DEF 14A of RUM Group Inc.
Filed Apr 24, 2024 · FY20230001213900-24-035786
PROPOSAL NO. 1 — ELECTION OF DIRECTORS
PROPOSAL NO. 1 — ELECTION OF DIRECTORS Our business and affairs are managed under the direction of our Board of Directors. The Board of Directors presently has seven members, five of whom are deemed “independent” under the SEC rules and listing standards of The Nasdaq Stock Market (“Nasdaq”). Vacancies on the Board of Directors may be filled only by persons elected by a majority of the remaining directors or by a sole remaining director. Upon the recommendation of the Nominating and Corporate Governance Committee of our Board of Directors, our Board of Directors has nominated the seven director nominees listed below for election at the Annual Meeting. Each of the director nominees currently serves on the Board of Directors. The current term of all directors will expire at the Annual Meeting when their successors are elected, and the Board of Directors has nominated each of these individuals for a new one-year term that will expire at the 2025 Annual Meeting of Stockholders when their successors are elected. The Class A Director will be elected by a plurality of the votes cast by the holders of shares of our Class A Common Stock, present by virtual attendance or represented by proxy at the meeting and entitled to vote on the election of directors and the remaining directors will be elected by a plurality of the votes cast by the holders of shares of our Class A Common Stock, Class C Common Stock and Class D Common Stock (voting together as a single class), present by virtual attendance or represented by proxy at the meeting and entitled to vote on the election of directors. Accordingly, the seven nominees receiving the highest number of affirmative votes will be elected. Shares represented by executed proxies will be voted, if authority to do so is not withheld, for the election of each of the nominees named below. If the nominee becomes unavailable for election as a result of an unexpected occurrence, shares that would have been voted for that nominee will instead be voted for the election of a substitute nominee proposed by the Board of Directors. Each person nominated for election has consented to being named as a nominee in this Proxy Statement and has agreed to serve if elected. We have no reason to believe that any nominee will be unable to serve if elected. The Nominating and Corporate Governance Committee believes that all directors must, at a minimum, meet the criteria set forth in the Company’s Code of Conduct and Ethics and the Corporate Governance Guidelines, which specify, among other things, that the Nominating and Corporate Governance Committee will consider criteria such as independence, diversity, age, skills, and experience in the context of the needs of the Board of Directors. The Nominating and Corporate Governance Committee also will consider a combination of factors for each director, including (a) the nominee’s ability to represent all stockholders without a conflict of interest, (b) the nominee’s ability to work in and promote a productive environment, (c) whether the nominee has sufficient time and willingness to fulfill the substantial duties and responsibilities of a director, (d) whether the nominee has demonstrated the high level of character, ethics and integrity expected by the Company, (e) whether the nominee possesses the broad professional and leadership experience and skills necessary to effectively respond to the complex issues encountered by a publicly-traded company, and (f) the nominee’s ability to apply sound and independent business judgment. The following is a brief biography of the nominees for election at the Annual Meeting.
NOMINEES FOR ELECTION FOR A TERM EXPIRING AT THE 2024 ANNUAL MEETING OF STOCKHOLDERS
NOMINEES FOR ELECTION FOR A TERM EXPIRING AT THE 2024 ANNUAL MEETING OF STOCKHOLDERS Chris Pavlovski, age 40, is the Founder and Chief Executive Officer of Rumble and has served as a member of our Board of Directors since September 2022, and served as a member of the board of directors of Legacy Rumble since 2013. As a three-time successful entrepreneur, Mr. Pavlovski has over 20 years’ experience in the online marketing and advertising space. After building websites daily in his teenage years, Mr. Pavlovski founded Jolted Media Group and served as its Chief Executive Officer. During the same time, Mr. Pavlovski served as the director of marketing for NASA’s Next Giant Leap from 2009 through 2012 leading corporate donations, sponsorships, and internet marketing strategies. Mr. Pavlovski also founded Cosmic Development in 2011, a global IT business employing 150+ employees with offices in Europe and North America. The business was ranked as the 2nd best employer in Macedonia and has been the recipient of numerous awards. Mr. Pavlovski also sits on numerous boards, including Macedonia 2025, a not-for-profit organization focused on economic and educational development in Macedonia. As a result of his success, Mr. Pavlovski became a finalist for the Ernst & Young Entrepreneur of the Year in 2010. Prior to his entrepreneurial journey, Mr. Pavlovski served as a Network Administrator at Microsoft and studied at the University of Toronto. We believe that Mr. Pavlovski’s extensive experience in technology, online marketing and advertising and his unique perspective on technology related matters qualifies him to serve as a member of our Board of Directors. Paul Cappuccio, age 62, has served as a member of our Board of Directors since September 2022, and served as a member of the board of directors of Legacy Rumble from January 2021 through September 2022. Mr. Cappuccio has also served as a director of Chipotle Mexican Grill, Inc. (NYSE: CMG) from 2016 to 2020 (where Mr. Cappuccio served as the chairman of the Nominating and Governance Committee and on the Audit Committee) and Central European Media Enterprises (Nasdaq: CETV) from 2009 to 2018. Mr. Cappuccio also served as the Chief Legal Officer and General Counsel of NJOY, LLC, a privately-held company that sells electronic nicotine delivery systems to adult smokers and former smokers, from January 2020 to June 2023. From 2019 to 2020, Mr. Cappuccio served as Vice Chairman of dtx, a digital company that connects consumers with brands through QR codes. From January 2001 to June 2018, Mr. Cappuccio served as Executive Vice President and General Counsel of Time Warner, Inc., a consolidated worldwide media and entertainment company. From August 1999 to January 2001, he served as Senior Vice President and General Counsel at America Online, Inc., an internet access company. Prior to this, Mr. Cappuccio was a partner at Kirkland & Ellis and served as an Associate Deputy Attorney General at the U.S. Department of Justice. Additionally, Mr. Cappuccio served as a law clerk to two Justices of the Supreme Court of the United States, the Hon. Anthony M. Kennedy and the Hon. Antonin Scalia. Mr. Cappuccio received his J.D. from Harvard Law School and a B.A. from Georgetown University. We believe that Mr. Cappuccio’s experience as a leader in the legal, media and entertainment, and technology industries, as well as his prior service on multiple public company boards, qualifies him to serve as a member of our Board of Directors. Ryan Milnes, age 41, has served as a member of our Board of Directors since September 2022, and served as a member of the board of directors of Legacy Rumble from 2013 through September 2022. Mr. Milnes is an accomplished entrepreneur and the co-founder and Chief Executive Officer of Cosmic Development, a global IT business employing more than 150 employees with offices in Europe and North America. Since founding Cosmic in 2013, Mr. Milnes has overseen Cosmic’s provision of content editing and moderation services to Rumble. He is the owner and director of multiple businesses which focus on tech and real estate. Mr. Milnes holds a film degree from the Toronto Film School. We believe that Mr. Milnes’s experience as an entrepreneur in the information technology industry qualifies him to serve as a member of our Board of Directors. Robert Arsov, age 49, has served as a member of our Board of Directors since September 2022, and served as a member of the board of directors of Legacy Rumble from 2014 through September 2022. Mr. Arsov is a Founding Partner of Hoplon Capital, which was formed in May 2021. Mr. Arsov also currently serves as a Senior Advisor at Guggenheim Partners, a position he has held since May 2021. Prior to becoming Senior Advisor, he was a Senior Managing Director at Guggenheim Partners from May 2014 to May 2021, where he advised companies across the technology and IT/business services sectors, with special focus on the insurance, financial services, healthcare, cloud/network infrastructure and communications end-markets. He also maintained an active M&A advisory practice in the biotech and pharma sectors. Mr. Arsov was previously a member of the M&A group at Credit Suisse and its predecessor company Donaldson, Lufkin & Jenrette in New York. Mr. Arsov holds a B.S. degree from the Haas School of Business at the University of California at Berkeley. We believe that Mr. Arsov’s extensive business and financial experience qualifies him to serve as a member of our Board of Directors. Nancy Armstrong, age 57, has served as a member of our Board of Directors since September 2022. Ms. Armstrong is an Emmy-nominated producer and the founder/executive producer of Happy Warrior Media. She recently launched her award-winning documentary on ADHD, “The Disruptors”. Previously, she co-founded and was an executive producer of MAKERS since 2010, a leading women’s video and media platform and library. Prior to MAKERS, Ms. Armstrong began her career in media at Ogilvy, Inc. in New York City. Ms. Armstrong is a graduate of the University of Wisconsin-Madison, and received a master’s degree in communications from Boston University. We believe that Ms. Armstrong’s extensive media and advertising experience qualifies her to serve as a member of our Board of Directors. Ethan Fallang, age 40, has served as a member of our Board of Directors since September 2022, and served as a member of the board of directors Legacy Rumble from May of 2021 through September 2022. Mr. Fallang also serves as a director at Riverview Health Institute, LLC, an upscale medical center. From May 2022 to August 2023, Mr. Fallang served as a Partner at Narya Capital Management, LLC, where he was in charge of overseeing the fund’s accounting, tax, and audit functions. Prior to joining Narya in February 2020, Mr. Fallang served as the Chief Executive Officer of Riverview Health Institute, LLC beginning in October 2010. Mr. Fallang holds a B.S. in Business Administration from the Ohio State University and a Master of Business Administration from the Isenberg School of Management at the University of Massachusetts Amherst. We believe that Mr. Fallang’s extensive business and accounting experience qualifies him to serve as a member of our Board of Directors.
NOMINEES FOR ELECTION FOR A TERM EXPIRING AT THE 2024 ANNUAL MEETING OF STOCKHOLDERS
David Sacks, age 51, has served as a member of our Board of Directors since June 2023. Mr. Sacks also serves as general partner of Craft Ventures, a venture capital fund that he co-founded in 2017. His angel investments include Facebook, Uber, SpaceX, Palantir Technologies, and Airbnb, among many others. Prior to co-founding Craft Ventures, Mr. Sacks was the founding Chief Operating Officer and product leader of PayPal, a multinational financial technology company, and the founder and CEO of Yammer, an enterprise social networking software company. Mr. Sacks holds a B.A. in economics from Stanford University and a J.D. from the University of Chicago Law School. We believe that Mr. Sacks’s extensive entrepreneurial, technology, and venture capital experience qualifies him to serve as a member of our Board of Directors.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE ELECTION OF EACH OF THE NAMED NOMINEES ABOVE
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE ELECTION OF EACH OF THE NAMED NOMINEES ABOVE
BOARD OF DIRECTORS DIVERSITY
BOARD OF DIRECTORS DIVERSITY The Board of Directors Diversity Matrix, below, provides the diversity statistics for our Board of Directors as required by the Nasdaq rules.
BOARD OF DIRECTORS DIVERSITY
| Board of Directors Diversity Matrix (As of the date of this Proxy Statement) | | | | | | Total Number of Directors | 7 | | | | | | Female | Male | Non-Binary | Did Not Disclose Gender | | Part I: Gender Identity | | | | | | Directors | 1 | 5 | — | 1 | | Part II: Demographic Background | | | | | | African American or Black | — | — | — | — | | Alaskan Native or Native American | — | — | — | — | | Asian | — | — | — | — | | Hispanic or Latino | — | — | — | — | | Native Hawaiian or Pacific Islander | — | — | — | — | | White | 1 | 5 | — | — | | Two or More Races or Ethnicities | — | — | — | — | | LGBTQ+ | 1 | | | | | Did Not Disclose Demographic Background | 1 | | | |
INFORMATION REGARDING THE BOARD OF DIRECTORS AND CORPORATE GOVERNANCE
INFORMATION REGARDING THE BOARD OF DIRECTORS AND CORPORATE GOVERNANCE
Compensation Committee
| ● | review the form and amount of non-employee director compensation; and |
Compensation Committee
| ● | advise on the development of the Company’s peer group and provide support and analysis regarding executive and director compensation; |
Compensation Committee
| ● | complete a Board of Directors compensation assessment and recommendations; |
Directors and Executive Officers
Directors and Executive Officers The following table sets forth information regarding the beneficial ownership of shares of our different classes of voting securities (i.e., Class A Common Stock, Class C Common Stock and Class D Common Stock), as of December 31, 2023, by:
Directors and Executive Officers
| ● | each person known by us to be the beneficial owner of more than 5% of our common stock; |
Directors and Executive Officers
| ● | each of our directors and nominees for director; |
Directors and Executive Officers
| ● | each of our executive officers; and |
Directors and Executive Officers
| ● | all of our executive officers and directors as a group. |
Directors and Executive Officers
Beneficial ownership is determined according to the rules of the SEC, which generally provide that a person has beneficial ownership of a security if he, she or it possesses sole or shared voting or investment power over that security, including options and warrants that are currently exercisable or exercisable within 60 days. For example, in the event a holder of options that were exchanged for existing options in Legacy Rumble in connection with the consummation of the Business Combination (the “Exchanged Company Options”) has the right to exercise such options within 60 days, such underlying shares (including any shares issuable with respect to such option subject to escrow and forfeiture in accordance with the terms of the Business Combination Agreement (such shares, the “Tandem Option Earnout Shares”)) are reflected in such holder’s beneficial ownership in both the numerator and the denominator, but not in the denominator for other unaffiliated holders, in accordance with the rules of the SEC. In addition, such securities held by all of Rumble’s directors and executive officers are included in both the numerator and denominator for purposes of determining the percentage share ownership held by the directors and executive officers, calculated as a group. Notwithstanding the foregoing, however, (i) all shares of Class A Common Stock issuable upon exchange of any issued and outstanding exchangeable shares in an indirect, wholly owned Canadian subsidiary of the Company (the “ExchangeCo Shares”) and (ii) all shares of Class A Common Stock, Class C Common Stock and ExchangeCo Shares subject to forfeiture pursuant to the terms of the Business Combination Agreement (the “Forfeiture Escrow Shares”) and the CFAC Holdings VI, LLC’s (the “Sponsor”) shares subject to forfeiture and cancellation under that certain Sponsor Support Agreement, dated December 1, 2021, by and among Rumble Canada, CFVI and the Sponsor (for which the conditions to the achievement of the stock price-based release conditions can be achieved within 60 days) are deemed issued and outstanding and included in the denominator for all holders in order to avoid a distorted and potentially misleading presentation of percentage share ownership by holder. In accordance with the foregoing methodology, the determination of percentage of beneficial ownership in the below presentation is based on 280,280,298 shares of Class A Common Stock issued and as of December 31, 2023 (which number is inclusive of shares deemed issued and outstanding pursuant to clauses (i) and (ii)) and the calculation described in footnote (2) below.
Directors and Executive Officers
| | Class A Common Stock | | | | Name and Address of Beneficial Owner | Number of Shares Beneficially Owned(1) | % of Class(2) | % of Voting Power(2) | | Directors and Executive Officers(3) | | | | | Chris Pavlovski | 140,378,812(4)(5) | 44.6% | 88.4% | | Wojciech Hlibowicki | 15,363,038(6) | 5.3% | 1.0% | | Brandon Alexandroff | 18,897,615(7) | 6.4% | 1.3% | | Tyler Hughes | 473,416 | * | * | | Michael Ellis | 117,310 | * | * | | Claudio Ramolo | 13,576,360(8) | 4.7% | * | | Ryan Milnes | 48,063,268(9) | 17.1% | 3.3% | | Paul Cappuccio | 111,413 | * | * | | Robert Arsov(10) | 27,402,497 | 9.4% | 1.8% | | Nancy Armstrong | 9,368 | * | * | | Ethan Fallang | 10,756 | * | | | David Sacks | 1,703,034(11) | * | * | | All executive officers and directors as a group (12 individuals) | 266,106,887 | 72.9% | 93.6% | | 5% or More Shareholders: | | | | | 2286404 Ontario Inc.(9) | 48,063,268 | 17.1% | 3.3% | | Robert Arsov(10) | 27,402,497 | 9.4% | 1.8% | | Bongino Inc.(12) | 16,194,853 | 5.8% | 1.1% |
Directors and Executive Officers
| * Less than 1%. | | (1) The Company has two other classes of equity securities outstanding, Class C Common Stock and Class D Common Stock, the beneficial ownership of which is set forth in the table below. Each holder of ExchangeCo Shares was issued one “tandem” share of Class C Common Stock, which serves to provide the holder thereof with the same voting rights at the Company as one share of Class A Common Stock. The Company issued shares of Class D Common Stock to Mr. Pavlovski such that, after taking into account the shares of Class A Common Stock (if any) and Class C Common Stock issued to Mr. Pavlovski, Mr. Pavlovski has approximately 85% of the voting power of the Company on a fully-diluted basis. | | (2) The percentage of beneficial ownership of Class A Common Stock as to any person or group of persons is calculated by dividing (i) the number of shares of Class A Common Stock beneficially owned by such person or group of persons (including the number of shares of Class A Common Stock as to which such person or group of persons has the right to acquire within 60 days of December 31, 2023), by (ii) the sum of (A) 280,280,298 shares of Class A Common Stock issued and outstanding as of December 31, 2023 (which number is determined as described in the paragraph preceding this table) plus (B) the number of shares as to which such person or group of persons has the right to acquire within 60 days of December 31, 2023. Consequently, the denominator for calculating beneficial ownership percentages may be different for each person or group of persons in the table. | | (3) Unless otherwise noted, the business address of each of the following individuals is c/o Rumble Inc., 444 Gulf of Mexico Drive, Longboat Key, FL 34228. | | (4) 1000748380 Ontario Ltd. is the record holder of 69,824,238 of the reported shares. 1000748380 Ontario Ltd. is wholly owned by Mr. Pavlovski and therefore, Mr. Pavlovski has voting and dispositive power over such shares and may be deemed to beneficially own such shares. The business address of 1000748380 Ontario Ltd. is 100 King Street West, Suite 6000, Toronto, Ontario, M5X 1E2 Canada. | | (5) Includes a grant to Mr. Pavlovski of RSUs covering 1.1 million shares of the Company’s Class A Common Stock pursuant to the 2022 Plan (as defined below). One-third of such RSUs vested on September 16, 2023. Subject to Mr. Pavlovski’s continuous employment through the applicable vesting dates, the remaining two-thirds of such RSUs will vest in equal installments on each of September 16, 2024 and September 16, 2025. | | (6) 1000748376 Ontario Ltd. is the record holder of 3,096,803 of the reported shares. 1000748376 Ontario Ltd. is wholly owned by Mr. Hlibowicki and therefore, Mr. Hlibowicki has voting and dispositive power over such shares and may be deemed to beneficially own such shares. The business address of 1000748376 Ontario Ltd. is 100 King Street West, Suite 6000, Toronto, Ontario, M5X 1E2 Canada. | | (7) 1000748375 Ontario Ltd. is the record holder of 2,043,840 of the reported shares. 1000748375 Ontario Ltd. is wholly owned by Mr. Alexandroff and therefore, Mr. Alexandroff has voting and dispositive power over such shares and may be deemed to beneficially own such shares. The business address of 1000748375 Ontario Ltd. is 100 King Street West, Suite 6000, Toronto, Ontario, M5X 1E2 Canada. |
Directors and Executive Officers
| (8) 1000748378 Ontario Ltd. is the record holder of 1,457,086 of the reported shares. 1000748378 Ontario Ltd. is wholly owned by Mr. Ramolo and therefore, Mr. Ramolo has voting and dispositive power over such shares and may be deemed to beneficially own such shares. The business address of 1000748378 Ontario Ltd. is 100 King Street West, Suite 6000, Toronto, Ontario, M5X 1E2 Canada. | | (9) 2286404 Ontario Inc. is the record holder of the shares. 2286404 Ontario Inc. is wholly owned by Mr. Milnes and therefore, Mr. Milnes has voting and dispositive power over such shares and may be deemed to beneficially own such shares. The business address of 2286404 Ontario Inc. is PO Box 20112 Bayfield North, Barrie, Ontario, L4M6E9, Canada. | | (10) The business address of Mr. Arsov is c/o Willkie Farr & Gallagher LLP, 787 Seventh Avenue, New York, NY 10019. | | (11) Craft Ventures III, LP is the record holder of 246,498 shares. Sacks Family 2021 Irrevocable Trust fbo Leighton Natalee Sacks, Sacks Family 2021 Irrevocable Trust fbo Reagan Nicolette Sacks and Sacks Family 2021 Irrevocable Trust fbo Xavier Xander Sacks are each a record holder of 33,270 shares. The business address of each of the foregoing entities is Oak Lawn Avenue, Suite 1150, Dallas, TX, 75219. Craft Ventures II, LP is the record holder of 803,737 shares. Craft Ventures Affiliates II, LP is the record holder of 10,224 shares, Craft Ventures Partners III, LLC is the record holder of 25,189 shares. The business address of Craft Ventures II, LP and Craft Ventures Affiliates II, LP is 855 Front St, San Francisco, CA 94111. Mr. Sacks has voting and dispositive power over such shares and may be deemed to beneficially own such shares. Mr. Sacks is the record holder of 517,576 shares. | | (12) Bongino Inc. is the record holder of the shares. Bongino Inc. is wholly owned by Daniel Bongino. The business address of Bongino Inc. is 2239 SW Manele Place, Palm City, FL 34990. Information is based on a Schedule 13G/A filed with the SEC on December 11, 2023 by Daniel Bongino and Bongino Inc. |
Directors and Executive Officers
| | Class C Common Stock | | Class D Common Stock | | | | Number of Shares Beneficially Owned | % of Class | Number of Shares Beneficially Owned | % of Class | | Directors and Executive Officers | | | | | | Chris Pavlovski | 104,682,403 | 63.3% | 105,782,403 | 100.0% | | Wojciech Hlibowicki(1) | 4,618,833 | 2.8% | — | — | | Brandon Alexandroff(2) | 3,048,355 | 1.8% | — | — | | Tyler Hughes | — | — | — | — | | Michael Ellis | — | — | — | — | | Claudio Ramolo(3) | 2,173,220 | 1.3% | — | — | | Ryan Milnes(4) | 48,054,401 | 29.1% | — | — | | Paul Cappuccio | — | — | — | — | | Robert Arsov | — | — | — | — | | Nancy Armstrong | — | — | — | — | | Ethan Fallang | — | — | — | — | | David Sacks | — | — | — | — | | All executive officers and directors as a group (12 individuals) | 162,577,212 | 98.3% | 105,782,403 | 100.0% | | 5% or More Shareholders: | | | | | | 2286404 Ontario Inc.(4) | 48,054,401 | 29.1% | — | — | | Robert Arsov | — | — | — | — | | Bongino Inc. | — | — | — | — |
Directors and Executive Officers
| (1) See footnote 6 above. | | (2) See footnote 7 above. | | (3) See footnote 8 above. | | (4) See footnote 9 above. |
Processes and Procedures for Compensation Decisions
| ● | attract, incentivize, and retain employees at the executive level who contribute to our long-term success; |
Processes and Procedures for Compensation Decisions
| ● | effectively align our executives’ interests with those of our stockholders by focusing on long-term equity incentives that correlate with the creation of long-term value for our stockholders. |
Summary Compensation Table
Summary Compensation Table The following table shows information regarding the compensation earned by or paid to our NEOs during the fiscal years ended December 31, 2023 and December 31, 2022. The amounts paid to Messrs. Pavlovski and Hughes reflected herein have been converted from Canadian dollars to U.S. dollars using the average annual conversion ratio as of December 31 of the respective year.
Summary Compensation Table
| Name and Title | Year | Salary ($) | Bonus ($) | Stock Awards ($)(1) | Options Awards ($)(2) | All Other Compensation ($)(3) | Total ($) | | Chris Pavlovski | 2023 | 1,007,039 | 503,519(4) | 624,998 | 1,874,093 | 9,362 | 4,019,011 | | Chairman and Chief Executive Officer | 2022 | 428,923 | 1,250,000(5) | 13,534,408(6)(7) | 871,048 | 8,432 | 16,092,811 | | Tyler Hughes | 2023 | 394,725 | 198,362(4) | 243,450 | 729,998 | — | 1,566,535 | | Chief Operating Officer | 2022 | 451,263 | 200,000(4) | 72,599 | 217,762 | — | 941,624 | | Michael Ellis | 2023 | 400,000 | 200,000(4) | 249,997 | 749,634 | — | 1,599,631 | | General Counsel and Corporate Secretary | 2022 | 287,500 | 200,000(4) | 72,599 | 217,762 | — | 777,861 |
Summary Compensation Table
| (1) The amounts reported in this column do not reflect dollar amounts actually received by our NEOs. Instead, the amounts reported in this column represent the aggregate grant-date fair value of the restricted stock units (“RSUs”) granted during the fiscal years indicated computed in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”). See Note 2 to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 for a discussion of the relevant assumptions used in calculating these amounts. | | (2) The amounts reported in this column do not reflect dollar amounts actually received by our NEOs. Instead, these amounts reflect the aggregate grant-date fair value of the options to purchase shares of our common stock to each NEO, computed in accordance with U.S. GAAP. See Note 2 to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 for a discussion of the relevant assumptions used in calculating these amounts. Our NEOs will only realize compensation to the extent the trading price of our common stock is greater than the exercise price of the shares of our common stock underlying the option awards. | | (3) Represents the amounts paid to Mr. Pavlovski for foreign tax preparation. | | (4) Represents payments pursuant to our short-term incentive plan (“STIP”) for the respective years. In addition, the amounts include a one-time cash bonus in the amount of $1,000 to Mr. Hughes for exceeding expectations in his role during 2023. | | (5) Represents payment of a one-time bonus of $750,000 to Mr. Pavlovski in connection with the closing of the Business Combination and a payment of $500,000 pursuant to the STIP. | | (6) Represents in part, the grant date value of the 27,397 RSUs with a grant date fair value of $290,408 granted under the Rumble Inc. 2022 Stock Incentive Plan (the “2022 Plan”). | | (7) Represents in part, the one-time grant of 1,100,000 RSUs granted in lieu of the shares of restricted stock to which Mr. Pavlovski was entitled under his employment agreement in connection with the Business Combination, as further discussed below, with a grant date fair market value of $13,244,000. |
Outstanding Equity Awards as of December 31, 2023
Outstanding Equity Awards as of December 31, 2023 The following table shows certain information regarding outstanding equity awards held by each of our NEOs at December 31, 2023. All of the outstanding equity awards were granted under the 2022 Plan, unless otherwise indicated.
Outstanding Equity Awards as of December 31, 2023
| | Option Awards | | | | | Stock Awards | | | Name | Grant Date | Number of securities underlying unexercised options (#) exercisable | Number of securities underlying unexercised options (#) unexercisable | Option exercise price ($) | Option expiration date | Number of shares or units of stock that have not vested (#) | Market value of shares or units of stock that have not vested ($)(1) | | Chris Pavlovski | 9/1/2020(2) | 34,399,769(5)(6) | — | 0.03 | 9/1/2040 | — | — | | | 9/16/2022(3) | — | — | — | — | 773,334 | 3,292,670 | | | 11/16/2022(4) | — | — | — | — | 20,548 | 92,261 | | | 11/16/2022(4) | 23,068 | 69,204 | 10.60 | 11/16/2032 | — | — | | | 4/3/2023(4) | — | — | — | — | 66,348 | 297,903 | | | 4/3/2023(4) | — | 223,906 | 9.42 | 4/3/2033 | — | — | | Tyler Hughes | 8/16/2021(2) | 466,853(5)(6) | — | 2.50 | 8/16/2041 | — | — | | | 11/16/2022(4) | — | — | — | — | 5,137 | 23,065 | | | 11/16/2022(4) | 5,767 | 17,301 | 10.60 | 11/16/2032 | — | — | | | 4/3/2023(4) | — | — | — | — | 25,844 | 116,040 | | | 4/3/2023(4) | — | 87,216 | 9.42 | 4/3/2033 | — | — | | Michael Ellis | 11/6/2021 | 154,240(5)(6) | 44,392(5)(6)(7) | 10.06 | 11/6/2031 | — | — | | | 11/16/2022(4) | — | — | — | — | 5,137 | 23,065 | | | 11/16/2022(4) | 5,767 | 17,301 | 10.60 | 11/16/2032 | — | — | | | 4/3/2023(4) | — | — | — | — | 26,539 | 119,160 | | | 4/3/2023(4) | — | 89,562 | 9.42 | 4/3/2033 | — | — |
Outstanding Equity Awards as of December 31, 2023
| (1) The market value of unvested shares is calculated by multiplying the number of unvested shares by the closing market price of our common stock on NASDAQ on December 29, 2023, the last trading day of the year, which was $4.49 per share. |
Outstanding Equity Awards as of December 31, 2023
| (2) The awards vested in full on September 1, 2020 with respect to Mr. Pavlovski’s award and September 16, 2022 with respect to Mr. Hughes’s award. |
Outstanding Equity Awards as of December 31, 2023
| (3) The award vests in three equal annual installments on the first anniversary of the grant date. |
Outstanding Equity Awards as of December 31, 2023
| (4) The awards vest in four equal annual installments beginning on the first anniversary of the grant date. |
Outstanding Equity Awards as of December 31, 2023
| (5) Issued pursuant to the Prior Plan. |
Outstanding Equity Awards as of December 31, 2023
| (6) The number of options was determined after applying the exchange ratio pursuant to the Business Combination Agreement, such that for each option that was outstanding prior to the effective date of the Business Combination Agreement, such option was converted into a new option to purchase (i) a number of Class A Common Stock of the Company equal to the product (rounded down to the nearest whole number) of (x) the number of shares originally underlying such option, and (y) 16.474 (the “Option Exchange Ratio” and the Class A Common Stock of the Company described in this clause (i), being the “Base Option Shares”), and (ii) and for each Base Option Share, a fraction of a Class A Common Stock of the Company equal to 0.4915 of a share (the shares described in this clause (ii), the “Tandem Option Earnout Shares”). The aggregate exercise price per Base Option Share together with the related fraction of the Tandem Option Earnout Share is equal to (A) the exercise price originally applicable to the option, divided by (B) the Option Exchange Ratio (rounded up to the nearest whole cent). |
Outstanding Equity Awards as of December 31, 2023
| (7) The award will vest on November 6, 2024. |
DIRECTOR COMPENSATION
DIRECTOR COMPENSATION
Non-Employee Director Compensation Policy
Non-Employee Director Compensation Policy In August 2023, our Compensation Committee approved the terms of non-employee director compensation, pursuant to which our non-employee directors are eligible to receive (i) a cash retainer of $50,000, with the option to elect RSUs in satisfaction thereof, (ii) an equity retainer of RSUs with an aggregate grant date fair value of $200,000 (or $250,000 for the first year of service in the case of directors appointed to the Board subsequent to the 2023 annual meeting of stockholders), fully vesting on the date of the Annual Meeting, and (iii) an additional cash retainer, with the option to elect RSUs in satisfaction thereof, for the service on the following committees in the following roles:
Non-Employee Director Compensation Policy
| ● | Audit Committee chair: $20,000 |
Non-Employee Director Compensation Policy
| ● | Audit Committee member: $12,500 |
Non-Employee Director Compensation Policy
| ● | Compensation Committee chair: $15,000 |
Non-Employee Director Compensation Policy
| ● | Compensation Committee member: $7,500 |
Non-Employee Director Compensation Policy
| ● | Nominating and Corporate Governance Committee chair: $12,500 |
Non-Employee Director Compensation Policy
| ● | Nominating and Corporate Governance Committee member: $5,000 |
Director Compensation Table
Director Compensation Table The following table sets forth information regarding the compensation earned by or paid to non-employee directors during the fiscal year ended December 31, 2023.
Director Compensation Table
| Name | Fees Earned or Paid in Cash ($) | Stock Awards ($)(1)(2) | Total ($) | | Nancy Armstrong | 67,500(3) | 200,000 | 267,500 | | Paul Cappuccio | 77,500(3) | 200,000 | 277,500 | | Robert Arsov | 70,000 | 200,000 | 270,000 | | Ryan Milnes | 50,000 | 200,000 | 250,000 | | Ethan Fallang | 75,000 | 200,000 | 275,000 | | David Sacks | 50,000 | 250,000 | 300,000 |
Director Compensation Table
| (1) The amounts reported in this column do not reflect dollar amounts actually received by our non-employee directors. Instead, the amounts reported in this column represent the aggregate grant-date fair value of the RSUs granted to our non-employee directors during the fiscal year ended December 31, 2023, computed in accordance with U.S. GAAP. See Note 2 to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 for a discussion of the relevant assumptions used in calculating these amounts. As required by SEC rules, the amounts shown exclude the impact of estimated forfeitures related to service-based vesting conditions. |
Director Compensation Table
| (2) Awards fully vest on June 14, 2024. |
Director Compensation Table
| (3) Fees were paid on August 17, 2023 in the form of RSU awards which fully vest on June 14, 2024. |
Director Compensation Table
The following table sets forth the aggregate number of our shares of common stock subject to the RSU awards and the aggregate number of shares of our common stock underlying stock option awards held by each non-employee director as of December 31, 2023:
Director Compensation Table
| Name | RSUs | Number of Shares Underlying Stock Options | | Nancy Armstrong | 36,948 | — | | Paul Cappuccio | 38,329 | 93,616(1) | | Robert Arsov | 27,624 | — | | Ryan Milnes | 27,624 | — | | Ethan Fallang | 27,624 | — |
Director Compensation Table
| (1) The number of shares underlying the stock option was determined after applying the exchange ratio pursuant to the Business Combination Agreement, such that for each option that was outstanding prior to the effective date of the Business Combination Agreement, such option was converted into a new option to purchase (i) Base Option Shares, and (ii) the Tandem Option Earnout Shares. |