FREEDOM HOLDING CORP.
10-Ks and 10-Qs
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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
Filed
by the Registrant |X| Filed by a Party
other than the Registrant |_|
Check
the appropriate box:
|_| Preliminary
Proxy Statement
|_| Confidential,
for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
|
x
| Definitive Proxy
Statement
|_| Definitive
Additional Materials
|_| Soliciting
Material under Rule 14a-12
Freedom Holding Corp.
(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):
|
x
| No fee required
|_| Fee
computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11
(1)
Title of each class
of securities to which transaction applies:
_____________________________________________________________
(2)
Aggregate number of
securities to which transaction applies:
_____________________________________________________________
(3)
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):
_____________________________________________________________
(4)
Proposed maximum
aggregate value of transaction:
_____________________________________________________________
(5)
Total fee
paid:
_____________________________________________________________
|_| Fee
paid previously with preliminary materials.
|_| 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.
(1)
Amount Previously
Paid:
_____________________________________________________________
(2)
Form, Schedule or
Registration Statement No.:
_____________________________________________________________
(3)
Filing
Party:
_____________________________________________________________
(4)
Date Filed:
_____________________________________________________________
Freedom Holding Corp.
“Esentai Tower” BC, Floor 7
77/7 Al Farabi Ave.,
Almaty, 050040, Republic of Kazakhstan
_________________
Dear Stockholders:
You are cordially invited to attend the 2021
annual meeting of stockholders (the “Annual Meeting”)
of Freedom Holding Corp. (the “Company,”
“FRHC,” “us,” “our,” or
“we”) which will be held on September 14, 2021, at 8:30
p.m. East Kazakhstan Time (“EKT”) (10:30 a.m. Eastern
Daylight Time (“EDT”)). Due to the continuing potential
of COVID-19 disruptions, the Annual Meeting will be held in virtual
format only, at
www.virtualshareholdermeeting.com/FRHC2021
,
where you will be able to listen to the meeting live, submit
questions and vote online. To participate in the Annual Meeting,
you will need the 16-digit control number located on your proxy
card or the instructions that accompany your Proxy
Materials.
The
formal notice of the Annual Meeting is provided in the enclosed
proxy statement. At the Annual Meeting we will discuss each item of
business described in the Notice of Annual Meeting of Stockholders
and proxy statement.
Important notice regarding the
availability of Proxy Materials for the Annual
Meeting
. On or about July 30,
2021, we will begin mailing to certain stockholders a Notice of
Internet Availability of Proxy Materials containing instructions on
how to access our Proxy Materials, including our Annual Report on
Form 10-K for the year ended March 31, 2021 (the “Annual
Report”), via the internet. The Notice of Internet
Availability of Proxy Materials also contains instructions on how
to receive a paper copy of the Proxy Materials. Stockholders who do
not receive the Notice of Internet Availability of Proxy Materials
will receive a paper copy of the Notice of Annual Meeting of
Stockholders, Proxy Statement, Form of Proxy and Annual Report,
which we will also begin mailing on or about July 30, 2021. Copies
of our Notice of Annual Meeting of Stockholders, Proxy Statement,
Form of Proxy and Annual Report are available at
www.proxyvote.com
.
Voting
by internet or telephone is fast and convenient, and your vote is
immediately confirmed and tabulated. If you receive a paper copy of
the Proxy Materials, you may also vote by completing, signing,
dating and returning the accompanying proxy card in the enclosed
return envelope furnished for that purpose. By using the internet
or telephone, you help us reduce postage and proxy tabulation
costs.
Your vote is important to
us.
The enclosed proxy
statement provides you with detailed information regarding the
business to be considered at the Annual Meeting. We urge you to
please vote your shares now. You may revoke your proxy at any time
before the proxy is voted by following the procedures described in
the enclosed proxy statement. The record date for the Annual
Meeting is July 22, 2021. Only stockholders of record at the close
of business on that date may vote at the meeting or any adjournment
thereof.
By
order of the Board of Directors,
/s/
Adam Cook
Adam
Cook
Corporate
Secretary
July 29, 2021
FREEDOM HOLDING CORP.
NOTICE OF 2021 ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON SEPTEMBER 14, 2021
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Time and Date:
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8:30
p.m. East Kazakhstan Time (“EKT”) (10:30 a.m. Eastern
Daylight Time (“EDT”)) on September 14,
2021
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Location:
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Due to the continuing potential of COVID-19 disruptions, our Annual
Meeting will be held only virtually, at
www.virtualshareholdermeeting.com/FRHC2021
,
where you will be able to listen to the meeting live, submit
questions and vote online. To participate in the 2021 Annual
Meeting, you will need the 16-digit control number located on your
proxy card or the instructions that accompany your Proxy
Materials.
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Items of Business:
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(1)
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To
elect to the Board of Directors two Class II directors until the
2024 Annual Meeting of Stockholders, and until their respective
successors have been duly elected and qualified, the following two
nominees recommended by the Board of Directors: Leonard Stillman
and Amber Williams
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(2)
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Advisory
vote to approve the compensation of our named executive
officers.
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(3)
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Ratification
of the appointment of WSRP, LLC as our independent registered
public accounting firm for the 2022 fiscal year.
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(4)
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Transact
such other business as may properly come before the meeting or any
postponement or adjournment thereof.
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Record Date:
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You can
vote at the meeting, or any adjournment thereof, if you were a
stockholder of record at the close of business on July 22,
2021.
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Internet Availability:
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We are
using the internet as our primary means of furnishing our Proxy
Materials to our stockholders. Rather than sending stockholders a
paper copy of our Proxy Materials, we are sending them a notice
with instructions for accessing the materials and voting via the
internet. We believe this method of distribution makes the proxy
distribution process more efficient and less costly and will limit
our impact on the environment. This notice of the Annual Meeting,
the proxy statement and our Annual Report on Form 10-K for the
fiscal year ended March 31, 2021, are available at
www.proxyvote.com
.
We anticipate that the Notice of Internet Availability of Proxy
Materials will first be sent to stockholders on or about July 30,
2021. The proxy statement and the form of proxy relating to the
Annual Meeting are first being made available to stockholders on or
about July 30, 2021.
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Proxy Voting:
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It is
important that your shares be present or represented and voted at
the Annual Meeting. You can vote your shares on the internet at
www.proxyvote.com
, by
telephone by calling
1-800-690-6903
, by completing and
returning your proxy card, or at the Annual Meeting. Voting
instructions are printed on your proxy card or included with your
Proxy Materials. You can revoke a proxy before its exercise at the
Annual Meeting by following the instructions in the accompanying
proxy statement.
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By
order of the Board of Directors,
/s/
Adam Cook
Adam
Cook
Corporate
Secretary
July
29, 2021
TABLE
OF CONTENTS
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I
NFORMATION ABOUT THE
ANNUAL MEETING AND VOTING
Why did I receive these Proxy Materials?
We
are providing this notice of annual meeting of stockholders, proxy
statement, voting instructions, form of proxy and Annual Report on
Form 10-K for the fiscal year ended March 31, 2021 (the
“Proxy Materials”) in connection with the solicitation
by the board of directors (the “Board”) of Freedom
Holding Corp., a Nevada corporation, (the “Company,”
“FRHC,” “we,” “us” or
“our”) of proxies to be voted at our annual meeting of
stockholders for the fiscal year ended March 31, 2021, and at any
adjournment or postponement thereof (the “Annual
Meeting”).
We
anticipate that the Notice of Internet Availability of Proxy
Materials will first be sent to stockholders on or about July 30,
2021. The proxy statement and the form of proxy relating to the
Annual Meeting are first being made available to stockholders on or
about July 30, 2021.
What is the difference between holding shares as a stockholder of
record and as a beneficial owner?
If
your shares are registered directly in your name with our transfer
agent, Pacific Stock Transfer Company, you are considered the
“stockholder of record” with respect to those shares.
If you are a stockholder of record, we are sending the Proxy
Materials directly to you at the address of record on account with
Pacific Stock Transfer Company.
If
your shares are held in a stock brokerage account or by a bank or
other holder of record, those shares are held in “street
name.” You are considered the “beneficial owner”
of those shares. The Proxy Materials have been or will be forwarded
to you by your broker, bank or other holder of record who is
considered, with respect to those shares, the stockholder of
record. As the beneficial owner, you have the right to direct your
broker, bank or other holder of record on how to vote your shares
by using the proxy or voting instructions included in the mailing
or by following their instructions for voting by telephone or on
the internet.
Why did I receive in the mail a Notice of Internet Availability of
Proxy Materials?
Under rules adopted by the United States
Securities and Exchange Commission (the “SEC”), we are
providing access to our Proxy Materials over the internet.
Accordingly, we are sending a Notice of Internet Availability of
Proxy Materials to many of our stockholders. If you received a
notice by mail, you will not receive a printed copy of the Proxy
Materials unless you request one. The notice tells you how to
access and review the Proxy Materials over the internet at
www.proxyvote.com
.
The notice also tells you how to access your proxy card to vote on
the internet. If you received a notice by mail and would like to
receive a printed or emailed copy of the Proxy Materials, please
follow the instructions included in the notice.
How do I attend the Annual Meeting?
In light of the continuing potential of COVID-19
disruptions, our Board has determined that the Annual Meeting be
held in a virtual-only format via live webcast. The Annual Meeting
will begin promptly at 8:30 p.m. EKT (10:30 a.m. EDT) on September
14, 2021. You may attend the Annual Meeting virtually at
www.virtualshareholdermeeting.com/FRHC2021
,
where you will be able to listen to the meeting live, submit
questions and vote online. To participate in the Annual Meeting
virtually, you will need the 16-digit control number located on
your proxy card or the instructions that accompany your Proxy
Materials. In the event that you do not have the control number,
please contact your broker, bank or other nominee as soon as
possible so that you can be provided with a control number and
participate in the Annual Meeting. The live webcast of the Annual
Meeting will be available to our stockholders and invited guests,
but participation in the Annual Meeting, including voting shares
and submitting questions, will be limited to stockholders. If you
plan to attend the meeting virtually, online check-in will begin 15
minutes prior to the start of the Annual Meeting, and you should
allow ample time for online check-in procedures. If you plan to
attend virtually, we encourage you to access the website for the
Annual Meeting prior to the start time of the meeting to allow time
for you to log-in and test your device’s audio
system.
1
What if I have technical difficulties accessing the Annual Meeting
website?
Beginning 15 minutes prior to the start of and
during the Annual Meeting, we will have a support team ready to
assist stockholders with technical difficulties they may have
accessing or hearing the Annual Meeting. If you encounter
difficulties accessing the Annual Meeting you may call the help
numbers found on the Annual Meeting website at
www.virtualshareholdermeeting.com/
FRHC2021
.
This assistance is limited to technical difficulties accessing the
meeting. If you have problems accessing the Annual Meeting online
because of problems with your control number, you should contact
your broker, bank or other custodian.
May stockholders ask questions at the Annual Meeting?
Yes. Stockholders attending virtually will have
the ability to submit questions during the Annual Meeting
www.virtualshareholdermeeting.com/
FRHC2021
.
As part of the Annual Meeting, we will hold a live question and
answer session, during which we intend to answer questions
submitted by stockholders online which are pertinent to the Company
and the Annual Meeting matters, as time permits. Detailed
guidelines for submitting questions online during the Annual
Meeting will be available at
www.virtualshareholdermeeting.com/
FRHC2021
. We encourage you to
read our Annual Report provided as part of the Proxy Materials and
available free of charge on our website
(www.freedomholdingcorp.com) or at
www.proxyvote.com
.
Who is entitled to vote at the Annual Meeting?
Stockholders
of record at the close of business on July 22, 2021, the record
date for the Annual Meeting, are entitled to receive notice of and
vote at the Annual Meeting. You are entitled to one vote on each
matter presented at the Annual Meeting for each share of common
stock you owned at that time. Stockholders have no right to
cumulative voting as to any matter, including the election of
directors. At the close of business on July 22, 2021, there were
58,443,212 shares of our common stock outstanding.
How do I vote?
You
may vote using any of the following methods:
By Mail
If
you received a paper copy of the Proxy Materials, you may vote by
completing, signing and dating your proxy card and returning it in
the enclosed envelope. Your mailed proxy card must be received by
no later than 11:59 p.m. EDT on September 13, 2021, to be counted.
If you did not receive a paper copy of the Proxy Materials, but
wish to vote by mail, you may request a paper copy and vote by mail
as described in the instructions that accompany the Proxy
Materials.
By Internet
We encourage you to vote and submit your proxy
over the internet at
www.proxyvote.com
.
Your internet vote must be received by no later than 11:59 p.m. EDT
on September 13, 2021, to be counted.
By Telephone
You may vote by telephone by
calling
1-800-690-6903
.
Your telephone vote must be received by no later than 11:59 p.m.
EDT on September 13, 2021, to be counted.
2
At the Annual Meeting
Stockholders who wish to vote during the Annual
Meeting, will need to attend the meeting at
www.virtualshareholdermeeting.com/FRHC2021
where they will be provided voting
instructions.
If
you are a stockholder of record, to vote you will need the 16-digit
control number that appears on your proxy card or the instructions
that accompany the Proxy Materials. Each stockholder has a unique
control number so that we can ensure all voting instructions are
genuine and prevent duplicative voting. Depending on the number of
accounts in which you hold shares of common stock, you may receive
and need more than one control number. If you receive more than one
control number be sure to vote each control number to ensure that
all of your shares are voted.
If
the shares you own are held in “street name” by a
brokerage firm, your brokerage firm, as the record holder of your
shares, is required to vote your shares according to your
instructions. To vote your shares, you will need to follow the
directions your brokerage firm provides you. Many brokers also
offer the option of voting over the internet or by telephone,
instructions for which would be provided by your brokerage firm on
your voting instruction form.
What can I do if I change my mind after I vote my
shares?
If
you are a stockholder of record, you can revoke your proxy before
it is exercised by:
●
written notice of
revocation to Vote Processing, c/o Broadridge, 51 Mercedes Way,
Edgewood, NY 11717, which must be received by no later than 11:59
p.m. EDT on September 13, 2021;
●
timely submission
of a valid, later-dated proxy via mail, the internet or the
telephone, which must be received by no later than
11:59 p.m. EDT on September 13, 2021
;
or
●
voting at the
Annual Meeting.
If
you are a beneficial owner of shares, you may submit new voting
instructions by contacting your broker, bank or other holder of
record as described in the voting instructions they provide you.
You may also vote at the Annual Meeting as described in the answer
to the previous question.
Can my broker vote if my shares are held in “street
name”?
If
you do not give instructions to your brokerage firm, bank or other
custodian holding your shares, it will still be able to vote your
shares with respect to “discretionary” items, but it
will not be allowed to vote your shares with respect to
“non-discretionary” items. The election of directors
(Proposal One) and “say-on-pay” proposal (Proposal Two)
are considered to be non-discretionary items; therefore, if
you do not instruct your broker how to vote with respect to these
proposals, your broker is not permitted to vote with respect to
them and those votes will thus be considered
“broker non-votes.” Broker non-votes are
shares that are held in “street name” by a custodian,
such as a bank or brokerage firm that indicates on its proxy that
it does not have or did not exercise discretionary authority to
vote on a particular matter or matters. The ratification of WSRP,
LLC as our independent registered public accounting firm (Proposal
Three) is considered to be a discretionary item, and your brokerage
firm will be able to vote on that item even if it does not receive
instructions from you, so long as it holds your shares in its
name.
How will votes be counted?
Each
share of common stock will be counted as one vote according to the
instructions contained on a proper proxy card, whether submitted by
mail, over the internet or by telephone, or voted at the Annual
Meeting.
3
What does it mean if I received more than one proxy
card?
If
you receive more than one proxy card, it means that you hold shares
registered in more than one name or account. To ensure that all of
your shares are voted, sign and return each proxy card you receive,
or if you vote by internet or by telephone, you will need to vote
each proxy card.
What constitutes a quorum?
For
business to be conducted at the Annual Meeting, a quorum must be
present. For each of the proposals to be presented at the Annual
Meeting, a quorum consists of the holders of a majority of the
shares of common stock issued and outstanding on July 22, 2021, the
record date.
Shares
of common stock present (virtually) in person or represented by
proxy (including “broker non-votes” and
shares that abstain or do not vote with respect to a particular
proposal) will be counted for purposes of determining whether a
quorum exists at the Annual Meeting.
If
a quorum is not present, the Annual Meeting will be adjourned until
a quorum is obtained.
What vote is required for each item and how does the Board
recommend that I vote?
Proposal One – Election
of Directors
. Under our
By-Laws, a nominee for director will be elected to the Board by a
plurality of votes given at the election, meaning the nominee will
be elected if the votes cast “for” the nominee’s
election exceed the votes cast “against” the
nominee’s election. Abstentions and
broker non-votes are not considered votes cast for or
against the nominee and will have no effect on the proposal. If you
do not instruct your broker how to vote with respect to this
proposal, your broker cannot vote your shares with respect to the
election of directors.
Our
Restated Articles of Incorporation provide that our Board shall be
divided into three classes. Each class shall consist, as nearly as
may be possible, of one-third of the total number of directors,
with each director serving for a term of three years and until his
or her successor has been duly elected and qualified. Our
Nominating and Corporate Governance Committee (“nominating
committee”) recommended to the Board, and the Board has
nominated two individuals, Leonard Stillman and Amber Williams,
each of whom currently serves as a Class II director, for election
as Class II directors at the Annual Meeting.
THE BOARD RECOMMENDS THAT YOU VOTE FOR THE ELECTION OF THE TWO
NOMINEES NAMED IN THE ENCLOSED PROXY MATERIALS TO THE
BOARD
Proposal Two – Advisory
vote to approve the compensation of our named executive officers
(
“
Say-on-Pay
”). We are required to submit a proposal to
you for a non-binding advisory vote to approve the compensation of
our named executive officers pursuant to Section 14A of the
Securities Exchange Act of 1934, as amended (the “Exchange
Act”). The stockholder vote on executive compensation is an
advisory vote only and is not binding on the Company, the Board or
the Compensation Committee of the Board (the “compensation
committee”).
Although
the vote is non-binding, we value your opinion and intend to
consider the outcome of the vote when making future compensation
decisions. This proposal, commonly known as a
“say-on-pay” proposal, gives our stockholders an
opportunity to express their views on the compensation of our named
executive officers as described in this proxy statement under the
heading “Executive Compensation.”
The
affirmative vote of the holders of a majority of the total number
of votes of our common stock present in person or represented by
proxy and entitled to vote on the proposal is needed to approve
this proposal. Abstentions count as votes against the proposal.
Because shares treated as “broker non-votes” are not
entitled to vote on the proposal, they will have no effect on the
vote. If you do not instruct your broker how to vote with respect
to this proposal, your broker cannot vote with respect to this
proposal.
4
THE BOARD RECOMMENDS THAT YOU VOTE FOR APROVAL OF THE NON-BINDING
ADVISORY RESOLUTION REGARDING COMPENSATION OF THE COMPANY’S
NAMED EXECUTIVE OFFICERS AS DESCRIBED IN THE PROXY
STATEMENT
Proposal Three –
Ratification of Independent Registered Public Accounting
Firm
. The affirmative vote of
the holders of a majority of the total number of votes of our
common stock present (virtually) in person or represented by proxy
and entitled to vote on the proposal is needed to ratify the
selection of WSRP, LLC as our independent registered public
accounting firm for our 2022 fiscal year. Abstentions count as
votes against the proposal. If you do not provide instructions to
your brokerage firm regarding how to vote your shares on this
proposal, your broker may (a) vote your shares on your behalf
(because this proposal is a “discretionary” item) or
(b) leave your shares unvoted. Our By-laws do not require that
stockholders ratify the appointment of our independent auditors.
However, we are submitting the appointment of WSRP, LLC to you for
ratification as a matter of good corporate governance. If our
stockholders fail to ratify the selection, we will consider that
failure as a direction to the Board and the Audit Committee of the
Board (the “audit committee”) to consider the selection
of a different firm. Even if the selection is ratified, the audit
committee in its discretion may select a different independent
registered public accounting firm, at any time during the year if
it determines that such a change would be in the best interests of
the Company and our stockholders.
The
affirmative vote of the holders of a majority of the total number
of votes of our common stock present (virtually) in person or
represented by proxy and entitled to vote on the proposal is needed
to approve this proposal. Abstentions count as votes against the
proposal.
THE BOARD RECOMMENDS THAT YOU VOTE FOR RATIFICATION OF THE
APPOINTMENT OF WSRP, LLC AS OUR INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM FOR THE 2022 FISCAL YEAR
Where can I find the voting results?
We
will report the voting results in a Current Report on
Form 8-K within four business days after completion of
our Annual Meeting.
Could other matters be decided at the Annual Meeting?
As
of the date this proxy statement, we did not know of any matters to
be raised at the Annual Meeting other than those described in this
proxy statement. If other matters are properly presented at the
Annual Meeting for consideration, however, the proxies appointed by
the Board will have the discretion to vote on those matters for
you.
Who will pay for the cost of this proxy solicitation?
We
will pay for the cost of this proxy solicitation. We do not intend
to solicit proxies other than by use of the mail or website
posting, but certain of our directors, officers and other
employees, without additional compensation, may solicit proxies
personally or by telephone, facsimile or email on our
behalf.
5
Who will count the vote?
The
inspector of elections appointed for the Annual Meeting will
tabulate all votes.
What is “householding” and how does it affect
me?
We
have adopted a procedure approved by the SEC called
“householding.” Under this procedure, stockholders of
record who have the same address and last name will receive only
one copy of the Proxy Materials and Notice of Internet Availability
of Proxy Materials, unless one or more of these stockholders
notifies us that they wish to continue receiving individual copies.
This procedure will reduce our printing costs and postage
fees.
Stockholders
who participate in householding will continue to receive separate
proxy cards. Also, householding will not in any way affect dividend
check mailings, if any.
If you are eligible for householding, but you and
other stockholders of record with whom you share an address
currently receive multiple copies of the Proxy Materials or Notice
of Internet Availability of Proxy Materials, or if you hold stock
in more than one account, and in either case you wish to receive
only a single copy of each of these documents for your household,
please make a written request to the: Corporate Secretary, Freedom
Holding Corp.,
1930 Village Center Cir. #3-6972, Las Vegas,
Nevada 89134,
email
usoffice@freedomholdingcorp.com or contact our Corporate Secretary
at (888) 996-3742. If multiple stockholders of record who have the
same address receive only one copy of the Proxy Materials and would
like to receive additional copies, or if they would like to receive
a copy for each stockholder living at that address in the future,
send a written request to the address or email address above or
contact our Corporate Secretary at (888) 996-3742. Upon such
written or oral request, we will promptly deliver separate Proxy
Materials and Notices of Internet Availability of Proxy Materials
to any stockholders who receive one paper copy at a shared
address.
Beneficial
owners can request information about householding from their
brokers, banks or other holders of record.
Smaller reporting company
During
fiscal 2021 we qualified as a “smaller reporting
company” as defined in Rule 12b-2 of the Exchange Act and
have elected to take advantage of the scaled disclosures available
to smaller reporting companies.
Other information
Our
Annual Report on Form 10-K for the fiscal year ended
March 31, 2021 (the “Annual Report”), accompanies this
proxy statement. No material contained in the Annual Report is to
be considered a part of the Proxy Materials. “Fiscal
2021” refers to the 52-week fiscal year that ended
on March 31, 2021. The contents of our corporate website or
the corporate website of any of our subsidiaries are not
incorporated by reference into this proxy statement.
6
P
ROPOSAL ONE —
ELECTION OF DIRECTORS
Our
Restated Articles of Incorporation provide that our Board shall be
divided into three classes. Each director serves for a term of
three years and until his or her successor has been duly elected
and qualified. The term of office of the Class II Directors expires
at the Annual Meeting. The nominating committee recommended, and
the Board has nominated Leonard Stillman and Amber Williams to
stand for re-election at the Annual Meeting as Class II Directors.
Mr. Stillman has served as a member of the Board since October 2006
and Ms. Williams has served as a member of the Board since November
2020. If elected at the Annual Meeting each of these nominees would
serve until the 2024 Annual Meeting and until his or her successor
is duly elected and qualified, or if sooner, until the
director’s death, resignation or removal.
Directors
are elected by a plurality of the votes cast. The two nominees
receiving the most “For” votes will be elected. If no
contrary indication is made, shares represented by executed proxies
will be voted “For” the election of the two nominees
named above. If, prior to the Annual Meeting, it should become
known that either of the nominees will be unwilling or unable to
serve as a director after the Annual Meeting by reason of
resignation, death, incapacity or other unexpected occurrence, the
proxies will be voted “For” such substitute nominee as
is determined by nominating committee and the Board or
alternatively, not voted for any nominee. The Board has no reason
to believe that either nominee will withdraw or be unable to serve.
Proxies cannot be voted for more than the number of nominees
proposed for election.
The
Board believes that it is necessary for each of our directors to
possess many qualities and skills. When searching for candidates,
the nominating committee considers the evolving needs of the Board
and searches for candidates that fill any current or anticipated
future gap. The nominating committee considers a candidate’s
business experience, issues of judgment, background, stature,
conflicts of interest, integrity, ethics and commitment to the goal
of maximizing stockholder value. Candidates should possess one or
more of the following skills and qualifications: experience in the
financial services industry, experience in international business,
financial expertise, accounting skills, human resource management,
public company management, legal expertise, etc. The nominating
committee does not have a formal policy with respect to Board
diversity. The Board and the nominating committee believe that it
is desirable to have a variety of viewpoints on the Board, which
may be enhanced by a mix of different professional and personal
backgrounds and experience. In considering candidates for the
Board, the nominating committee considers the entirety of each
candidate’s credentials in the context of these standards.
With respect to the nomination of continuing directors
for re-election, the individual’s contributions to
the Board are also considered.
7
The
following is a brief biography, as of the date of this proxy
statement, of the nominees for Class II directors and each person
whose term as a Class I or Class III director will continue after
the Annual Meeting.
|
Leonard Stillman
Age:
78
Class
II Director Since:
October
2006
Independent
Committee
Memberships:
Audit
Compensation
Nominating
and Corporate Governance
|
|
Mr.
Stillman earned his Bachelor of Science degree in mathematics from
Brigham Young University and Master of Business Administration from
the University of Utah. He began his career in 1963 with Sperry
UNIVAC as a programmer developing trajectory analysis software for
the Sergeant Missile system. Mr. Stillman spent many years as a
designer and teacher of computer language classes at Brigham Young
University, where he developed applications for the Administrative
Department including the school’s first automated teacher
evaluation system. During that time, he was also a vice-president
of Research and Development for Automated Industrial Data Systems,
Inc. and the Owner of World Data Systems Company, which provided
computerized payroll services for companies such as Boise Cascade.
Mr. Stillman has over 45 years of extensive business expertise,
including strategic planning, venture capital financing, budgeting,
manufacturing planning, cost controls, personnel management,
quality planning and management, and the development of standards,
policies, and procedures. He has extensive skills in the design and
development of computer software systems and computer evaluation.
Mr. Stillman helped found Stillman George, Inc. in 1993 and founded
Business Plan Tools, LLC in 2004. He was employed with Stillman
George, Inc. until 2010, where his primary responsibilities
included managing information, technical development, and financial
analysis projects and development, as well as general company
management and consulting activities. From 2008 to 2009 Mr.
Stillman served as the interim Chief Financial Officer of BMB
Munai, Inc., the predecessor to the Company. He is currently
employed by Business Plan Tools, LLC, which provides cloud-based
SaaS business planning software and consolidates a broad variety of
skills from a growing group of business professionals to provide
needed support in finance, marketing, management, sales, planning,
product development, and more to businesses worldwide. In
addition, from January 2020 through April 2021, Mr. Stillman served
as a director, Chief Financial Officer, Secretary and Treasurer of
Pipergy, Inc., an oil and gas pipeline maintenance company based in
Newcastle, Wyoming. Pipergy, Inc. is an SEC reporting
issuer.
Skills and Qualifications
:
The Board selected Mr. Stillman as a
director nominee because of his significant background in business
management, strategic planning, corporate finance, and information
management.
|
|
Amber Williams
Age:
40
Class
II Director Since:
November
2020
Independent
Committee
Memberships:
Audit
Nominating
and Corporate Governance
Risk
|
|
Since 2012, Ms. Williams has provided accounting and chief
financial officer consulting services to companies. Ms. Williams is
a Certified Public Accountant, having earned licensure in 2010.
From 2018 to 2019, she was employed as a Manager with Brixey &
Meyer, an Ohio based CPA firm. In that position she managed a team
of accountants providing companies with chief financial officer,
accounting and human resource functions. From 2004 to 2012, Ms.
Williams was employed in various accounting and finance positions
with Grant Thornton, Basic Research, Goldman Sachs and
PricewaterhouseCoopers, where her responsibilities included:
planning and managing audit functions for public and private
companies, domestically and internationally, including audit
planning, fieldwork and internal control testing; assisting with
product launch; serving as a member of a management team in
conjunction with the sale of a business unit; and process
improvement. Ms. Williams earned a Bachelor of Science degree in
accounting from the University of Utah in 2004, and a Masters of
Accounting degree from the University of Utah in 2005.
Skills and Qualifications
:
Ms. Williams was selected to serve as a
director nominee based on her professional experience in
accounting, auditing, finance and internal controls and her
background as a licensed CPA.
|
8
|
Timur Turlov
Age:
33
Class
III Director Since:
November
2015
Continuing
in office until the 2022 Annual Meeting
Non-independent
Committee
Memberships:
Nominating
and Corporate Governance
Risk
|
|
Mr.
Turlov has served as the Chief Executive Officer and Chair of the
Board since November 2015. He graduated from Russia State Technic
University (named after Tsiolkovsky) in 2009 with a Bachelor of
Science degree in economics and management. Mr. Turlov holds a
management certificate in stock exchange operations and securities
broker and dealer management granted by the Russian National
Securities Market Association and has more than 10 years of
experience in various areas in the international securities
industry. From July 2013 to July 2017, he served as the Advisor to
the Chairman of the Board of our subsidiary JSC Freedom Finance
(“Freedom KZ”). In that capacity, he was primarily
responsible for strategic management, public and investor relations
events, investment strategy, sales strategy, and government
relations. In July 2017, Mr. Turlov became Chairman of the Board of
Directors of Freedom KZ. He has also served as the General Director
of our subsidiary LLC IC Freedom Finance (“Freedom RU”)
from August 2011 to April 2021. As the General Director, he is
responsible for establishing Freedom RU’s strategic goals,
including acquisition and retention of large clients, sales
strategy and company development. From May 2012 through January
2013, he served as the Chairman of the Board of Directors of JSC
Nomad Finance where he oversaw business set up and acquisition of
large clients. From July 2010 through August 2011, he was employed
as the Vice Director of the International Sales Department of
Nettrader LLC. In this capacity, his major responsibilities
included consulting to set up access to foreign markets, trading,
back office, and internal accounting functions. Mr. Turlov was
appointed as Chairman of the Board of Directors of Bank Freedom
Finance Kazakhstan JSC in December 2020, and in that role, he
participates in determining the priority areas of the Bank's
business activities and development strategy. He has served as a
member of the Supervisory Board of LLP AK Niet Group since April
2020.
Skills and Qualifications
: Mr.
Turlov was selected as a director based on his in-depth knowledge
of the business of the Company and capital markets, his
professional experience and his educational background in economics
and management.
|
|
Jason Kerr
Age:
50
Class
III Director Since:
May
2008
Continuing
in office until the 2022 Annual Meeting
Independent
Committee
Memberships:
Compensation
Nominating
and Corporate Governance
Risk
|
|
Mr.
Kerr earned his Bachelor of Science degree in economics in 1995 and
a Juris Doctorate in 1998 from the University of Utah, where he was
named the William H. Leary Scholar. In 2011, Mr. Kerr founded the
law firm Price, Parkinson & Kerr, where he practices commercial
litigation. From 2006 to 2011, Mr. Kerr was the associate general
counsel of Basic Research, LLC, concentrating in intellectual
property litigation. Before joining Basic Research, Mr. Kerr was a
partner with the law firm of Plant, Christensen & Kanell in
Salt Lake City, Utah. Mr. Kerr was employed with Plant, Christensen
& Kanell from 1996 through 2001 and from 2004 to 2006. From
2001 through 2004, Mr. Kerr was employed as a commercial litigator
with the Las Vegas office of Lewis and Roca. Mr. Kerr became our
director in May 2008.
Skills and Qualifications
:
Mr. Kerr was selected as a director
based on his educational background in economics, his managerial
and business management skills, and his extensive professional
experience as both in-house and outside legal counsel.
|
9
|
Boris Cherdabayev
Age:
67
Class I
Director Since:
February
2019
Continuing
in office until the 2023 Annual Meeting
Independent
Committee
Memberships:
Audit
Compensation
|
|
Since
2012 Mr. Cherdabayev has served as Counsellor to the Chairman of
the management board of Weatherford-CER, a privately owned joint
venture company between Weatherford International and Caspian
Energy Research LLP. Mr. Cherdabayev served as the Chairman of the
board of BMB Munai Inc., the predecessor of the Company, from
November 2003 to November 2015 and also as Chief Executive Officer
from November 2003 through August 2007. From May 2000 to May 2003,
Mr. Cherdabayev served as Director at TengizChevroil LLP, a
multi-national oil and gas company owned by Chevron, ExxonMobil,
KazMunayGas and LukOil. From 1998 to May 2000, Mr. Cherdabayev
served as a member of the Board of Directors, Vice-President of
Exploration and Production and Executive Director on Services
Projects Development for NOC “Kazakhoil”, an oil and
gas exploration and production company. From 1983 to 1988 and from
1994 to 1998 he served as a people’s representative at
Novouzen City Council (Kazakhstan); he served as a people’s
representative at Mangistau Oblast Maslikhat (regional level
legislative structure) and a Chairman of the Committee on Law and
Order. For his achievements Mr. Cherdabayev has been awarded with a
national “Kurmet” order. Mr. Cherdabayev earned an
engineering degree from the Ufa Oil & Gas Institute, with a
specialization in “machinery and equipment of oil and gas
fields” in 1976. Mr. Cherdabayev also earned an engineering
degree from Kazakh Polytechnic Institute, with a specialization in
“mining engineer on oil and gas fields’
development.” During his career he also completed an English
language program in the United States, the
СНАМР Program (Chevron Advanced
Management Program) at Chevron Corporation offices in San
Francisco, California, and the CSEP Program (Columbia Senior
Executive Program) at Columbia University.
Skills and Qualifications
:
Mr. Cherdabayev was selected as a
director because of his extensive executive management and board
experience with both private companies and U.S. public
companies.
|
|
Askar Tashtitov
Age:
42
Class I
Director Since:
May
2008
Continuing
in office until the 2023 Annual Meeting
Non-independent
Committee
Memberships:
None
|
|
Mr.
Tashtitov has served as president of the Company since June 2018
and leads our investment banking activities. He has served as a
director of the Company since May 2008 and was employed with BMB
Munai, Inc., the predecessor of the Company, from 2004 through
2015, serving as the president from May 2006 to November 2015. From
2011 to 2015 Mr. Tashtitov was engaged in private equity projects.
From 2002 to 2004 Mr. Tashtitov was a management consultant with PA
Government Services Inc. Mr. Tashtitov earned a Bachelor of Arts
degree from Yale University in economics and history in
2002.
Skills and Qualifications
:
Mr. Tashtitov was selected as a
director because he has over 15 years of experience in the public
company arena, with particular expertise in interfacing with equity
and debt financing professionals, as well as investment banking and
significant business management experience.
|
10
No directors, nominees for director or executive
officers have any family relationship to any other director,
nominee for director or executive officer. Mr. Stillman
served as a director of Pipergy, Inc., an oil and gas pipeline
maintenance company based in Newcastle, Wyoming from January 2020
through April 2021. Pipergy, Inc. became an SEC reporting issuer in
September 2020. No other director or nominee for director served as
a director of an SEC reporting issuer
during the past five years.
There
are no arrangements or understandings with any other person
pursuant to which any director or nominee for director was selected
as a director or nominee.
No
director, nominee for director or executive officers or, to our
knowledge, any owner of record or beneficially of more than five
percent of our common stock, or any associate of any such director,
officer, affiliate of the Company, or security holder is a party
adverse to us or any of our subsidiaries or has a material interest
adverse to us or any of our subsidiaries.
Information about our Executive Officers
The
following table sets forth information regarding our executive
officers:
|
Name
|
|
Age
|
|
Position
|
|
Timur
Turlov
|
|
33
|
|
Chief
Executive Officer and Chairman of the Board
|
|
Askar
Tashtitov
|
|
42
|
|
President
|
|
Evgeniy
Ler
|
|
38
|
|
Chief
Financial Officer
|
As
Messrs. Turlov and Tashtitov are also Company directors, their
biographical information appears above.
11
Evgeniy Ler
– Mr. Ler has served
as the Chief Financial Officer of the Company since November 2015.
Prior to that time, he served as Chief Financial Officer of BMB
Munai, Inc., the predecessor of the Company from April 2009 to
November 2015. BMB Munai, Inc. was a public company listed on the
American Stock Exchange (AMEX). Mr. Ler joined BMB Munai in 2006
and served in several capacities including finance manager and
reporting manager before being appointed Chief Financial Officer.
During 2013 and 2014 Mr. Ler was engaged in private equity
projects. From 2003 to 2006 Mr. Ler was an auditor at Deloitte
Kazakhstan. In 2003 Mr. Ler was awarded a Bachelor’s degree
in financial management from the Kazakh-American University located
in Almaty, Kazakhstan.
There
are no arrangements or understandings between any of our executive
officers and any other person pursuant to which such individual was
selected as an executive officer.
|
|
THE
BOARD RECOMMENDS THAT YOU VOTE “FOR” THE ELECTION
OF EACH OF THE DIRECTOR NOMINEES LISTED ABOVE
|
C
ORPORATE
GOVERNANCE
Director Independence
Our
common stock is listed on the Nasdaq Capital Market and the Board
relies upon the listing requirements and rules of the Nasdaq Stock
Market to assist it in its determinations of director independence.
Because Timur Turlov owns more than 50% of the voting power for
election of directors, the Company is a “Controlled
Company” as defined by Rule 5615 of the Nasdaq Stock Market
rules. As such, we are not required to have a majority of
independent directors on our Board, nor are we required to have a
majority of independent directors on our nominating committee,
compensation committee or the Risk Committee of our Board (the
“risk committee”). While our Board is presently staffed
by a majority of independent directors, that may not always be the
case. Our audit committee and compensation committee are currently
staffed solely by independent directors. Timur Turlov, who is not
independent, currently serves on our nominating committee and our
risk committee. For so long as the Company remains a Controlled
Company, we anticipate we will take advantage of the exemptions to
the independence requirements available to Controlled
Companies.
The
nominating committee and the full Board review the independence of
all members of the Board for purposes of determining which Board
members are deemed independent. Based on the director independence
standards of the Nasdaq Stock Market, the nominating committee and
the full Board affirmatively determined that Messrs. Cherdabayev,
Kerr and Stillman and Ms. Williams are independent. In making this
determination, our nominating committee and Board considered the
current and prior relationships that each of the directors has with
our Company and all other facts and circumstances our nominating
committee and Board deemed relevant in determining their
independence, including the beneficial ownership of our capital
stock by each non-employee director and other transactions,
relationships, and arrangements that are not required to be
disclosed in this proxy statement.
Communication with the Board
The Board encourages communication from our
stockholders. Any stockholder who wishes to communicate with
the directors should send any such communication to the
Corporate Secretary by email to
usoffice@freedomholdingcorp.com
or by
mail to
1930 Village Center Cir. #3-6972, Las Vegas, Nevada
89134
. All such stockholder
communication will be reviewed by the Corporate Secretary who will
determine the appropriate response or course of
action.
12
BOARD LEADERSHIP STRUCTURE
Board Leadership
The Chairman of the Board and Chief
Executive Officer of the Company is Timur Turlov, our controlling
stockholder. Mr. Turlov, along with the senior management
team,
is responsible for
setting our strategic direction and
our day-to-day leadership and performance, while the
Board is responsible to hold management accountable for execution
of strategy once it is developed. The Board believes that it is
currently in the best interest of the Company and our stockholders
for Mr. Turlov to serve as Chief Executive Officer and Chairman of
the Board. Our directors bring different perspectives, experience,
insight and expertise from outside the Company while Mr. Turlov
brings Company specific experience and expertise. The Board
believes that the combined role of Chairman and Chief Executive
Officer also facilitates flow of information between the Board and
management.
The
Board currently consists of six members; our Chief Executive
Officer, our President and four non-employee directors, all of whom
are independent. Members of the Board are kept informed of our
operations by reviewing materials provided to them, speaking to our
executives, employees and legal counsel and by attending meetings
of the Board and the various committees they may serve on. We do
not currently have a lead independent director.
The Role of the Board in Oversight of Risk
Our
Chief Executive Officer and senior management are responsible for
identifying and assessing our exposure to risk and developing risk
controls related to significant business activities and Company
objectives, developing programs to determine the sufficiency of
risk identification, balancing of potential risk to potential
reward and the appropriate manner in which to control risk. It is
the responsibility of our management to develop and implement our
short-term and long-term objectives and to identify, evaluate,
manage and mitigate the risks inherent in seeking to achieve those
objectives. The Board’s responsibility is to oversee and
monitor the Company’s risk management processes and efforts
of senior management. As described in more detail below, this is
carried out primarily through various board committees which report
to our full board. The Board coordinates with the audit committee,
risk committee and management regarding the Company’s cyber
and technology security and risks.
BOARD COMMITTEES
The
table below sets forth the committees of our Board. As noted above,
as a Controlled Company we are exempt from certain board and
committee independence requirements of the Nasdaq Stock Market. Our
audit committee and compensation committee consist of all
independent directors. Our nominating committee and our risk
committee are each staffed by two independent directors and one
non-independent director.
The
memberships of each committee as of the date of this proxy
statement are listed below:
|
Name
|
Audit
Committee
|
Compensation
Committee
|
Nominating and
Corporate Governance Committee
|
Risk Committee
|
|
Boris
Cherdabayev
|
X
|
X
|
|
|
|
Jason
Kerr
|
|
C
|
|
C
|
|
Leonard
Stillman
|
X
|
X
|
X
|
|
|
Askar
Tashtitov*
|
|
|
|
|
|
Timur
Turlov*
|
|
|
C
|
X
|
|
Amber
Williams
|
C
|
|
X
|
X
|
“X”
indicates membership on the committee.
“C”
indicates that the director serves as the chair of the
committee.
* Mr.
Turlov and Mr. Tashtitov do not meet the independence standards of
the Nasdaq Stock Market.
13
Audit Committee
The purpose of the audit committee is to oversee
our accounting and financial reporting processes and the audit of
our financial statements. The Audit Committee Charter provides that
the audit committee is primarily responsible for the integrity of
our accounting and financial reporting processes, our compliance
with legal and regulatory requirements, the independence,
qualifications and the performance of our independent registered
public accounting firm, and performance of internal audit
functions. Specifically, these duties include: selecting,
retaining, compensating, overseeing, and if necessary, terminating
our independent registered public accounting firm and any other
registered public accounting firm, as necessary; approving audit
and non-audit services provided to us by the independent registered
public accounting firm; approving all audit engagement fees and
terms; reviewing the scope of the audit to be conducted by such
firm, including the firm’s internal quality control
procedures, and issues raised by the most recent peer review
or
public company accounting
oversight board (United States) (“
PCAOB”) review or inspection, as well as the
results of its audit; evaluating, at least annually, the
qualifications, performance and independence of the independent
auditors; reviewing and discussing with the independent auditors
any audit problems, difficulties and disagreements and
management’s responses to same; overseeing our financial
reporting activities, including annual and quarterly reports and
the accounting standards and principles followed; reviewing and
approving the design and implementation of internal audit
functions; reviewing and approving related-party transactions;
overseeing legal and regulatory compliance; overseeing disclosure
and internal controls, including establishing and overseeing
procedures to address concerns about the same; and preparing the
report of the audit committee, as required by the rules and
regulations of the SEC, included in this proxy
statement.
Each
member of the audit committee is financially literate. Ms.
Williams, Mr. Cherdabayev and Mr. Stillman each meet the
independent director definition of Nasdaq Rule 5605. The Board has
determined that Ms. Williams qualifies as an “audit committee
financial expert” as defined in Item 407(d)(5)(ii) of
Regulation S-K. Ms. Williams serves as the Chair of the audit
committee. The Audit Committee Charter provides that the audit
committee will meet at least four times annually. During fiscal
2021 the audit committee met five times.
Report of the Audit Committee
The
audit committee oversees our financial reporting process on behalf
of the Board. Management is responsible for our internal controls,
financial reporting process and compliance with laws, regulations
and ethical business standards. Our independent registered public
accounting firm is responsible for performing an integrated audit
of our consolidated financial statements and of our internal
control over financial reporting in accordance with standards of
the PCAOB, and to issue opinions thereon. The audit
committee’s responsibility is to monitor and oversee these
processes. In this capacity, the audit committee provides advice,
counsel, and direction to management and the auditors on the basis
of the information it receives, discussions with management and the
auditors, and the experience of the audit committee’s members
in business, financial and accounting matters.
The
audit committee reviewed and discussed with management and WSRP,
LLC, our independent registered public accounting firm, our audited
financial statements for the fiscal year ended March 31, 2021. The
audit committee reviewed and discussed with management and WSRP,
LLC, management’s assessment of the effectiveness of the
Company’s internal control over financial reporting and WSRP,
LLC’s opinion about the effectiveness of the Company’s
internal control over financial reporting. The audit committee
discussed with WSRP, LLC the matters required to be discussed by
applicable requirements of the PCAOB as currently in effect. The
audit committee also received the written disclosures and the
letter from WSRP, LLC required by applicable requirements of the
PCAOB regarding auditor-audit committee communications concerning
independence and discussed with WSRP, LLC its independence from
Freedom Holding Corp. and its management.
In
reliance on the reviews and discussions referred to above, the
audit committee recommended to the Board, and the Board approved,
that our audited financial statements be included in the
Company’s Annual Report. These are the same financial
statements that appear in our Annual Report that has been filed
with the SEC.
Members of the Audit
Committee
:
Amber
Williams, Chair
Leonard
Stillman
Boris
Cherdabayev
14
Compensation Committee
The
Compensation Committee Charter provides that the primary function
of the compensation committee is to carry out the duties assigned
to it by the Board relating to review and determination of
executive compensation. The Compensation Committee Charter assigns
the compensation committee the following authority and
responsibilities: reviewing and approving corporate goals and
objectives applicable to the compensation of the Chief Executive
Officer and evaluation of the Chief Executive Officer’s
performance to determine and approve Chief Executive Officer
compensation; reviewing and approving the compensation of all other
executive officers; reviewing, approving and, when appropriate,
recommending to the Board for approval, incentive compensation
plans and equity-based plans, and where appropriate or required,
recommending such plans for approval by our stockholders; reviewing
with management executive compensation disclosure to be included,
as required by SEC rules and regulations, in our annual reports on
Form 10-K and/or proxy statements; reviewing, approving and, when
appropriate, recommending to the Board for approval, any employment
agreements and severance arrangements or plans, including any
benefits to be provided in connection with a change in control, and
any amendments or terminations thereto; determining stock ownership
guidelines for executive officers and monitoring compliance with
such guidelines; reviewing incentive compensation arrangements and
the relationship between risk management policies and practices and
compensation policies and practices; reviewing and recommending to
the Board for approval the frequency of Say on Pay votes; reviewing
all director compensation and benefits; and overseeing engagement
with stockholders and, as applicable, proxy advisory firms on
matters of executive compensation.
The
Compensation Committee Charter allows the compensation committee to
invite such members of management to its meeting as it deems
appropriate, but in all cases the Chief Executive Officer and any
other such officers shall not be present at meetings at which their
compensation or performance is discussed or
determined.
The
Compensation Committee Charter also authorizes the compensation
committee to access, at our expense, such internal and external
resources, including retaining, legal, financial and other
advisors, such as compensation consultants, as the compensation
committee deems necessary or appropriate to fulfill its
responsibilities. Neither the compensation committee nor the Board
retained the services of a compensation consultant during fiscal
2021. The Compensation Committee Charter authorizes the
compensation committee to delegate any of its responsibilities and
authority to one or more subcommittees as it deems
appropriate.
Mr.
Kerr is the Chair of the compensation committee and Mr. Cherdabayev
and Mr. Stillman are members of the committee. Each meets the
independent director definition of Nasdaq Rule 5605. To the extent
securities laws or other laws, rules or regulations require
approval by the full Board, or by the independent members of the
Board, such matters will be submitted for appropriate approval. The
compensation committee met three times during fiscal
2021.
Nominating and Corporate Governance Committee
The
Nominating and Corporate Governance Committee Charter provides that
the nominating committee’s responsibilities include, among
other things: determining the qualifications, qualities, skills,
and other expertise required to be a director; identifying
individuals qualified to become Board members; recommending to the
Board nominees to stand for election or to fill vacancies;
developing and recommending corporate governance guidelines;
overseeing our corporate governance practices and procedures;
developing, subject to approval by the Board, processes for annual
evaluation of the Board and its committees and overseeing the
conduct of annual evaluations; reviewing the Board’s
committee structure and composition and making recommendations to
the Board regarding the appointment of directors to serve as
members of each committee; developing and recommending to the Board
for approval director standards for determining whether a director
has a material relationship with the Company that would impair his
or her independence; as necessary, amending and updating our Code
of Ethics and Business Conduct; monitoring compliance with,
investigating any alleged breach or violation of, and enforcing the
provisions of our Code of Ethics and Business Conduct; with senior
management, developing and recommending to the Board for approval
an officer succession plan; and reviewing all tendered director
resignation letters and evaluating and recommending to the Board
whether such resignations should be accepted.
15
In
discharging its responsibilities to nominate candidates for
election to the Board neither the Board, nor the nominating
committee has, at this time, specified minimum qualifications for
serving on the Board. We believe that our directors should have the
highest professional and personal ethics and values, consistent
with our values and standards. They should be committed to
enhancing stockholder value and should have sufficient time to
carry out their duties and to provide insight and practical wisdom
based on experience. Their service on other boards of public
companies should be limited to a number that permits them, given
their individual circumstances, to perform responsibly all director
duties for us. When considering potential director candidates, the
nominating committee also considers the candidate’s
character, judgment, diversity, age and skills, including financial
literacy and experience in the context of our needs and the needs
of the Board.
There
is no assurance that all stockholder proposed candidates will be
fully considered, that all candidates will be considered equally,
or that the proponent of a proposed candidate, or any candidate,
will be contacted by the Company, the Board or the nominating
committee, and no undertaking to do so is implied by the
willingness to consider candidates proposed by
stockholders.
The
Nominating and Corporate Governance Charter authorizes the
nominating committee to access, at our expense, such internal and
external resources, including retaining, legal, financial and other
advisors, such as the nominating committee deems necessary or
appropriate to fulfill its responsibilities.
Mr.
Turlov is the Chair of the nominating committee and Mr. Stillman
and Ms. Williams are members of the committee. As our CEO, Mr.
Turlov does not qualify as an independent director under Nasdaq
Rule 5605. Mr. Stillman and Ms. Williams do qualify as independent
directors under Nasdaq Rule 5605. To the extent securities laws or
other laws, rules or regulations require approval by the full
Board, or by the independent members of the Board, such matters
will be submitted for appropriate approval. The nominating
committee met twice during fiscal 2021.
Risk Committee
The
Board has approved the creation of a risk committee as described
below. The risk committee has met to review the current state of
risk management activities conducted in the Company, discuss the
scope of oversight activities to be made by the committee and
drafted a Risk Committee Charter, which has been circulated to the
full Board for review and approval. It is the responsibility of our
Chief Executive Officer and senior management to identify and
assess the Company’s exposure to risk. The risk committee is
responsible to meet periodically with senior management to review
the Company’s risk management, compliance activities and
potential risk exposures and to carry out its other duties set
forth in the Risk Committee Charter.
The
Risk Committee Charter tasks the risk committee to assist the Board
in its oversight and monitoring of our senior management and risk
managers in carrying out their responsibilities for enterprise risk
management (“ERM”). This includes oversight of
financial management, risk profile, financial risk and return,
legal and regulatory and strategic planning and alignment. The risk
committee is responsible for oversight and review with senior
management of the Company’s capital planning process, capital
position, capital adequacy, capital structure, and certain policies
relating to financial management of the Company and its
subsidiaries, as well as overseeing implementation of such
policies. The risk committee will periodically review the
Company’s funding and liquidity requirements and contingency
funding plan and is tasked with overseeing senior
management’s establishment of an independent ERM framework.
The risk committee will work with senior management to: recommend a
risk profile of the Company to the Board; review and monitor risk
elements associated with the Company’s business; oversee and
review the Company’s ERM charter, policies and procedures for
assessing and managing exposure, including exposure to
cybersecurity risk; and receive and review reports regarding the
Company’s overall state of legal and regulatory compliance.
The risk committee will oversee senior management’s
establishment of the Company’s overall strategic planning
process and alignment of the Company’s risk profile with its
strategic plan, goals and objectives. The risk committee is also
responsible to review material strategic transactions, principal
investments or dispositions where the aggregate consideration to be
paid or received exceeds limits specified by the
Board.
16
The
Risk Committee Charter authorizes the risk committee to select,
retain and terminate special risk management, legal, financial,
accounting, audit and other professional advisors, at our expense,
to assist the risk committee in discharging its responsibilities.
This authority excludes selecting, retaining or terminating the
Company’s independent registered public accounting firm,
which is the responsibility of the audit committee.
The
Risk Committee Charter provides that the risk committee shall be
comprised of at least three members and a majority of the members
of the risk committee must be independent according to the
standards of the Nasdaq Stock Market and the Company (to the extent
the Company maintains a more stringent standard). Mr. Kerr, Mr.
Turlov and Ms. Williams have been appointed by the Board to serve
on the risk committee. Mr. Kerr and Ms. Williams qualify as
independent directors under Nasdaq Rule 5605. Mr. Turlov does not
qualify as an independent director.
Anti-Hedging Policy
We do
not have a formal anti-hedging policy. While we do not encourage
such activity, our employees, officers and directors are not
prohibited from engaging in transactions designed to hedge or
offset decreased in the market value of our equity
securities.
Stockholder Nominees for Director
Our
nominating committee will consider qualified director nominees
recommended by stockholders when such recommendations are submitted
in accordance with applicable SEC requirements, our By-laws, Nevada
state corporate law and any other applicable law, rule or
regulation regarding director nominations. Under our By-laws,
nominations of persons for election to the Board may be made at an
annual meeting of stockholders by any stockholder who was a
stockholder of record as of the record date and at the time of
giving of the notice provided for in our By-laws and at the time of
the annual meeting; and provides timely notice and otherwise
complies with the procedures set forth in our By-laws.
No
candidates for director nominations were submitted to the
nominating committee by any stockholder in connection with our
Annual Meeting. Any stockholder desiring to present a nomination
for consideration by the nominating committee prior to the 2022
Annual Meeting must do so in accordance with our By-laws and
policies as described in more detail in “Stockholder
Proposals for the 2022 Annual Meeting,” elsewhere in this
proxy statement.
Advance Notice Provisions
To be timely, a stockholder’s notice
pursuant to the advance notice provisions of our By-laws must be in
writing and delivered to us at our address listed below not later
than the close of business on the 90th day, nor earlier than the
close of business on the 120th day, in advance of the anniversary
of the previous year’s annual meeting if such meeting is to
be held on a day which is not more than 30 days in advance of the
anniversary of the previous year’s annual meeting or not
later than 60 days after the anniversary of the previous
year’s annual meeting; and with respect to any other annual
meeting of stockholders, including in the event that no annual
meeting was held in the previous year, not earlier than the close
of business on the 120th day prior to the annual meeting and not
later than the close of business on the later of: (1) the 90th day
prior to the annual meeting and (2)
the tenth day following
the day on which public announcement of the date of such meeting is
first made
. A stockholder’s
notice pursuant to the advance notice provisions of our By-Laws
should be delivered to: Chairman of the Nominating and Corporate
Governance Committee c/o Corporate Secretary, Freedom Holding Corp,
1930 Village Ctr. Cir., #3-6972, Las Vegas, Nevada
89134.
17
To
be in proper form, a stockholder’s notice pursuant to the
advance notice provisions of our By-laws must set forth, as to the
stockholder giving the notice and the beneficial owner, if any, on
whose behalf the nomination is made:
●
the
name and address of the stockholder as they appear on our books and
of the beneficial owner, if any, on whose behalf the nomination is
being made;
●
the
class and number of our shares which are owned by the stockholder
(beneficially and of record) and owned by the beneficial owner, if
any, on whose behalf the nomination is being made, as of the date
of the notice, and a representation that the stockholder will
notify us in writing of the class and number of such shares owned
of record and beneficially by the stockholder as of the record date
for the meeting within five business days after the record date for
such meeting;
●
a
description of any agreement, arrangement, or understanding with
respect to such nomination between or among the stockholder or the
beneficial owner, if any, on whose behalf the nomination is being
made and any of their affiliates or associates, and any others
(including their names) acting in concert with any of the
foregoing, and a representation that the stockholder will notify us
in writing of any such agreement, arrangement, or understanding in
effect as of the record date for the meeting within five business
days after the record date for such meeting;
●
a
description of any agreement, arrangement, or understanding
(including any derivative or short positions, profit interests,
options, hedging transactions, and borrowed or loaned shares) that
has been entered into as of the date of the notice by, or on the
stockholder’s behalf, or the beneficial owner, if any, on
whose behalf the nomination is being made and any of their
affiliates or associates, the effect or intent of which is to
mitigate loss to, manage risk or benefit of share price changes
for, or increase or decrease the voting power of such person or any
of their affiliates or associates with respect to shares of our
stock, and a representation that the stockholder will notify us in
writing of any such agreement, arrangement, or understanding in
effect as of the record date for the meeting within five business
days after the record date for such meeting;
●
a
representation that the stockholder is a holder of record of our
shares entitled to vote at the meeting and intends to appear in
person or by proxy at the meeting to nominate the person or persons
specified in the notice, and
●
a
representation whether the stockholder intends to deliver a proxy
statement and/or form of proxy to holders of at least the
percentage of our outstanding capital stock required to approve the
nomination and/or otherwise to solicit proxies from stockholders in
support of the nomination. We may require any proposed nominee to
furnish such other information as we may reasonably require to
determine the eligibility of such proposed nominee to serve as an
independent director or that could be material to a reasonable
stockholder’s understanding of the independence, or lack
thereof, of such nominee.
The
stockholder’s notice must provide the nominating committee
the following:
●
the name, age,
business address, and residence address of each proposed
nominee;
●
the principal
occupation or employment of each such nominee;
●
the class and
number of shares of our capital stock which are owned of record and
beneficially by each such nominee (if any);
●
such other
information concerning each such nominee as would be required to be
disclosed in a proxy statement soliciting proxies for the election
of such nominee as a director in an election contest (even if an
election contest is not involved) or that is otherwise required to
be disclosed, under Section 14(a) of the Exchange Act;
●
a
written questionnaire with respect to the background and
qualification of such proposed nominee (which questionnaire shall
be provided by the Corporate Secretary upon written request), and a
written statement and agreement executed by each such nominee
acknowledging that such person:
o
consents
to being named in the Company’s proxy statement as a nominee
and to serving as a director if elected;
o
intends
to serve as a director for the full term for which such person is
standing for election; and
o
makes
the following representations: (1) that the nominee has read and
agrees to adhere to our Code of Ethics and Business Conduct and
other corporate governance policies and guidelines applicable to
directors, (2) that the nominee is not and will not become a party
to any agreement, arrangement, or understanding with, and has not
given any commitment or assurance to, any person or entity as to
how such person, if elected as a director, will act or vote on any
issue or question, (3) that the nominee is not and will not become
a party to any agreement, arrangement, or understanding with any
person or entity other than the Company with respect to any direct
or indirect compensation, reimbursement, or indemnification in
connection with such person’s nomination for director or
service as a director.
18
Proxy Access Provisions
Pursuant
to the proxy access provisions of our By-laws, a stockholder, or a
group of not more than 20 stockholders, that has continuously owned
for at least three years a number of shares that represents at
least 3% of our outstanding voting shares can nominate for
inclusion in the Company’s proxy statement a number of
nominees not to exceed 20% of the number of directors in office as
of the last day on which notice of a nomination may be delivered to
the Company, or if such amount is not a whole number, the closest
whole number less than 20%, provided that the stockholder(s) and
the stockholder nominee(s) satisfy the requirements specified in
our By-laws. Such requirements include the timely delivery of a
stockholder’s notice to our Corporate Secretary.
To be timely, a stockholder’s notice
pursuant to the proxy access provisions must be delivered to our
Corporate Secretary at our principal executive offices not later
than 120 days nor more than 150 days prior to the first anniversary
of the date the definitive proxy statement was first sent to
stockholders in connection with the preceding year’s annual
meeting; provided, however, that in the event that the date of the
annual meeting is advanced more than 30 days or delayed more than
60 days from the anniversary of the preceding year’s annual
meeting, or if no annual meeting was held in the preceding year,
the notice must be delivered not earlier than the close of business
on the 150
th
day prior to such annual meeting and
not later than the close of business on the later of (i) the
120
th
day prior to such annual meeting or
the tenth day following the day on which public announcement of the
date of such meeting is first made.
A
stockholder’s notice pursuant to the proxy access provisions
must set forth, as to the stockholder giving the notice and the
beneficial owner, if any, on whose behalf the nomination is
made:
●
the
information required in a stockholder’s notice pursuant to
the advance notice provisions of our By-laws;
●
a statement of the
stockholder (a) setting forth and certifying to the number of
shares of the Company the stockholder owns and has owned
continuously for at least three years as of the date of the notice
and (b) agreeing to continue to own such shares through the
applicable annual meeting;
●
a copy of the
Schedule 14N that has been or concurrently is filed with the SEC as
required by Rule 14a-18 under the Exchange
Act;
●
the
details of any relationship that existed within the past three
years and that would have been described pursuant to Item 6(e) of
Schedule 14N if the relationship existed on the date of submission
of the Schedule 14N; and
●
written agreements
of the stockholder(s) setting forth certain additional agreements,
representations and warranties specified in our
By-laws.
Meeting Attendance
The
Board met twelve times during fiscal 2021. Each director attended
at least 75% of the meetings of the Board. In addition to
participation in Board meetings, our directors discharged their
responsibilities throughout the year through personal meetings and
other communications, including telephone contact on any matters of
interest and concern.
We
do not have a formal policy requiring members of the Board to
attend the annual meeting, although all directors are encouraged to
attend if available. All the members of our Board attended the 2020
annual meeting of stockholders, which was held virtually due to
COVID-19 imposed restrictions.
Indemnification
As
permitted by Nevada state corporate law, our Restated Articles of
Incorporation and By-Laws authorize and require us to indemnify our
officers and directors to the fullest extent permitted under Nevada
law.
19
Other Corporate Governance Resources
The charters of each committee of
our Board and our Code of Ethics and Business Conduct are available
on the Investor Relations Section of our website,
https://ir.freedomholdingcorp.com/governance-docs
.
D
IRECTOR
COMPENSATION
On
March 31, 2021, the last day of our 2021 fiscal year, and as of the
date of this proxy statement, we had six directors. During the
period from April 1, 2020, through December 31, 2020, our
non-employee directors received a cash retainer based on an
annualized amount of $24,000. During the same period, our
non-employee directors received a cash retainer for each Board
committee they served on based on an annualized amount of
$3,000.
In
January 2021, the Board approved increasing the annual cash
retainer paid to non-employee directors as follows: (i) from
January 1, 2021 to June 30, 2021, each non-employee director will
receive a quarterly payment of $15,000; (ii) commencing on July 1,
2021, the quarterly payment will increase to $25,000. Also,
effective as of January 1, 2021, the Board terminated separate
retainers for committee service, including serving as a committee
chair. Directors who are employees do not receive annual cash
retainers or fees for services on the Board.
Our
directors do not receive board meeting, committee meeting or
stockholder meeting attendance fees, but they will be reimbursed
for reasonable travel expenses incurred in connection with required
in-person attendance at such meetings.
The following table provides information
concerning the compensation of each of our independent directors
who served in fiscal 2021. Compensation of Mr. Turlov and Mr.
Tashtitov, who are also executive officers of the Company, is
described under the heading “
Executive
Compensation
”
elsewhere in this proxy statement. Mr. Turlov and
Mr. Tashtitov did not receive any compensation for their service on
the Board or any Board committee.
|
Name
|
Fees Earned
or Paid in Cash
($)
|
Stock Awards
($)
|
All
Other Compensation
($)
|
Total
($)
|
|
Boris
Cherdabayev
|
37,500
|
--
|
--
|
37,500
|
|
Jason
Kerr
|
39,750
|
--
|
--
|
39,750
|
|
Leonard
Stillman
|
37,109
|
--
|
--
|
37,109
|
|
Amber
Williams*
|
18,587
|
--
|
--
|
18,587
|
*
Ms. Williams was appointed to the Board in November
2020.
As
of March 31, 2021, none of the non-employee members of our Board
held any outstanding stock options or other equity awards. We do
not currently have a fixed plan for the award of equity
compensation to our non-employee directors. Any equity grants to
non-employee directors will be granted at a price equal to the fair
market value of our common stock on the date of grant. We did not
award any equity compensation to our non-employee directors during
the fiscal year ended March 31, 2021.
20
S
ECURITY
OWNERSHIP
As of
July 22, 2021, the record date, we had 58,443,212 shares of common
stock issued and outstanding. The following table sets forth the
outstanding shares of common stock owned of record or beneficially
by each person that owned of record, or was known to us to own
beneficially, more than 5% of our issued and outstanding stock, and
the name and stock holdings of each director and nominee for
director, named executive officer, and the stock holdings of all of
the directors, nominees and named executive officers as a
group:
|
|
Shares
Beneficially Owned
|
|
|
Name
of Person or Group
(1)
|
Amount
|
Percent
(2)(3)
|
|
Greater than 5% Stockholders:
|
|
|
|
Timur
Turlov
|
42,405,112
|
72.6
%
|
|
|
|
|
|
Directors, Nominees and Named Executive Officers:
|
|
|
|
Timur
Turlov
|
42,405,112
|
72.6
%
|
|
Jason
Kerr
|
--
|
--
|
|
Boris
Cherdabayev
|
6,074
|
*
|
|
Leonard
Stillman
|
--
|
--
|
|
Askar
Tashtitov
|
130,200
(4)
|
*
|
|
Amber
Williams
|
--
|
--
|
|
Evgeniy
Ler
|
60,000
(5)
|
*
|
|
|
|
|
|
All
Directors, Nominees and Named Executive Officers, as a Group (7
persons)
|
42,601,386
|
72.9
%
|
*
Less than
1%.
(1)
Unless otherwise
indicated, the mailing address of each beneficial owner is c/o
Freedom Holding Corp., “Esentai Tower” BC, Floor 7,
77/7 Al Farabi Ave., Almaty, 050040, Republic of Kazakhstan. The
information provided in the table is based on our records,
information filed with the SEC, and information provided to us,
except where otherwise noted.
(2)
The amounts and
percentages of shares beneficially owned are reported on the basis
of SEC regulations governing the determination of beneficial
ownership of securities. Under SEC rules, a person is deemed to be
a “beneficial” owner of a security if that person has
or shares voting power or investment power, which includes the
power to dispose of or to direct the disposition of such security.
A person is also deemed to be a beneficial owner of any securities
of which that person has a right to acquire beneficial ownership
within 60 days.
(3)
In May 2021 we
awarded restricted stock grants totaling 1,031,500 shares to
certain of our employees and executive officers. In July 2021 an
employee exercised outstanding options to purchase 60,000 shares of
our common stock. We are currently in process of effecting the
issuances of these shares. For purposes of determining the
percentage of shares beneficially owned in the table above, we have
not included such shares as outstanding. Upon issuance of the
shares Mr. Turlov’s beneficial ownership percentage will
decrease to 71.2% of our outstanding shares and all directors,
nominees and named executive officers, as a group, will decrease to
71.6% of our outstanding shares.
21
(4)
Includes 53,000
restricted shares granted to Mr. Tashtitov as equity incentive
compensation. Vesting of 6,621 of these shares is contingent upon
Mr. Tashtitov’s continuous service with us until March 31,
2022. Vesting of the remaining 46,379 shares is contingent upon Mr.
Tashtitov’s continuous service with us through the applicable
vesting dates described below, and satisfaction of the continuous
service requirement notwithstanding, (ii) if the weighted average
closing price of our common shares for the 20 trading days prior to
the first vesting date is less than 70% of the closing price of the
common shares on the grant date, (May 18, 2021), and as to any
subsequent vesting date, if the weighted average closing price of
our common shares for the 20 trading days prior to the vesting date
is less than 70% of the weighted average closing price of the
common shares on the immediately prior vesting date, then the
common shares scheduled to vest on the vesting date shall not vest
but shall be automatically forfeited on the stated vesting date and
we shall have no further obligations to Mr. Tashtitov as to that
portion of the restricted stock award forfeited. Assuming
satisfaction of the foregoing vesting conditions, vesting of the
46,379 shares will occur as follows: 14,759 shares on May 18, 2023,
10,600 shares on May 18, 2024, 10,600 shares on May 18, 2025, and
10,600 shares on May 18, 2026.
During the vesting
periods, Mr. Tashtitov will be the record owner of the restricted
stock and he will be entitled to all the rights of a stockholder of
the Company, including the right to vote and receive dividends or
other distributions on the shares, provided, however, that dividend
payments or other distributions on unvested shares shall be held in
custody by the Company and subject to the same restrictions that
apply to unvested shares. The shares will not be delivered until
they vest, and he has no rights to assign, alienate, pledge,
attach, sell or otherwise transfer or encumber the shares until
such shares vest, except as otherwise provided in the applicable
grant agreement or the Freedom Holding Corp. 2019 Equity Incentive
Plan (the “2019 Plan”). To the extent he forfeits
shares of restricted stock
for failure to satisfy an
applicable vesting condition
, he will no longer be
entitled to any rights as a stockholder of the Company, including
the rights to vote or receive dividends or other distributions on
such forfeited shares.
(5)
Includes 40,000
restricted shares granted to Mr. Ler as equity incentive
compensation. Vesting of 6,621 of these shares is contingent upon
Mr. Ler’s continuous service with the Company until March 31,
2022. Vesting of the remaining 33,379 shares is contingent upon Mr.
Ler’s continuous service with us through the applicable
vesting dates described below, and satisfaction of the continuous
service requirement notwithstanding, (ii) if the weighted average
closing price of our common shares for the 20 trading days prior to
the first vesting date is less than 70% of the closing price of the
common shares on the grant date, (May 18, 2021), and as to any
subsequent vesting date, if the weighted average closing price of
our common shares for the 20 trading days prior to the vesting date
is less than 70% of the weighted average closing price of the
common shares on the immediately prior vesting date, then the
common shares scheduled to vest on the vesting date shall not vest
but shall be automatically forfeited on the stated vesting date and
we shall have no further obligations to Mr. Ler as to that portion
of the restricted stock award forfeited. Assuming satisfaction of
the foregoing vesting conditions, vesting of the 33,379 shares will
occur as follows: 9,379 shares on May 18, 2023, 8,000 shares on May
18, 2024, 8,000 shares on May 18, 2025, and 8,000 shares on May 18,
2026.
During the vesting
periods, Mr. Ler will be the record owner of the restricted stock
and he will be entitled to all the rights of a stockholder of the
Company, including the right to vote and receive dividends or other
distributions on the shares, provided, however, that dividend
payments or other distributions on unvested shares shall be held in
custody by the Company and subject to the same restrictions that
apply to unvested shares. The shares will not be delivered until
they vest, and he has no rights to assign, alienate, pledge,
attach, sell or otherwise transfer or encumber the shares until
such shares vest, except as otherwise provided in the applicable
grant agreement or the 2019 Plan. To the extent he forfeits shares
of restricted stock for failure to satisfy and applicable vesting
condition, he will no longer be entitled to any rights as a
stockholder of the Company, including the rights to vote or receive
dividends or other distributions on such forfeited
shares.
Equity Compensation Plan Information
The
following table sets forth, as of July 28, 2021, certain
information related to our equity compensation plans.
|
Plan
Category
|
Number of Securitiesto
Be Issued upon Exercise of Outstanding Options,Warrants and
Rights
(a)
|
Weighted-Average
Exercise Price of Outstanding Options,Warrants and
Rights
(b)
|
Number of Securities
Remaining Available for Future Issuance under Equity Compensation
Plans (Excluding Securities Reflected in Column
(a))
|
|
Equity compensation
plans approved by security holders
|
--
|
$
--
|
2,598,500
(1)
|
|
Equity compensation
plans not approved by security holders
|
--
|
--
|
--
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
--
|
--
|
2,598,500
|
|
|
|
|
|
(1)
Securities available for award under the 2019
Plan.
22
S
ECTION 16(A) BENEFICIAL
OWNERSHIP REPORTING COMPLIANCE
Section
16(a) of the Exchange Act requires our directors and executive
officers, and any persons who own more than 10% of our common stock
to file with the SEC reports of beneficial ownership and changes in
beneficial ownership of our common stock. Officers and directors
are required by SEC regulations to furnish us with copies of all
Section 16(a) forms they file. Based solely on review of the copies
of such reports furnished to us or written representations, we
believe that during fiscal 2021 all filing requirements applicable
to our executive officers, directors and greater than 10%
stockholders were met on a timely basis, except for a Form 3 for
Ms. Williams at the time she became a director, a Form 4 for each
of Mr. Tashtitov and Mr. Ler in connection with a grant of equity
incentive compensation, and a Form 4 for Mr. Ler in connection with
the sale of 8,471 shares in multiple trades occurring on the same
day. Each of the Form 4 filings by Mr. Tashtitov and Mr. Ler were
inadvertently filed one day late.
E
XECUTIVE
COMPENSATION
The
table below summarizes compensation paid to or earned by our named
executive officers for the years ended March 31, 2021 and
2020.
Summary Compensation Table
|
Name and
Principal Position
|
|
Year
|
Salary
($)
(1)
|
Stock Awards
($)
|
Option Awards
($)
|
All Other Compensation
($)
(2)
|
Total
($)
(3)
|
|
Timur
Turlov
|
|
2021
|
279,525
|
--
|
--
|
22,189
|
301,714
|
|
CEO and
Chairman
(4)
|
|
2020
|
95,236
|
--
|
--
|
39,048
|
134,284
|
|
|
|
|
|
|
|
|
|
|
Evgeniy
Ler
|
|
2021
|
180,157
|
--
|
--
|
25,758
|
205,942
|
|
CFO
|
|
2020
|
129,266
|
--
|
--
|
20,814
|
150,080
|
|
|
|
|
|
|
|
|
|
|
Askar
Tashtitov
|
|
2021
|
154,539
|
--
|
--
|
22,905
|
177,443
|
|
President
(4)
|
|
2020
|
131,927
|
--
|
--
|
21,110
|
153,037
|
(1)
Annual salary is
net of all salary-related taxes and dues required under the laws of
the Russian Federation and the Republic of Kazakhstan, which are
legally the responsibility of the Company.
(2)
Includes
salary-related taxes and dues, including mandatory contributions to
nationally-sponsored pension programs of $17,534 and $17,654, and a
car and travel allowance of $4,655 and $21,394 for Mr. Turlov
during the fiscal years ended March 31, 2021 and 2020,
respectively, salary-related taxes and dues, including mandatory
contributions to nationally-sponsored pension programs of $25,785
and $20,814 for Mr. Ler during the fiscal years ended March 31,
2021 and 2020, respectively, and salary-related taxes and dues,
including mandatory contributions to nationally-sponsored pension
programs of $22,905 and $21,110 for Mr. Tashtitov during the fiscal
years ended March 31, 2021 and 2020, respectively.
(3)
Mr. Turlov receives
compensation in both Russian rubles and Kazakhstani tenge. Mr. Ler
and Mr. Tashtitov are paid in Kazakhstani tenge. The U.S. dollar
amounts shown in the table above were calculated using the average
annual exchange rates for the period from April 1, 2020 to March
31, 2021, of Kazakhstani tenge to Russian ruble and Russian ruble
to U.S. dollar as reported by the Central Bank of
Russia.
(4)
Mr. Turlov and Mr.
Tashtitov are also Company directors. They receive no compensation
for their service on our Board.
23
Employment Agreements
At
this time Freedom Holding Corp does not have employment agreements
with Mr. Turlov, Mr. Ler or Mr. Tashtitov. Mr. Turlov has a
standard statutorily required employment agreement for all
employees in the Russian Federation with Freedom RU and a standard
statutorily required employment agreement for all employees in the
Republic of Kazakhstan with our subsidiary Freedom Finance Global
PLC (“Freedom Global”). Mr. Ler and Mr. Tashtitov have
standard statutorily required employment agreement for all
employees in the Republic of Kazakhstan with our subsidiary Freedom
KZ. These standard statutorily required employment agreements
primarily provide for statutory rights relating to employees,
employers, base salary, and payment of salary-related taxes and
dues, including personal income taxes and pension fund obligations.
Each of Mr. Turlov, Mr. Ler and Mr. Tashtitov provide services to
the Company on an at-will basis.
Base Salary
We
provide base salaries as a fixed source of compensation for our
named executive officers, allowing them a degree of certainty with
respect to their day-to-day compensation. Base salaries of our
named executive officers are reviewed periodically by our
compensation committee based on performance, scope of
responsibilities and market information. In accordance with the
laws of the Russian Federation and the Republic of Kazakhstan,
salaries are net of all salary-related taxes, dues and state
sponsored pension plans, which are the legal responsibility of the
employer in those countries. Mr. Turlov’s base salary
includes salary paid to him by Freedom RU and Freedom Global. Mr.
Ler and Mr. Tashtitov receive base salaries from Freedom
KZ.
During
the fiscal year, the compensation committee evaluated the
performance and scope of responsibilities of Messrs. Turlov, Ler
and Tashtitov, as well as compensation information of other
financial services companies and companies with market caps similar
to those of the Company. Based on this evaluation, the compensation
committee recommended to our Board and our Board approved increases
in the annual salaries for each of Messrs. Turlov, Ler and
Tashtitov. Mr. Turlov’s annual salary was increased to
$1,200,000 commencing from February 1, 2021. The annual salaries of
each of Mr. Ler and Mr. Tashtitov were increased to $300,000
commencing from March 1, 2021. Consistent with local regulations,
salary amounts are net of all salary-related taxes.
Incentive Compensation
From
time to time, we may award incentive compensation in the form of
cash or equity to our employees, including our named executive
officers, designed to compensate them for Company performance and
their contributions to Company success. In February 2021, the
compensation committee and the Board approved incentive
compensation awards to each of Mr. Ler and Mr. Tashtitov for our
2022 fiscal year. Mr. Ler is eligible to receive cash or equity
compensation of up to $300,000 based on achievement of financial
reporting performance objectives during fiscal 2022. Mr. Tashtitov
is eligible to receive cash or equity compensation of up to
$400,000 based on achievement of investment banking performance and
business development objectives during fiscal 2022.
Mr.
Ler and Mr. Tashtitov were also each awarded long-term equity
incentive compensation in the form of a restricted stock grant of
6,621 shares of our common stock. Vesting of these shares to each
is subject to each remaining in Continuous Service (defined below)
with the Company through March 31, 2022. Based on the closing
market price of the Company’s common stock on May 18, 2021,
the date we finalized agreements with Mr. Ler and Mr. Tashtitov
relating to these grants, the restricted stock grant to each of
them was valued at approximately $300,000.
On
May 18, 2021, Mr. Ler and Mr. Tashtitov were also awarded
restricted stock grants of 33,379 shares and 46,379, respectively.
Vesting of these grants is subject to (i) each individually
remaining in Continuous Service with us through the applicable
vesting dates set forth in the vesting schedule below, and
satisfaction of the Continuous Service requirement notwithstanding,
and (ii) if the weighted average closing price of our common shares
for the 20 trading days prior to the first vesting date is less
than 70% of the closing price of the common shares on the grant
date (May 18, 2021), and as to any subsequent vesting date, if the
weighted average closing price of our common shares for the 20
trading days prior to the vesting date is less than 70% of the
weighted average closing price of the common shares on the
immediately prior vesting date, then the common shares scheduled to
vest on the vesting date shall not vest but shall be automatically
forfeited on the stated vesting date and we shall have no further
obligations as to any portion of the restricted stock award
forfeited.
24
The
restricted stock grants made to Messrs. Tashtitov and Ler are
scheduled to vest upon satisfaction of the vesting conditions, as
follows:
|
|
Shares of Common Stock
|
|
|
Vesting Date
|
Tashtitov
|
Ler
|
|
May
18, 2023
|
14,579
|
9,379
|
|
May
18, 2024
|
10,600
|
8,000
|
|
May
18, 2025
|
10,600
|
8,000
|
|
May
18, 2026
|
10,600
|
8,000
|
"Continuous
Service" means the individual’s service with the Company,
whether as an employee, consultant or director, is not interrupted
or terminated. The individual’s Continuous Service shall not
be deemed to have terminated merely because of a change in the
capacity in which the individual renders service to the Company as
an employee, consultant or director or a change in the entity for
which the individual renders such service, provided that there is
no interruption or termination of the individual’s Continuous
Service. The compensation committee, or its delegate, in its sole
discretion, may determine whether Continuous Service will be
considered interrupted, and whether a Company transaction, such as
a sale or spin-off of a division or subsidiary that employs an
individual shall be deemed to result in termination of Continuous
Service. If the individual’s Continuous Service terminates
for any reason at any time before all of the individual’s
restricted stock grant has vested, the unvested restricted stock
shall be automatically forfeited upon such termination of
Continuous Service and we shall have no further obligations to the
individual under the grant agreement, unless otherwise determined
by the compensation committee.
Outstanding Equity Awards at Fiscal Year-End
As
of the fiscal year ended March 31, 2021, none of our named
executive officers held any outstanding equity awards. Subsequent
to the fiscal year-end, Mr. Ler and Mr. Tashtitov were awarded
equity incentive compensation awards as described above under the
heading “Incentive Compensation”.
Option Exercises and Stock Vested
As
of the fiscal year ended March 31, 2021, none of our named
executive officers held any unexercised stock options or unvested
restricted stock awards. Subsequent to the fiscal year-end, Mr. Ler
and Mr. Tashtitov were awarded equity incentive compensation awards
as described above under the heading “Incentive
Compensation”.
Nonqualified Deferred Compensation
We
do not have a deferred compensation program for our employees,
officers or directors, including our named executive
officers.
Pension and Retirement Benefits
We
do not offer a company-sponsored pension program or retirement
benefits for our employees, officers or directors, including our
named executive officers. Several of the countries in which we
operate have nationally sponsored pension programs to which we are
required to make contributions. Such contributions are paid by us
to the government on behalf of the employee. We do not have other
liabilities related to any supplementary pensions, post-retirement
health care, insurance benefits or retirement
indemnities.
25
Potential Payments upon Termination or Change in
Control
We do
not currently have any contract, agreement, plan or arrangement
with any of our named executive officers that would result in any
potential payment upon resignation, retirement or other termination
of employment with the Company or as a result of a change in
control of the Company or change of responsibilities in the event
of a change in control of the Company.
Advisory Vote on Executive Compensation
At the
2018 Annual Meeting, pursuant to Section 14A of the Exchange Act,
we submitted a proposal to stockholders for an advisory and
non-binding vote to approve the compensation of our executive
officers as disclosed in the proxy statement for the 2018 Annual
Meeting. This advisory vote on executive compensation, commonly
referred to as a “say-on-pay” proposal, gave our
stockholders the opportunity to express their views on the
compensation of our named executive officers.
The vote was not intended to address any specific
element of compensation, but rather related to the overall
compensation of our named executive officers. At the 2018 Annual
Meeting, our stockholders approved the compensation of our named
executive officers with approximately 77% of the vote cast in
favor.
P
ROPOSAL TWO —
ADVISORY AND NON-BINDING VOTE TO APPROVE NAMED EXECUTIVE
OFFICER COMPENSATION
In
accordance with Section 14A of the Exchange Act, we provide our
stockholders with the opportunity to vote to approve, on an
advisory and non-binding basis, the compensation of our named
executive officers as disclosed in this proxy statement in
accordance with the compensation disclosure rules of the SEC once
every three years. The next advisory and non-binding vote to
approve named executive officer compensation will be held at our
2024 annual meeting of stockholders.
Our
executive compensation programs are designed to attract, motivate,
and retain our named executive officers, who are critical to our
success, and to reward our named executive officers for the
achievement of strategic and operational goals and the achievement
of increased total stockholder returns. We seek to align the
interests of our named executive officers with the interests of our
stockholders. Our compensation committee reviews named executive
officer compensation to ensure such compensation is consistent with
our goals.
This
vote is advisory, which means that the vote on executive
compensation is not binding on us, our Board, or our compensation
committee. The vote on this resolution is not intended to address
any specific element of compensation, but rather relates to the
overall compensation of our named executive officers, as described
in this proxy statement. Because we value our stockholders’
views on named executive officer compensation and as a matter of
good corporate governance, to the extent there is a significant
vote against our named executive officer compensation as disclosed
in this proxy statement, the compensation committee will consider
such as a direction to the Board and the compensation committee to
evaluate our named executive officer compensation practices and to
determine what actions may be necessary to address our
stockholders’ concerns.
Accordingly,
we ask you to vote on the following resolution at the Annual
Meeting:
“RESOLVED,
that the Company’s stockholders approve, on an advisory
basis, the compensation of the named executive officers, as
disclosed in the Company’s Proxy Statement for the 2021
Annual Meeting of Stockholders pursuant to the compensation
disclosure rules of the Securities and Exchange Commission,
including the Summary Compensation Table, and the other related
tables and disclosure.”
26
|
|
|
THE
BOARD RECOMMENDS THAT YOU VOTE “FOR” APROVAL OF THE
NON-BINDING ADVISORY RESOLUTION REGARDING COMPENSATION OF THE
COMPANY’S NAMED EXECUTIVE OFFICERS AS DESCRIBED IN THE PROXY
STATEMENT
|
P
ROPOSAL THREE —
RATIFICATION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM
The
Board, upon the recommendation of the audit committee, has
appointed WSRP, LLC to serve as our independent registered public
accounting firm for our 2022 fiscal year. WSRP, LLC served as our
independent registered public accounting firm for our 2021 fiscal
year.
A
representative of WSRP, LLC is expected to be present virtually at
the Annual Meeting and is expected to be available to respond to
appropriate questions. The representative will also have an
opportunity to make a statement if he desires to do
so.
We
are asking our stockholders to ratify the selection of WSRP, LLC as
our independent registered public accounting firm. Although
ratification is not required by our By-Laws or otherwise, the Board
is submitting the selection of WSRP, LLC to our stockholders for
ratification as our audit committee has recommended because we
value our stockholders’ views on our independent registered
public accounting firm and as a matter of good corporate practice.
If our stockholders fail to ratify the selection, we will consider
that failure as a direction to the Board and the audit committee to
consider the selection of a different firm. Even if the selection
is ratified, the audit committee in its discretion may select a
different independent registered public accounting firm, at any
time during the year if it determines that such a change would be
in the best interests of the Company and our
stockholders.
P
RINCIPAL ACCOUNTANT FEES AND
SERVICES
Pre-Approval of Services
The
audit committee annually engages our independent registered public
accounting firm and pre-approves their services related to the
annual audit and interim quarterly reviews of our financial
statements and all reasonably related assurance services.
All non-audit services are also considered
for pre-approval by the audit committee. Audit
committee pre-approval of audit
and non-audit services is not required if the engagement
for the services is entered into pursuant
to pre-approval policies and procedures established by
the audit committee regarding our engagement of the independent
registered public accounting firm.
Audit Fees
The
firm of WSRP, LLC has served as our independent registered public
accounting firm for the fiscal years ended March 31, 2021 and 2020.
Principal accounting fees for professional services provided to us
by WSRP, LLC for the fiscal years ended March 31, 2021 and 2020 are
summarized as follows:
|
Fee
Type
|
For
the
year
ended
March
31,
2021
($)
|
For
the
year
ended
March
31,
2020
($)
|
|
Audit
fees
|
1,168,117
|
1,010,527
|
|
Audit-related
fees
|
7,963
|
42,660
|
|
Tax
fees
|
175
|
1,287
|
|
All
other fees
|
--
|
---
|
|
Total
|
1,176,254
|
1,054,473
|
27
Audit Fees
. Audit fees were for
professional services rendered in connection with the audit of the
financial statements included in our annual report on Form 10-K and
review of the financial statements included in our quarterly
reports of Form 10-Q and for services normally provided by our
independent registered public accounting firm in connection with
statutory and regulatory filings or engagements and fees for
Sarbanes-Oxley 404 audit work.
Audit-Related Fees
. Audit-related fees
during the fiscal years ended March 31, 2021 and 2020, were
primarily fees billed for professional services related to foreign
statutory reporting and document review.
Tax Fees
. Fees billed for professional
services rendered for tax compliance, tax advice and tax planning
within the United States for the fiscal years ended March 31, 2021
and 2020.
All
of the services provided by WSRP, LLC described above were approved
by our audit committee pursuant to our audit committee’s
pre-approval policies.
The
audit committee has determined that the provision of services by
our independent registered accounting firm described above is
compatible with maintaining WSPR, LLC’s
independence.
|
|
|
THE
BOARD RECOMMENDS THAT YOU VOTE “FOR” RATIFICATION OF
THE APPOINTMENT OF WSRP, LLC AS OUR INDEPENDENT REGISTERED
ACCOUNTING FIRM FOR THE 2022 FISAL YEAR.
|
C
ERTAIN RELATIONSHIPS AND
RELATED PERSON TRANSACTIONS
In addition to the compensation arrangements
discussed above under “
Executive
Compensation
” elsewhere
in this proxy statement, the following is a description of
transactions since April 1, 2020, to which we have been a
participant, in which the amount involved in the transaction
exceeds or will exceed the lesser of (i) $120,000 or
(ii) 1% of the average of our total assets at year-end
for the last two completed fiscal years, and in which any of
our directors, executive officers or holders of more than 5% of our
capital stock, or any immediate family member of, or person sharing
the household with, any of these individuals, had or will have a
direct or indirect material interest or such other persons as may
be required to be disclosed pursuant to Item 404 of
Regulation S-K, which we refer collectively to as
“related persons”.
Certain
of our executive officers, directors, greater than 5% stockholders
and persons or entities affiliated with them have brokerage,
banking and/or other discretionary accounts with our subsidiary
companies and engage in transactions with those entities in the
ordinary course of business involving brokerage, banking and
investment banking services. Such transactions are made on
substantially the same terms and conditions as other similarly
situated unaffiliated third parties. In connection with these
accounts, our subsidiaries may extend credit in the ordinary course
of business to certain of our directors, executive officers,
greater than 5% stockholders and persons or entities affiliated
with them. These extensions of credit may be in connection with
margin lending or other extensions of credit by our subsidiaries in
the ordinary course of business, on substantially the same terms,
including interest rates and collateral, as those prevailing at the
time for comparable extensions of credit with similar situated
unaffiliated third parties and do not involve more than the normal
risk of collectability or present other unfavorable
features.
Since November 2015
Timur Turlov has been our controlling shareholder and served as a
member of our Board and as our CEO. In July 2014 Mr. Turlov created
and has remained the sole owner of FFIN Brokerage Services, Inc., a
corporation registered in and licensed as a broker dealer in Belize
(“FFIN Brokerage”). Many of our clients are also
clients of FFIN Brokerage. In Eurasia, as a foreign broker dealer,
FFIN Brokerage has been able to provide easier access to the U.S.
securities markets, which conduct business in U.S. dollars, to
investors in Russia and Kazakhstan, due to local regulations that
imposed restrictions on foreign currency accounts, required
mandatory securities custody in-country, and limited access to
foreign securities, unless listed on local exchanges. Over the past
few years, the securities markets in Russia and Kazakhstan have
developed substantially and many of the barriers to open access to
foreign securities and foreign stock markets have been reduced or
eliminated. However, since 2015 our subsidiaries have
engaged in ordinary course brokerage,
banking, lending, trading and other financial services with FFIN
Brokerage. All such transactions are conducted in the ordinary
course of our business. Such transactions are conducted on
substantially the same terms as those prevailing at the time for
comparable transactions with similarly situated unaffiliated third
parties.
28
To
comply with certain foreign ownership restrictions relating to
registered Ukrainian broker-dealers, on August 24, 2019, we sold
67.12% of the outstanding equity interest of our subsidiary LLC
Freedom Finance Ukraine (“Freedom UA”) to Askar
Tashtitov, our president. Due to recent amendments by regulators to
further restrict foreign ownership of registered Ukrainian
broker-dealers, in July 2021 we were required to sell an additional
22.88% of the outstanding equity interests in Freedom UA to Mr.
Tashtitov, reducing our ownership interest in Freedom UA to 10%. In
August 2019, we entered into a series of contractual arrangements
with Freedom UA and Mr. Tashtitov, including a consulting services
agreement, an operating agreement and an option agreement. Because
such agreements obligate us to: (i) guarantee the performance of
all Freedom UA obligations and provide Freedom UA sufficient
funding to cover all Freedom UA operating losses and net capital
requirements, (ii) enable us to receive 90% of the net profits of
Freedom UA after tax, and (iii) require us to provide Freedom UA
the management competence, operational support, and ongoing access
to our significant assets, technology resources and expertise to
necessary to conduct the business of Freedom UA; we account for
Freedom UA as a variable interest entity (“VIE”) under
the accounting standards of the Financial Accounting Standards
Board (“FASB”). Accordingly, the financial statements
of Freedom UA are consolidated into our financial
statements.
From
time to time we may identify business acquisition opportunities we
believe are in the best interest of the Company and our
stockholders, but for various reasons, including the need to obtain
regulatory approvals, the target entity’s lack of financial
statements and or internal controls meeting the standards required
of the PCAOB and the SEC, or the business not being sufficiently
mature, we may be precluded from completing the acquisition within
a time frame acceptable to the seller. In the past when presented
with such situations, Mr. Turlov or other related persons have made
such acquisitions, and then once necessary regulatory approvals
have been received, proper financial statements and internal
controls have been implemented and the business has matured
sufficiently, we have acquired the business from the related party
for a purchase price that does not exceed the historical price paid
by the related party plus capital contributions, if any, made by
the related party after acquisition. It is foreseeable that we will
pursue similar acquisitions in the future, although we have not
executed definitive agreements for any such acquisitions as of the
date of this proxy statement.
As
noted elsewhere in this proxy statement, under U.S. exchange and
market rules, we are deemed a “Controlled Company”
because Mr. Turlov currently owns 7.26% of our total outstanding
common stock. The Audit Committee Charter provides that the audit
committee will review all relationships and transactions with
related parties. Based on all the relevant facts and circumstances,
the audit committee will decide whether a related-person
transaction is appropriate and will approve only those transactions
that are in our best interests and that conform with SEC rules
prohibiting personal loans to executive officers and
directors.
S
TOCKHOLDER
PROPOSALS
FOR THE 2022 ANNUAL MEETING
As
required by SEC Rule 14a-8 and provided in the proxy access
provisions of our By-Laws, you may request that we include a
proposal in the proxy statement and form of proxy for our 2022
annual meeting of stockholders (the “2022 Annual
Meeting”), including director nominations. The proposal must
be in writing and should be mailed by certified mail, return
receipt requested, and must comply in all respects with
Rule 14a-8 under the
Exchange Act,
the laws of the state of Nevada and our
By-Laws. Your proposals should be delivered to the
Chairman of the Nominating and Corporate
Governance Committee c/o
Corporate Secretary, Freedom
Holding Corp, 1930 Village Ctr. Cir., #3-6972, Las Vegas, Nevada
89134.
For a proposal to
be included in our Proxy Materials for the 2022 Annual Meeting, it
must be delivered to us not earlier than the close of business on
March 3, 2022, and not later than the close of business on April 2,
2022.
In the event that our 2022
Annual Meeting is advanced by more than 30 days or delayed by more
than 60 days from the anniversary date of our 2021 Annual Meeting,
your proposal must be delivered to us not earlier than the close of
business on the 150
th
day prior to the date of our 2022
Annual Meeting and not later than the close of business on the
later to occur of (i) the 120
th
day prior to the 2022 Annual Meeting,
and (ii)
the tenth day following the day on which public
announcement of the date of such meeting is first
made.
29
Notice of any proposal that you intend to present
at the 2022 Annual Meeting, but do not intend to have included in
the proxy statement and form of proxy relating to the 2022 Annual
Meeting (other than pursuant to Rule 14a-8 or the proxy access
provisions of our By-laws), must be in writing and delivered to our
Corporate Secretary, Freedom Holding Corp. at 1930 Village Ctr.
Cir., #3-6972, Las Vegas, Nevada 89134 not earlier than close of
business on April 2, 2022, and not later than the close of business
on May 2, 2022. In the event that our 2022 Annual Meeting is
advanced by more than 30 days or delayed by more than 60 days from
the anniversary date of our 2021 Annual Meeting, your proposal must
be delivered to us not earlier than the close of business on the
120
th
day prior to the date of our 2022
Annual Meeting and not later than the close of business on the
later to occur of (i) the 90
th
day prior to the 2022 Annual Meeting,
and (ii)
the tenth day following the day on which public
announcement of the date of such meeting is first
made.
Each
item of business proposed by a stockholder, including director
nominations, must be made in accordance with our By-laws, Nevada
state corporate law and any other applicable law, rule or
regulation. In addition, any notice of a proposed director
candidate must also comply with our By-laws, including the criteria
set forth under “Stockholder Nominees for Director”
elsewhere in this this proxy statement. If written notice is not
given in accordance with these requirements, the proposal or
nomination will be considered deficient or untimely, as applicable,
and we may exclude such business from consideration at the
meeting.
For all
matters other than director nominations that you wish to bring
before the meeting, you must provide the following
information:
●
a brief description
of the business desired to be brought before the
meeting;
●
the reason for
conducting such business at the meeting;
●
the text of any
proposal or business;
●
any substantial
interest (such as financial or personal interest) you and the
beneficial owner, if any, on whose behalf the matter is being
proposed have in the matter;
●
any other
information relating to you and the beneficial owner, if any, on
whose behalf the proposal is being made, required to be disclosed
in a proxy statement or other filing required to be made in
connection with solicitations of proxies for the proposal and
pursuant to and in accordance with Section 14(a) of the Exchange
Act and the rules and regulations promulgated
thereunder;
●
a description of
all agreements, arrangements, or understandings between or among
you and the beneficial owner, if any, on whose behalf you are
making the proposal, including any of their affiliates or
associates, and any other person or persons (including their names)
in connection with the proposal of such business and any material
interest of such person or persons or any of their affiliates or
associates, in such business, including any anticipated benefit
therefrom to such person or persons, or their affiliates or
associates; and
●
As to you, you must
provide:
o
your name and
address as they appear on our books and of the beneficial owner, if
any, on whose behalf the nomination is being made;
o
the class and
number of our shares which are owned by you (beneficially and of
record) and owned by the beneficial owner, if any, on whose behalf
the nomination is being made, as of the date of your notice, and a
representation that you will notify us in writing of the class and
number of such shares owned of record and beneficially by you as of
the record date for the meeting within five business days after the
record date for such meeting;
o
a description of
any agreement, arrangement, or understanding with respect to such
nomination between or among you or the beneficial owner, if any, on
whose behalf the nomination is being made and any of their
affiliates or associates, and any others (including their names)
acting in concert with any of the foregoing, and a representation
that you will notify us in writing of any such agreement,
arrangement, or understanding in effect as of the record date for
the meeting within five business days after the record date for
such meeting;
30
o
a description of
any agreement, arrangement, or understanding (including any
derivative or short positions, profit interests, options, hedging
transactions, and borrowed or loaned shares) that has been entered
into as of the date of your notice by, or on your behalf, or the
beneficial owner, if any, on whose behalf the nomination is being
made and any of their affiliates or associates, the effect or
intent of which is to mitigate loss to, manage risk or benefit of
share price changes for, or increase or decrease the voting power
of such person or any of their affiliates or associates with
respect to shares of our stock, and a representation that you will
notify us in writing of any such agreement, arrangement, or
understanding in effect as of the record date for the meeting
within five business days after the record date for such
meeting;
o
a representation
that you are a holder of record of our shares entitled to vote at
the meeting and you intend to appear in person or by proxy at the
meeting to nominate the person or persons specified in the notice;
and
o
a representation
whether you intend to deliver a proxy statement and/or form of
proxy to holders of at least the percentage of our outstanding
capital stock required to approve the nomination and/or otherwise
to solicit proxies from stockholders in support of the nomination.
We may require any proposed nominee to furnish such other
information as we may reasonably require to determine the
eligibility of such proposed nominee to serve as an independent
director or that could be material to a reasonable
stockholder’s understanding of the independence, or lack
thereof, of such nominee.
2
021 ANNUAL REPORT ON
FORM 10-K
Included with these Proxy Materials is a copy of
our Annual Report on Form 10-K for the fiscal year ended March
31, 2021, without exhibits, as filed with the SEC. We will
furnish to each person whose proxy is solicited, on the written
request of that person, a copy of the exhibits to that Annual
Report on Form 10-K without charge. We will also mail to you
without charge, upon request, a copy of any document specifically
referenced or incorporated by reference in this proxy statement.
Please direct your request to Corporate Secretary at Freedom
Holding Corp,
1930 Village Center Cir. #3-6972, Las Vegas,
Nevada 89134
.
I
NCORPORATION BY
REFERENCE
To
the extent this proxy statement is incorporated by reference into
any other filing by us under the Securities Act of 1933, as amended
or the Exchange Act, the section of this proxy statement entitled
“Report of the Audit Committee” (to the extent
permitted by SEC rules) will not be deemed so incorporated, unless
specifically provided in such filing.
O
THER MATTERS
We
know of no other matters to be submitted to our stockholders at the
Annual Meeting. If any other matters are properly brought before
the Annual Meeting, it is the intention of the persons named in the
accompanying proxy to vote on such matters in accordance with their
best judgment.
31
32
33
TABLE OF CONTENTS
INFORMATION ABOUT THE ANNUAL MEETING AND VOTINGPROPOSAL ONE ELECTION OF DIRECTORSCORPORATE GOVERNANCEDIRECTOR COMPENSATIONSECURITY OWNERSHIPSECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCEEXECUTIVE COMPENSATIONPROPOSAL TWO ADVISORY VOTE TO APPROVE THE COMPENSATION OF OUR NAMES EXECUTIVE OFFICERSPROPOSAL THREE RATIFICATION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMPRINCIPAL ACCOUNTANT FEES AND SERVICESCERTAIN RELATIONSHIPS AND RELATED PERSON TRANSACTIONSSTOCKHOLDER PROPOSALS FOR THE 2022 ANNUAL MEETING2021 ANNUAL REPORT ON FORM 10-KINCORPORATION BY REFERENCEOTHER MATTERS