Item 5.02 Departure of Directors or Certain Officers; Election of
Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers.
On
December 30, 2018, the Board of Directors (the “Board”)
of Blockchain Industries, Inc. (the “Company”)
appointed three members to the Company’s Board of Directors.
In accordance with the Company’s Bylaws, the Board appointed
Mr. Richard Kromka to serve as a Class 3 Director and Vice-Chairman
of the Board, Mr. Michael H. Conn to serve as a Class 2 Director,
and Mr. Kevin Hu to serve as a Class 1 Director. The Board also
designated Mr. Patrick Moynihan, the Company’s Chairman of
the Board and Chief Executive Officer, as a Class 3 Director and
designated Mr. Max Robbins, current member of the Board, as a Class
2 Director. Messrs. Kromka, Conn and Hu’s biographies are
further detailed below. The Board now consists of Mr. Hu as a Class
I Director, Messrs. Robbins and Conn as Class II Directors, and
Messrs. Moynihan and Kromka as Class III
Directors.
Mr. Richard Kromka
Mr.
Richard Kromka, age 53, brings over 25 years of senior management
experience in the investment banking industry. He has also been
involved in the entertainment, airline and real estate industries,
holding other senior management positions. From June 1987 through
June 1998, Mr. Kromka was a Vice President for JP Morgan Chase
bank. From July 1998 to November 2000, he served as Chief Financial
Officer for Grupo Taca Airlines, Inc., a consolidated airline group
for Central America. From December 2000 through Jan 2003, he was
the Founder and Managing Director of Deutsche Bank’s $200MM
Venture Fund, during which time he sat on the Boards of FareChase,
Q-Trade, 3-Tex and Execution Noble Limited. From February 2003
through December 2005, he was the Chief Executive Officer of
Guerrilla Entertainment a company that he founded. From December
2005 through December 2010 he developed real estate and advised a
telecommunications company. Mr. Kromka is currently a Managing
Director with EC Mergers and Acquisitions managing its business in
Asia. He has an undergraduate BS degree from the University of
Richmond, Robins School of Business and an MBA from New York
University, Stern School of Business.
There
are no related party transactions with regard to Mr. Kromka
reportable under Item 404(a) of Regulation S-K.
In
connection with his appointment to the Board, the Company and Mr.
Kromka entered into a director agreement (the “Kromka
Director Agreement”), whereby the Company issued
to
Mr.
Kromka options to purchase 600,000 shares of the Company’s
common stock at an exercise price of $1.75 over the course of four
years (the “Kromka Options”). 200,000 of the Kromka
Options vested on January 1, 2019, and the remaining 400,000 Kromka
Options would vest upon a Sale Transaction (as defined in the
Kromka Director Agreement) if it were ever to occur. The Company
will reimburse Mr. Kromka for all reasonable out-of-pocket travel
expenses incurred in connection with the performance of his duties
under the Kromka Director Agreement.
Mr. Michael H. Conn
Mr.
Michael H. Conn, age 40, brings nearly 20 years of experience in
the global financial and financial technology industries. Since
December 2015 he has been the Founder and Managing Principal of
Quail Creek Ventures, an asset management and financial technology
investment and advisory business. Mr. Conn also served as
Co-founder and Chief Executive Officer of Ether Capital from
October 2017 through August 2018. Since May 2018 he served as
Co-founder, Director, President and Chief Investment Officer of
Bitfinance, a financial technology company focused on democratizing
access to alternative investment management, of which both Ether
Capital and Bitfinance focus on the intersection of blockchain
technology and the financial industry. From December 2013 through
November 2015, Mr. Conn was the Chief Operating Officer of the
Alternative Investment Management group for AllianceBernstein, a
global asset manager with close to $500 billion AUM. From November
2005 through January 2013, he was Managing Director and Head of
Corporate Strategy and Development for Trust Company of the West, a
global asset manager with over $200 billion AUM. Mr. Conn was
previously a director for Ether Capital (NEO:ETHC), a financial
technology company focused on bridging the Ethereum ecosystem and
the world of traditional finance, from October 2017 to August 2018.
He has an undergraduate degree and Masters of International
Economics and Finance from Brandeis University, as well as an MBA
from the University of Southern California’s Marshall School
of Business.
There
are no related party transactions with regard to Mr. Conn
reportable under Item 404(a) of Regulation S-K.
In
connection with his appointment to the Board, the Company and Mr.
Conn entered into a director agreement (the “Conn Director
Agreement”), whereby the Company issued to
Mr.
Conn an option to purchase 250,000 shares of the Company’s
common stock (the “Conn Options”) with 100,000 of the
Conn Options vested on January 1, 2019 and the remaining 150,000
Conn Option vesting upon a Sale Transaction (as defined in the Conn
Director Agreement) if it were ever to occur. The Company will
reimburse Mr. Conn for all reasonable out-of-pocket travel expenses
incurred in connection with the performance of his duties under the
Conn Director Agreement.
Kevin Hu
Mr.
Kevin Hu, age 25, has served as the Company’s as Head of
Research and Allocation since March 2018. Previously, he was an
investment analyst at BlackRock’s Hedge Fund Solutions Group
from August 2015 through March 2018. He has an undergraduate degree
in Mathematics from the University of Toronto.
There
are no related party transactions with regard to Mr. Hu reportable
under Item 404(a) of Regulation S-K.
In
March of 2018, the Company entered into a consulting agreement with
Mr. Hu (the “Hu Consulting Agreement”), whereby Mr. Hu
would provide the Company with services related to risk oversight
and portfolio management for a term of three years starting from
the date of the Hu Consulting Agreement. Mr. Hu’s salary is
$200,000 per year and he was issued options to purchase 500,000
shares of the Company’s common stock vesting at different
times over the course of the Hu Consulting Agreement. Upon a Change
in Control (as defined in the Hu Consulting Agreement), all of
these unvested options vest immediately. The Company may terminate
the Hu Consulting Agreement upon giving Mr. Hu five (5) days prior
written notice of such termination. The Company may also terminate
the Hu Consulting Agreement immediately and without prior notice if
Mr. Hu refuses to or is unable to perform the Services (as defined
in the Hue Consulting Agreement) or is in breach of any material
provision of the Hu Consulting Agreement.
In
connection with Mr. Hu’s appointment to the Board, on
December 31, 2018, the Company and Mr. Hu entered into a director
agreement (the “Hu Director Agreement”), whereby the
Company issued to Mr. Hu an option to purchase 400,000 shares of
the Company’s common stock (the “Hu Options”)
with the 150,000 of the Hu Options vested on January 1, 2019 and
the remaining 250,000 Hu Option vesting upon a Sale Transaction (as
defined in the Hu Director Agreement) if it were to
occur.
The
Company will reimburse Mr. Hu for all reasonable out-of-pocket
travel expenses incurred in connection with the performance of his
duties under the Hu Director Agreement.
The
foregoing descriptions of the Kromka Director Agreement, Conn
Director Agreement, Hu Director Agreement and Hu Director Agreement
are qualified in their entirety by reference to the provisions of
the agreements filed as Exhibits 10.1, 10.2, 10.3 and 10.4,
respectively, to this Current Report on Form 8-K, which are
incorporated by reference herein.