Item 5.02. | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
On November 4, 2023, Jeff Whiteside notified eXp World Holdings, Inc. (the “Company”) that he will be resigning as Chief Financial Officer and Chief Collaboration Officer of the Company, effective as of December 1, 2023 (the “Effective Date”). Mr. Whiteside is resigning in order to pursue other opportunities and not as a result of any disagreement with the Company on any matters.
The Board of Directors of the Company intends to conduct a search of potential internal and external candidates to replace Mr. Whiteside. Mr. Whiteside will remain Chief Financial Officer of the Company until the Effective Date. If Mr. Whiteside’s successor is not yet appointed as of the Effective Date, the Board of Directors of the Company has appointed Jian “Kent” Cheng, the Company’s Chief Accounting Officer, to assume the additional role of principal financial officer, effective as of the Effective Date, to serve until such time that Mr. Whiteside’s permanent successor is appointed.
Mr. Cheng’s biographical information is set forth in the section entitled, “Executive Officers – Business Experience of our Executive Officers – Kent Cheng” of the Company’s definitive proxy statement on Schedule 14A filed with the Securities and Exchange Commission on April 6, 2023, and such information is incorporated herein by reference.
There are no material compensatory arrangements between the Company and Mr. Cheng with respect to his role as interim principal financial officer. There are no arrangements or understandings between Mr. Cheng and any other person in connection with his appointment. There is no family relationship between Mr. Cheng and any director or executive officer of the Company, and Mr. Cheng is not a party to any transaction required to be disclosed pursuant to Item 404(a) of Regulation S-K.
Item 7.01 Regulation FD Disclosure.
On November 2, 2023, a putative class action complaint under the caption Batton et. al. v. Compass, Inc. et. al. (the “Class Action”) was filed in the United States District Court for the Northern District of Illinois, Eastern Division, naming certain unaffiliated real estate brokerages, including the Company, as defendants. The Class Action alleges that defendants participated in a system that resulted in sellers of residential property paying inflated buyer broker commissions in violation of federal antitrust law. The plaintiffs seek a permanent injunction under federal antitrust laws enjoining the defendants from requiring home sellers to pay buyer-agent commissions without negotiations or from otherwise restricting competition among brokers and an award of declaratory relief and damages or restitution under the laws of various states on behalf of certain home buyers in those states, as well as attorneys’ fees and costs of suit. Plaintiffs allege joint and several liability and seek treble or other multiple damages. The Company believes that additional antitrust litigation may be possible. The Company cannot provide any assurances that results of such litigation will not have a material adverse effect on its business, results of operations or financial condition.
The information in this Item 7.01 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing by the Company under the Exchange Act or the Securities Act of 1933, as amended, regardless of any general incorporation language in such filing, except as expressly set forth by specific reference in such filing.