UNITED STATES

 

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549

 

FORM 8-K

 

CURRENT REPORT

 

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

Date of report (Date of earliest event reported) December 1, 2020

 

Net Element, Inc.

 

(Exact Name of Registrant as Specified in Charter)

 

 

Delaware

 

001-34887

 

90-1025599

(State or Other Jurisdiction
of Incorporation)

 

(Commission File
Number)

 

(IRS Employer
Identification No.)

     
 

 3363 NE 163rd Street, Suite 705, North Miami Beach, FL         33160

 
 

           (Address of Principal Executive Offices)             (Zip Code)

 
     
 

(305) 507-8808

 
 

(Registrant’s telephone number, including area code)

 
     
 

Not Applicable

 
 

(Former Name or Former Address, if Changed Since Last Report)

 
 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

☐   Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐   Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐   Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐   Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

Trading symbol(s)

Name of each exchange on which registered

Common Stock, $0.0001 par value per share

NETE

The Nasdaq Stock Market, LLC (Nasdaq Capital Market)

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company                    ☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

 
 

 

 

Item 3.02 Unregistered Sales of Equity Securities.

 

The disclosure provided in Part B of Item 5.02 of this Report is hereby incorporated by reference into this Item 3.02.

 

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

 

A.     On December 1, 2020, the stockholders of Net Element, Inc. (the “Company”) approved at the 2020 annual meeting of stockholders of the Company (the “Annual Meeting”) an amendment to its 2013 Equity Incentive Plan, as amended (the “Plan”), to increase the number of shares of the Common Stock available for issuance thereunder by 210,500 shares of Common Stock (the “Plan Amendment”). After such approval, the Company entered into the Plan Amendment, dated on December 1, 2020. The form of the Plan Amendment was previously filed as Appendix “A” to the Company’s definitive proxy statement on Schedule 14A filed with the Securities and Exchange Commission on October 13, 2020.

 

B.     On December 1, 2020, the stockholders of the Company approved the previously disclosed on Form 8-K, filed on September 3, 2020, equity awards outside of the Plan: (i) 119,361 restricted shares of the Company common stock, vesting immediately on the grant date, to Oleg Firer, the Chief Executive Officer of the Company; (ii) 12,287 restricted shares of the Company common stock, vesting immediately on the grant date, to Steven Wolberg, the Chief Legal Officer of the Company; and (iii) 4,824 restricted shares of the Company common stock, vesting immediately on the grant date, to Jefferey Ginsberg, the Chief Financial Officer of the Company. Such awards of restricted shares common stock of the Company were subject to and contingent upon the Company shareholders’ approval for purposes of compliance with the Nasdaq Rule 5635(c). Upon such approval, such restricted shares of the Company common stock were issued to each of Mr. Firer, Mr. Wolberg and Mr. Ginsberg under an exemption from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”), in reliance upon Section 4(a)(2) of the Securities Act.

 

Item 5.07 Submission of Matters to a Vote of Security Holders.

 

The Company held its Annual Meeting on December 1, 2020. The matters voted upon at the Annual Meeting and the results of such voting are set forth below.

 

Proposal 1: To elect four directors of the Company, three of whom shall be independent directors as defined by applicable rules, to serve for a one-year term expiring in 2021.

 

Name of Director

 

For

   

Withheld

   

Broker Non-Vote

 

Oleg Firer

    1,393,772       54,556       2,069,269  

John Roland

    1,333,772       40,556       2,069,269  

Jon Najarian

    1,155,387       218,941       2,069,269  

Todd Raarup

    1,333,727       40,601       2,069,269  

 

All director nominees were duly elected.

 

2
 

 

Proposal 2: To approve an amendment to the Company’s 2013 Equity Incentive Plan, as amended (the “Plan”), to increase the number of shares of Common Stock authorized for issuance under the Plan by 210,500 shares of Common Stock resulting (if such increase is authorized by the shareholders) in the aggregate 1,160,500 shares authorized for issuance under the Plan, which represents in the aggregate approximately 23.95% of our issued and outstanding Common Stock.

 

For

   

Against

   

Abstain

   

Broker Non-Vote

 
  1,032,247       329,638       12,443       2,069,269  

 

Proposal 2 was approved.

 

Proposal 3: To approve the issuance by the Company of 119,361 restricted shares of Common Stock to the Company’s Chief Executive Officer, Oleg Firer as a performance bonus, as required by and in accordance with NASDAQ Listing Rule 5635.

 

For

   

Against

   

Abstain

   

Broker Non-Vote

 
  1,008,075       357,469       8,784       2,069,269  

 

Proposal 3 was approved.

 

Proposal 4: To approve the issuance by the Company of 12,287 restricted shares of Common Stock to the Company’s Chief Legal Officer, Steven Wolberg as a performance bonus, as required by and in accordance with NASDAQ Listing Rule 5635.

 

For

   

Against

   

Abstain

   

Broker Non-Vote

 
  1,004,996       359,442       9,890       2,069,269  

 

Proposal 4 was approved.

 

Proposal 5: To approve the issuance by the Company of 4,824 restricted shares of Common Stock to the Company’s Chief Financial Officer, Jeffrey Ginsberg as a performance bonus, as required by and in accordance with NASDAQ Listing Rule 5635.

 

For

   

Against

   

Abstain

   

Broker Non-Vote

 
  1,007,012       353,509       13,807       2,069,269  

 

Proposal 5 was approved.

 

Proposal 6: To approve the issuance by the Company of 3,909 restricted shares of Common Stock to the Company’s Chief Technology Officer, Andrey Krotov as a performance bonus, as required by and in accordance with NASDAQ Listing Rule 5635.

 

For

   

Against

   

Abstain

   

Broker Non-Vote

 
  1,002,833       357,974       13,521       2,069,269  

 

Proposal 6 was approved.

 

Proposal 7: To approve the issuance by the Company of 13,107 restricted shares of Common Stock to President of Unified Payments, the Company’s subsidiary, Vlad Sadovskiy as a performance bonus, as required by and in accordance with NASDAQ Listing Rule 5635.

 

For

   

Against

   

Abstain

   

Broker Non-Vote

 
  1,004,306       359,079       10,943       2,069,269  

 

Proposal 7 was approved.

 

3
 

 

Proposal 8: To approve the issuance by the Company of 8,730 restricted shares of Common Stock to the Company’s in-house counsel in Russia, Asaph Panarin as a performance bonus, as required by and in accordance with NASDAQ Listing Rule 5635.

 

For

   

Against

   

Abstain

   

Broker Non-Vote

 
  1,010,163       353,362       10,803       2,069,269  

 

Proposal 8 was approved.

 

Proposal 9: To ratify the selection of Daszkal Bolton LLP as the Company’s independent registered public accounting firm for the year ending December 31, 2020.

 

For

   

Against

   

Abstain

 
  2,964,698       462,016       16,883  

 

Proposal 9 was approved.

 

Proposal 10: To approve, on an advisory (nonbinding) basis, the compensation of the Company’s named executive officers.

 

For

   

Against

   

Abstain

   

Broker Non-Vote

 
  1,035,034       329,308       9,986       2,069,269  

 

Proposal 10 was approved.

 

Proposal 11: To approve, on an advisory (nonbinding) basis, the frequency of advisory votes on the compensation of the Company’s named executive officers.

 

Three Years

   

Two Years

   

One Year

   

Abstain

   

Broker Non-Vote

 
  926,303       52,153       355,585       40,287       2,069,269  

 

Proposal 11 was approved with three years as the frequency of advisory votes on the compensation of the Company’s named executive officers.

 

4
 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

Dated: December 3, 2020 

 

 

     
  NET ELEMENT, INC.  

 

 

 

 

 

 

 

 

 

By:

/s/ Jeffrey Ginsberg

 

 

Name: 

Jeffrey Ginsberg 

 

 

Title: 

Chief Financial Officer 

 

 

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