor of Science degree in
accounting in 1989. He trained as a certified public accountant until 1992 and then worked at an investment/merchant bank which
specialized in the technology, agriculture, and environmental industries, where his duties included acting as interim chief financial
officer for several companies within its investment portfolio. In 1997, Mr. Branton co-founded Mooers Branton & Company, an
international merchant bank which provides early-stage financing to emerging businesses.
Michael
Bond
Mr.
Bond has served as a consultant to several companies since 2016, including to the Company since January 27, 2020. He was the Chief
Financial Officer of Pulse Electronics Corporation (“Pulse”) from 2013 until 2016. Prior to such time, Mr. Bond held
the positions of Vice President and Treasurer of Pulse from 2011 to 2013. From 2008 to 2011, Mr. Bond was Senior Consultant and
Principal at Clear Strategic Solutions, Inc., a financial and corporate development consulting firm. Mr. Bond is an experienced
financial executive with over 30 years of experience, including as Head of Corporate Development and Mergers and Acquisitions
at Lucent Technologies, and held similar roles at Avaya and AT&T. Mr. Bond has also held the positions of Senior Auditor at
Deloitte, and Corporate Controller and VP of Finance at the Brookwood Companies, Inc. and at Bellwether, Inc.
EXECUTIVE
COMPENSATION
Summary
Compensation Table for Fiscal Years 2019 and 2018
The
following table sets forth all plan and non-plan compensation for the last two completed fiscal years paid to all individuals
who served as the Company’s principal executive officer (“PEO”) or acted in a similar capacity and the Company’s
two other most highly compensated executive officers during the last completed fiscal year, as required by Item 402(m)(2) of Regulation
S-K of the Securities Act. We refer to all of these individuals collectively as our “Named Executive Officers.”
Name
and
Principal
Position
|
|
Fiscal
Year
|
|
|
Salary
($)
|
|
|
Bonus
($)
|
|
|
Stock
Awards
($)
|
|
|
Option
Awards
($)(8)
|
|
|
Non-Equity
Incentive
Plan
Compensation
($)
|
|
|
Non-qualified
Deferred
Compensation
Earnings
($)
|
|
|
All Other
Compensation
($)
|
|
|
Total
($)
|
|
Roger G. Branton,
Chief Executive Officer and Chief Financial Officer(1)
|
|
2019
|
|
|
|
350,000
|
|
|
|
56,000
|
|
|
|
—
|
|
|
|
77,747
|
|
|
|
—
|
|
|
|
—
|
|
|
|
27,110
|
(3)
|
|
|
510,857
|
|
|
|
2018
|
|
|
|
293,800
|
|
|
|
0
|
|
|
|
104,000
|
|
|
|
73,873
|
|
|
|
—
|
|
|
|
—
|
|
|
|
19,615
|
(4)
|
|
|
491,288
|
|
John B. Payne IV,
Chief Operating Officer(2)
|
|
2019
|
|
|
|
350,000
|
|
|
|
56,000
|
|
|
|
—
|
|
|
|
77,467
|
|
|
|
|
|
|
|
|
|
|
|
30,299
|
(5)
|
|
|
513,766
|
|
|
|
2018
|
|
|
|
286,917
|
|
|
|
0
|
|
|
|
78,000
|
|
|
|
73,873
|
|
|
|
—
|
|
|
|
—
|
|
|
|
28,428
|
(6)
|
|
|
467,218
|
|
George F. Schmitt,
Chief Executive Officer (former)(7)
|
|
2019
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
2018
|
|
|
|
87,500
|
|
|
|
0
|
|
|
|
104,000
|
|
|
|
73,873
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
265,373
|
|
|
(1)
|
On
January 15, 2020, Mr. Branton resigned as Chief Executive Officer. In connection with Mr. Branton’s resignation, the
Board appointed Carleton M. Miller as Chief Executive Officer. Mr. Branton continues to serve as Chief Financial Officer until
he steps down on March 31, 2020. Effective April 1, 2020, Michael Bond will become the Company’s Chief Financial Officer
and Treasurer.
|
|
|
|
|
(2)
|
On
February 24, 2020, John Payne resigned from his role as the Company’s President and Chief Operating Officer and is expected
to conclude his employment with the Company on March 19, 2020.
|
|
|
|
|
(3)
|
$27,110
of medical and dental insurance premiums were paid by the Company during fiscal year 2019 for the benefit of Mr. Branton.
|
|
|
|
|
(4)
|
$19,615
of medical and dental insurance premiums were paid by the Company during fiscal year 2018 for the benefit of Mr. Branton.
|
|
|
|
|
(5)
|
$12,389
of medical insurance premiums, $2,910 of dental insurance premiums and $15,000 of car allowance were paid by the Company during
fiscal year 2019 for the benefit of Mr. Payne.
|
|
|
|
|
(6)
|
$10,523
of medical insurance premiums, $2,905 of dental insurance premiums and $15,000 of car allowance were paid by the Company during
fiscal year 2018 for the benefit of Mr. Payne.
|
|
|
|
|
(7)
|
George
F. Schmitt retired from his position as Chief Executive Officer of the Company on April 23, 2018.
|
|
|
|
|
(8)
|
Amounts
relate to grants of stock options made under the 2015 and 2016 Incentive Compensation Plans. With respect to each stock option
grant, the amounts disclosed generally reflect the grant date fair value computed in accordance with FASB ASC Topic 718 “Stock
Compensation.”
|
Employment
Agreements
Carleton
M. Miller
On
January 22, 2020, the Company entered into an employment agreement with Carleton M. Miller in connection with his appointment
as Chief Executive Officer of the Company (the “Miller Employment Agreement”). Pursuant to the Miller Employment Agreement,
Mr. Miller will receive an annual base salary of $330,000 per year, and an annual cash bonus in accordance with the terms of any
annual cash bonus incentive plan maintained for the Company’s key executive officers. The Miller Employment Agreement also
provides that Mr. Miller will receive an inducement award of a time-based option to purchase 2,155,481 shares of Common Stock
under Nasdaq Listing Rule 5653(c)(4) outside of the Company’s existing equity compensation plans (the “Miller Time-Based
Option”), 25% of which will vest on January 22, 2021 and the remaining 75% of which will vest in substantially equal monthly
installments over the 36-month period following such date, subject to Mr. Miller’s continued employment by the Company on
the applicable vesting date. Pursuant to the Miller Employment Agreement, Mr. Miller will also receive an inducement award of
a performance-based option to purchase 1,500,000 shares of Common Stock under Nasdaq Listing Rule 5653(c)(4) outside of the Company’s
existing equity compensation plans (the “Miller Performance-Based Option”). The Miller Performance-Based Option will
vest in three equal tranches of 500,000 shares upon the Company’s attainment, on or before the fifth anniversary of January
22, 2020, of specified cumulative EBITDA performance conditions, subject in each case to Mr. Miller’s continued employment
by the Company on the applicable vesting date. The Miller Time-Based Option and the Miller Performance-Based Option both have
exercise prices of $0.285 per share.
Michael
Bond
On
February 27, 2020, the Company entered into an employment agreement with Michael Bond in connection with his contemplated employment
as Chief Financial Officer of the Company, effective as of April 1, 2020 (the “Bond Employment Agreement”). Pursuant
to the Bond Employment Agreement, Mr. Bond will receive an annual base salary of $250,000 per year, and an annual cash bonus in
accordance with the terms of any annual cash bonus incentive plan maintained for the Company’s key executive officers. The
Miller Bond Employment Agreement also provides that Mr. Bond will receive an inducement award of stock options to purchase a quantity
of shares equal to one percent of the Company’s fully diluted outstanding shares of its Common Stock as of April 1, 2020
under Nasdaq Listing Rule 5635(c)(4) outside of the Company’s existing equity compensation plans (the “Bond Inducement
Options”). The per share exercise price of the Bond Inducement Options will be the closing price of the Company’s
Common Stock on April 1, 2020. 25% of the Bond Inducement Options will vest and become exercisable on April 1, 2021 and the remaining
75% of the Bond Inducement Options will vest in substantially equal monthly installments over the thirty-six (36) month period
thereafter, provided that Mr. Bond remains in continuous employment with the Company through the respective vesting date. As Mr.
Bond’s employment is on an “at-will” basis, the Company or Mr. Bond may terminate the employment relationship
at any time, with or without Cause (as defined in the Bond Employment Agreement). Upon Mr. Bond’s termination of employment
for any reason, Mr. Bond will be entitled to receive a lump sum payment equal to the sum of his earned but unpaid base salary
through his termination date plus his accrued but unused vacation days through his termination date, and any other benefits or
rights that Mr. Bond has accrued or earned through his termination date in accordance with the terms of the applicable fringe
or employee benefit plans and programs of the Company.
Outstanding
Equity Awards as of December 31, 2019
The
following table presents information regarding the outstanding options held by our Named Executive Officers as of December 31,
2019:
|
|
Option Awards
|
|
|
|
|
|
Number of
Securities
Underlying
Unexercised
Options (#)
Exercisable
|
|
|
Number of
Securities
Underlying
Unexercised
Options (#)
Unexercisable
|
|
|
Option
Exercise
Price
($)
|
|
|
Option
Expiration
Date
|
Roger G. Branton(1)
|
|
|
10,000
|
|
|
|
5,000
|
|
|
|
15.50
|
|
|
3/24/2027
|
John Payne(2)
|
|
|
10,000
|
|
|
|
5,000
|
|
|
|
15.50
|
|
|
3/24/2027
|
(1)
|
5,000
of these options vested on March 24, 2018, 5,000 of these options vested on March 24, 2019, and 5,000 of these options vest
on March 24, 2020.
|
|
|
(2)
|
5,000
of these options vested on March 24, 2018, 5,000 of these options vested on March 24, 2019, and 5,000 of these options vest
on March 24, 2020.
|
|
|
Narrative
Disclosure to Outstanding Equity Awards Table
The
Board authorized cancellation of all of the outstanding options granted under its equity compensation plans, including those held
by the Company’s Named Executive Officers because such options were out-of-the-money and the Company is planning to replace
those options with incentive compensation on a more cash-based award system. As of the date of this prospectus, none of those
options have been cancelled.
EQUITY
COMPENSATION PLAN INFORMATION
The
following table contains information about our equity compensation plans as of December 31, 2019.
|
|
Number of
Securities to be
Issued upon
Exercise of
Outstanding
Options
|
|
|
Weighted
Average Exercise
Price of
Outstanding
Options
|
|
|
Number of
Securities
Remaining Available
for Future Issuance
under Equity
Compensation Plans
(excluding securities
reflected in column
(a))
|
|
|
|
(a)
|
|
|
(b)
|
|
|
(c)
|
|
|
|
|
|
|
|
|
|
|
|
Equity compensation plans approved by security holders(1)
|
|
|
72,500
|
|
|
$
|
15.50
|
|
|
|
2,744,047
|
|
Equity compensation plans approved by security holders(2)
|
|
|
43,550
|
|
|
$
|
15.50
|
|
|
|
2,012,350
|
|
Equity compensation plans approved by security holders(3)
|
|
|
—
|
|
|
$
|
—
|
|
|
|
6,042,632
|
|
Equity compensation plans approved by security holders(4)
|
|
|
139,000
|
|
|
$
|
15.50
|
|
|
|
12,076,532
|
|
Equity compensation plans approved by security holders(5)
|
|
|
261,000
|
|
|
$
|
15.50
|
|
|
|
377,305
|
|
|
|
|
516,050
|
|
|
$
|
15.50
|
|
|
|
23,252,866
|
|
(1)
|
Represents
the shares authorized for issuance under the 2013 Long-Term Stock Incentive Plan, which was approved by the Company’s
stockholders. The maximum aggregate number of shares of Common Stock that may be issued under the 2013 Option Plan, including
stock options, stock awards, and stock appreciation rights is limited to 15% of the shares of Common Stock outstanding on
the first trading day of any fiscal year, or 2,816,547 shares of Common Stock for fiscal year 2019.
|
(2)
|
Represents
the shares authorized for issuance under the 2015 Incentive Compensation Plan, which was approved by the Company’s stockholders.
The maximum aggregate number of shares of Common Stock that may be issued under the 2015 Incentive Compensation Plan, including
stock options and stock awards is limited to $513,975 of shares of Common Stock, which based on the closing price of $0.25
of our Common Stock on December 31, 2019, as listed on the Nasdaq Capital Market, was equal to 2,055,900 shares of Common
Stock.
|
(3)
|
Represents
the shares authorized for issuance under the 2016 Employee Stock Purchase Plan, which was approved by the Company’s
stockholders. The maximum aggregate number of shares of Common Stock that may be issued under the 2016 Employee Stock Purchase
Plan is limited to $1,510,658 shares of Common Stock, which based on the closing price of $0.25 of our Common Stock
on December 31, 2019, as listed on the Nasdaq Capital Market, was equal to 6,042,632 shares of Common Stock.
|
(4)
|
Represents
the shares authorized for issuance under the 2016 Incentive Compensation Plan, which was approved by the Company’s stockholders.
The maximum aggregate number of shares of Common Stock that may be issued under the 2016 Incentive Compensation Plan, including
stock options and stock awards is limited to $3,053,883 of shares of Common Stock, which based on the closing price of $0.25
of our Common Stock on December 31, 2019, as listed on the Nasdaq Capital Market, was equal to 12,215,532 shares of Common
Stock.
|
(5)
|
Represents
the shares authorized for issuance under the 2017 Incentive Compensation Plan, which was approved by the Company’s stockholders.
The maximum aggregate number of shares of Common Stock that may be issued under the 2017 Incentive Compensation Plan, including
stock options and stock awards is limited to 638,306 of shares of Common Stock.
|
CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS
Other
than compensation arrangements for our directors and executive officers, we engaged in no reportable transactions with related
persons since the years ended December 31, 2019 and 2018 that involved an amount that exceeds the lesser of $120,000 or one percent
of the average of the Company’s total assets at year-end for the last two completed fiscal years, other than below. See
also “Executive Compensation” for additional information regarding compensation of related parties.
Our
Audit Committee considers and approves or disapproves any related person transaction as required by Nasdaq regulations.
MB
Technology Holdings, LLC and MB Merchant Group, LLC
On
April 29, 2014, the Company entered into a management agreement (the “Management Agreement”) with MB Technology Holdings,
LLC (“MBTH”), pursuant to which MBTH agreed to provide certain management and financial services to the Company. The
Management Agreement was effective January 1, 2014. Roger G. Branton, the Company’s former Chief Executive Officer and current
Chief Financial Officer and a member of the Board of Directors of the Company (who is not standing for re-election), was previously
a director of MBTH, George F. Schmitt, a member of the Board of Directors of the Company (who is not standing for re-election)
and former Chief Executive Officer and Executive Chairman of the Board, is a director of MBTH, and Richard Mooers, a member of
the Board of Directors of the Company (who is not standing for re-election), was previously a director of MBTH. Effective December
31, 2018, Mr. Branton and Mr. Mooers are no longer affiliated with MBTH. The Company agreed to award MBTH a 3% cash success fee
if MBTH arranges financing, a merger, consolidation or sale by the Company of substantially all of its assets. On November 29,
2016, the Company and MBTH entered into an acquisition services agreement (the ‘‘M&A Services Agreement’’)
pursuant to which the Company engaged MBTH to provide services in connection with merger and acquisition searches, negotiating
and structuring deal terms and other related services. The M&A Services Agreement incorporated by reference the terms of the
Management Agreement, as well as the Company’s agreement with MBTH on January 12, 2013 to pay MBTH a 3% success fee on any
financing arranged for the Company, merger or consolidation of the Company or sale by the Company of substantially all of its
assets. The M&A Services Agreement also provided for additional fees owed to MBTH.
On
February 16, 2017, the Board amended the terms of the Block Purchase Option in the M&A Services Agreement to allow MBTH the
option to acquire 25% of the fully diluted outstanding shares of common stock and warrants of the Company at a price of $2.10
per share and for a five-year term (the “Dilutive Option”).
On
December 31, 2018, MBTH terminated the foregoing agreements and services provided to the Company. In connection therewith, we
entered into an acquisition services agreement, dated December 29, 2018 (the “MBMG Agreement”) with MB Merchant Group,
LLC (“MBMG”). Under the MBMG Agreement, MBMG will continue to provide the services provided by MBTH to the Company.
The term of the MBMG Agreement commenced on January 1, 2019 and will renew automatically annually thereafter until sooner terminated
by either party on thirty (30) days’ prior written notice. Roger G. Branton and Richard Mooers are the only members and
partners of MBMG. Principally, MBMG will receive the following fees and compensation under the MBMG Agreement:
|
1.
|
An
acquisition fee comprised of the greater of $250,000 or 6% of the total acquisition price for all deals where the total consideration
for the acquisition paid by the Company is less than $10 million. For deals which are $10 million to $100 million, the Company
will pay MBMG a fee of $600k (for the first $10 million) plus a 4% fee of the excess value over $10 million. For deals which
are $100 million to $400 million, the Company will pay MBMG a fee of $4.2 million (for the first $100 million) plus a 2% fee
of the excess over $100 million. For deals which are over $400 million, the Company will pay MBMG a fee of $10.2 million plus
a 1.1% fee of the excess over $400 million.
|
|
|
|
|
2.
|
A
success-based due diligence fee of $250,000, only on successfully closed deals, in addition to any other fees.
|
|
|
|
|
3.
|
The
3% success fee referred to with respect to MBTH above shall be waived on a case by case basis whenever an acquisition fee
is more than $1 million. The waiver should be for that part of the financing which is for the acquisition and should not relate
to any additional fees raised for the Company above the acquisition price. And such 3% fee was decreased to 2% beginning January
1, 2019.
|
|
|
|
|
4.
|
Should
the Company engage an external, independent advisor to value the acquisition, and the result is a higher value than the price
MBMG negotiated, then MBMG will receive an additional fee of 5% of such gain. This is to further incent MBMG to help the Company
achieve the best value in acquisitions.
|
|
|
|
|
5.
|
Reimbursement
for certain expenses.
|
Pursuant
to the MBMG Agreement, MBMG shall have the option to convert up to 50% of its fees into common shares of the Company so long as
the receivable remains outstanding. The conversion price will be fixed at 110% of the price of the shares on the day of closing
or the price in connection with any acquisition financing, whichever is lower. Provided MBMG converts at least 25% of its fees,
then the Company agrees to register all of shares in the Company held by MBMG.
MBMG
and MBTH separately agreed to split the Dilutive Option effective January 1, 2019. The split was based on present ownership in
MBTH and provided that MBMG be willing to accept this assignment to continue such merger and acquisition services to the Company.
The Company agreed to allow both MBTH and MBMG to amend the strike price of said options based on any financing consummated in
2019 and such reset to be at the lowest and same price as the Company may agree to in any of its 2019 financings.
Additionally,
MBMG would receive a monthly fee of $50,000, and the Company at its sole discretion will have the option to credit such fees against
future acquisition fees due each year to the extent it deems that appropriate based on all services received from MBMG.
On
February 25, 2020, the Company and MBMG entered into a letter agreement (the “MBMG Letter Agreement”), pursuant to
which the Company and MBMG agreed to amend and restate certain of the foregoing service agreements previously entered into with
MBMG as well as its predecessor entity (the “MBMG Agreements”). Pursuant to the MBMG Letter Agreement, MBMG has agreed
to provide only the following services to the Company: (i) to conduct merger and acquisition searches, negotiating and structuring
deal terms and other related services in connection with closing suitable acquisitions for the Company, and (ii) to seek and secure
financing for the Company, except in those regions in which the Company had previously appointed a business representative to
exclusively seek such opportunities, and subject in each case to prior approval by the Company’s Chief Executive Officer
on a case-by-case basis (collectively, the “MBMG Services”). Pursuant to the MBMG Letter Agreement, MBMG will no longer
provide strategic planning and financial structuring services or technical consulting services, review patent applications or
provide consulting services with respect to certain legal matters.
Pursuant
to the MBMG Letter Agreement, in consideration for the MBMG Services, the Company agreed to compensate MBMG through payment of:
(i) an acquisition fee equal to (A) the greater of $250,000 or 6% of the total acquisition price for deals in which the total
consideration paid by the Company is less than $50 million; (B) $3,000,000 plus 4% of the consideration paid by the Company in
excess of $50 million for deals in which the total consideration paid by the Company is between $50 million and $100 million;
(C) $5,000,000 plus 2% of the consideration paid by the Company in excess of $100 million for deals in which the total consideration
paid by the Company is between $100 million and $400 million; or (D) $10,200,000 plus 1.1% of the consideration paid by the Company
in excess of $400 million for deals in which the total consideration paid by the Company exceeds $400 million; (ii) a success-based
due diligence fee of $250,000 on successfully closed deals, (iii) a waivable success-based finance fee of 2% of the acquisition
price and (iv) an incentive fee of 5% of an external advisor’s higher valuation of an acquisition, with such fees subject
to a customary 12-month tail period in the event of termination of the MBMG Letter Agreement. The MBMG Letter Agreement further
provides that (x) MBMG shall have the option to convert up to 50% of all such fees into the Company’s common stock so long
as a receivable remains outstanding, convertible at a fixed price of 110% of the lower of the price of such shares on the day
of closing or such price in connection with any acquisition financing, as applicable; (y) the Company will no longer compensate
MBMG through, among other discontinued fees, a $50,000 monthly consulting fee that would have been due pursuant to the MBMG Agreements
and (z) in full satisfaction of specified claims arising out of the MBMG Agreements, the Company shall pay MBMG $420,000, with
$200,000 to be paid within three days of the execution of the MBMG Letter Agreement and $220,000 to be paid within 30 days of
such execution.
John
C. Coleman
We’ve
entered into a non-exclusive license agreement with our former Chief Executive Officer and director, John C. Coleman. Because
there is no minimum and no financial commitment by either us or Mr. Coleman, we cannot adequately place a value on the agreement
at this time.
DELINQUENT
16(a) REPORTS
Section
16(a) of the Exchange Act requires the Company’s directors and executive officers, and persons who own more than ten percent
(10%) of the Common Stock, to file with the SEC the initial reports of ownership and reports of changes in ownership of Common
Stock. Officers, directors and greater than ten percent (10%) stockholders are required by SEC regulation to furnish the Company
with copies of all Section 16(a) forms they file. Specific due dates for such reports have been established by the SEC, and the
Company is required to disclose in this Proxy Statement any failure to file reports by such dates during fiscal year 2019. Based
solely on its review of the copies of such reports received by it, or written representations from certain reporting persons that
no Forms 5 were required for such persons, the Company believes that during the fiscal year ended December 31, 2019, there was
no failure to comply with Section 16(a) filing requirements applicable to its executive officers, directors or greater than ten
percent (10%) stockholders other than as listed in the table below:
Name
|
|
Number
of
Late
Reports
|
|
Description
|
John
C. Coleman
|
|
1
|
|
2
transactions were not reported on a timely basis upon the acquisition of Common Stock.
|
Raymond
M. Sidney
|
|
1
|
|
1
transaction was not reported on a timely basis upon the acquisition of Common Stock.
|
Richard
Mooers
|
|
2
|
|
2
transactions were not reported on a timely basis upon the abandonment of Common Stock; 1 transaction was not reported
on a timely basis upon the acquisition of Common Stock.
|
Roger
G. Branton
|
|
1
|
|
2
transactions were not reported on a timely basis upon the abandonment of Common Stock.
|
James
T. Conway
|
|
1
|
|
1
transaction was not reported on a timely basis upon the acquisition of Common Stock.
|
Susan
Swenson
|
|
1
|
|
1
transaction was not reported on a timely basis upon the acquisition of Common Stock.
|
AUDIT
COMMITTEE REPORT
The
following Report of the Audit Committee (the “Audit Report”) does not constitute soliciting material and should not
be deemed filed or incorporated by reference into any other Company filing under the Securities Act of 1933, as amended, or the
Securities Exchange Act of 1934, as amended, except to the extent the Company specifically incorporates this Audit Report by reference
therein.
Role
of the Audit Committee
The
Audit Committee’s primary responsibilities fall into three (3) broad categories:
First,
the Audit Committee is charged with monitoring the preparation of quarterly and annual financial reports by the Company’s
management, including discussions with management and the Company’s outside auditors about draft annual financial statements
and key accounting and reporting matters;
Second,
the Audit Committee is responsible for matters concerning the relationship between the Company and its outside auditors, including
recommending their appointment or removal; reviewing the scope of their audit services and related fees, as well as any other
services being provided to the Company; and determining whether the outside auditors are independent (based in part on the annual
letter provided to the Company pursuant to Independence Standards Board Standard No. 1); and
Third,
the Audit Committee reviews financial reporting, policies, procedures, and internal controls of the Company. The Audit Committee
has implemented procedures to ensure that during the course of each fiscal year it devotes the attention that it deems necessary
or appropriate to each of the matters assigned to it under the Audit Committee’s charter. In overseeing the preparation
of the Company’s financial statements, the Audit Committee met with management and the Company’s outside auditors,
including meetings with the Company’s outside auditors without management present, to review and discuss all financial statements
prior to their issuance and to discuss significant accounting issues. Management advised the Audit Committee that all financial
statements were prepared in accordance with generally accepted accounting principles, and the Audit Committee discussed the statements
with both management and the outside auditors. The Audit Committee’s review included discussion with the outside auditors
of matters required to be discussed pursuant to the Statement on Auditing Standards No. 61 (Communication with Audit Committees).
With
respect to the Company’s outside auditors, the Audit Committee, among other things, discussed with Marcum LLP matters relating
to its independence, including the disclosures made to the Audit Committee as required by the Independence Standards Board Standard
No. 1 (Independence Discussions with Audit Committees).
Recommendations
of the Audit Committee. In reliance on the reviews and discussions referred to above, the Audit Committee recommended to the
Board that the Board approve the inclusion of the Company’s audited financial statements in the Company’s Annual Report
on Form 10-K for the fiscal year ended December 31, 2019 for filing with the Securities and Exchange Commission.
This
Audit Report has been furnished by the Audit Committee of the Board of Directors.
Susan
Swenson, Chairman
Ralph
Faison
Brian
K. Krolicki
RATIFICATION
OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS
(Proposal
No. 2)
Marcum
LLP (“Marcum”) has served as our independent registered public accounting firm since September 11, 2015 and has been
appointed by the Audit Committee of the Board to continue as our independent registered public accounting firm for the fiscal
year ending December 31, 2020.
At
the Annual Meeting, the stockholders will vote on a proposal to ratify this selection of an independent registered public accounting
firm. If this ratification is not approved by the affirmative vote of a majority of the shares of Common Stock outstanding and
entitled to vote on the matter, the Board will reconsider its selection of an independent registered public accounting firm. Marcum
has no interest, financial or otherwise, in the Company. We do not currently expect a representative of Marcum to physically attend
the Annual Meeting; however, it is anticipated that a Marcum representative will be available to participate in the Annual Meeting
via telephone in the event he or she wishes to make a statement, or in order to respond to appropriate questions.
The
following table presents aggregate fees for professional services rendered by Marcum for the audit of our annual consolidated
financial statements for the fiscal years ended December 31, 2019 and 2018.
|
|
For the Year Ended December 31,
|
|
|
|
2019
|
|
|
2018
|
|
Audit fees (1)
|
|
$
|
260,410
|
|
|
$
|
255,843
|
|
|
|
|
|
|
|
|
|
|
Audit-related fees
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
Tax fees
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
All other fees
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
Total fees
|
|
$
|
260,410
|
|
|
$
|
255,843
|
|
|
(1)
|
Audit
fees consist of the aggregate fees billed for each of the last two fiscal years for professional services rendered by Marcum
for the audit of the Company’s annual financial statements and review of financial statements included in the Company’s
Form 10-Qs, or services that are normally provided by Marcum in connection with the Company’s statutory and regulatory
filings or engagements for those fiscal years.
|
Policy
on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Auditors
The
Audit Committee pre-approves all audit and non-audit services provided by the independent auditors prior to the engagement of
the independent auditors with respect to such services. The Chairman of the Audit Committee has been delegated the authority by
the Audit Committee to pre-approve interim services by the independent auditors other than the annual audit. The Chairman of the
Audit Committee must report all such pre-approvals to the entire Audit Committee at the next Audit Committee meeting.
Vote
Required and Recommendation
Our
By-laws provide that, on all matters (other than the election of directors and except to the extent otherwise required by our
Certificate of Incorporation or applicable Delaware law), the affirmative vote of a majority of the shares of Common Stock outstanding
and entitled to vote on the matter will be required for approval. Accordingly, the affirmative vote of a majority of the shares
of Common Stock outstanding on the Record Date and entitled to vote on the matter will be required for the Board’s selection
of Marcum LLP as our independent registered public accountants for the fiscal year ending December 31, 2020.
At
the Annual Meeting a vote will be taken on a proposal to ratify the selection of Marcum as our independent registered public accountants
for the fiscal year ending December 31, 2020.
THE
BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR THE RATIFICATION OF THE SELECTION OF MARCUM AS THE COMPANY’S INDEPENDENT
REGISTERED PUBLIC ACCOUNTANTS FOR THE FISCAL YEAR ENDING DECEMBER 31, 2020.
PROPOSAL
TO AUTHORIZE THE BOARD OF DIRECTORS TO AMEND THE COMPANY’S
CERTIFICATE
OF INCORPORATION TO EFFECT A REVERSE STOCK SPLIT OF OUR
OUTSTANDING
COMMON STOCK AT ITS DISCRETION
(Proposal
No. 3)
Summary
Our
Board has unanimously approved a proposal to amend the Certificate of Incorporation to effect a reverse stock split of all of
our outstanding shares of Common Stock by a ratio in the range of one-for-____ to one-for-____ (the “Reverse Stock Split”).
The proposal provides that our Board shall have sole discretion pursuant to Section 242(c) of the DGCL to elect, as it determines
to be in the Company’s best interests, whether or not to effect the Reverse Stock Split before October 11, 2020, or to abandon
it. Should the Board proceed with the Reverse Stock Split, the exact ratio shall be set at a whole number within the above range
as determined by our Board in its sole discretion. Our Board believes that the availability of alternative reverse stock split
ratios will provide it with the flexibility to implement the Reverse Stock Split in a manner designed to maximize the anticipated
benefits for the Company and its stockholders. In determining whether to implement the Reverse Stock Split following the receipt
of stockholder approval, our Board may consider, among other things, factors such as:
|
●
|
the
historical trading price and trading volume of our Common Stock;
|
|
|
|
|
●
|
the
then prevailing trading price and trading volume of our Common Stock and the anticipated impact of the Reverse Stock Split
on the trading market for our Common Stock;
|
|
|
|
|
●
|
our
ability to have our shares of Common Stock remain listed on the Nasdaq Capital Market;
|
|
|
|
|
●
|
the
anticipated impact of the reverse stock split on our ability to raise additional financing; and
|
|
|
|
|
●
|
prevailing
general market and economic conditions.
|
If
our Board determines that effecting the Reverse Stock Split is in our best interest, the Reverse Stock Split will become effective
upon filing of an amendment to our Certificate of Incorporation with the Secretary of State of the State of Delaware. The amendment
filed thereby will set forth the number of shares of Common Stock to be combined into one share of our Common Stock within the
limits set forth in this proposal. Except for adjustments that may result from the treatment of fractional shares as described
below, each stockholder will hold the same percentage of our outstanding Common Stock immediately following the Reverse Stock
Split as such stockholder holds immediately prior to the Reverse Stock Split.
The
text of the form of amendment to the Certificate of Incorporation, which would be filed with the Secretary of State of the State
of Delaware to effect the Reverse Stock Split, is set forth in Appendix D to this Proxy Statement. The text of the form
of amendment accompanying this Proxy Statement is, however, subject to amendment to reflect the exact ratio for the Reverse Stock
Split and any changes that may be required by the office of the Secretary of State of the State of Delaware or that the Board
may determine to be necessary or advisable ultimately to comply with applicable law and to effect the Reverse Stock Split.
Our
Board of Directors believes that approval of the amendment to the Certificate of Incorporation to effect the Reverse Stock Split
is in the best interests of the Company and our stockholders and has unanimously recommended that the proposed amendment be presented
to our stockholders for approval.
Board
Discretion to Implement or Abandon Reverse Stock Split
The
Reverse Stock Split will be effected, if at all, only upon a determination by our Board that the Reverse Stock Split (with an
exchange ratio determined by our Board as described above) is in the Company’s best interest. Such determination shall be
based upon certain factors, including, but not limited to, the historical trading price and trading volume of our Common Stock,
the then prevailing trading price and trading volume of our Common Stock and the anticipated impact of the Reverse Stock Split
on the trading market for our Common Stock, our ability to have our shares of Common Stock remain listed on the Nasdaq Capital
Market, the anticipated impact of the Reverse Stock Split on our ability to raise additional financing; and prevailing general
market and economic conditions. No further action on the part of stockholders would be required to either implement or abandon
the Reverse Stock Split. If our stockholders approve the proposal, and the Board determines to effect the Reverse Stock Split,
we would communicate to the public, prior to the Effective Date (as defined below), additional details regarding the Reverse Stock
Split, including the specific ratio selected by the Board.
If
the Board does not implement the Reverse Stock Split prior to October 11, 2020, the authority granted in this proposal to implement
the Reverse Stock Split will terminate. The Board is requesting authorization to implement the Reverse Stock Split up until such
time in the event the Company needs to utilize this Proposal No. 3 subsequent to the expiration of the Second Nasdaq Extension
Period (described below under “Purpose of the Reverse Stock Split”). However, the Board would only want to implement
the Reverse Stock Split to remain on the Nasdaq Capital Market or to regain compliance with Nasdaq. As such, the Board reserves
its right to elect not to proceed with the Reverse Stock Split if it determines, in its sole discretion, that this proposal is
no longer in the Company’s best interest. In the event that our stock price has a minimum bid price of at least $1.00 for
at least ten (10) consecutive business days without the Reverse Stock Split, then we intend to abandon this Proposal No. 3.
Effective
Date
If
the proposed amendment to the Certificate of Incorporation to give effect to the Reverse Stock Split is approved at the Annual
Meeting and the Board determines to effect the Reverse Stock Split, the Reverse Stock Split will become effective as of 5:30 p.m.
Eastern Time on the effective date of the certificate of amendment to our Certificate of Incorporation with the Secretary of State
of the State of Delaware, which we would expect to be the date of filing (the “Effective Date”). Except as explained
below with respect to fractional shares, each issued share of Common Stock immediately prior to the Effective Date will automatically
be changed, as of the Effective Date, into a fraction of a share of Common Stock based on the exchange ratio within the approved
range determined by the Board of Directors.
Purpose
of the Reverse Stock Split
The
sole purpose for the Reverse Stock Split is based on the Board’s belief that the Reverse Stock Split will likely be necessary
to maintain the listing of our Common Stock on the Nasdaq Capital Market. In the event that the Board, in its sole discretion,
determines to implement the Reverse Stock Split for such purpose, the Board believes that the Reverse Stock Split could improve
the marketability and liquidity of the Common Stock.
Maintain
our listing on the Nasdaq Capital Market. Our Common Stock is traded on the Nasdaq Capital Market. On September 26, 2019,
we received a written notification from Nasdaq indicating that the Company was not in compliance with Nasdaq Listing Rule 5550(a)(2)
as the Company’s closing bid price was below $1.00 per share for the previous thirty (30) consecutive business days.
The
Company is under a 180-calendar day compliance period granted through the Nasdaq Listing Rule 5810(c)(3)(A), or until March 24,
2020, to regain compliance with the minimum bid price requirements. During the compliance period, the Company’s shares of
Common Stock will continue to be listed and traded on the Nasdaq Capital Market.
To
regain compliance, the closing bid of the Company’s shares of Common Stock must meet or exceed $1.00 per share for at least
ten (10) consecutive business days during the 180-calendar day grace period. The Company can elect a second 180-calendar day grace
period if it is not in compliance by March 24, 2020 (the “Second Nasdaq Extension Period”). The Company, to maintain
compliance, would be required to meet the continued listing requirement for the market value of publicly held shares and all other
initial listing standards for Nasdaq, except for the minimum bid price requirements. In addition, we would be required to notify
Nasdaq of our intent to cure such minimum bid price deficiency by effecting a reverse stock split, if necessary. If we do not
regain compliance within the allotted compliance period(s), including any extensions that may be granted by Nasdaq, Nasdaq will
provide notice that our shares of Common Stock will be subject to delisting. We intend to monitor the closing bid price for our
Common Stock between now and March 24, 2020, and will consider available options to resolve our noncompliance with the minimum
bid price requirements, as may be necessary.
As
of the date of this Proxy Statement, our stock price has not had a minimum bid price of at least $1.00 for at least ten (10) consecutive
business days. In the event that our stock price does have a minimum bid price of at least $1.00 for at least ten (10) consecutive
business days without the Reverse Stock Split, we will not utilize an approval of this Proposal No. 3.
The
Board has considered the potential harm to the Company and its stockholders should Nasdaq delist our Common Stock from the Nasdaq
Capital Market. Delisting our Common Stock could adversely affect the liquidity of our Common Stock because alternatives, such
as the OTC Bulletin Board and the pink sheets, are generally considered to be less efficient markets. An investor likely would
find it less convenient to sell, or to obtain accurate quotations in seeking to buy our Common Stock on an over-the-counter market.
Less investors might buy or sell our Common Stock due to difficulty in accessing over-the-counter markets, policies preventing
them from trading in securities not listed on a national exchange or other reasons. The Board believes that the Reverse Stock
Split is a potentially effective means for us to maintain compliance with the rules of Nasdaq and to avoid, or at least mitigate,
the likely adverse consequences of our Common Stock being delisted from the Nasdaq Capital Market by producing the immediate effect
of increasing the bid price of our Common Stock.
Improve
the marketability and liquidity of the Common Stock. In the event that the Board elects to implement the Reverse Stock Split
in order to avoid the delisting of our Common Stock from Nasdaq, we also believe that the increased market price of our Common
Stock expected as a result of implementing the Reverse Stock Split will improve the marketability and liquidity of our Common
Stock and will encourage interest and trading in our Common Stock. A reverse stock split could allow a broader range of institutions
to invest in our Common Stock (namely, funds that are prohibited from buying stocks whose price is below a certain threshold),
potentially increasing the liquidity of our Common Stock. A reverse stock split could help increase analyst and broker interest
in our stock as their policies can discourage them from following or recommending companies with low stock prices. Because of
the trading volatility often associated with low-priced stocks, many brokerage houses and institutional investors have internal
policies and practices that either prohibit them from investing in low-priced stocks or tend to discourage individual brokers
from recommending low-priced stocks to their customers. Some of those policies and practices may function to make the processing
of trades in low-priced stocks economically unattractive to brokers. Additionally, because brokers’ commissions on low-priced
stocks generally represent a higher percentage of the stock price than commissions on higher-priced stocks, the current average
price per share of our Common Stock can result in individual stockholders paying transaction costs representing a higher percentage
of their total share value than would be the case if the share price were substantially higher. It should be noted, however, that
the liquidity of our Common Stock may in fact be adversely affected by the proposed Reverse Stock Split given the reduced number
of shares of Common Stock that would be outstanding after the Reverse Stock Split.
For
the above reasons, we believe that providing the Board with the ability to effect the Reverse Stock, in the event that it determines,
in its sole discretion, that implementing the Reverse Stock Split will help us regain and maintain compliance with the Nasdaq
listing requirements and, as a result, could also improve the marketability and liquidity of our Common Stock, is in the best
interests of the Company and our stockholders. However, regardless as to whether or not the Board believes that implementing the
Reverse Stock Split could help us regain and maintain compliance with the Nasdaq listing requirements, the Board reserves its
right to abandon the Reverse Stock Split if it determines, in its sole discretion, that it would no longer be in our and our stockholders’
best interests.
Risks
of the Proposed Reverse Stock Split
We
cannot assure you that the proposed Reverse Stock Split will increase our stock price and have the desired effect of maintaining
compliance with the rules of Nasdaq. The Board expects that the Reverse Stock Split of our Common Stock will increase the
market price of our Common Stock so that we are able to regain and maintain compliance with the Nasdaq minimum bid price listing
standard. However, the effect of the Reverse Stock Split upon the market price of our Common Stock cannot be predicted with any
certainty, and the history of similar reverse stock splits for companies in like circumstances is varied. Under applicable Nasdaq
rules, in order to regain compliance with the $1.00 minimum closing bid price requirement and maintain our listing on Nasdaq,
the $1.00 closing bid price must be maintained for a minimum of ten (10) consecutive business days. In determining whether to
monitor bid price beyond ten business days, Nasdaq will consider the following four factors: (1) margin of compliance (the amount
by which the price is above the $1.00 minimum standard); (2) trading volume (a lack of trading volume may indicate a lack of bona
fide market interest in the security at the posted bid price); (3) the market maker montage (the number of market makers quoting
at or above $1.00 and the size of their quotes); and (4) the trend of the stock price. Accordingly, we cannot assure you that
we will be able to maintain our Nasdaq listing after the Reverse Stock Split is effected or that the market price per share after
the Reverse Stock Split will exceed or remain in excess of the $1.00 minimum bid price for a sustained period of time.
It
is possible that the per share price of our Common Stock after the Reverse Stock Split will not rise in proportion to the reduction
in the number of shares of our Common Stock outstanding resulting from the Reverse Stock Split, and the market price per post-Reverse
Stock Split share may not exceed or remain in excess of the $1.00 minimum bid price for a sustained period of time, and the Reverse
Stock Split may not result in a per share price that would attract brokers and investors who do not trade in lower priced stocks.
Even if we effect the Reverse Stock Split, the market price of our Common Stock may decrease due to factors unrelated to the stock
split. In any case, the market price of our Common Stock may also be based on other factors which may be unrelated to the number
of shares outstanding, including our future performance. If the Reverse Stock Split is consummated and the trading price of the
Common Stock declines, the percentage decline as an absolute number and as a percentage of our overall market capitalization may
be greater than would occur in the absence of the Reverse Stock Split. Even if the market price per post-Reverse Stock Split share
of our Common Stock remains in excess of $1.00 per share, we may be delisted due to a failure to meet other continued listing
requirements, including Nasdaq requirements related to the minimum stockholders’ equity, the minimum number of shares that
must be in the public float, the minimum market value of the public float and the minimum number of round lot holders.
The
proposed Reverse Stock Split may decrease the liquidity of our Common Stock. The liquidity of our Common Stock may be harmed
by the proposed Reverse Stock Split given the reduced number of shares of Common Stock that would be outstanding after the Reverse
Stock Split, particularly if the stock price does not increase as a result of the Reverse Stock Split. In addition, investors
might consider the increased proportion of unissued authorized shares of Common Stock to issued shares to have an anti-takeover
effect under certain circumstances, because the proportion allows for dilutive issuances which could prevent certain stockholders
from changing the composition of the Board or render tender offers for a combination with another entity more difficult to successfully
complete. The Board does not intend for the Reverse Stock Split to have any anti-takeover effects.
Principal
Effects of the Reverse Stock Split
Common
Stock. If this proposal is approved by the stockholders at the Annual Meeting and the Board determines to effect the Reverse
Stock Split and thus amend the Certificate of Incorporation, the Company will file a certificate of amendment to the Certificate
of Incorporation with the Secretary of State of the State of Delaware. Except for adjustments that may result from the treatment
of fractional shares of Common Stock as described below, each issued share of Common Stock immediately prior to the Effective
Date will automatically be changed, as of the Effective Date, into a fraction of a share of Common Stock based on the exchange
ratio within the approved range determined by the Board. In addition, proportional adjustments will be made to the maximum number
of shares of Common Stock issuable under, and other terms of, our stock plans, as well as to the number of shares of Common Stock
issuable under, and the exercise price of, our outstanding options and warrants.
Except
for adjustments that may result from the treatment of fractional shares of Common Stock as described below, because the Reverse
Stock Split would apply to all issued shares of our Common Stock, the proposed Reverse Stock Split would not alter the relative
rights and preferences of our existing stockholders nor affect any stockholder’s proportionate equity interest in the Company.
For example, a holder of two percent (2%) of the voting power of the outstanding shares of our Common Stock immediately prior
to the effectiveness of the Reverse Stock Split will generally continue to hold two percent (2%) of the voting power of the outstanding
shares of our Common Stock immediately after the Reverse Stock Split. Moreover, the number of stockholders of record will not
be affected by the Reverse Stock Split. The amendment to the Certificate of Incorporation itself would not change the number of
authorized shares of our Common Stock. The Reverse Stock Split will have the effect of creating additional unreserved shares of
our authorized Common Stock. Although at present we have no current arrangements or understandings providing for the issuance
of the additional shares of Common Stock that would be made available for issuance upon effectiveness of the Reverse Stock Split,
other than those shares needed to satisfy the conversion and/or exercise of the Company’s outstanding convertible notes,
convertible preferred stock, warrants and options, these additional shares of Common Stock may be used by us for various purposes
in the future without further stockholder approval, including, among other things:
|
●
|
raising
capital to fund our operations and to continue as a going concern;
|
|
|
|
|
●
|
establishing
strategic relationships with other companies;
|
|
|
|
|
●
|
providing
equity incentives to our employees, officers or directors; and
|
|
|
|
|
●
|
expanding
our business or product lines through the acquisition of other businesses or products.
|
While
the Reverse Stock Split will make additional shares of Common Stock available for the Company to use in connection with the foregoing,
the primary purpose of the Reverse Stock Split is to increase our stock price in order to regain and maintain compliance with
the Nasdaq minimum bid price listing standard, which compliance will be the sole factor in determining the ratio of the Reverse
Stock Split.
Effect
on Employee Plans, Options, Restricted Stock Awards and Convertible or Exchangeable Securities. Pursuant to the terms of our
2004, 2005, 2006, 2007, 2009 Stock Incentive Plans, our 2015 and 2016 Incentive Compensation Plans, our 2013 Long Term Incentive
Plan, and our 2015, 2016 and 2017 Employee Stock Purchase Plans (collectively, “the Plans”), the Board or a committee
thereof, as applicable, will adjust the number of shares of Common Stock available for future grant under the Plans, the number
of shares of Common Stock underlying outstanding awards, the exercise price per share of outstanding stock options, and other
terms of outstanding awards issued pursuant to the Plans to equitably reflect the effects of the Reverse Stock Split. Based upon
the Reverse Stock Split ratio determined by the Board, proportionate adjustments are also generally required to be made to the
per share exercise price and the number of shares of Common Stock issuable upon the exercise or conversion of outstanding options,
and any convertible or exchangeable securities entitling the holders to purchase, exchange for, or convert into, shares of Common
Stock. This would result in approximately the same aggregate price being required to be paid under such options, and convertible
or exchangeable securities upon exercise, and approximately the same value of shares of Common Stock being delivered upon such
exercise, exchange or conversion, immediately following the Reverse Stock Split as was the case immediately preceding the Reverse
Stock Split. The number of shares of Common Stock subject to restricted stock awards and restricted stock units will be similarly
adjusted, subject to our treatment of fractional shares of Common Stock. The number of shares of Common Stock reserved for issuance
pursuant to these securities and our Plans will be adjusted proportionately based upon the Reverse Stock Split ratio determined
by the Board, subject to our treatment of fractional shares of Common Stock.
Listing.
Our shares of Common Stock currently trade on the Nasdaq Capital Market. The Reverse Stock Split will not directly affect
the listing of our Common Stock on the Nasdaq Capital Market, although we believe that the Reverse Stock Split could potentially
increase our stock price, facilitating compliance with Nasdaq’s minimum bid price listing requirement. Following the Reverse
Stock Split, our Common Stock will continue to be listed on the Nasdaq Capital Market under the symbol “VISL,” although
our Common Stock would have a new committee on uniform securities identification procedures (“CUSIP”) number, a number
used to identify our Common Stock.
“Public
Company” Status. Our Common Stock is currently registered under Section 12(b) and 12(g) of the Securities Exchange Act
of 1934, as amended (the “Exchange Act”), and we are subject to the “public company” periodic reporting
and other requirements of the Exchange Act. The proposed Reverse Stock Split will not affect our status as a public company or
this registration under the Exchange Act. The Reverse Stock Split is not intended as, and will not have the effect of, a “going
private transaction” covered by Rule 13e-3 under the Exchange Act.
Odd
Lot Transactions. It is likely that some of our stockholders will own “odd-lots” of less than 100 shares of Common
Stock following the Reverse Stock Split. A purchase or sale of less than 100 shares of Common Stock (an “odd lot”
transaction) may result in incrementally higher trading costs through certain brokers, particularly “full service”
brokers, and generally may be more difficult than a “round lot” sale. Therefore, those stockholders who own less than
100 shares of Common Stock following the Reverse Stock Split may be required to pay somewhat higher transaction costs and may
experience some difficulties or delays should they then determine to sell their shares of Common Stock.
Authorized
but Unissued Shares; Potential Anti-Takeover Effects. Our Certificate of Incorporation presently authorizes 100,000,000 shares
of Common Stock and 10,000,000 shares of preferred stock. The Reverse Stock Split would not change the number of authorized shares
of the Common Stock or preferred stock as designated. Therefore, because the number of issued and outstanding shares of Common
Stock would decrease, the number of shares of Common Stock remaining available for issuance by us in the future would increase.
Such
additional shares of Common Stock would be available for issuance from time to time for corporate purposes such as issuances of
Common Stock in connection with capital-raising transactions and acquisitions of companies or other assets, as well as for issuance
upon conversion or exercise of securities such as convertible preferred stock, convertible debt, warrants or options convertible
into or exercisable for Common Stock. We believe that the availability of the additional shares of Common Stock will provide us
with the flexibility to meet business needs as they arise, to take advantage of favorable opportunities and to respond effectively
in a changing corporate environment. For example, we may elect to issue shares of Common Stock to raise equity capital, to make
acquisitions through the use of stock, to establish strategic relationships with other companies, to adopt additional employee
benefit plans or reserve additional shares of Common Stock for issuance under such plans, where the Board determines it advisable
to do so, without the necessity of soliciting further stockholder approval, subject to applicable stockholder vote requirements
under Delaware law and Nasdaq rules. If we issue additional shares of Common Stock for any of these purposes, the aggregate ownership
interest of our current stockholders, and the interest of each such existing stockholder, would be diluted, possibly substantially.
The
additional shares of our Common Stock that would become available for issuance upon an effective Reverse Stock Split could also
be used by us to oppose a hostile takeover attempt or delay or prevent a change of control or changes in or removal of our management,
including any transaction that may be favored by a majority of our stockholders or in which our stockholders might otherwise receive
a premium for their shares of Common Stock over then-current market prices or benefit in some other manner. Although the increased
proportion of authorized but unissued shares of Common Stock to issued shares of Common Stock could, under certain circumstances,
have an anti-takeover effect, the Reverse Stock Split is not being proposed in order to respond to a hostile takeover attempt
or to an attempt to obtain control of the Company.
Fractional
Shares
We
will not issue fractional certificates for post-Reverse Stock Split shares of Common Stock in connection with the Reverse Stock
Split. To the extent any holders of pre-Reverse Stock Split shares of Common Stock are entitled to fractional shares of Common
Stock as a result of the Reverse Stock Split, the Company will issue an additional share to all holders of fractional shares of
Common Stock.
No
Dissenters’ Rights
Under
Delaware law, our stockholders would not be entitled to dissenters’ rights or rights of appraisal in connection with the
implementation of the Reverse Stock Split, and we will not independently provide our stockholders with any such rights.
Certain
United States Federal Income Tax Consequences
The
following is a summary of certain United States federal income tax consequences of the Reverse Stock Split. It does not address
any state, local or foreign income or other tax consequences, which, depending upon the jurisdiction and the status of the stockholder/taxpayer,
may vary from the United States federal income tax consequences. It applies to you only if you held pre-Reverse Stock Split shares
of Common Stock as capital assets for United States federal income tax purposes. This discussion does not apply to you if you
are a member of a class of our stockholders subject to special rules, such as (a) a dealer in securities or currencies, (b) a
trader in securities that elects to use a mark-to-market method of accounting for your securities holdings, (c) a bank, (d) a
life insurance company, (e) a tax-exempt organization, (f) a person that owns shares of Common Stock that are a hedge, or that
are hedged, against interest rate risks, (g) a person who owns shares of Common Stock as part of a straddle or conversion transaction
for tax purposes or (h) a person whose functional currency for tax purposes is not the U.S. dollar. The discussion is based on
the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), its legislative history, existing, temporary
and proposed regulations under the Internal Revenue Code, published rulings and court decisions, all as of the date hereof. These
laws, regulations and other guidance are subject to change, possibly on a retroactive basis. We have not sought and will not seek
an opinion of counsel or a ruling from the Internal Revenue Service regarding the United States federal income tax consequences
of the Reverse Stock Split.
PLEASE
CONSULT YOUR OWN TAX ADVISOR CONCERNING THE CONSEQUENCES OF THE REVERSE STOCK SPLIT IN YOUR PARTICULAR CIRCUMSTANCES UNDER THE
INTERNAL REVENUE CODE AND THE LAWS OF ANY OTHER TAXING JURISDICTION.
Tax
Consequences to United States Holders of Common Stock. A United States holder, as used herein, is a stockholder who or that
is, for United States federal income tax purposes: (a) a citizen or individual resident of the United States, (b) a domestic corporation,
(c) an estate whose income is subject to United States federal income tax regardless of its source, or (d) a trust, if a United
States court can exercise primary supervision over the trust’s administration and one or more United States persons are
authorized to control all substantial decisions of the trust. This discussion applies only to United States holders.
Except
for adjustments that may result from the treatment of fractional shares of Common Stock as described above, no gain or loss should
be recognized by a stockholder upon such stockholder’s exchange of pre-Reverse Stock Split shares of Common Stock for post-Reverse
Stock Split shares of Common Stock pursuant to the Reverse Stock Split, and the aggregate adjusted basis of the post-Reverse Stock
Split shares of Common Stock received will be the same as the aggregate adjusted basis of the Common Stock exchanged for such
new shares. The stockholder’s holding period for the post-Reverse Stock Split shares of Common Stock will include the period
during which the stockholder held the pre-Reverse Stock Split shares of Common Stock surrendered.
Accounting
Consequences
Following
the Effective Date of the Reverse Stock Split, if any, the net income or loss and net book value per share of Common Stock will
be increased because there will be fewer shares of the Common Stock outstanding. We do not anticipate that any other accounting
consequences would arise as a result of the Reverse Stock Split.
Exchange
of Stock Certificates
As
of the Effective Date, each certificate representing shares of our Common Stock outstanding before the Reverse Stock Split will
be deemed, for all corporate purposes, to evidence ownership of the reduced number of shares of our Common Stock resulting from
the Reverse Stock Split. All shares underlying options, warrants and other securities exchangeable or exercisable for or convertible
into Common Stock also automatically will be adjusted on the Effective Date.
Our
transfer agent, Continental Stock Transfer & Trust Company, will act as the exchange agent for purposes of exchanging stock
certificates subsequent to the Reverse Stock Split. Shortly after the Effective Date, stockholders of record will receive written
instructions requesting them to complete and return a letter of transmittal and surrender their old stock certificates for new
stock certificates reflecting the adjusted number of shares as a result of the Reverse Stock Split. Certificates representing
shares of Common Stock issued in connection with the Reverse Stock Split will continue to bear the same restrictive legends, if
any, that were borne by the surrendered certificates representing the shares of Common Stock outstanding prior to the Reverse
Stock Split. No new certificates will be issued until such stockholder has surrendered any outstanding certificates, together
with the properly completed and executed letter of transmittal, to the exchange agent. Until surrendered, each certificate representing
shares of Common Stock outstanding before the Reverse Stock Split would continue to be valid and would represent the adjusted
number of shares of Common Stock, based on the ratio of the Reverse Stock Split.
Any
stockholder whose stock certificates are lost, destroyed or stolen will be entitled to a new certificate or certificates representing
post-Reverse Stock Split shares of Common Stock upon compliance with the requirements that we and our transfer agent customarily
apply in connection with lost, destroyed or stolen certificates. Instructions as to lost, destroyed or stolen certificates will
be included in the letter of instructions from the exchange agent.
Upon
the Reverse Stock Split, we intend to treat stockholders holding our Common Stock in “street name”, through a bank,
broker or other nominee, in the same manner as registered stockholders whose shares of Common Stock are registered in their names.
Banks, brokers and other nominees will be instructed to effect the Reverse Stock Split for their beneficial holders holding our
Common Stock in “street name”. However, such banks, brokers and other nominees may have different procedures than
registered stockholders for processing the Reverse Stock Split. If you hold your shares in “street name” with a bank,
broker or other nominee, and if you have any questions in this regard, we encourage you to contact your bank, broker or nominee.
YOU
SHOULD NOT DESTROY YOUR STOCK CERTIFICATES AND YOU SHOULD NOT SEND THEM NOW. YOU SHOULD SEND YOUR STOCK CERTIFICATES ONLY AFTER
YOU HAVE RECEIVED INSTRUCTIONS FROM THE EXCHANGE AGENT AND IN ACCORDANCE WITH THOSE INSTRUCTIONS.
If
any certificates for shares of Common Stock are to be issued in a name other than that in which the certificates for shares of
Common Stock surrendered are registered, the stockholder requesting the reissuance will be required to pay to us any transfer
taxes or establish to our satisfaction that such taxes have been paid or are not payable and, in addition, (a) the transfer must
comply with all applicable federal and state securities laws, and (b) the surrendered certificate must be properly endorsed and
otherwise be in proper form for transfer.
Book-Entry
The
Company’s registered stockholders may hold some or all of their shares electronically in book-entry form with our transfer
agent. These stockholders do not have stock certificates evidencing their ownership of Common Stock. They are, however, provided
with a statement reflecting the number of shares of Common Stock registered in their accounts.
|
●
|
If
you hold registered shares of Common Stock in book-entry form, you do not need to take any action to receive your post-Reverse
Stock Split shares of Common Stock in registered book-entry form.
|
|
|
|
|
●
|
If
you are entitled to post-Reverse Stock Split shares of Common Stock, a transaction statement will automatically be sent to
your address of record by our transfer agent as soon as practicable after the Effective Date indicating the number of shares
of Common Stock that you hold.
|
Interests
of Directors and Executive Officers
Our
directors and executive officers have no substantial interests, directly or indirectly, in the matters set forth in this proposal
except to the extent of their ownership of shares of our Common Stock and equity awards under granted to them under our equity
incentive plans.
Vote
Required and Recommendation
Our
By-laws provide that, on all matters (other than the election of directors and except to the extent otherwise required by our
Certificate of Incorporation or applicable Delaware law), the affirmative vote of a majority of the shares of Common Stock outstanding
and entitled to vote on the matter will be required for approval of the amendment to our Certificate of Incorporation to give
effect to the reverse stock split. Accordingly, the affirmative vote of a majority of the shares of Common Stock outstanding on
the Record Date and entitled to vote on the matter will be required to approve the Reverse Stock Split.
At
the Annual Meeting a vote will be taken on a proposal to amend the Company’s Certificate of Incorporation to effect the
Reverse Stock Split at the discretion of the Board of Directors.
THE
BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE APPROVAL OF
PROPOSAL
NO. 3.
FUTURE
STOCKHOLDER PROPOSALS
The
Board of Directors has not yet determined the date on which the next Annual Meeting of Stockholders will be held. Stockholders
may submit proposals on matters appropriate for stockholder action at an Annual Meeting of Stockholders in accordance with the
rules and regulations adopted by the SEC. Any proposal which an eligible stockholder desires to have included in our proxy statement
and presented at the next Annual Meeting of Stockholders will be included in our proxy statement and related proxy card if it
is received by us by , 20 and if it complies with SEC rules regarding inclusion of proposals in proxy statements, including Rule
14a-8 promulgated under the Exchange Act. In order to avoid controversy as to the date on which we receive a proposal, it is suggested
that any stockholder who wishes to submit a proposal submit such proposal by certified mail, return receipt requested.
Other
deadlines apply to the submission of stockholder proposals for the next Annual Meeting of Stockholders that are not required to
be included in our proxy statement under SEC rules. With respect to these stockholder proposals for the next Annual Meeting of
Stockholders, a stockholder’s notice must be received by us a reasonable time before we begin to print and send our proxy
materials. The form of proxy distributed by the Board for such meeting will confer discretionary authority to vote on any such
proposal not received by such date. If any such proposal is received by such date, the proxy statement for the Annual Meeting
of Stockholders will provide advice on the nature of the matter and how we intend to exercise our discretion to vote on each such
matter if it is presented at that meeting.
EXPENSES
AND SOLICITATION
We
will bear the costs of printing and mailing proxies. In addition to soliciting our stockholders by mail or through our regular
employees, we may request banks, brokers and other custodians, nominees and fiduciaries to solicit their customers who have shares
of our Common Stock registered in the name of a nominee and, if so, will reimburse such banks, brokers and other custodians, nominees
and fiduciaries for their reasonable out-of-pocket costs. Solicitation by our officers and employees may also be made of some
our stockholders following the original solicitation.
OTHER
BUSINESS
The
Board knows of no other items that are likely to be brought before the meeting except those that are set forth in the foregoing
Notice of Annual Meeting. If any other matters properly come before the Annual Meeting, the persons designated on the enclosed
proxy will vote in accordance with their judgment on such matters.
ADDITIONAL
INFORMATION
We
are subject to the information and reporting requirements of the Exchange Act, and in accordance therewith, we file periodic reports,
documents and other information with the SEC relating to our business, financial statements and other matters. Such reports and
other information may be accessed at www.sec.gov. You are encouraged to review our Annual Report on Form 10-K, together with any
subsequent information we filed or will file with the SEC and other publicly available information. A copy of any public filing
is also available, at no charge, by contacting our legal counsel, Sullivan & Worcester LLP, Attn: David E. Danovitch, Esq.
at (212) 660-3060.
*************
It
is important that the proxies be returned promptly and that your shares be represented. Stockholders are urged to mark, date,
execute, and promptly return the accompanying proxy card.
March
___, 2020
|
By
Order of the Board of Directors,
|
|
|
|
|
/s/
Susan Swenson
|
|
Name:
|
Susan
Swenson
|
|
Title:
|
Chairman
of the Board of Directors
|
Appendix
A
Vislink
Technologies, Inc.
AUDIT
COMMITTEE CHARTER
Role
The
Audit Committee of the Board of Directors assists the Board of Directors in fulfilling its responsibility for oversight of the
quality and integrity of the accounting, auditing, and reporting practices of the Company, and such other duties as directed by
the Board. The Committee’s purpose is to oversee the accounting and financial reporting processes of the Company, the audits
of the Company’s financial statements, the qualifications of the public accounting firm engaged as the Company’s independent
auditor to prepare or issue an audit report on the financial statements of the Company, and the performance of the Company’s
internal and independent auditors. The Committee’s role includes a particular focus on the qualitative aspects of financial
reporting to shareholders, the Company’s processes to manage business and financial risk, and compliance with significant
applicable legal, ethical, and regulatory requirements. The Committee is directly responsible for the appointment, compensation,
retention and oversight of the independent auditor.
Membership
The
membership of the Committee shall consist of at least three directors, all of whom shall meet the independence requirements established
by the Board and applicable laws, regulations and listing requirements provided, that to the extent that the Board so determines
and applicable laws, regulations and listing requirements permit (as, for instance, with regard to companies which are “Small
Business Issuers” within the meaning of the applicable rules and regulations promulgated by the Securities and Exchange
Commission (the “SEC”), the membership of the Committee may consist of at least two directors or, if the membership
of the Committee consists of at least three directors, one need not meet the aforesaid independence requirements. Each member
shall in the judgment of the Board have the ability to read and understand fundamental financial statements. At least one member
of the Committee shall in the judgment of the Board be an “audit committee financial expert” as defined by the rules
and regulations promulgated by the SEC (the “SEC Rules”), and at least one member (who may also serve as the audit
committee financial expert) shall in the judgment of the Board meet the applicable financial sophistication standard as defined
by the requirements of the market or exchange on which the Company’s securities may from time to time be listed or qualified
for trading. The Board appoints the members of the Committee and the chairperson. The Board may remove any member from the Committee
at any time with or without cause.
Operations
The
Committee shall meet at least six times a year. Additional meetings may occur as the Committee or its chair deems advisable. The
Committee will cause to be kept adequate minutes of all its proceedings, and will report on its actions and activities at the
next quarterly meeting of the Board. Committee members will be furnished with copies of the minutes of each meeting and any action
taken by unanimous consent. The Committee is governed by the same rules regarding meetings (including meetings by conference telephone
or similar communications equipment), action without meetings, notice, waiver of notice, and quorum and voting requirements as
are applicable to the Board. The Committee is authorized and empowered to adopt its own rules of procedure not inconsistent with
(a) any provision of this Charter, (b) any provision of the Bylaws of the Company, or (c) the laws of the state of Delaware.
Communications
The
independent auditor reports directly to the Committee. The Committee is expected to maintain free and open communication with
the independent auditor, the internal auditors, and management. This communication will include periodic private executive sessions
with each of these parties.
Education
The
Company is responsible for providing new members with appropriate orientation briefings and educational opportunities, and the
full Committee with educational resources related to accounting principles and procedures, current accounting topics pertinent
to the Company and other material as may be requested by the Committee. The Company will assist the Committee in maintaining appropriate
financial literacy.
Authority
The
Committee will have the resources and authority necessary to discharge its duties and responsibilities. The Committee has sole
authority to retain and terminate outside financial experts or similar consultants, as it deems appropriate, including sole authority
to approve the firms’ fees and other retention terms. The Committee will be provided with appropriate funding by the Company,
as the Committee determines, for the payment of compensation to the Company’s independent auditor and other advisors as
it deems appropriate, and ordinary administrative expenses of the Committee that are necessary or appropriate in carrying out
its duties. In discharging its oversight role, the Committee is empowered to investigate any matter brought to its attention.
Any communications between the Committee and legal counsel in the course of obtaining legal advice will be considered privileged
communications of the Company, and the Committee will take all necessary steps to preserve the privileged nature of those communications.
The
Committee may form and delegate authority to subcommittees and may delegate authority to one or more designated members of the
Committee.
Responsibilities
The
Committee’s specific responsibilities in carrying out its oversight role are delineated in the Audit Committee Responsibilities
Calendar. The Responsibilities Calendar will be updated annually to reflect changes in regulatory requirements, authoritative
guidance, and evolving oversight practices. As the compendium of Committee responsibilities, the most recently updated Responsibilities
Calendar will be considered to be an addendum to this Charter.
The
Committee relies on the expertise and knowledge of management, the internal auditors and the independent auditor in carrying out
its oversight responsibilities. Management of the Company is responsible for determining the Company’s financial statements
are complete, accurate and in accordance with generally accepted accounting principles. The independent auditor is responsible
for auditing the Company’s financial statements. It is not the duty of the Committee to plan or conduct audits, to determine
that the financial statements are complete and accurate and in accordance with generally accepted accounting principles, to conduct
investigations, or to assure compliance with laws and regulations or the Company’s standards of business conduct, codes
of ethics, internal policies, procedures and controls.
Vislink
Technologies, Inc. Audit Committee Responsibilities Calendar
|
|
WHEN
PERFORMED
Audit
Committee Meetings
|
RESPONSIBILITY
|
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
|
As
Needed
|
|
|
|
|
|
|
|
|
|
|
|
1. The
agenda for Committee meetings will be prepared in consultation between the Committee chair (with input from the Committee
members), Finance management, and the independent auditor.
|
|
X
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|
X
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X
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|
X
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|
X
|
2. Review
and update the Audit Committee Charter and Responsibilities Calendar annually.
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|
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X
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3. Complete
an annual evaluation of the Committee’s performance.
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X
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4. Provide
a report in the annual proxy that includes the Committee’s
review and discussion of matters with management and the
independent
auditor.
|
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X
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|
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5. Include
a copy of the Committee charter as an appendix to the proxy statement at least once every three years. Appoint or replace the
independent auditor and approve.
|
|
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|
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|
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|
|
X
|
|
|
WHEN PERFORMED
Audit
Committee Meetings
|
RESPONSIBILITY
|
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
|
As
Needed
|
6.
The terms on which the independent auditor is engaged for the ensuing fiscal year. At least annually, evaluate the
independent auditor’s qualifications, performance, and independence, including that of the lead partner. The evaluation
will include obtaining a written report from the independent auditor describing: the firm’s internal quality control
procedures; any material issues raised by the most recent internal.
|
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|
|
|
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X
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7. Quality
control review, or peer review, of the firm or by any inquiry or investigation by governmental or professional authorities
within the past five years, concerning an independent audit or audits carried out by the firm, and any steps taken to deal
with those issues; and all relationships between the independent auditor and the Company.
|
|
|
|
|
|
|
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X
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|
X
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8. Resolve
any disagreements between management and the independent auditor about financial reporting. Establish and oversee a policy
designating permissible services that the independent auditor may perform for the Company, providing for pre-approval of
those services by.
|
|
|
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X
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9. The
Committee subject to the de minimis exceptions permitted under applicable rules, and quarterly review of any services
approved by the designated member under the policy and the firm’s non-audit services and related fees.
|
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X
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X
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X
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X
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X
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10. Review
the responsibilities, functions and performance of the Company’s internal audit department.
|
|
X
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|
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11. Ensure
receipt from the independent auditor of a formal written statement delineating all relationships between the auditor and the
company, consistent with Independence Standards Board Standard No. 1, and actively engage in a dialogue with the auditor
about any disclosed relationships or services that may impact the objectivity and independence of the auditor, and take
appropriate action to oversee the independence of the independent auditor.
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|
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|
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X
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|
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12. Advise
the Board about the Committee’s determination whether the Committee consists of three or more members all of whom are
financially literate, including at least one member who has financial sophistication and is a financial expert.
|
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X
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|
|
|
|
|
|
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13.
Inquire of Finance management and the independent auditor about significant risks or exposures, review the Company’s
policies for risk assessment and risk management, and assess the steps management has taken to control such risk to the
Company.
|
|
X
|
|
X
|
|
|
|
|
|
|
14.
Review with the independent auditor and Finance management the audit scope and plan, and coordination of audit efforts to
ensure completeness of coverage, reduction of redundant efforts, the effective use of audit resources, and the use of
independent public accountants other than the appointed auditors of the Company.
|
|
X
|
|
X
|
|
X
|
|
|
|
|
|
|
WHEN
PERFORMED Audit
Committee Meetings
|
RESPONSIBILITY
|
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
|
As
Needed
|
15. Consider
and review with Finance management and the independent auditor:
|
|
|
|
|
|
|
|
|
|
|
a.
The Company’s annual assessment of the effectiveness of its internal controls and the independent auditor’s attestation
and report about the Company’s assessment.
|
|
X
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|
|
|
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|
|
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|
b.
The adequacy of the Company’s internal controls including computerized information system controls and security.
|
|
X
|
|
|
|
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|
|
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|
c.
Any related significant findings and recommendations of the independent auditor and internal audit together with management’s
responses.
|
|
|
|
|
|
|
|
|
|
X
|
16.
Review with Finance management any significant changes to GAAP and/or MAP policies or standards.
|
|
X
|
|
X
|
|
X
|
|
X
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|
|
17.
Review with Finance management and the independent auditor at the completion of the annual audit:
|
|
|
|
|
|
|
|
|
|
|
a.
The Company’s annual financial statements and related footnotes.
|
|
X
|
|
|
|
|
|
|
|
X
|
b.
The independent auditor’s audit of the financial statements and its report thereon.
|
|
X
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|
|
|
|
|
|
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X
|
c.
Any significant changes required in the independent auditor’s audit plan.
|
|
X
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|
|
|
|
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X
|
d.
Any serious difficulties or disputes with management encountered during the course of the audit and management’s response.
|
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X
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|
|
|
|
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|
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X
|
e.
Other matters related to the conduct of the audit which are to be communicated to the Committee under generally accepted auditing
standards.
|
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X
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|
|
|
|
|
|
|
X
|
18.
Review with Finance management and the independent auditor at least annually the Company’s critical accounting
policies.
|
|
X
|
|
|
|
|
|
|
|
X
|
19.
Review policies and procedures with respect to transactions between the Company and officers and directors, or affiliates of
officers or directors, or transactions that are not a normal part of the Company’s business, and review and approve
those related-party transactions that would be disclosed pursuant to SEC Regulation S-K, Item 404.
|
|
|
|
|
|
|
|
X
|
|
X
|
20.
Consider and review with Finance management:
|
|
|
|
|
|
|
|
|
|
|
a.
Significant findings during the year and management’s responses.
|
|
X
|
|
X
|
|
X
|
|
X
|
|
X
|
b.
Any difficulties encountered in the course of their audits, including any restrictions on the scope of their work or access
to required information.
|
|
X
|
|
X
|
|
X
|
|
X
|
|
X
|
c.
Any changes required in planned scope of their audit plan.
|
|
X
|
|
X
|
|
X
|
|
X
|
|
X
|
21.
Participate in a telephonic meeting among Finance management and the independent auditor before each earnings release to
discuss the earnings release, financial information and earnings guidance.
|
|
X
|
|
X
|
|
X
|
|
X
|
|
|
22.
Review and discuss with Finance management and the independent auditor the Company’s quarterly financial
statements.
|
|
X
|
|
X
|
|
X
|
|
X
|
|
|
23.
Review the periodic reports of the Company with Finance management and the independent auditor prior to filing of the reports
with the SEC, including the disclosures under “Management’s Discussion and Analysis of Financial Condition and
Results of Operations”.
|
|
X
|
|
X
|
|
X
|
|
X
|
|
|
|
|
WHEN
PERFORMED Audit
Committee Meetings
|
RESPONSIBILITY
|
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
|
As
Needed
|
24.
In connection with each periodic report of the Company, review:
|
|
|
|
|
|
|
|
|
|
|
a.
Management’s disclosure to the Committee and the independent auditor under Section 302 of the Sarbanes-Oxley Act, including
identified changes in internal control over financial reporting.
|
|
X
|
|
X
|
|
X
|
|
X
|
|
|
b.
The contents of the Chief Executive Officer and the Chief Financial Officer certificates to be filed under Sections 302 and
906 of the Sarbanes-Oxley Act.
|
|
X
|
|
X
|
|
X
|
|
X
|
|
|
25.
Monitor the appropriate standards adopted as a code of conduct for the Company.
|
|
|
|
X
|
|
|
|
|
|
X
|
26.
Review with the applicable officer of the Company legal and regulatory matters that may have a material impact on the
financial statements, related Company compliance policies, and programs and reports received from regulators.
|
|
X
|
|
X
|
|
X
|
|
X
|
|
|
27.
Develop, review and oversee procedures for (i) receipt, retention and treatment of complaints received by the Company
regarding accounting, internal accounting controls and auditing matters, and (ii) the confidential, anonymous submission of
employee concerns regarding accounting or auditing matters. The procedures established pursuant to this paragraph should also
be made available for use by persons making reports under the Company’s Code of Conduct or Whistleblower
Policy.
|
|
|
|
X
|
|
|
|
|
|
X
|
28.
Meet with the independent auditor in executive session to discuss any matters the Committee or the independent auditor
believes should be discussed privately with the Audit Committee.
|
|
X
|
|
X
|
|
X
|
|
X
|
|
|
29.
Meet with Finance management in executive sessions to discuss any matters the Committee or Finance management believes should
be discussed privately with the Audit Committee.
|
|
|
|
|
|
|
|
|
|
X
|
30.
Set clear hiring policies for the Company’s hiring of employees or former employees of the independent auditor who were
engaged in the Company’s account, and ensure the policies comply with any regulations applicable to the
Company.
|
|
|
|
|
|
|
|
|
|
X
|
Appendix
B
Vislink
Technologies, Inc.
COMPENSATION
COMMITTEE CHARTER
Role
The
Compensation Committee’s role is to discharge the Board’s responsibilities relating to compensation of the Company’s
executives, to produce an annual report on executive compensation for inclusion in the Company’s proxy statement, and to
oversee and advise the Board on the adoption of policies that govern the Company’s compensation programs, including stock
and benefit plans.
Membership
The
membership of the Committee consists of at least three directors, all of whom shall, except as otherwise permitted under applicable
laws, regulations and listing requirements, (a) meet the independence requirements established by the Board and applicable laws,
regulations and listing requirements, (b) be a “non-employee director” within the meaning of Rule 16b-3 under the
Securities Exchange Act of 1934, and (c) be an “outside director” within the meaning of Section 162(m) of the Internal
Revenue Code. The Board appoints the members of the Committee and the chairperson. The Board may remove any member from the Committee
at any time with or without cause.
Operations
The
Committee shall meet at least once a year. Additional meetings may occur as the Committee or its chair deems advisable. The Committee
will cause to be kept adequate minutes of all its proceedings, and will report on its actions and activities at the next quarterly
meeting of the Board. Committee members will be furnished with copies of the minutes of each meeting and any action taken by unanimous
consent. The Committee is governed by the same rules regarding meetings (including meetings by conference telephone or similar
communications equipment), action without meetings, notice, waiver of notice, and quorum and voting requirements as are applicable
to the Board. The Committee is authorized to adopt its own rules of procedure not inconsistent with (a) any provision of this
Charter, (b) any provision of the Bylaws of the Company, or (c) the laws of the state of Delaware.
Authority
The
Committee will have the resources and authority necessary to discharge its duties and responsibilities. The Committee has sole
authority to retain and terminate compensation consultants retained to assist the Committee in determining the compensation of
the Chief Executive Officer or senior executive officers, or other similar experts or consultants, as it deems appropriate, including
sole authority to approve the firms’ fees and other retention terms. Any communications between the Committee and legal
counsel in the course of obtaining legal advice will be considered privileged communications of the Company and the Committee
will take all necessary steps to preserve the privileged nature of those communications.
The
Committee may form and delegate authority to subcommittees and may delegate authority to one or more designated members of the
Committee.
Responsibilities
Subject
to the provisions of any applicable Vislink Technologies, Inc. corporate governance policies, the principal responsibilities and
functions of the Compensation Committee are as follows:
|
1.
|
Review
the competitiveness of the Company’s executive compensation programs to ensure (a) the attraction and retention of corporate
officers, (b) the motivation of corporate officers to achieve the Company’s business objectives, and (c) the alignment
of the interests of key leadership with the long-term interests of the Company’s shareholders.
|
|
2.
|
Review
trends in management compensation, oversee the development of new compensation plans, and, when necessary, approve the revision
of existing plans.
|
|
|
|
|
3.
|
Review
and approve the compensation structure for corporate officers at the level of corporate vice president and above.
|
|
|
|
|
4.
|
Oversee
an evaluation of the performance of the Company’s executive officers and approve the annual compensation, including
salary, bonus, incentive and equity compensation, for the executive officers.
|
|
|
|
|
5.
|
Review
and approve CEO goals and objectives, evaluate CEO performance in light of these corporate objectives, and set CEO compensation
consistent with company philosophy. The CEO may not be present during deliberations or voting concerning the CEO’s compensation.
The CEO will be reviewed by the Chairman of the Board. The results of the annual CEO evaluation will be considered in setting
CEO salary and other compensation.
|
|
|
|
|
6.
|
Review
and approve compensation packages for new corporate officers and termination packages for corporate officers as requested
by management.
|
|
|
|
|
7.
|
Review
and discuss with the Board and senior officers plans for officer development and corporate succession plans for the CEO and
other senior officers.
|
|
|
|
|
8.
|
Review
and make recommendations concerning long-term incentive compensation plans, including the use of equity-based plans. Except
as otherwise delegated by the Board, the Committee will act on behalf of the Board as the “Committee” established
to administer equity-based and employee benefit plans, and as such will discharge any responsibilities imposed on the Committee
under those plans, including making and authorizing grants, in accordance with the terms of those plans.
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|
|
|
|
9.
|
Review
periodic reports from management on matters relating to the Company’s personnel appointments and practices.
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|
|
|
|
10.
|
Produce
an annual Report of the Compensation Committee on Executive Compensation for the Company’s annual proxy statement in
compliance with applicable Securities and Exchange Commission rules and regulations and relevant listing authority.
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|
|
|
|
11.
|
Regularly
review and make recommendations about changes to the charter of the Committee.
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|
|
|
|
12.
|
Obtain
or perform an annual evaluation of the Committee’s performance and make applicable recommendations.
|
Appendix
C
Vislink
Technologies, Inc.
GOVERNANCE
AND NOMINATION COMMITTEE CHARTER
Revised
as of August 8, 2019
Role
The
Governance and Nomination Committee’s role is to: determine the slate of director nominees for election to the Company’s
Board of Directors, to identify and recommend candidates to fill vacancies occurring between annual shareholder meetings, to review,
evaluate and recommend changes to the Company’s corporate governance policies and to consider matters of corporate governance
generally, to develop and recommend qualification standards and other criteria for selecting new Directors, and to review the
Company’s policies and programs that relate to matters of corporate responsibility, including public issues of significance
to the Company and its stakeholders.
Membership
The
membership of the Committee consists of at least two directors, each of whom shall meet the independence requirements established
by the Board and applicable laws, regulations and listing requirements, provided, that if the Committee consists of at least three
directors and applicable laws, regulations and listing requirements so permit, one of those directors need not meet independence
requirements. The Board appoints the members of the Committee and the chairperson. The Board may remove any member from the Committee
at any time with or without cause.
Operations
The
Committee shall meet at least twice a year. The two established meetings for the Committee shall be in connection with the quarterly
board meeting to review the second quarter financial statements and at the yearend board meeting at which time the Committee shall
evaluate, establish, and recommend to the full Board of Directors candidates for the succeeding year’s proxy statement.
Additional meetings may occur as the Committee or its chair deems advisable. The Committee will cause to be kept adequate minutes
of all its proceedings, and will report on its actions and activities at the next quarterly meeting of the Board (or within four
months, whichever occurs sooner). Committee members will be furnished with copies of the minutes of each meeting and any action
taken by unanimous consent. The Committee is governed by the same rules regarding meetings (including meetings by conference telephone
or similar communications equipment), action without meetings, notice, waiver of notice, and quorum and voting requirements as
are applicable to the Board. The Committee is authorized and empowered to adopt its own rules of procedure not inconsistent with
(a) any provision of this Charter, (b) any provision of the Bylaws of the Company, or (c) the laws of the state of Delaware.
Authority
The
Committee will have the resources and authority necessary to discharge its duties and responsibilities. The Committee has sole
authority to retain and terminate any search firm used to identify director candidates, or other similar experts or consultants,
as it deems appropriate, including sole authority to approve such firms’ fees and other retention terms. Any communications
between the Committee and legal counsel in the course of obtaining legal advice will be considered privileged communications of
the Company and the Committee will take all necessary steps to preserve the privileged nature of those communications.
The
Committee may form and delegate authority to subcommittees and may delegate authority to one or more designated members of the
Committee.
Responsibilities
Subject
to the provisions of the Corporate Governance Guidelines, the principal responsibilities and functions of the Governance and Nomination
Committee are as follows:
1.
Annually evaluate and report to the Board on the performance and effectiveness of the Board to facilitate the directors fulfilling
their responsibilities in a manner that serves the interests of Vislink Technologies, Inc.’s shareholders.
2.
Annually present to the Board a list of individuals recommended for nomination for election to the Board at the annual meeting
of shareholders.
3.
Before recommending an incumbent, replacement or additional director, review his or her qualifications, including capability,
availability to serve, conflicts of interest, and other relevant factors.
4.
Assist in identifying, interviewing and recruiting candidates for the Board.
5.
Annually review the composition of each committee and present recommendations for committee memberships to the Board as requested
by the Board.
6.
Periodically review the compensation paid to non-employee directors for annual retainers (including Board and committee Chairs)
and meeting fees, if any, and make recommendations to the Board for any adjustments. No member of the Committee will act to fix
his or her own compensation except for uniform compensation to directors for their services as such.
7.
Develop and periodically review and recommend to the Board appropriate revisions to the Company’s corporate governance policies,
including, among other things, periodically reviewing the Company’s General Code of Ethics; Code of Ethics for Executive
Officers and Principal Accounting Personnel; confidential information and insider trading policies and any similar Company codes
and policies, and, based on such periodic review, recommend changes to the Board as deemed appropriate.
8.
Monitor compliance with the Company’s corporate governance policies.
9.
Review and discuss with management disclosure of the Company’s corporate governance practices, including information regarding
the operations of the Committee, director independence and the director nominations process, and to recommend that this disclosure
be included in the Company’s proxy statement or annual report on Form 10-K, as applicable.
10.
Regularly review and make recommendations about changes to the charters of all Board committees after consultation with the respective
committee chairs, in addition to the Committee charter.
11.
Obtain or perform an annual evaluation of the Committee’s performance and make applicable recommendations.
12.
Assist the Chairman of the Board, if the Chairman is a non-management director, or otherwise the Chairman of the Committee acting
as Lead Independent Director, in leading the Board’s annual review of the Chief Executive Officer’s performance.
Foundation
In
fulfilling its responsibilities, the Committee will seek to be guided by the following principles:
1.
The Board will need directors capable of satisfying the Board’s oversight responsibilities, which include monitoring and/or
making inquiries or ensuring: (a) the Company’s performance in relation to its plans, strategies, financial and non-financial
objectives; (b) the performance and effectiveness of the Company’s management team; (c) succession and development plans
for key Company executives; (d) through the Audit Committee, evaluating the integrity of the Company’s accounting and financial
reporting systems, including the audit of the Company’s annual financial statements by the independent auditors, and that
appropriate systems of control are in place; and (e) the Company’s compliance with legal and regulatory requirements.
2.
Board members are expected to: (a) become and remain informed about the Company, its business and its industry; (b) attend all
meetings of the Board and of Board committees on which they serve, having read and considered any materials distributed in advance
of the meeting; and (c) participate constructively in Board and committee meetings, drawing upon their individual experience,
knowledge and background, as appropriate, to provide perspectives and insights.
3.
The Committee will continue to monitor best practices throughout the small and microcap industry. The goal of such effort will
be to ensure that:
(a)
Frequency of Meetings
The
Board will hold at least four regular meetings each year and may hold additional or special meetings whenever necessary. Regular
Board meetings will, where appropriate and efficient, be held in person, although Board members may participate by conference
call. Special meetings may be held either in person or by conference call. The Board may also act by unanimous written consent.
(b)
Board Agendas
In
preparation for meetings of the Board, the Chairman, in consultation with the CEO, if such positions are held separately with
support from the Secretary of the Company and such other officers as the CEO or Secretary shall designate, shall disseminate to
directors on a timely basis briefing materials regarding matters to be included in the meeting agenda, as well as minutes from
prior meetings and any written reports by committees. Each Board member may suggest inclusion of items on the agenda and raise
at any Board meeting subjects that are not specifically on the agenda for that meeting.
(c)
Board Materials Distributed in Advance
Information
and materials that are important to the Board’s understanding of the agenda items and other topics to be considered at a
Board meeting should, to the extent practicable and appropriate, be distributed sufficiently in advance of the meeting to permit
prior review by the directors. Directors are expected to have reviewed and be prepared to discuss all materials distributed in
advance of any meeting.
(d)
Board Committees
The
Board currently has the following standing committees: Governance and Nomination Committee, Audit Committee and Compensation Committee.
The committees’ charters are posted on the Company’s website. From time to time the Board may form a new committee
or disband a current committee depending on the circumstances. Each committee will comply with the independence and other requirements
established by applicable law and regulations, including Securities and Exchange Commission and NASDAQ (or any other exchange
on which it may be listed) rules, within any required timeframes.
(e)
Nominating Process
The
nominating process outlined herein applies only with respect to the nomination of director candidates who will be presented to
the Company’s stockholders for election at the Annual Meeting, if any.
|
(i)
|
The
Committee is responsible for screening and recommending to the Board nominees for election as directors of the Company, including
nominees recommended by stockholders of the Company. When formulating its Board membership recommendations, the Committee
will consider advice and recommendations from stockholders, management, and others as it deems appropriate, and will also
take into account the performance of incumbent directors in determining whether to recommend them to stand for reelection
at the annual meeting of stockholders.
|
|
|
|
|
(ii)
|
After
the completion of interviews (including, as appropriate, with other Board members, the CEO and other members of senior management)
and reference checks of identified candidates, the Committee will meet in person or by conference call to discuss and make
recommendations to the Board with respect to the candidates. The full Board will then vote on the committee’s recommendations.
Those candidates approved by a majority of the Board shall be nominated for election by the Company’s stockholders at
the next Annual Meeting.
|
The
Chairman of the Board will contact any candidate(s) so approved, invite them to attend the Company’s Annual Meeting and
to join the Board at its first meeting thereafter, if they are elected by the Company’s stockholders at the Annual Meeting.
In the case of a Board candidate appointed between Annual Meetings, the same nominating process will generally apply except that
the approved candidate will be invited to join the Board at its next meeting after his/her approval by the Board and will stand
for election by stockholders at the first Annual Meeting thereafter.
Appendix
D
FORM
OF CERTIFICATE OF AMENDMENT OF
CERTIFICATE
OF INCORPORATION OF
Vislink
Technologies, Inc.
Vislink
Technologies, Inc., a corporation organized and existing under and by virtue of the General Corporation Law of the State of Delaware
(the “Corporation”), does hereby certify that:
FIRST:
The name of the Corporation is Vislink Technologies, Inc.
SECOND:
This Certificate of Amendment (this “Certificate of Amendment”) amends the provisions of the Corporation’s
Certificate of Incorporation, as amended, and any amendments thereto (the “Certificate of Incorporation”),
last amended by the Certificate of Amendment to the Certificate of Incorporation filed with the Secretary of State on February
11, 2019.
THIRD:
The Article 4(a) of the Certificate of Incorporation is hereby amended as follows:
“a)
Common Stock. Each holder of record of Common Stock shall have the right to one vote for each share of Common Stock registered
in the holder’s name on the books of the Corporation on all matters submitted to a vote of stockholders except as the right
to exercise such vote may be limited by the provisions of this Certificate of Incorporation or of any class or series of Preferred
Stock established hereunder. The holders of Common Stock shall be entitled to such dividends as may be declared by the Board of
Directors from time to time, provided that required dividends, if any, on Preferred Stock have been paid or provided for. In the
event of the liquidation, dissolution, or winding up, whether voluntary or involuntary, of the Corporation, the assets and funds
of the Corporation available for distribution to stockholders, and remaining after the payment to holders of Preferred Stock of
the amounts, if any, to which they are entitled, shall be divided and paid to the holders of Common Stock according to their respective
shares.
Upon
the filing of this Amendment with the Secretary of State of the State of Delaware (the “Effective Time”), each
________ outstanding shares of Common Stock (the “Old Common Stock”) shall be combined and converted into one
(1) share of Common Stock (the “New Common Stock”). This reverse stock split (the “Reverse Split”)
of the outstanding shares of Common Stock shall not affect the total number of shares of capital stock, including the Common Stock,
that the Company is authorized to issue, which shall remain as set forth under this Article 4.
The
Reverse Split shall occur without any further action on the part of the Corporation or the holders of shares of New Common Stock
and whether or not certificates representing such holders’ shares prior to the Reverse Split are surrendered for cancellation.
No fractional interest in a share of New Common Stock shall be deliverable upon the Reverse Split, all of which shares of New
Common Stock be rounded up to the nearest whole number of such shares. All references to “Common Stock” in these Articles
shall be to the New Common Stock.
The
Reverse Split will be effectuated on a stockholder-by-stockholder (as opposed to certificate-by-certificate) basis. Certificates
dated as of a date prior to the Effective Time representing outstanding shares of Old Common Stock shall, after the Effective
Time, represent a number of shares equal to the same number of shares of New Common Stock as is reflected on the face of such
certificates, divided by and rounded up to the nearest whole number. The Corporation shall not be obligated to issue new certificates
evidencing the shares of New Common Stock outstanding as a result of the Reverse Split unless and until the certificates evidencing
the shares held by a holder prior to the Reverse Split are either delivered to the Corporation or its transfer agent, or the holder
notifies the Corporation or its transfer agent that such certificates have been lost, stolen or destroyed and executes an agreement
satisfactory to the Corporation to indemnify the Corporation from any loss incurred by it in connection with such certificates.”
Notwithstanding
the foregoing, the language under this Article 4(a) shall not be amended in any way.
FOURTH:
This amendment was duly adopted in accordance with the provisions of Sections 212 and 242 of the General Corporation Law of the
State of Delaware.
FIFTH:
This Certificate of Amendment shall be effective as of New York Time on the date written below.
IN
WITNESS WHEREOF, the Corporation has caused this Certificate of Amendment to be signed by its officer thereunto duly authorized
this day of , 2020.
|
VISLINK
TECHNOLOGIES, INC.
|
|
|
|
|
By:
|
/s/
Carleton M. Miller
|
|
Name:
|
Carleton
M. Miller
|
|
Title:
|
Chief
Executive Officer
|
ANNUAL
MEETING OF STOCKHOLDERS OF
Vislink
Technologies, Inc.
April
17, 2020
Please
mark, date, sign and mail your proxy card in the
envelope
provided as soon as possible
MARK,
DATE, SIGN AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE [X].
1.
|
Election
of Directors
|
|
|
[ ]
|
Carleton
M. Miller
|
|
|
[ ]
|
Susan
Swenson
|
|
|
[ ]
|
General
James T. Conway
|
|
|
[ ]
|
Jude
T. Panetta
|
|
|
[ ]
|
Ralph
Faison
|
|
|
[ ]
|
WITHHOLD
AUTHORITY FOR ALL NOMINEES
|
|
|
[ ]
|
FOR
ALL EXCEPT
|
2.
To approve a proposal to ratify the Board’s selection of MARCUM LLP as the Company’s independent registered public
accountants for the fiscal year ending December 31, 2020.
|
|
[ ]
|
FOR
THE PROPOSAL
|
|
|
[ ]
|
AGAINST
THE PROPOSAL
|
|
|
[ ]
|
ABSTAIN
|
3.
To approve a proposal to authorize the Company’s Board of Directors to amend the Company’s Certificate of Incorporation,
as amended, to effect a reverse stock split of our outstanding Common Stock in the sole discretion of the Company’s
Board of Directors.
|
|
[ ]
|
FOR
THE PROPOSAL
|
|
|
[ ]
|
AGAINST
THE PROPOSAL
|
|
|
[ ]
|
ABSTAIN
|
|
|
THIS
PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED AS DIRECTED. IF NO DIRECTION IS MADE, THE PROXY SHALL BE VOTED FOR THE ELECTION
OF THE LISTED NOMINEES AS DIRECTORS, FOR THE RATIFICATION OF MARCUM LLP AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC
ACCOUNTANTS FOR THE FISCAL YEAR ENDING DECEMBER 31, 2020, AND FOR AN AMENDMENT TO THE COMPANY’S CERTIFICATE OF INCORPORATION
TO EFFECT THE REVERSE STOCK SPLIT AT THE DISCRETION OF THE BOARD OF DIRECTORS.
PLEASE
CHECK HERE IF YOU PLAN TO ATTEND THE ANNUAL MEETING OF STOCKHOLDERS ON APRIL 17, 2020, AT 9:00 A.M. (EASTERN TIME) AT THE
COMPANY’S OFFICES AT 101 BILBY ROAD, SUITE 15, BUILDING 2, HACKETTSTOWN, NJ 07840
|
[ ]
|
Signature
of Stockholder _____________________ Date: __________
Signature
of Stockholder _____________________ Date: __________
Note:
This proxy must be signed exactly as the name appears hereon. When shares of Common Stock are held jointly, each holder should
sign. When signing as executor, administrator, attorney, trustee or guardian, please give full title as such. If the signer is
a corporation, please sign full corporate name by a duly authorized officer, giving full title as such. If signer is a partnership,
please sign in partnership name by an authorized person.
Vislink
Technologies, Inc.
THIS
PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
ANNUAL
MEETING OF STOCKHOLDERS TO BE HELD ON APRIL 17, 2020
Revoking
all prior proxies, the undersigned, a stockholder of Vislink Technologies, Inc. (the “Company”), hereby appoints Carleton
M. Miller and Susan Swenson, or either of them, as attorneys-in-fact and agents of the undersigned, with full power of substitution,
to vote all of the shares of the Company’s common stock, par value $0.00001 per share (“Common Stock”), owned
by the undersigned at the Annual Meeting of Stockholders of the Company to be held on April 17, 2020 at the Company’s offices
at 101 Bilby Road, Suite 15, Building 2, Hackettstown, NJ 07840, at 9:00 a.m. Eastern Time, and at any adjournment thereof, as
fully and effectively as the undersigned could do if personally present and voting, hereby approving, ratifying, and confirming
all that said attorney and agent or his substitute may lawfully do in place of the undersigned as indicated on the reverse.
IMPORTANT:
SIGNATURE REQUIRED ON THE REVERSE SIDE
Vislink Technologies (NASDAQ:VISL)
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