On March 18, 2020, in connection with the 2020 Private Placement, the Company, HealthQuest, the EW Entities, and SEDCO entered into a registration rights agreement. The registration rights agreement provides, among other things, that certain holders of the Company’s capital stock have certain rights relating to the registration of shares of such capital stock.
Transactions with Our Chief Operating Officer
Søren Maor Sinay has been our Chief Operating Officer since the Merger and Venus Concept Ltd.’s Chief Operating Officer since September 2017. Mr. Sinay and our subsidiaries have entered into the following transactions:
Non-Interest Demand Loan to PT Neoasia Medical
On July 1, 2016, Mr. Sinay transferred 100% of his shares in Inphronics Limited to Venus Concept USA Inc., making it an indirect wholly owned subsidiary of Venus Concept Ltd. At such time, an unsecured non-interest-bearing working capital loan to PT Neoasia Medical, a subsidiary of Inphronics Limited, that was previously provided by Mr. Sinay was outstanding. As of December 31, 2020, the outstanding amount of the loan was Indonesian rupiah (“IDR”) 6.9 billion, which is equivalent to $495,000. In the fourth quarter of fiscal year 2020, Venus Concept Inc. disposed of its interest in Inphronics Limited and PT Neoasia Medical, thereby transferring the above-described loan to the third-party purchaser and extinguishing the debt with no further obligations on behalf of the Company. Mr. Sinay remains on the board of directors of Inphronics Limited and the commissioner of PT Neoasia Medical.
Declaration and Distribution of Dividends from Venus Concept Singapore Pte. Ltd.
On March 5, 2020, the Company’s board of directors approved declaration and distribution of dividends from Venus Concept Singapore Pte. Ltd. (“Venus Singapore”) in the amount of 400,000 Singapore dollars (“SDG”), which is equivalent to $289,000 USD. Mr. Sinay was an existing shareholder of Venus Singapore and therefore was entitled to receive a dividend distribution equal to forty-five percent (45%) of the total distribution, or $130,000.
On January 1, 2018, Venus Concept Ltd. entered into a distribution agreement with Technicalbiomed Co., Ltd (“TBC”) pursuant to which TBC distributes our products in Thailand. Mr. Sinay is a 30% shareholder of TBC. For the years ended December 31, 2021 and 2020, TBC purchased products in the amount of $537,000 and $278,000, respectively, under this distribution agreement.
In the fourth quarter of fiscal year 2020, the Company disposed of its interest in Venus Singapore. Effective January 1, 2021, the Company entered into a distribution agreement with Aexel Biomed Pte Ltd. (“Aexel Biomed”), formerly Venus Singapore, pursuant to which Aexel Biomed distributes our products in Singapore. Mr. Sinay is a 45% shareholder of Aexel Biomed and is currently an officer of that company. In the year ended December 31, 2021, Aexel Biomed purchased products in the amount of $239,000 under the distribution agreement.
Certain of Mr. Serafino’s family members receive compensation as employees or consultants of the Company, which compensation is not included in the following tables, as their employment is independent of Mr. Serafino’s position with the Company. Mr. Serafino’s spouse was employed by the Company until November 30, 2020 and became an independent contractor on December 1, 2020, providing services to the Company as needed. Mr. Serafino’s daughter was employed by the Company until July 15, 2021 and become an independent contractor on July 16, 2021. Neither she, nor Mr. Serafino’s spouse, were or are executive officers of the Company and each have aggregate annual compensation that does not exceed $120,000.
Mr. Serafino’s son-in-law, Luciano Lombardi, is employed by the Company as Area Sales Manager. His employment as a salaried employee, and not an executive officer, is independent of Mr. Serafino’s position with the Company. During 2021, Mr. Lombardi received base salary equal to approximately $77,250 CAD, commission and bonus equal to approximately $210,000 CAD and an auto allowance equal to approximately $7,000 CAD. Additionally, Mr. Lombardi participates in the Company’s Registered Retirement Savings Plan (Canada) program and in the Company’s employee benefits plan.
The equity holdings of these family members are reflected on the table included in the section titled “Security Ownership of Certain Beneficial Owners and Management” in this Proxy Statement.