UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of
the Securities Exchange Act of 1934 (Amendment No.)
Filed by the Registrant x
Filed by a Party other than the Registrant o
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Preliminary Proxy Statement |
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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
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Definitive Proxy Statement |
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Definitive Additional Materials |
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Soliciting Material Pursuant to §240.14a-12 |
ENTERTAINMENT GAMING ASIA INC. |
(Name of Registrant as Specified In Its Charter) |
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant) |
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ENTERTAINMENT GAMING ASIA INC.
Unit C1, Ground Floor, Koon
Wah Building
No. 2 Yuen Shun Circuit
Yuen Chau Kok, Shatin
New Territories, Hong Kong
NOTICE OF ANNUAL MEETING OF
STOCKHOLDERS
TO BE HELD
OCTOBER 29, 2015
To our Stockholders:
The 2015
annual meeting of stockholders of Entertainment Gaming Asia Inc., a Nevada corporation, will be held on Thursday, October 29, 2015,
at 10:00 a.m., local time, at Unit C1, Ground Floor, Koon Wah Building, No. 2 Yuen Shun Circuit, Yuen Chau Kok, Shatin, New Territories,
Hong Kong to:
| 1. | Elect six directors, each to serve until our 2016 annual meeting of stockholders; |
| 2. | Ratify the appointment of Ernst & Young as our independent registered public accounting firm for the fiscal year ending
December 31, 2015; |
| 3. | Vote on a proposed increase in the number of authorized shares of the Company’s common stock; |
| 4. | Conduct a non-binding “say on pay” advisory vote on the compensation of the Company’s named executive officers
described in the tabular compensation disclosures in the accompanying proxy statement; |
| 5. | Vote on the adjournment or postponement of the 2015 annual meeting to another time and date if such action is necessary for
the board of directors to solicit additional proxies in favor of proposals 1, 2, 3 and 4; and |
| 6. | Consider any other business that properly comes before the meeting. |
Only
stockholders of record at the close of business on September 3, 2015 will be entitled to notice of, and to vote at, the
meeting and any adjournments of the meeting. It is important that your shares be represented at the meeting. Please mark,
sign, date, and mail the enclosed proxy card in the postage-paid envelope provided, regardless of whether you plan to attend
in person.
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Sincerely, |
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Clarence Chung, |
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Chairman of the Board |
September 21, 2015
Hong Kong
TABLE OF CONTENTS
ENTERTAINMENT GAMING ASIA INC.
PROXY STATEMENT FOR
2015 ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD OCTOBER 29, 2015
The
accompanying proxy is solicited on behalf of the board of directors of Entertainment Gaming Asia Inc. (“we” or
the “Company”) in connection with our annual meeting of stockholders to be held on Thursday, October 29, 2015, at
10:00 a.m., local time, at Unit C1, Ground Floor, Koon Wah Building, No. 2 Yuen Shun Circuit, Yuen Chau Kok, Shatin, New
Territories, Hong Kong for the purposes set forth in the accompanying Notice of Meeting.
Please
mark and sign the enclosed proxy card and return it in the accompanying envelope. No postage is required if your returned proxy
card is mailed within the United States. We will bear the cost of soliciting proxies, including the preparation, assembly and mailing
of the proxies and soliciting material, as well as the cost of forwarding the materials to the beneficial owners of our common
stock. Our directors, officers and regular employees may, without compensation other than their regular compensation, solicit proxies
by telephone, electronic mail, personal conversation or other means of communication. We may reimburse brokerage firms and others
for expenses in forwarding proxy material to the beneficial owners of our common stock.
Any proxy
given pursuant to this solicitation and received in time for the 2015 annual meeting will be voted according to the instructions
given in the proxy. Any stockholder giving a proxy may revoke it any time prior to its use at the 2015 annual meeting by giving
a written revocation notice to our secretary, by filing a revoking instrument or a duly executed proxy bearing a later date with
our secretary or by attending the 2015 annual meeting and voting in person.
We expect
that this proxy statement, the proxy and notice of meeting will first be mailed to our stockholders on or about September 23, 2015.
QUESTIONS AND ANSWERS ABOUT
THE MEETING
| Q: | Why am I receiving this proxy statement? |
| A: | We are holding our 2015 annual meeting of stockholders to elect the members of our board of directors.
In addition, we are seeking (i) stockholder ratification of the appointment of Ernst & Young as our independent registered
public accounting firm for the fiscal year ending December 31, 2015, as more fully described in Proposal Two; (ii) stockholder
approval of increase in the number of authorized shares of the Company’s common stock, as more fully described in Proposal
Three; and (iii) a non-binding “say on pay” stockholder advisory vote on the compensation of our named executive officers,
as more fully described in Proposal Four. |
| Q: | What do I need to do now? |
| A: | We urge you to carefully read and consider the information contained in this proxy statement. If
applicable, you should then vote as soon as possible in accordance with the instructions provided in this proxy statement and on
the enclosed proxy card or submit your voting instructions by internet or by telephone if that option is available to you. |
| A: | If you are an EGT stockholder of record, you may vote in person at the 2015 annual meeting or by
submitting a proxy for the meeting. You can submit your proxy by completing, signing, dating and returning the enclosed proxy card
in the accompanying pre-addressed postage paid envelope. If you hold your shares in “street name,” which means your
shares are held of record by a broker, bank or nominee, you must provide the record holder of your shares with instructions on
how to vote your shares. Please refer to your proxy card or the voting instruction card used by your broker, bank or nominee to
see if you may submit voting instructions using the internet or telephone. |
| Q: | What happens if I do not vote? |
| A: | If you do not submit a proxy card or vote at the 2015 annual meeting, your proxy will not be counted
as present for the purpose of determining the presence of a quorum, and your shares will not be voted at the meeting. If you submit
a proxy card and affirmatively elect to abstain from voting, your proxy will be counted as present for the purpose of determining
the presence of a quorum but will not be voted at the 2015 annual meeting. Broker non-votes will have the effect as more fully
described in the section “Voting of Shares — Vote Required for Approval” below. |
| Q: | If my EGT shares are held in “street name,” will my broker, bank, or nominee vote
my shares for me on all proposals? |
| A: | Your broker, bank, or nominee can vote your shares on the ratification of accountants in the event
you do not provide instructions on how to vote in accordance with the information and procedures provided to you by your broker,
bank, or nominee. Your broker, bank, or nominee cannot vote your shares on the election of directors or any other Proposals, unless
you provide instructions on how to vote. |
| Q: | Can I change my vote after I have mailed my signed proxy or direction form? |
| A: | Yes. If you are a record holder, you can change your vote at any time before your proxy is voted
at your stockholder meeting by: |
| • | delivering to the Company’s corporate secretary a signed notice of revocation; |
| • | granting a new, later-dated proxy, which must be signed and delivered to the Company’s corporate
secretary; or |
| • | attending the 2015 annual meeting and voting in person; however, your attendance alone will not
revoke your proxy. |
If your shares are held in street
name and you have instructed your broker or nominee to vote your shares, you must follow your broker or nominee’s directions
in order to change your vote or revoke your proxy.
| Q: | What should I do if I receive more than one set of voting materials? |
| A: | You may receive more than one set of voting materials, including multiple copies of this proxy statement and multiple proxy
cards or voting instruction cards. For example, if you hold your shares in more than one brokerage account, you will receive a
separate voting instruction card for each brokerage account in which you hold shares. If you are a holder of record and your shares
are registered in more than one name, you will receive more than one proxy card. Please complete, sign, date and return each proxy
card and voting instruction card that you receive. |
| Q: | What if I object to the proposed transactions? Do I have dissenter’s rights? |
| A: | No. Dissenter’s rights are not available for the types of transactions discussed in this proxy statement. |
| Q: | Whom should I call with questions? |
| A: | If you have any questions about the meeting, require directions to the meeting or need additional copies of this proxy statement
or the enclosed proxy card, you should contact: |
Entertainment Gaming Asia Inc.
40 E. Chicago Ave. #186 Chicago,
IL 60611-2026
Attn: Traci Mangini
Email address: tracimangini@egt-group.com
VOTING OF SHARES
Our board of
directors has fixed the close of business on September 3, 2015 as the record date for determining the stockholders entitled
to notice of, and to vote at, the 2015 annual meeting. On September 3, 2015, 14,464,220 shares of our common stock,
$0.001 par value, were outstanding and held by approximately 144 record holders. On February 26, 2015, we effected a
reverse split, which we refer to as the 2015 reverse split in this document, through a combination of the outstanding shares
of our common stock on a one for four basis. Accordingly, each four pre-2015 reverse split share outstanding on that date
entitles its holder to one vote in person or by proxy on each matter to be voted on at the 2015 annual meeting. All
historical share and share price information in this proxy statement have been adjusted to give effect to the 2015 reverse
split.
Quorum
The presence at the
2015 annual meeting, in person or by proxy, of the holders of a majority of the outstanding shares of common stock entitled to
vote at the meeting is required for a quorum for the transaction of business. In general, shares of common stock represented by
a properly signed and returned proxy card will be counted as shares present and entitled to vote at the meeting for purposes of
determining a quorum.
Vote Required for Approval
Pursuant to Section
2.8 of our bylaws, the vote of the holders of a majority of the stock having voting power present in person or represented by proxy
shall be sufficient to elect directors or to decide any question brought before such meeting, unless a different vote is expressly
required by our charter documents or the Nevada General Corporation Law. In counting votes on the election of directors and all
other matters to come before the meeting, broker non-votes (i.e. shares held of record by a broker which are not voted because
the broker has not received voting instructions from the beneficial owner) will be counted as not present . and these shares will
be deducted from the total shares of which a majority is required. Shares subject to abstention shall be counted as present but
not voted, which will have the same practical effect as having against the particular matter.
All proposals presented
in this proxy statement will be approved if a majority of the shares present or represented at the meeting are voted in favor of
such matter.
Voting of Proxies
Shares of common stock
represented by properly executed proxy cards will be voted according to the choices specified. Proxies that are signed by stockholders
but that lack any voting instructions will be voted “FOR” the election of all of the nominees for director
listed in this proxy statement, and “FOR” Proposals Two, Three and Four and in the discretion of the
persons voting the respective proxies with respect to any other matter that may properly come before the 2015 annual meeting.
Voting via the Internet, by Telephone
or by Mail
As an alternative
to voting in person at the 2015 annual meeting, stockholders whose shares are registered in their own names may vote via the Internet,
by telephone or by mailing a completed proxy card. For those stockholders who receive a paper proxy card, instructions for voting
via the Internet or by telephone are set forth on the proxy card. Those stockholders who receive a paper proxy card and voting
instructions by mail, and who elect to vote by mail, should sign and return the mailed proxy card in the prepaid and addressed
envelope that was enclosed with the proxy materials, and your shares will be voted at the 2015 annual meeting in the manner you
direct.
If your shares are
registered in the name of a bank or brokerage firm (your record holder), you will receive instructions from your record holder
that must be followed in order for your record holder to vote your shares per your instructions. Many banks and brokerage firms
have a process for their beneficial holders to provide instructions via the Internet or over the telephone. If you hold shares
through a bank or brokerage firm and wish to be able to vote in person at the 2015 annual meeting, you must obtain a legal proxy
from your brokerage firm, bank or other holder of record and present it to the inspector of elections with your ballot.
Important Notice Regarding the Availability
of Proxy Materials for the Annual Meeting
This proxy statement,
our 2014 annual report to stockholders and, if your shares are registered in your name, your proxy card, are available on the Internet.
This proxy statement, our annual report to stockholders and, if your shares are registered in your name, your proxy card, are available
at: www.cstproxy.com/egt-group/2015.
You may access your
proxy materials and, if your shares are registered in your name, vote your shares online by going to www.cstproxyvote.com
and following the prompts. You will need to have your proxy card with you since your card includes your unique identification numbers.
PROXY SOLICITATION
We are soliciting
proxies from our stockholders for our 2015 annual meeting of stockholders. We will pay the cost of solicitation of proxies from
our stockholders, including preparation, assembly, printing and mailing of this proxy statement and the proxy cards. Copies of
solicitation materials will be furnished to banks, brokerage houses, fiduciaries and custodians holding in their names shares of
our common stock beneficially owned by others to forward to such beneficial owners. We may reimburse persons representing beneficial
owners of our common stock for their costs of forwarding solicitation materials to such beneficial owners. In addition to solicitation
by use of the mails, proxies may be solicited by our board of directors, officers and employees, in person or by telephone, electronic
mail, or other means of communication. No additional compensation for soliciting proxies will be paid to our board of directors,
officers or regular employees for such services.
PROPOSAL ONE — ELECTION
OF DIRECTORS
Our bylaws provide
that our board will consist of between one and twelve members, with the number of directors determined from time to time by our
board. The number of directors is currently set at six. The current term of all of our six directors expires at the 2015 annual
meeting. Accordingly, six directors will be elected at the 2015 annual meeting to serve until the next annual meeting of stockholders
and until their successors are elected and qualified. Each nominee has consented to being nominated and to serve if elected. If
any nominee is unable or declines to serve as director at the time of the 2015 annual meeting, an event not now anticipated, proxies
will be voted for any nominee designated by the board of directors to fill the vacancy.
Information About Nominees
Names of the board
of directors’ nominees and certain biographical information about the nominees are set forth below.
Clarence (Yuk Man) Chung
Age 52
Director since 2007 |
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Mr. Chung joined our board in October 2007 and has served as our chairman of the board since August 2008 and chief executive officer since October 2008. Mr. Chung is also an executive director of Melco International Development Limited, a company listed on the Hong Kong Stock Exchange. He has served on the board of directors of Melco International Development Limited since May 2006 and is a member of the executive committee, finance committee and corporate social responsibility committee of the company. In addition, Mr. Chung is a non-executive director of Melco Crown Entertainment Limited, a company listed on the NASDAQ Global Market and the Hong Kong Stock Exchange. He has served on the board of directors of Melco Crown since November 2006. He has also served as chairman and president of Melco Crown (Philippines) Resorts Corporation, a company listed on the Philippines Stock Exchange, since December 2012. Mr. Chung has more than 25 years of experience in the financial industry in various capacities as a chief financial officer, an investment banker and merger and acquisition specialist. Mr. Chung holds a master degree in business administration from the Kellogg School of Management at Northwestern University and the Hong Kong University of Science and Technology, and a bachelor degree in business administration from the Chinese University of Hong Kong. Mr. Chung is also a member of the Hong Kong Institute of Certified Public Accountants and the Institute of Chartered Accountants in England and Wales. |
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Mr. Chung has extensive knowledge of the gaming industry in the markets in which the Company operates from his senior management experience with Melco International Development Limited. As a result of these and other professional experiences, our board of directors has concluded that Mr. Chung is qualified to serve as a director. |
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Vincent L. DiVito
Age 55
Director since 2005 |
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Mr. DiVito joined our board in October 2005 and chairs our audit committee. Since April 2010, Mr. DiVito has served as a financial and management consultant. From January 2008 to April 2010, Mr. DiVito served as president of Lonza America, Inc., a global life sciences chemical business headquartered in Allendale, New Jersey, and also served as chief financial officer and treasurer of Lonza America, Inc. from September 2000 to April 2010. Lonza America, Inc. is part of Lonza Group, whose stock is traded on the Swiss Stock Exchange. From 1990 to September 2000, Mr. DiVito was employed by Algroup Wheaton, a global pharmaceutical and cosmetics packaging company, first as its director of business development and later as its vice president and chief financial officer. Mr. DiVito is a certified public accountant and certified management accountant and is a National Association of Corporate Directors Board Leadership Fellow. Mr. DiVito has served on the board of directors of Riviera Holdings Corporation, a publicly held company, from July 2002 until the consummation of a change in control of the corporation in March 2011. Mr. DiVito also serves on the board and chairs the audit committee of Aqua Metals, Inc, a California-based technology start-up. |
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Mr. DiVito has extensive knowledge of accounting and corporate governance issues from his experience serving on various corporate board of directors and has extensive operational knowledge as a result of his experience as an operational executive at a major corporation and is invaluable to our board’s discussions of financial and operational issues. As a result of these and other professional experiences, our board of directors has concluded that Mr. DiVito is qualified to serve as a director. |
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John W. Crawford, J.P.
Age 73
Director since 2007 |
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Mr. Crawford joined our board in November 2007 and chairs our nominating committee and conflicts committee. Mr. Crawford has been the chairman of International Quality Education Limited since February 2002. Prior to that, Mr. Crawford was a founding partner of the Hong Kong office of Ernst & Young where, as chairman of the Audit Division, he acted as engagement or review partner for many public companies and banks before he retired from the firm in 1997. Mr. Crawford is a member of the Hong Kong Institute of Certified Public Accountants, a member and honorary president of the Macau Society of Certified Practising Accountants, and a member of the Canadian Institute of Chartered Accountants. Mr. Crawford has been a JP (Justice of the Peace) since 1997. Mr. Crawford also served on the board of directors and was chairman of the audit committee of e-Kong Group Limited which is listed on the Hong Kong Stock Exchange until June 8, 2015. He is also on the board of directors and chairman of the audit committee of Regal Portfolio Management Limited, which manages the Regal Real Estate Investment Trust, the units of which are listed on the Hong Kong Stock Exchange. In February 2012, Mr. Crawford was appointed as a member of the conflicts committee of the Macau Studio City project held by Melco Crown Entertainment Limited although he does not hold any directorships with Melco Crown Entertainment Limited or any of its subsidiaries. |
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Mr. Crawford has extensive knowledge of accounting issues from his experience as a managing audit partner at a major international accounting firm and has extensive operational knowledge as a result of his consulting experience, and is invaluable to our board’s discussions of financial and operational issues. As a result of these and other professional experiences, our board of directors has concluded that Mr. Crawford is qualified to serve as a director. |
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Samuel (Yuen Wai) Tsang
Age 60
Director since 2008 |
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Mr. Tsang joined our board in
September 2008. Mr. Tsang is a solicitor admitted in Hong Kong, England and Australia. He is the chief legal advisor of Melco
International Development Limited. Since he joined Melco in 2001, Mr. Tsang has been acting as the company secretary of Melco
and overseeing its legal, corporate and compliance matters, which holds significant interests in a total of four listed companies
in Hong Kong, the United States and Canada. Mr. Tsang has worked as a lawyer with major law firms and listed conglomerates in
Hong Kong for over 30 years. He holds a master of laws degree from University of Hong Kong and a master of business administration
degree from the Australian Graduate School of Management. |
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Mr. Tsang has extensive knowledge of corporate law, corporate governance and the gaming industry, including the regulation of the gaming industry, in the markets in which we operate from his senior legal management experience with Melco International Development Limited, and is invaluable to our board’s discussions of legal, governance and regulatory issues. As a result of these and other professional experiences, our board of directors has concluded that Mr. Tsang is qualified to serve as a director. |
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Anthony (Kanhee) Tyen,
Ph.D.
Age 59
Director since 2008 |
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Dr. Tyen joined our board in September
2008 and chairs our compensation committee. Since 1985, Dr. Tyen has been in the proprietorship of his own
accountancy and consulting practice, Anthony Tyen & Co. Dr. Tyen is a certified public accountant in Hong Kong
and has over 38 years’ experience in auditing, accounting, management and company secretarial practice. He
holds a doctoral degree in philosophy and a master degree in business administration, both from the Chinese
University of Hong Kong. He is an associate member of the Hong Kong Institute of Certified Public Accountants, and a
fellow member of both the Association of Chartered Certified Accountants and the Institute of Chartered Secretaries
and Administrators. Dr. Tyen has served as an independent non-executive director and a member of audit committee to
the board of Melco International Development Limited since June 2010 and Summit Ascent Holdings Limited since March 2011,
all being companies listed on the Hong Kong Stock Exchange. Dr. Tyen has also been a director of Alpha Peak Leisure
Inc., a company listed on the Toronto Stock Exchange since August 2012. He was previously an
independent non-executive director of three Hong Kong listed
companies, namely Value Convergence Holdings Limited, Recruit Holdings
Limited and ASR Logistics Holdings Limited.
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Dr. Tyen has extensive knowledge of accounting
issues and the business operations in the markets in which the Company operates from his experience as an owner of an accounting
firm in Hong Kong and is invaluable to our board’s discussions of accounting and operational issues. As a result of these
and other professional experiences, our board of directors has concluded that Dr. Tyen is qualified to serve as a director.
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Dennis (Chi Wai) Tam,
Ph.D.
Age 46
Director since 2015 |
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Mr. Tam joined our board in March 2015. He
has over 20 years of experience in corporate finance, accounting, financial control, and mergers & acquisitions. Mr. Tam has
served as the Group Finance Director and Head of Human Resources & Administration of Melco International Development Limited,
a company listed on The Stock Exchange of Hong Kong Limited, since October 2006 and July 2010, respectively. Mr. Tam is also an
executive director of MelcoLot Limited, a company listed on The Stock Exchange of Hong Kong Limited.
Mr. Tam obtained his Master Degree in Accounting
from Monash University, completed his Ph.D. program at Washington Intercontinental University and trained at Harvard Business School
in Cambridge, Massachusetts. He is the chairman of the board for Greater China for the Institute of Certified Management Accountants
(Australia), a member of CPA Australia and advisor of the General Education Development Committee in Peking University Shenzhen
Graduate School. Mr. Tam was awarded “Asia’s Best CFO (Investor Relations)” at the Asian Excellence Awards by
Corporate Governance Asia magazine in 2014 and 2015.
Mr. Tam has extensive knowledge of accounting
issues and the business operations in the markets in which we operate from his senior management experience with Melco International
Development Limited, and is invaluable to our board’s discussions of accounting and operational issues. As a result of these
and other professional experiences, our board of directors has concluded that Mr. Tam is qualified to serve as a director.
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Additional Information about
our Board and its Committees
We have been a “controlled
company” as defined under NASDAQ Listing Rule 5615(c)(1) since November 25, 2014 when EGT Entertainment Holding Limited became
an approximate 64.8% shareholder of our Company. We rely on the “controlled company” exemption pursuant to NASDAQ Listing
Rule 5615(c) to exempt our Company from the majority independent director composition requirement. All of the director nominees
except Mr. Chung, Mr. Tsang and Mr. Tam are considered by the board of directors to be “independent” as defined
in Rule 5605(a)(2) of the NASDAQ Listing Rules.
During the year
ended December 31, 2014, our board met eight times and all of the directors attended at least 75% of all meetings during the periods
for which they served on our board, and at least 75% of all of the meetings held by committees of the board on which they serve.
The board of directors has formed an audit committee, a nominating committee, a conflicts committee and a compensation committee,
all of which operate under written charters, copies of which are available on our website at www.egt-group.com.
Our board of directors
does not have a policy regarding board members’ attendance at meetings of our stockholders and all members of our board attended
our prior year’s annual meeting of stockholders.
Audit Committee
During the year ended
December 31, 2014, our audit committee was comprised of Mr. Vincent DiVito, Mr. John Crawford and Dr. Anthony Tyen. Mr. DiVito
serves as the audit committee chair.
Our audit
committee generally meets at least once a quarter and, in the year ended December 31, 2014, our audit committee held four
meetings. This committee has the responsibility of selecting the firm that will serve as our independent public accountants,
approving and reviewing the scope and results of the audit and any non-audit services provided by the independent public
accountants and meeting with our financial staff to review internal controls, procedures and policies.
We have identified
Mr. DiVito as the audit committee financial expert. Mr. DiVito was previously the president and chief financial officer of Lonza
America, Inc., a global life sciences chemical company and he is also a certified public accountant and a certified management
accountant. All members of our audit committee are independent, as defined in Rule 5605(a)(2) of the NASDAQ Listing Rules and as
independence for audit committee members is defined in Rule 10A-3(b)(1) under the Securities Exchange Act of 1934. In addition,
Mr. Crawford and Dr. Anthony Tyen each meet the financial sophistication requirements in Rule 5605(c)(2)(A) of the NASDAQ Listing
Rules.
Nominating Committee
During the year
ended December 31, 2014, our nominating committee was comprised of Mr. Vincent DiVito, Mr. John Crawford and Dr. Anthony Tyen.
Mr. Crawford serves as the nominating committee chair. Our nominating committee held one meeting in the year ended December 31,
2014.
The nominating committee
is responsible for assisting our board with respect to the appropriate size and composition of our board and monitoring and making
recommendations regarding the performance of our board. In this regard, our nominating committee evaluates the qualifications of
all proposed candidates for election to our board, including capabilities, availability to serve, conflicts of interest and other
relevant factors, and makes recommendations to our board concerning the size and composition of our board of directors.
The members of our
nominating committee are considered by our board of directors to be “independent” as defined in Rule 5605(a)(2) of
the NASDAQ Listing Rules.
The charter of our
nominating committee allows the nominating committee to consider for directorship candidates nominated by third parties, including
stockholders. For a third party to suggest a candidate, one must provide our legal department with the name of the candidate, together
with a brief biographical sketch and a document indicating the candidate’s willingness to serve if elected.
Our nominating committee
has recommended Mr. Clarence Chung, Mr. Vincent DiVito, Mr. John Crawford, Mr. Samuel Tsang, Dr. Anthony Tyen and Mr. Dennis Tam
as nominees for election to our board of directors at the 2015 annual meeting.
Compensation Committee
During the year
ended December 31, 2014, our compensation committee was comprised of Mr. Vincent DiVito, Mr. John Crawford and Dr. Anthony Tyen.
Dr. Tyen serves as the compensation committee chair. Our compensation committee held one meeting in the year ended December 31,
2014.
Our compensation
committee has the responsibility of setting executive compensation guidelines, administering our stock incentive plans, and approving
compensation of our executive officers and members of the board of directors. Our chief executive officer and other executive officers
may attend compensation committee meetings and make recommendations, but they may not be present during discussions or deliberations
regarding their own compensation. From time to time, our compensation committee will use an independent consultant in considering
compensation policies and programs for executive officers. The members of our compensation committee are considered by our board
of directors to be “independent” as defined in Rule 5605(a)(2) of the NASDAQ Listing Rules.
Conflicts Committee
During the year
ended December 31, 2014, our conflicts committee was comprised of Mr. Vincent DiVito and Mr. John Crawford. Mr. Crawford serves
as the conflicts committee chair. The conflicts committee held one meeting in the year ended December 31, 2014.
With regard to transactions
between us and our principal stockholder, EGT Entertainment Holding, our board of directors has established a committee of the
board, known as the conflicts committee, made up exclusively of members of our board who satisfy the independence requirements
of Rule 5605(a)(2) of the NASDAQ Listing Rules and meet the criteria for independence as set forth in Rule 10A-3(b)(1) under the
Exchange Act of 1934, and who are not then, and during the two years prior to their appointment or election had not been, an officer,
director, employee of or consultant or advisor to EGT Entertainment Holding Limited or any affiliate of EGT Entertainment Holding
Limited.
The conflicts committee
operates under a charter that has been approved by our board of directors. Pursuant to the charter, the conflicts committee is
required to review and approve all material agreements or transactions, if any, between us and any party holding 10% or more of
our common shares or voting power or their affiliates. The conflicts committee charter may not be amended or modified unless (i)
such amendment or modification has been approved and recommended by a majority of the members of the conflicts committee and (ii)
at least five business days preceding the effective date of such amendment or modification we have filed with the SEC a current
report on Form 8-K that accurately and fully discloses the proposed amendment or modification and the basis for the conflicts committee’s
recommendations.
Director Compensation
Each member of our
board of directors (except Mr. Dennis (Chi Wai) Tam) received an initial grant of 6,250 options upon his appointment.
On November 8,
2011, our board of directors, acting upon the recommendation and approval of our compensation committee, approved an
amendment to our policy concerning the compensation of our directors. Pursuant to such amendments, for the three calender
years 2012, 2013 and 2014, each member of our board of directors receives an annual grant of options to purchase 6,250 shares
of our common stock and each non-employee board member also receives a quarterly fee of $13,500, provided that the chairman
of our audit committee receives an additional $6,500 per quarter. As of the date of this report, Mr. Samuel Tsang and Mr.
Dennis (Chi Wai) Tam have unconditionally waived all their entitlements to the aforesaid quarterly fees. Since January 1, 2015,
no annual grant of options has been made to members of our board of directors for reasons as explained in the last paragraph
on page 22 of this proxy statement.
All annual
grant options will vest in full six months and one day following the date of grant. The exercise price of such options is
the market price of our common stock on the date of grant. Our directors are reimbursed for their out-of-pocket expenses
related to their services as directors or meeting attendances, including their direct travel related expenses and education
expenses of certain director.
Board Leadership Structure and
Role in Risk Oversight
Mr. Clarence Chung
has served as our chairman of the board since August 2008 and chief executive officer since October 2008. We have neither adopted
a formal policy on whether the chairman and chief executive officer positions should be separate or combined nor do we have a lead
director. We believe that given the small size of our board of directors and establishment of separate audit, compensation and
nominating committees consisting of independent directors that our present board structure is in the best interest of us and our
stockholders. Our board of directors has an active role in overseeing our areas of risk. While the full board has overall responsibility
for risk oversight, the board has assigned certain areas of risk primarily to designated committees, which report back to the full
board.
Compensation Committee Interlocks
and Insider Participation
No member of our
board of directors is employed by us or our subsidiaries except for Mr. Clarence Chung, who is presently employed as our president
and chief executive officer. None of our executive officers serve on the board of directors of another entity, whose executive
officers serve on the compensation committee of our board of directors. None of officers or employees participated in deliberations
of our compensation committee concerning executive officer compensation.
Process for Stockholders to
Send Communications to our Board of Directors
Because we have
always maintained open channels of communication with our stockholders, we do not have a formal policy that provides a process
for stockholders to send communications to our board. However, if a stockholder would like to send a communication to our board
of directors, please address the letter to the attention of our legal department and it will be distributed to each director.
Recommendation of the Board
of Directors
Our board of directors
recommends that you vote “FOR” the election of all director nominees listed in this proxy statement.
Audit Committee Report
The audit committee
reviewed and discussed our audited financial statements for the year ended December 31, 2014 with our management. The audit committee
discussed with Ernst & Young, our independent auditors for the fiscal year ended December 31, 2014, the matters required to
be discussed by Statement on Auditing Standards No. 114, “The Auditors Communication with Those Charged with Governance”.
The audit committee also received the written communication from Ernst & Young required by PCAOB Ethics and Independence Rule
3526, “Communication with Audit Committees Concerning Independence”, and the audit committee has discussed the independence
of Ernst & Young with them.
Based on the audit
committee’s review and discussions noted above, the audit committee recommended to our board of directors that our audited
financial statements be included in our annual report on Form 10-K for the year ended December 31, 2014 filed with the SEC on March
26, 2015.
|
THE AUDIT COMMITTEE |
|
|
|
Vincent DiVito, Chairman |
|
John Crawford |
|
Anthony Tyen |
PROPOSAL TWO —
RATIFICATION OF INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM
The audit committee
of our board of directors has appointed Ernst & Young as our independent registered public accounting firm for the fiscal
year ending December 31, 2015. It is expected that representatives of Ernst & Young will attend the 2015 annual meeting by
way of telephone conferencing, who will have the opportunity to make statements if they desire to do so. They will also be available
to respond to appropriate questions from stockholders.
Ernst & Young
continuously served as our independent registered public accounting firm beginning with the year ended December 31, 2008.
Independent Registered Public
Accounting Firm Fees
The following table
sets forth the aggregate fees billed to us for services rendered to us for the years ended December 31, 2014 and 2013 by our independent
registered public accounting firm, Ernst & Young, for such years for the audit of our consolidated financial statements for
the years ended December 31, 2014 and 2013, and assistance with the reporting requirements thereof, the review of our condensed
consolidated financial statements included in our quarterly reports on Form 10-Q and accounting and auditing assistance relative
to acquisition accounting and reporting.
| |
Years Ended December 31, | |
(Amounts in thousands) | |
2014 | | |
2013 | |
Audit Fees | |
$ | 413 | | |
$ | 449 | |
Tax Fees | |
| 125 | | |
| 63 | |
Other Services | |
| 2 | | |
| 2 | |
| |
$ | 540 | | |
$ | 514 | |
Audit Committee Pre-Approval
Policies
Our audit committee
approves all audit fees, audit-related fees, tax fees and special engagement fees. The audit committee approved 100% of such fees
for the years ended December 31, 2014 and 2013.
Recommendation of the Board
of Directors
Our board of directors
recommends that you vote “FOR” the ratification of the selection of Ernst & Young as our independent registered
public accounting firm for the fiscal year ending December 31, 2015.
PROPOSAL THREE — INCREASE
IN AUTHORIZED SHARES OF COMMON STOCK
Our board of directors
has approved a proposal to amend the Company’s Amended and Restated Articles of Incorporation to increase the number
of authorized shares of the Company’s common stock from 18,750,000 to 38,000,000. The proposed amendment would replace Section
4.1 of the Fourth Article of the Amended and Restated Certificate of Incorporation with the following language:
“The
Corporation is authorized to issue thirty-eight million (38,000,000) shares of common stock, $.001 per value (“Common
Stock”) and ten million (10,000,000) shares of preferred stock, $.001 par value (“Preferred Stock”). Common Stock
and Preferred Stock may be issued from time to time without action by the stockholders. Common Stock and Preferred Stock may
be issued for such consideration as may be fixed from time to time by the Board of Directors.”
Our board of directors
believes it is in the best interest of the Company to increase the number of authorized shares of common stock in order to give
the Company greater flexibility in considering and planning for future corporate needs, including, but not limited to, stock dividends,
grants under equity compensation plans, stock splits, financings, potential strategic transactions, including mergers, acquisitions,
and business combinations, as well as other general corporate transactions. Our board of directors believes that additional authorized
shares of common stock will enable the Company to take timely advantage of market conditions and favorable financing and acquisition
opportunities that become available to the Company without the delay and expense associated with convening a special meeting of
the Company’s stockholders.
The Company has
no current plan, commitment, arrangement, understanding or agreement regarding the issuance of the additional shares of common
stock that will result from the Company’s adoption of the proposed amendment. Except as otherwise required by law or by a
regulation of the NASDAQ Capital Market, the newly authorized shares of common stock will be available for issuance at the discretion
of the board of directors (without further action by the stockholders) for various future corporate needs, including those outlined
above. While adoption of the proposed amendment would not have any immediate dilutive effect on the proportionate voting power
or other rights of the Company’s existing stockholders, any future issuance of additional authorized shares of the Company’s
common stock may, among other things, dilute the earnings per share of the common stock and the equity and voting rights of those
holding common stock at the time the additional shares are issued.
In addition to the
corporate purposes mentioned above, an increase in the number of authorized shares of the Company’s common stock may make
it more difficult to, or discourage an attempt to, obtain control of the Company by means of a takeover bid that our board of directors
determines is not in the best interest of the Company and its stockholders. However, our board of directors does not intend or
view the proposed increase in the number of authorized shares of the Company’s common stock as an anti-takeover measure and
is not aware of any attempt or plan to obtain control of the Company.
Any newly authorized
shares of the Company’s common stock will be identical to the shares of common stock now authorized and outstanding. The
proposed amendment will not affect the rights of current holders of the Company’s common stock, none of whom have preemptive
or similar rights to acquire the newly authorized shares.
Recommendation
of the Board of Directors
Our board of directors
recommends that you vote “FOR” the proposed amendment to increase the number of authorized shares of
the Company’s common stock from 18,750,000 to 38,000,000.
PROPOSAL
FOUR — ADVISORY VOTE ON THE COMPENSATION OF THE COMPANY’S NAMED EXECUTIVE OFFICERS
Under Section 14A of
the Exchange Act and related Securities and Exchange Commission rules and regulations, we are required to provide our stockholders
the opportunity, on a non-binding advisory basis, to approve the compensation of our named executive officers as described in
the “Executive Compensation” section of this proxy statement. At our annual meeting of stockholders held on July 26,
2013, our stockholders, upon the recommendation of our board of directors, approved a resolution that we provide stockholders
this opportunity annually.
Our compensation structure
is established by our compensation committee and is designed to attract and retain motivated executives who substantially contribute
to our long-term success and the creation of stockholder value, to reward executives when we perform financially or operationally
well, to align the financial interests of our executives with the interests of our stockholders, and to be competitive within
our industry without targeting or setting compensation at specific benchmark percentiles. Our compensation committee’s philosophy
is to balance the named executive officers’ short-term compensation with long-term compensation in order to align their
interests with the interests of our stockholders. Within this framework, our compensation committee strives to maintain executive
compensation that is fair, reasonable, and competitive.
Our board of directors is asking the stockholders to approve of and support
the compensation of the named executive officers as described in this proxy statement. This vote is advisory, which means that
it will not be binding on the Company. However, even though this vote is non-binding, we value the input of our stockholders and
our compensation committee will consider the results of this vote in making future compensation decisions regarding our named
executive officers.
Recommendation
of the Board of Directors
Our
board of directors recommends that you vote “FOR” the approval of the compensation paid to our named
executive officers, as disclosed pursuant to Item 402 of Regulation S-K, including the compensation tables and narrative discussion
included in this proxy statement.
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The table below
sets forth the beneficial ownership of our common stock as of August 31, 2015, by:
• | | All of our then current directors and executive officers, individually; |
• | | All of our then current directors and executive officers, as a group; and |
• | | All persons who beneficially owned more than 5% of our outstanding common stock. |
The beneficial ownership
of each person was calculated based on 14,464,220 shares of our common stock outstanding as of August 31, 2015, according to the
recorded ownership listings as of that date, the beneficial ownership reports filed by 5% beneficial owners with the SEC and the
verifications we solicited and received from each director and executive officer. The SEC has defined “beneficial ownership”
to mean more than ownership in the usual sense. For example, a person has beneficial ownership of a share not only if he owns it
in the usual sense, but also if he has the power (solely or shared) to vote, sell or otherwise dispose of the share. Beneficial
ownership also includes the number of shares that a person has the right to acquire within 60 days of August 31, 2015, pursuant to
the exercise of options or warrants or the conversion of notes, debentures or other indebtedness, but excludes stock appreciation
rights. Two or more persons might count as beneficial owners of the same share. Unless otherwise noted, the address of the following
persons listed below is c/o Entertainment Gaming Asia Inc., Unit C1, Ground Floor, Koon Wah Building, No. 2 Yuen Shun Circuit,
Yuen Chau Kok, Shatin, New Territories, Hong Kong.
Name of Director, Executive Officer or Nominee | |
| Shares(1) | | |
| Percentage | |
Clarence (Yuk Man) Chung | |
| 851,516 | (2) | |
| 5.8 | % |
| |
| | | |
| | |
Andy (Kin Ming) Tsui | |
| 50,938 | (3) | |
| * | |
| |
| | | |
| | |
Vincent L. DiVito | |
| 48,648 | (4) | |
| * | |
| |
| | | |
| | |
John W. Crawford | |
| 50,671 | (5) |
| | * |
| |
| | | |
| | |
Anthony (Kanhee) Tyen | |
| 41,875 | (6) |
| | * |
| |
| | | |
| | |
Samuel (Yuen Wai) Tsang | |
| 41,875 | (7) | |
| * | |
| |
| | | |
| | |
Dennis (Chi Wai) Tam | |
| NIL | | |
| - | |
| |
| | | |
| | |
All directors and executive officers as a group (7 persons) | |
| 1,085,523 | | |
| 7.3 | % |
Name
and Address of 5%(+) Holders | |
| | | |
| | |
EGT Entertainment Holding Limited
38/F, The Centrium 60 Wyndham Street Central, Hong Kong | |
| 9,378,074 | (8) | |
| 64.8 | % |
(1) | | Unless otherwise noted, the persons identified in this table have sole voting and
sole investment power with regard to the shares beneficially owned by them. |
(2) | | Includes 261,250 shares issuable upon the exercise of stock options. |
(3) | | Includes 40,000 shares issuable upon the exercise of stock options. |
(4) | | Includes 30,938 shares issuable upon the exercise of stock options. |
(5) | | Includes 36,250 shares issuable upon the exercise of stock options. |
(6) | | Includes 34,375 shares issuable upon the exercise of stock options. |
(7) | | Includes 34,375 shares issuable upon the exercise of stock options. |
(8) | | The shares are owned directly by EGT Entertainment Holding, which is the indirect
wholly-owned subsidiary of Melco International Development Limited. Melco is the indirect beneficial owner of the reported securities. |
Equity Compensation Plan Information
At our annual meeting
on September 8, 2008, our stockholders approved our 2008 Stock Incentive Plan, or the 2008 plan. The 2008 plan allows for incentive
awards to eligible recipients consisting of:
• | | Options to purchase shares of common stock, that qualify as incentive stock options
within the meaning of the Internal Revenue Code; |
• | | Non-statutory stock options that do not qualify as incentive options; |
• | | Restricted stock awards; and |
• | | Performance stock awards, which may be subject to future achievement of performance
criteria or free of any performance or vesting conditions. |
The number of shares
reserved for issuance under the 2008 plan is 1,250,000 shares. The exercise price of an option granted under the 2008 plan shall
not be less than 100% of the fair market value of one share of common stock on the date of grant, unless the participant owns more
than 10% of the total combined voting power of all classes of our stock or any parent or subsidiary corporation of ours, in which
case the exercise price shall then be 110% of the fair market value. The outstanding stock options generally vest over three years
and have ten-year contractual terms.
During the year
ended December 31, 2014, stock options for the purchase of 56,250 shares of common stock were granted with a weighted average exercise
price of $4.84 and weighted average fair value of $2.28 (2013: $2.76) per share and will vest from six-month and one day to three-year
periods. During the year ended December 31, 2014, 23,750 shares of restricted stock awards with a fair value of $4.84 per share
were issued. The shares of restricted stock shall vest, subject to and upon the recipient’s achievement of key operational
and financial performance milestones. For restricted stock awards with performance conditions, the Company evaluates if performance
conditions are probable in each reporting period. The compensation expense of restricted awards is recognized ratably over the
implicit service period if achieving performance conditions is probable. Cumulative catch-up adjustments are required in the event
of any changes in the assessment of probabilities.
During the year ended
December 31, 2014, there were no exercises of outstanding stock options.
Prior to January
1, 2009, we had two stock options plans, the Amended and Restated 1999 Stock Option Plan and the Amended and Restated 1999 Directors’
Stock Option Plan, or the previous stock option plans, through which 937,500 shares and 18,750 shares were authorized, respectively.
Both previous stock option plans expired on December 31, 2008; however, options granted under the previous stock option plans that
were outstanding as of the date of termination remain outstanding and subject to termination according to their terms.
As of December 31,
2014, stock options for the purchase of 229,620 and 5,001 shares of common stock, respectively, were outstanding in relation to
the previous stock option plans.
As of December 31,
2014, stock options for the purchase of 550,599 shares of common stock were outstanding under the 2008 plan.
As of December 31,
2014, 727,949 stock options were exercisable with a weighted average exercise price of $8.14, a weighted average fair value of
$3.50 and an aggregate intrinsic value of approximately $46,000. The total fair value of shares vested during the year ended December
31, 2014 was approximately $411,000. As of December 31, 2014, an aggregate of 57,271 options granted under all plans were subject
to vesting with a total compensation cost approximately $89,000. The amount is expected to be recognized over 1.38 years.
A summary of all
current and expired plans as of December 31, 2014 and 2013 and changes during the years then ended are presented in the following
tables.
Options
| |
Number of Shares | | |
Weighted Average Exercise Price | | |
Weighted Average Remaining Contractual Life (in years) | | |
Aggregate Intrinsic Value (in thousands) | |
Outstanding as of December 31, 2012 | |
| 739,384 | | |
$ | 8.54 | | |
| 5.79 | | |
$ | 2,293 | |
Granted | |
| 215,000 | | |
| 4.81 | | |
| - | | |
| 280 | |
Exercised | |
| - | | |
| - | | |
| - | | |
| - | |
Forfeited or expired | |
| (131,250 | ) | |
| 3.00 | | |
| - | | |
| - | |
Outstanding as of December 31, 2013 | |
| 823,134 | | |
| 8.45 | | |
| 5.99 | | |
| 738 | |
Exercisable as of December 31, 2013 | |
| 695,970 | | |
$ | 8.70 | | |
| 5.63 | | |
$ | 738 | |
| |
Number of Shares | | |
Weighted Average Exercise Price | | |
Weighted Average Remaining Contractual Life (in years) | | |
Aggregate Intrinsic Value (in thousands) | |
Outstanding as of December 31, 2013 | |
| 823,134 | | |
$ | 8.45 | | |
| 5.99 | | |
$ | 738 | |
Granted | |
| 56,250 | | |
| 4.84 | | |
| - | | |
| - | |
Exercised | |
| - | | |
| - | | |
| - | | |
| - | |
Forfeited or expired | |
| (94,164 | ) | |
| 9.80 | | |
| - | | |
| - | |
Outstanding as of December 31, 2014 | |
| 785,220 | | |
| 8.03 | | |
| 5.50 | | |
| 46 | |
Exercisable as of December 31, 2014 | |
| 727,949 | | |
$ | 8.14 | | |
| 5.27 | | |
$ | 46 | |
Restricted Stock
| |
Number of shares | | |
Weighted Average Fair Value at Grant Date | | |
Weighted
Average
Remaining Contractual Life (in years) | |
Unvested balance as of December 31, 2012 | |
| - | | |
$ | - | | |
| - | |
Granted | |
| 12,500 | | |
| 7.88 | | |
| - | |
Vested(1) | |
| (12,500 | ) | |
| 7.88 | | |
| - | |
Unvested balance as of December 31, 2013 | |
| - | | |
$ | - | | |
| - | |
| |
Number of shares | | |
Weighted Average Fair Value at Grant Date | | |
Weighted
Average Remaining Contractual Life (in years) | |
Unvested balance as of December 31, 2013 | |
| - | | |
$ | - | | |
| - | |
Granted | |
| 23,750 | | |
| 4.84 | | |
| - | |
Vested(2) | |
| (16,250 | ) | |
| 4.84 | | |
| - | |
Unvested balance as of December 31, 2014 | |
| 7,500 | | |
$ | 4.84 | | |
| 1.41 | |
(1) | | Vested shares included 12,500 shares of restricted common stock issued in the year
ended December 31, 2013 for which final vesting of 8,125 shares was approved by the Company’s compensation committee in
March 2014. |
(2) | | Vested shares included 12,500 shares of restricted common stock issued in the year
ended December 31, 2014 for which final vesting of 5,625 shares was approved by the Company’s compensation committee in
March 2015. |
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table sets
forth the compensation awarded to, earned by or paid to, the chief executive officer for the years ended December 31, 2014 and
2013 and the only other executive officer earning in excess of $100,000 for services rendered in all capacities for the years ended
December 31, 2014 and 2013. Mr. Chung has served as the chief executive officer since October 2008. Mr. Tsui has
served as the chief accounting officer since April 2009.
(amounts in thousands) Name and Principal
Position(a) | |
Year (b) | | |
Salary (c) | | |
Bonus (d) | | |
Stock Awards
(e) | | |
Option Awards
(f) | | |
All Other
Compensation (g) | | |
Total (h) | |
Clarence Chung, CEO | |
| 2014 | | |
$ | 90 | | |
$ | 135 | (1) | |
$ | 19 | (1) | |
$ | 38 | (1) | |
$ | — | | |
$ | 282 | |
| |
| 2013 | | |
$ | 90 | | |
$ | 195 | (2) | |
$ | 64 | (2) | |
$ | 278 | (2) | |
$ | — | | |
$ | 627 | |
Andy Tsui, CAO | |
| 2014 | | |
$ | 208 | | |
$ | 17 | (3) | |
$ | — | | |
$ | — | | |
$ | — | | |
$ | 225 | |
| |
| 2013 | | |
$ | 199 | | |
$ | 21 | (4) | |
$ | — | | |
$ | 17 | (5) | |
$ | — | | |
$ | 237 | |
The dollar amounts in
columns (e) and (f) reflect the values of shares and/or options as of the grant date for the years ended December 31,
2014 and 2013, in accordance with ASC 718, Compensation-Stock Compensation and, therefore, do not necessarily reflect actual
benefits received by the individuals. Assumptions used in the calculation of these amounts are included in Note 12 to our
audited financial statements for the year ended December 31, 2014.
(1) |
On December 31, 2013, the compensation committee of the board of directors resolved that the amount of the CEO's eligible performance-based compensation for 2014 was a cash award up to $300,000, options to purchase up to 25,000 common shares and a restricted stock award of up to 12,500 shares, all of which were subject to the vesting and risk of forfeiture based on the performance of Mr. Chung for the fiscal year ended December 31, 2014. On March 31, 2015, the compensation committee reviewed the financial and non-financial performance targets as of 2014 and decided that Mr. Chung should be entitled to 45% of the cash, the options and the restricted stock award under the CEO’s eligible performance-based compensation for 2014. For the year ended December 31, 2014, Mr. Chung was granted options to purchase 6,250 shares of our common stock as part of the annual grant to members of the board of directors. |
|
|
(2) |
On December 31, 2012, the compensation committee of the board of directors resolved that the amount of the CEO's eligible performance-based compensation for 2013 was a cash award up to $300,000, options to purchase up to 25,000 common shares and a restricted stock award of up to 12,500 shares, all of which were subject to the vesting and risk of forfeiture based on the performance of Mr. Chung for the fiscal year ended December 31, 2013. On March 4, 2014, the compensation committee reviewed the financial and non-financial performance targets as of and for the fiscal year ended December 31, 2013 and decided that Mr. Chung should be entitled to 65% of the cash, the options and the restricted stock award under the CEO's eligible performance-based compensation for 2013. In addition, on December 27, 2013, the compensation committee of the board of directors approved the extension of options to purchase 125,000 common shares for an additional five years up to December 29, 2018, which incurred one-off stock-based compensation expense of $165,000 for the year ended December 31, 2013. For the year ended December 31, 2013, Mr. Chung was granted options to purchase 6,250 shares of our common stock as part of the annual grant to members of the board of directors. |
|
|
(3) |
On April 2, 2015, Mr. Tsui received a cash bonus of $17,000 for his contribution during the year ended December 31, 2014. |
|
|
(4) |
On March 24, 2014, Mr. Tsui received a cash bonus of $21,000 for his contribution during the year ended December 31, 2013. |
|
|
(5) |
On February 27, 2013, the compensation committee approved the grant of 3,750 options to Mr. Tsui. |
Narrative Disclosure to Summary Compensation Table
Mr. Clarence Chung
On December 31, 2012, Elixir
Gaming Technologies (Hong Kong) Limited, or EGT-HK, and Dreamworld Leisure Management Limited, or EGT-BVI, both of which are our
wholly-owned subsidiaries, each entered into different employment agreements with Mr. Chung for the position of CEO. The employment
agreement entered into by EGT-HK is for Mr. Chung’s services performed on behalf of us within Hong Kong or in relation to
our business, if any, in Hong Kong and the employment agreement entered into by EGT-BVI is for Mr. Chung’s services performed
on our behalf outside of Hong Kong or in relation to our business outside of Hong Kong.
Each employment agreement
commenced on January 1, 2013 and continues indefinitely until terminated by either party. EGT-HK or EGT-BVI, as the case may be,
can terminate their respective agreements immediately for “cause”, as such term is defined in the agreements. In addition,
either party to the agreements may terminate the agreement without cause upon three months prior written notice or payment of three
months base salary in lieu of notice to the other party.
According to the terms
of each employment agreement, the CEO is entitled to an annual base salary to be determined annually by the compensation committee
of our board of directors. The compensation committee has determined that the CEO’s annual base salary under the new Hong
Kong and overseas employment agreements for 2013 is $30,000 and $60,000, respectively. Pursuant to the terms of the new overseas
employment agreement, the CEO is also entitled to receive discretionary and performance-based compensation, payable in cash or
securities of the Company or a combination of both as the compensation committee may determine. The amount of the performance-based
compensation and the key performance indexes by which the CEO will earn the performance based compensation shall be determined
by the compensation committee annually. The compensation committee has determined that the amount of the CEO’s eligible performance-based
compensation for 2013 is up to $300,000 in cash, options to purchase up to 25,000 common shares and a restricted stock award of
up to 12,500 shares, all of which are subject to the vesting and risk of forfeiture based on the performance of Mr. Chung for the
fiscal year ending December 31, 2013. Both of the options to purchase 25,000 common shares of the Company and the restricted stock
award of 12,500 common shares of the Company were granted by us to Mr. Chung on January 2, 2013 under our 2008 Stock Incentive
Plan. The options were granted at an exercise price of $7.86 per share. On March 4, 2014, the compensation committee decided that
Mr. Chung should be entitled to 65% of the cash, the options and the restricted stocks award under the CEO's eligible performance-based
compensation for 2013.
On December 27, 2013, the
compensation committee determined that the CEO's annual base salary under the Hong Kong and overseas employment agreements
for 2014 would be $30,000 and $60,000, respectively. The compensation committee also determined that the amount of the CEO's eligible
performance-based compensation for 2014 is up to $300,000 in cash, options to purchase up to 25,000 common shares and a restricted
stock award of up to 12,500 shares, all of which are subject to the vesting and risk of forfeiture based on the performance of
Mr. Chung for the fiscal year ending December 31, 2014. All cash payments under the two employment agreements are to be paid by
EGT-BVI pursuant to the new overseas employment agreement, other than the $30,000 base salary payable by EGT-HK pursuant to the
Hong Kong employment agreement. Both of the options to purchase 25,000 common shares of the Company and the restricted stock
award of 12,500 common shares of the Company were granted by the Company to Mr. Chung on January 2, 2014 under its 2008 Stock Incentive
Plan. The options were granted at an exercise price of $4.84 per share. On March 31, 2015, the compensation committee decided that
Mr. Chung should be entitled to 45% of the cash, the options and the restricted stocks award under the CEO’s eligible performance-based
compensation for 2014.
On August 13, 2015, EGT-HK and Mr. Chung entered into a new
employment agreement (“Executive Employment Agreement”), which terminated and replaced the HK employment agreement
retroactive to December 31, 2014. Under the Executive Employment Agreement, Mr. Chung shall act as our Executive Chairman and CEO
and perform his service principally within and in relation to Asia with effect from January 1, 2015. On August 13, 2015, EGT-BVI
and Mr. Chung entered into a deed of termination and release for termination of the overseas employment agreement retroactive to
December 31, 2014.
The Executive Employment Agreement shall continue indefinitely
until terminated by either party. EGT-HK can terminate the Executive Employment Agreement immediately for “cause”,
as such term is defined in the Executive Employment Agreement. In addition, either party to the agreement may terminate the agreement
without cause upon three months prior written notice or payment of three months base salary in lieu of notice to the other party.
According to the terms of the Executive Employment Agreement,
Mr. Chung is entitled to a fixed salary in the amount of $1 per year and additional incentive remuneration, payable in cash, to
be determined annually by the compensation committee. The determination of the additional incentive remuneration is not subject
to any fixed or quantitative standards and instead shall be subject to the compensation committee’s discretion. The compensation
committee shall determine Mr. Chung’s additional incentive remuneration under the Executive Employment Agreement for 2015
within four months following the end of 2015, which is discretionary in nature and the amount of which, if any, shall be determined
by compensation committee and vary from year to year.
During his employment
with us, Mr. Chung also serves as (i) an executive director of Melco International Development Limited, the parent corporation
of our principal shareholder, EGT Entertainment Holding, and receives a salary from Melco for his services rendered to Melco; and
(ii) a director of Melco Crown Entertainment Limited. In December 2012, Mr. Chung has also been appointed as the chairman and president
of Melco Crown (Philippines) Resorts Corporation, an indirect subsidiary of Melco Crown Entertainment Limited, which engages in
a hotel casino resort project in the Philippines. Mr. Chung receives compensation in the abovementioned capacities.
Outstanding Equity Awards at Year-End 2014
Option Awards |
Name | |
Number of Securities Underlying Unexercised Options Exercisable | | |
Number of Securities Underlying Unexercised Options Unexercisable | | |
Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options | | |
Option Exercise Price | | |
Option Expiration Date (mm/dd/yyyy) |
Clarence Chung | |
| 1,875 | (1) | |
| - | | |
| - | | |
$ | 57.92 | | |
01/22/2018 |
| |
| 6,250 | (2) | |
| - | | |
| - | | |
$ | 73.44 | | |
11/14/2017 |
| |
| 125,000 | (3) | |
| - | | |
| - | | |
$ | 2.72 | | |
12/29/2018 |
| |
| 3,125 | (4) | |
| - | | |
| - | | |
$ | 2.08 | | |
02/12/2019 |
| |
| 3,125 | (5) | |
| - | | |
| - | | |
$ | 4.64 | | |
01/07/2020 |
| |
| 31,250 | (6) | |
| - | | |
| - | | |
$ | 4.40 | | |
01/22/2020 |
| |
| 3,125 | (7) | |
| - | | |
| - | | |
$ | 5.76 | | |
02/03/2021 |
| |
| 31,250 | (8) | |
| - | | |
| - | | |
$ | 5.76 | | |
02/03/2021 |
| |
| 6,250 | (9) | |
| - | | |
| - | | |
$ | 3.70 | | |
01/03/2022 |
| |
| 37,500 | (10) | |
| - | | |
| - | | |
$ | 3.70 | | |
01/03/2022 |
| |
| 6,250 | (11) | |
| - | | |
| - | | |
$ | 7.86 | | |
01/02/2023 |
| |
| - | | |
| 16,250 | (12) | |
| - | | |
$ | 7.86 | | |
01/02/2023 |
| |
| 6,250 | (13) | |
| - | | |
| - | | |
$ | 4.84 | | |
01/02/2024 |
| |
| - | | |
| 11,250 | (14) | |
| - | | |
$ | 4.84 | | |
01/02/2024 |
| |
| | | |
| | | |
| | | |
| | | |
|
Andy Tsui | |
| 12,500 | (15) | |
| - | | |
| - | | |
$ | 1.28 | | |
12/11/2018 |
| |
| 9,375 | (16) | |
| - | | |
| - | | |
$ | 4.16 | | |
03/12/2020 |
| |
| 15,625 | (17) | |
| - | (17) | |
| - | | |
$ | 5.76 | | |
02/03/2021 |
| |
| 1,250 | (18) | |
| 2,500 | (18) | |
| - | | |
$ | 7.50 | | |
03/11/2023 |
| (1) | We granted Mr. Chung 1,875 options as of January 22, 2008. Such options vested and became exercisable on July 23,
2008. |
| (2) | We granted Mr. Chung 6,250 options as of February 12, 2008. Such options vested and became exercisable on May 15,
2008. |
| (3) | We granted Mr. Chung 125,000 options as of December 29, 2008. Such options vested and became exercisable on December 29,
2009. On December 27, 2013, the compensation committee of the board of directors approved the extension of such options for an
additional five years up to December 29, 2018. |
| (4) | We granted Mr. Chung 3,125 options as of February 12, 2009. Such options vested and became exercisable on August 13,
2009. |
| (5) | We granted Mr. Chung 3,125 options as of January 7, 2010. Such options vested and became exercisable on July 8,
2010. |
| (6) | We granted Mr. Chung 31,250 options as of January 22, 2010. Such options vested and became exercisable on January 1,
2011. |
| (7) | We granted Mr. Chung 3,125 options as of February 3, 2011. Such options vested and became exercisable on August 4,
2011. |
| (8) | We granted Mr. Chung 31,250 options as of February 3, 2011. Such options vested and became exercisable on January 1,
2012. |
| (9) | We granted Mr. Chung 6,250 options as of January 3, 2012. Such options vested and became exercisable on July 4, 2012. |
| (10) | We granted Mr. Chung 37,500 options as of January 3, 2012. Such options vested and became exercisable on January 1, 2013. |
| (11) | We granted Mr. Chung 6,250 options as of January 2, 2013. Such options vested and became exercisable on July 3, 2013. |
| (12) | We granted Mr. Chung 25,000 options as of January 2, 2013. Such options vest and become exercisable as follows: 8,750 options
were forfeited on March 4, 2014; 16,250 options vest and become exercisable on January 2, 2016. |
| (13) | We granted Mr. Chung 6,250 options as of January 2, 2014. Such options vested and became exercisable on July 3, 2014. |
| (14) | We granted Mr. Chung 25,000 options as of January 2, 2014. Such options vest and become exercisable as follows: 13,750 options
were forfeited on March 31, 2015; 11,250 options vest and become exercisable on January 2, 2017. |
| (15) | We granted Mr. Tsui 12,500 options as of December 11, 2008. Such options vested and became exercisable as follows:
4,166 on December 11, 2009; 4,167 on December 11, 2010; and 4,167 on December 11, 2011. |
| (16) | We granted Mr. Tsui 9,375 options as of March 12, 2010. Such options vested and became exercisable on March 12,
2011. |
| (17) | We granted Mr. Tsui 15,625 options as of February 3, 2011. Such options vested and became exercisable as follows:
5,209 on February 3, 2012; 5,208 on February 3, 2013; and 5,208 on February 3, 2014. |
| (18) | We granted Mr. Tsui 3,750 options as of March 11, 2013. Such options vest and become exercisable as follows: 1,250 on March
11, 2014; 1,250 on March 11, 2015; and 1,250 on March 11, 2016. |
2014 Director Compensation Table
(amounts in thousands)
Name (a) | |
Fees Earned (b) | | |
Stock Awards (c) | | |
Option Awards (d) | | |
Non-Equity Incentive Plan Compensation (e) | | |
Change in Pension Value and Nonqualified Deferred Compensation Earnings (f) | | |
All Other Compensation (g) | | |
Total (h) | |
Vincent DiVito | |
$ | 80 | | |
$ | - | | |
$ | 16 | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | 96 | |
John Crawford | |
$ | 54 | | |
$ | - | | |
$ | 16 | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | 70 | |
Anthony Tyen | |
$ | 54 | | |
$ | - | | |
$ | 16 | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | 70 | |
Samuel Tsang | |
$ | - | | |
$ | - | | |
$ | 16 | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | 16 | |
The dollar amounts in columns
(c) and (d) reflect the values of equity awards as of the grant date, in accordance with ASC 718, Compensation-Stock
Compensation, and, therefore, do not necessarily reflect actual benefits received by the individuals. Assumptions used in the
calculation of these amounts are included in Note 12 to our audited financial statements for the year ended December 31, 2014.
Each member of the board
of directors received an initial grant of 6,250 options upon his appointment.
Between January 2009
and January 2012, our policy had been to provide each member of the board of directors with an annual grant of options to purchase
3,125 shares of our common stock and each non-employee board member a quarterly fee of $12,000, provided that the chairman of our
audit committee received an additional $6,000 per quarter.
On November 8, 2011,
the board of directors, acting upon the recommendation and approval of the compensation committee, approved an amendment to our
policy concerning the compensation of directors. Pursuant to such amendments, effective as of January 1, 2012, each member
of our board of directors will receive an annual grant of options to purchase 6,250 shares of our common stock and each non-employee
board member will also receive a quarterly fee of $13,500, provided that the chairman of the audit committee will receive an additional
$6,500 per quarter. As of the date of this proxy statement, both Mr. Samuel Tsang and Dennis Tam had unconditionally waived all
his entitlements to the aforesaid quarterly fees. Melco International Development Limited, a company listed on the Hong Kong Stock
Exchange Limited, or HKEx, became an indirect owner of 64.8% of the issued shares of our Company in November, 2014, as a result
of which our Company became Melco’s subsidiary. As Melco’s subsidiary, the Rules Governing the Listing of Securities
on the HKEx (the “HKEx Listing Rules”) became applicable to certain aspects of our Company. In particular, the HKEx
Listing Rules prescribe specific requirements as to the terms and adoption of any incentive plans under which options over our
Company’s shares may be granted. As our Company’s 2008 incentive plan was implemented before the HKEx listing
rules became applicable to our Company, its terms are not consistent with the relevant HKEx Listing Rules requirements and, as
a result, our Company was not and will not be able to grant any further options over our shares until we adopt a new incentive
plan which complies with the those requirements. Accordingly, from January 1st, 2015 up to the date of this proxy statement,
no annual grant of options has been made to members of our board of directors.
All annual grant options
will vest in full six months and one day following the date of grant. The exercise price of such options is the market price of
our common stock on the date of grant. Our directors are reimbursed for their out-of-pocket expenses related to their services
as directors or meeting attendances.
On February 27, 2013, the
compensation committee of the board of directors resolved the grant of cash bonus of $25,000 to each non-employee director for
rewarding their efforts and guidance to management during the year ended December 31, 2012.
SEC Position on Certain Indemnification
Arrangements
Our articles of incorporation
obligate us to indemnify our directors and officers to the fullest extent permitted under Nevada law. Chapter 78 of the Nevada
Revised Statutes provides for indemnification by a corporation of costs incurred by directors, employees, and agents in connection
with an action, suit, or proceeding brought by reason of their position as a director, employee, or agent. The person being indemnified
must have acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation.
Insofar as indemnification
for liabilities arising under the Securities Act may be permitted to our directors, officers or persons controlling us pursuant
to the provisions contained in our amended and restated articles of incorporation, our amended and restated bylaws, Nevada law
or otherwise, we have been informed that, in the opinion of the SEC, such indemnification is against public policy as expressed
in the Securities Act and is therefore unenforceable. If a claim for indemnification against such liabilities, other than the payment
by us of expenses incurred or paid by one of our directors, officers or controlling persons in the successful defense of any action,
suit, or proceeding, is asserted by such director, officer or controlling person, we will, unless in the opinion of our counsel
the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question of whether such
indemnification by us is against public policy as expressed in the Securities Act and will be governed by the final adjudication
of this issue.
Indemnification Agreements
We have entered
into indemnification agreements with members of our board of directors and certain other employees in which we agreed to hold harmless
and indemnify such directors, officers and employees to the fullest extent authorized under Nevada law, and to pay any and all
related expenses reasonably incurred by the indemnitee. The relevant members of our board of directors are Mr. Clarence Chung,
Mr. Vincent L. DiVito, Mr. John Crawford, Mr. Samuel Tsang and Dr. Anthony Tyen.
CERTAIN RELATIONSHIPS AND RELATED
TRANSACTIONS WITH THE COMPANY
Transaction Review
We have adopted
a policy that any transactions with directors, officers or entities of which they are also officers or directors or in which they
have a financial interest, will only be on terms consistent with industry standards and approved by a majority of the disinterested
directors of our board of directors. Our bylaws provide that no such transactions by us shall be either void or voidable solely
because of such relationship or interest of directors or officers or solely because such directors are present at the meeting of
our board or a committee thereof which approves such transactions, or solely because their votes are counted for such purpose if:
| • | The fact of such common directorship or financial interest is disclosed or known by our board or
committee and noted in the minutes, and our board or committee authorizes, approves or ratifies the contract or transaction in
good faith by a vote for that purpose without counting the vote or votes of such interested directors; or |
| • | The fact of such common directorship or financial interest is disclosed to or known by the stockholders
entitled to vote, and they approve or ratify the contract or transaction in good faith by a majority vote or written consent of
stockholders holding a majority of the shares of common stock entitled to vote (the votes of the interested directors or officers
shall be counted in any such vote of stockholders); or |
| • | The contract or transaction is fair and reasonable to us at the time it is authorized or approved. |
In addition,
interested directors may be counted in determining the presence of a quorum at a meeting of our board or a committee thereof that
approves such transactions. If there are no disinterested directors, we shall obtain a majority vote of the stockholders approving
the transaction.
With regard
to transactions between us and our principal stockholder, EGT Entertainment Holding Limited, our board of directors has established
a committee of the board, known as the conflicts committee. For details of the scope of authority and composition of our conflicts
committee, please refer to the section “Conflicts Committee” in Proposal One — Election of Directors
set forth above.
EGT Entertainment Holding Limited
(“EGT Entertainment Holding”) Transactions
Melco Transactions
Trade Sales of Gaming Products
Period/Date |
|
Related
Party |
|
Contracts/Transactions |
|
Amount
(US$) |
During the year ended December 31, 2013 |
|
Melco
Crown (Macau) Limited, an associate company of Melco International Development Limited |
|
Purchase of gaming products from us |
|
Purchase price:
approximately $941,000 |
During the year ended December 31, 2014 |
|
Melco Crown (Macau) Limited, or MCM, an associate of Melco International Development Limited |
|
Purchase of gaming products from us |
|
Purchase price:
approximately $138,000 |
During the year ended December 31, 2014 |
|
MCE Leisure (Philippines) Corporation, or MCE Leisure, an associate of Melco International Development Limited |
|
Purchase of gaming products from us |
|
Purchase price:
approximately $3.5 million |
During the year ended December 31, 2014 |
|
Melco Crown Entertainment Limited, an associate of Melco International Development Limited |
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Purchase of gaming products from us |
|
Purchase price:
approximately $243,000 |
On December 18, 2014 |
|
MCM and MCE Leisure |
|
(a) MCM and Dolphin Products entered into
the Macau Framework Agreement; and
(b) MCE Leisure and Dolphin Products entered
into the PHP Framework Agreement;
Under the above agreements, MCM and MCE
Leisure will purchase, from time to time, gaming equipment, gaming chips, gaming plaques and related products from Dolphin Products,
its holding companies and subsidiaries for a term of three years commencing from January 1, 2015 subject to annual caps;
Neither MCM nor MCE Leisure is under any
commitment to purchase any amount of products from Dolphin Products and there can be no assurance that either will purchase any
products.
|
|
The annual caps for each of the three financial years ending December 31, 2017 are $18 million, $6 million and $5 million, respectively. |
Hong Kong Office Premises
On March 16,
2011, we entered into a license agreement with Melco Services Limited, which is the principal tenant of a larger office area, for
occupying our existing Hong Kong office premises with an area of approximately 1,920 square feet. Pursuant to the license agreement,
we were required to pay a monthly fee of HK$94,000 (equivalent to approximately $12,000) to Melco Services and such monthly fee
covers the relevant rental, the relevant management fees, air-conditioning and other utilities and services charges. Melco Services
confirmed that all these fees are charged at cost without any markup. The license agreement was for an initial term commencing
from March 17, 2011 until March 16, 2013. The term license agreement was subsequently extended to mid-April 2013 and on April 15,
2013, we relocated our executive offices to Unit C1, G/F., Koon Wah Building, No. 2 Yuen Shun Circuit, Yuen Chau Kok, Shatin, New
Territories, Hong Kong, at which time the parties terminated the license agreement and we ceased paying for the Melco Services.
Management Services
Period |
|
Related
Party |
|
Transactions |
|
Amount(US$) |
During the year ended December 31, 2013 |
|
Golden Future (Management Services) Limited, a wholly-owned subsidiary of Melco Crown (Macau) Limited |
|
Management services related to our gaming products business provided by Golden Future (Management Services) Limited |
|
Payment of approximately $146,000 to Golden Future (Management Services) Limited |
During the year ended December 31, 2014 |
|
Golden Future (Management Services) Limited, a wholly-owned subsidiary of Melco Crown (Macau) Limited |
|
Management services related to our gaming products business provided by Golden Future (Management Services) Limited |
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Payment of approximately $276,000 to Golden Future (Management Services) Limited |
SECTION 16(a) BENEFICIAL OWNERSHIP
REPORTING COMPLIANCE
Rules adopted
by the SEC under Section 16(a) of the Securities Exchange Act of 1934, or the Exchange Act, require our officers and directors,
and persons who own more than 10% of the issued and outstanding shares of our equity securities, to file reports of their ownership,
and changes in ownership, of such securities with the SEC on Forms 3, 4 or 5, as appropriate. Such persons are required by the
regulations of the SEC to furnish us with copies of all forms they file pursuant to Section 16(a).
Based solely
upon a review of Forms 3, 4 and 5 and amendments thereto furnished to us during our most recent fiscal year, and any written representations
provided to us, we believe that all of the officers, directors, and owners of more than ten percent of the outstanding shares of
our common stock complied with Section 16(a) of the Exchange Act for the year ended December 31, 2014.
OTHER BUSINESS
We know of no
business that will be presented for consideration at the 2015 annual meeting other than that described in this proxy statement.
As to other business, if any, that may properly come before the 2015 annual meeting, it is intended that proxies solicited by our
board will be voted according to the judgment of the person or persons voting the proxies.
HOUSEHOLDING OF ANNUAL MEETING
MATERIALS
Some banks,
brokers and other nominee record holders may be participating in the practice of “householding” proxy statements and
annual reports. This means that only one copy of our proxy statement or annual report to stockholders may have been sent to multiple
stockholders in each household. We will promptly deliver a separate copy of either document to any stockholder upon written request
to Investor Relations, Entertainment Gaming Asia Inc., 40 E. Chicago Ave. #186 Chicago, IL 60611-2026 or tracimangini@egt-group.com.
Any stockholder
who wants to receive separate copies of our proxy statement or annual report in the future, or any stockholder who is receiving
multiple copies and would like to receive only one copy per household, should contact the stockholder’s bank, broker, or
other nominee record holder, or the stockholder may contact the Company at the above correspondence address and email address.
PROPOSALS FOR THE NEXT ANNUAL MEETING
For any proposal
to be considered for inclusion in our proxy statement and form of proxy for submission to the stockholders at our 2016 annual meeting,
it must be submitted in writing and comply with the requirements of Rule 14a-8 of the Securities Exchange Act of 1934. Such proposals
must be received by the Company at its offices at Unit C1, G/F., Koon Wah Building, No. 2 Yuen Shun Circuit, Yuen Chau Kok, Shatin,
New Territories, Hong Kong no later than March 15, 2016. Our board of directors will review any proposals from eligible stockholders
that it receives by that date and will make a determination whether any such proposals will be included in our proxy materials.
Any proposal received after March 15, 2016 shall be considered untimely and shall not be made a part of our proxy materials.
A stockholder
who wishes to make a proposal at the next annual meeting without including the proposal in our proxy statement must also notify
us within a reasonable time before we print and mail the proxy materials. If a stockholder fails to give reasonable advance notice,
then the persons named as proxies in the proxies solicited by us for the next annual meeting will have discretionary authority
to vote on the proposal.
INFORMATION INCORPORATED BY REFERENCE
We are permitted
to incorporate by reference information that we file with the Securities and Exchange Commission. Accordingly, we incorporate by
reference our Annual Report on Form 10-K for the fiscal year ended December 31, 2014, which was filed with the SEC on March 26,
2015, except to the extent information in that report is different from the information contained in this proxy statement. The
information incorporated by reference includes the description of our executive officers set forth in Part III, Item 10 “Directors,
Executive Officers and Corporate Governance” in our 2014 annual report on Form 10-K.
ANNUAL REPORT
COPIES OF OUR
ANNUAL REPORT ON FORM 10-K, INCLUDING ALL EXHIBITS, CAN BE OBTAINED WITHOUT CHARGE BY CONTACTING BY REQUEST TO INVESTOR RELATIONS
OF ENTERTAINMENT GAMING ASIA INC. AT 40 E. CHICAGO AVE. #186 CHICAGO, IL 60611-2026 OR TO THE EMAIL ADDRESS AT tracimangini@egt-group.com
or by phone at (872) 802-4227.
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BY ORDER OF THE BOARD OF DIRECTORS |
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Clarence Chung |
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Chairman of the Board |
September 21, 2015 |
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Hong Kong |
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[FRONT OF PROXY CARD]
YOUR VOTE IS IMPORTANT TO US.
PLEASE CAST YOUR VOTE TODAY.
PROXY
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS,
OCTOBER 29, 2015
SOLICITED BY THE BOARD OF DIRECTORS OF Entertainment
Gaming Asia INC.
The undersigned stockholder of
Entertainment Gaming Asia Inc. hereby acknowledges receipt of the notice of annual meeting of stockholders, proxy statement
and annual report in connection with our annual meeting of stockholders to be held on Thursday, October 29, 2015, at 10:00
a.m., local time, at Unit C1, Ground Floor, Koon Wah Building, No. 2 Yuen Shun Circuit, Yuen Chau Kok, Shatin, New
Territories, Hong Kong, and hereby appoints Clarence (Yuk Man) Chung and Traci Mangini, as proxies, with power of
substitution, to attend and to vote all shares the undersigned would be entitled to vote if personally present at said annual
meeting and at any adjournment thereof.
(The proxy is instructed to vote as specified
on the reverse)
VOTING BY TELEPHONE OR INTERNET
IS QUICK, EASY AND IMMEDIATE. As a stockholder of Entertainment Gaming Asia Inc., you have the option of voting your shares
electronically through the Internet or on the telephone, eliminating the need to return the proxy card. Your electronic vote authorizes
the named proxies to vote your shares in the same manner as if you marked, signed, dated and returned the proxy card. Votes submitted
electronically over the Internet or by telephone must be received by 7:00 p.m., Eastern time, on October 27, 2015.
TO VOTE YOUR PROXY BY INTERNET.
Please access the website, www.cstproxyvote.com, with your proxy card available. Please follow the prompts to
vote your shares.
TO VOTE YOUR PROXY BY TELEPHONE.
Using any touch-tone telephone, please call ____________ to vote your proxy. Please have your proxy card available when you call
and follow the voting instructions to vote your shares.
TO VOTE YOUR PROXY BY MAIL.
Please mark, sign and date your proxy card below, detach the proxy card and return the proxy card in the postage-paid envelope
provided.
PLEASE DO NOT RETURN THE PROXY CARD IF YOU
ARE VOTING
ELECTRONICALLY BY INTERNET OR TELEPHONE.
6
FOLD AND DETACH HERE AND READ THE REVERSE SIDE. 6
PROXY
THIS PROXY SHALL BE VOTED AS DIRECTED, OR IF NO DIRECTION
IS INDICATED, WILL BE VOTED “FOR” THE PROPOSALS. THIS PROPOSAL IS SOLICITED
ON BEHALF OF THE BOARD OF DIRECTORS. |
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Please
make your
votes like
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1. ELECTION
OF DIRECTORS (To withhold authority to vote for any
individual nominee, strike a line through that nominee’s name
in the list
below) |
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FOR
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WITHHOLD
AUTHORITY
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4. ADVISORY
NON-BINDING VOTE
ON THE COMPENSATION OF OUR
NAMED EXECUTIVE OFFICERS |
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FOR
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AGAINST
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ABSTAIN
o |
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(1) Clarence
Chung
(2) Vincent
L. DiVito
(3)
John W. Crawford
(4)
Samuel Tsang
(5)
Anthony Tyen
(6)
Dennis Tam
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5. VOTE
ON THE ADJOURNMENT OR POSTPONEMENT OF THE ANNUAL MEETING TO ANOTHER TIME AND DATE IF SUCH ACTION IS NECESSARY FOR THE BOARD
OF DIRECTORS TO SOLICIT ADDITIONAL PROXIES IN FAVOR OF PROPOSALS 1, 2, 3 OR 4. |
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AGAINST
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ABSTAIN
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2. VOTE
ON RATIFICATION OF INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM |
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FOR
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AGAINST
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ABSTAIN
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6. IN
THEIR DISCRETION, THE
PROXIES ARE AUTHORIZED TO
VOTE UPON SUCH OTHER
MATTERS AS MAY PROPERLY
COME BEFORE THE MEETING. |
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AGAINST
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ABSTAIN
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3. VOTE
ON THE PROPOSAL TO INCREASE AUTHORIZED SHARES
OF COMMON STOCK |
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FOR
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AGAINST
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ABSTAIN
o |
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COMPANY ID: |
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PROXY NUMBER: |
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ACCOUNT NUMBER: |
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Entertainment Gaming Asia Incorporated (NASDAQ:EGT)
Historical Stock Chart
From Apr 2024 to May 2024
Entertainment Gaming Asia Incorporated (NASDAQ:EGT)
Historical Stock Chart
From May 2023 to May 2024