Algorhythm Holdings, Inc.
For the period ended Dec 19, 2024. Filed Dec 19, 2024.
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What shareholders are asked to vote on at a company's meeting. It is where to find what directors and top executives are paid, and who owns the most shares.
Dec 19, 2024 · Filed Dec 19, 2024
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DEF 14A 1 formdef14a.htm
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
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NOTICE OF THE 2024 VIRTUAL ANNUAL MEETING OF STOCKHOLDERS
December 19, 2024
Dear Stockholders:
It is my pleasure to invite you to the 2024 Virtual Annual Meeting of Stockholders (the “Annual Meeting”) of Algorhythm Holdings, Inc., a Delaware corporation (the “Company,” “Algorhythm,” “us,” or “our”). The Annual Meeting will be held on January 13, 2025 at 9:00 a.m. Eastern Time virtually by means of remote communication and can be accessed by visitingwww.cstproxy.com/algorhythmholdings/2024 where you will be able to listen to the meeting live, submit questions and vote online. You will not be able to attend the meeting in person.
The Annual Meeting is being held for the following purposes:
| 1. | To elect six directors to serve on our board of directors until their respective successors are duly elected and qualified, or until their respective earlier death, resignation or removal (the “Director Election Proposal”); |
| 2. | To approve an amendment to our certificate of incorporation to increase the number of shares of authorized common stock, par value $0.01 per share (the “Common Stock”) from 100,000,000 to 800,000,000 (the “Authorized Share Increase Proposal”); |
| 3. | To grant discretionary authority to our board of directors to (i) amend our certificate of incorporation to combine outstanding shares of our Common Stock into a lesser number of outstanding shares, or a “reverse stock split,” at a specific ratio within a range of one-for-ten (1-for-10) to a maximum of a one-for-two hundred fifty (1-for-250) split, with the exact ratio to be determined by our board of directors in its sole discretion; and (ii) effect the reverse stock split, if at all, within one year of the date the proposal is approved by stockholders (the “Reverse Stock Split Proposal”); |
| 4. | To approve an amendment to our 2022 Equity Incentive Plan (the “2022 Plan”) to amend the automatic increase “evergreen” clause within the 2022 Plan to increase the number of shares available under the 2022 Plan in future years (the “2022 Plan Amendment Proposal”); |
| 5. | To ratify the selection of Marcum LLP as our independent registered public accounting firm to audit our consolidated financial statements for the fiscal year ending December 31, 2024 (the “Auditor Ratification Proposal”); |
| 6. | To authorize, for purposes of complying with Nasdaq listing rule 5635(d), the issuance of Warrants, shares of Common Stock underlying the Warrants and certain provisions of the Warrants, issued in connection with an offering and sale of securities of the Company that was consummated on December 6, 2024 (the “Issuance Proposal”); |
| 7. | To approve one or more adjournments of the Annual Meeting, if necessary or appropriate, to solicit additional proxies in favor of the Reverse Stock Split Proposal, the Authorized Share Increase Proposal, 2022 Plan Amendment Proposal or the Issuance Proposal if there are not sufficient votes at the Annual Meeting to approve and adopt the Reverse Stock Split Proposal, the Authorized Share Increase Proposal, the 2022 Plan Amendment Proposal or the Issuance Proposal (the “Adjournment Proposal”); and |
| 8. | To transact such other business as may properly come before the Annual Meeting virtually, or any postponement or adjournment thereof. |
Only stockholders of record as of the close of business on November 15, 2024 will be entitled to receive notice of and to vote at the Annual Meeting, or any postponement or adjournment thereof. The accompanying Proxy Statement contains details concerning the foregoing items, as well as information on how to vote your shares. Other detailed information about our business and operations, including our audited financial statements, are included in our Transition Report on Form 10-KT. We urge you to read and consider these documents carefully.
Your vote is very important. Whether or not you plan to attend the Annual Meeting, we encourage you to submit your proxy or voting instructions as soon as possible. For specific instructions on how to vote your shares, please refer to the instructions on the proxy card you received in the mail, and the additional information in the accompanying Proxy Statement.
On behalf of the Board and the officers and employees of the Company, I would like to take this opportunity to thank you for your continued support.
Sincerely,
/s/ Gary Atkinson
Gary Atkinson
Director and Chief Executive Officer
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PROXY STATEMENT
FOR ANNUAL MEETING OF STOCKHOLDERS
TABLE OF CONTENTS
| Page | |
|---|---|
| NOTE REGARDING FORWARD-LOOKING STATEMENTS | 1 |
| PROXY STATEMENT | 2 |
| PROPOSAL 1 – THE DIRECTOR ELECTION PROPOSAL | 9 |
| INFORMATION ABOUT OUR BOARD OF DIRECTORS AND COMMITTEES | 12 |
| PROPOSAL 2 – THE AUTHORIZED SHARE INCREASE PROPOSAL | 17 |
| PROPOSAL 3 – THE REVERSE STOCK SPLIT PROPOSAL | 19 |
| PROPOSAL 4 –THE 2022 PLAN AMENDMENT PROPOSAL | 24 |
| PROPOSAL 5 – THE AUDITOR RATIFICATION PROPOSAL | 28 |
| AUDIT COMMITTEE REPORT | 30 |
| PROPOSAL 6 – THE ISSUANCE PROPOSAL | 31 |
| PROPOSAL 7 – THE ADJOURNMENT PROPOSAL | 36 |
| MANAGEMENT | 37 |
| EXECUTIVE COMPENSATION | 37 |
| PAY VERSUS PERFORMANCE | 42 |
| SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT | 43 |
| CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS | 44 |
| OTHER BUSINESS | 46 |
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NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Proxy Statement contains forward-looking statements within the meaning of the federal securities laws. Forward-looking statements may relate to our future financial performance, business operations, and executive compensation decisions, or other future events. You can identify forward-looking statements by the use of words such as “anticipate,” “believe,” “could,” “expect,” “intend,” “may,” “will,” or the negative of such terms, or other comparable terminology. Forward-looking statements also include the assumptions underlying or relating to such statements. We have based these forward-looking statements on our current expectations and projections about future events that we believe may affect our business, results of operations and financial condition.
The outcomes of the events described in these forward-looking statements are subject to risks, uncertainties and other factors described in the section titled “Risk Factors,” and elsewhere, in the Transition Report on Form 10-KT for the nine-month transition period from April 1, 2023 to December 31, 2023, as well as the other reports we file with the Securities and Exchange Commission. We cannot assure you that the events and circumstances reflected in the forward-looking statements will be achieved or occur, and actual results could differ materially from those expressed or implied in the forward-looking statements. The forward-looking statements made in this Proxy Statement relate only to events as of the date of this Proxy Statement. We undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made.
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.