SIEBERT FINANCIAL CORP — Proxy Solicitation & Information Statement 2012

Apr 24, 2012

DEF 14A 1 siebert_def14a.htm DEFINITIVE PROXY STATEMENT

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549

SCHEDULE 14A 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 ¨
Check the appropriate
box:
¨	Preliminary Proxy
Statement
¨	Confidential, For Use of the
Commission Only (as permitted by Rule 14a-6(e)(2))
x	Definitive Proxy
Statement
¨	Definitive Additional
Materials
¨	Soliciting Material Pursuant to §240.14a-12

| SIEBERT FINANCIAL CORP. |
| --- |
| (Name of Registrant as
Specified in its Charter) |
| (Name
of Person(s) Filing Proxy Statement, if Other Than the
Registrant) |

| Payment of Filing Fee (Check
the appropriate box): — x | No fee required. | |
| --- | --- | --- |
| ¨ | Fee computed on
table below per Exchange Act Rules 14a-6(i)(1) and
0-11. | |
| | 1. | Title of each class of
securities to which transaction applies: |
| | 2. | Aggregate number of
securities to which transaction applies: |
| | 3. | Per unit price or
other underlying value of transaction computed pursuant to Exchange Act
Rule 0-11 (Set forth the amount on which the filing fee is calculated and
state how it was determined): |
| | 4. | Proposed maximum
aggregate value of transaction: |
| | 5. | Total fee
paid: |
| ¨ | Fee paid previously
with preliminary materials. | |
| ¨ | Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its
filing. | |
| | 1. | Amount Previously
Paid: |
| | 2. | Form, Schedule or Registration
Statement No.: |
| | 3. | Filing Party: |
| | 4. | Date Filed: |

SIEBERT FINANCIAL CORP. 885 Third Avenue, Suite 1720 New York, New York 10022 (212) 644-2400

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON JUNE 11, 2012

Dear Shareholders:

Notice is hereby given of the Annual Meeting of Shareholders of Siebert Financial Corp., a New York corporation, at The Harmonie Club, 4 East 60th Street, New York, NY, on Monday, June 11, 2012 at 10:00 a.m., local time. The meeting’s purpose is to:

1. Elect six directors; and

2. Consider any other matters that are properly presented at the Annual Meeting and any adjournment thereof.

You may vote at the Annual Meeting if you were one of our shareholders of record at the close of business on Friday, April 20, 2012.

Along with the attached Proxy Statement, we are also enclosing a copy of our Annual Report to Shareholders, which includes our financial statements.

To assure your representation at the meeting, please vote by Internet or telephone or sign and mail the enclosed proxy as soon as possible. We have enclosed a return envelope, which requires no postage if mailed in the United States. Your proxy is being solicited by the Board of Directors. Shareholders who attend the meeting may revoke their proxy and vote their shares in person.

PLEASE VOTE—YOUR VOTE IS IMPORTANT

Secretary
New York, New
York
April 30, 2012

IMPORTANT NOTICE REGARDING INTERNET AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING: This Notice and Proxy Statement, our Proxy Card and our Annual Report also are available at www.proxyvote.com by entering the control number found on the enclosed Proxy Card

SIEBERT FINANCIAL CORP. 885 Third Avenue, Suite 1720 New York, New York 10022 (212) 644-2400

PROXY STATEMENT FOR THE 2012 ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON JUNE 11, 2012

INFORMATION ABOUT THE ANNUAL MEETING AND VOTING

| Annual Meeting: | June 11, 2012 10:00 a.m., local
time | |
| --- | --- | --- |
| Record Date: | Close of business on
Friday, April 20, 2012. If you were a shareholder at that time, you may
vote at the meeting. Each share is entitled to one vote. On the record
date, we had 22,101,535 shares of our common stock outstanding and
entitled to vote. Of those shares, 19,878,700 shares were beneficially
owned or controlled by Muriel F. Siebert, our Chairwoman, President and
Chief Executive Officer, and one of our directors. This proxy statement
and form of proxy were first mailed to shareholders on or about April 30,
2012. | |
| Quorum: | The holders of a majority of the outstanding
shares of our common stock, present in person or by proxy and entitled to
vote, will constitute a quorum at the meeting. Abstentions and broker
non-votes will be counted for purposes of determining the presence or
absence of a quorum. | |
| Agenda: | 1. 2. | Elect
six directors. Any
other proper business. However, we currently are not aware of any other
matters that will come before the meeting. |
| Vote Required: | The six nominees for
director who receive the most votes will be elected. If you withhold
authority to vote for any nominee on your proxy card, your vote will not
count either for or against the nominee. | |
| Broker Non-votes: | “Broker
non-votes” are shares held by brokers or nominees which are present in
person or represented by proxy, but which are not voted on a particular
matter because instructions have not been received from the beneficial
owner. Under the rules of the Financial Industry Regulatory Authority,
member brokers generally may not vote shares held by them in street name
for customers unless they are permitted to do so under the rules of any
national securities exchange of which they are a member. Under the rules
of the New York Stock Exchange, New York Stock Exchange-member brokers who
hold shares of our common stock in street name for their customers and
have transmitted our proxy solicitation materials to their customers, but
do not receive voting instructions from such customers, are not permitted
to vote on nonroutine
matters. | |

| Proxies: | Broker non-votes count for quorum purposes,
but we do not count broker non-votes as votes for or against any
nonroutine proposal. Under the New York Stock Exchange rules, the proposal
relating to the election of directors is deemed to be a nonroutine matter
with respect to which brokers and nominees may not exercise their voting
discretion without receiving instructions from the beneficial owner of the
shares. — Please vote; your vote is important. Prompt return of your
proxy will help avoid the costs of re-solicitation. Unless you tell us on
the proxy card to vote differently, we will vote signed returned proxies
“FOR” each of the Board of Directors’ nominees for
director. If any nominee cannot or
will not serve as a director, your proxy will vote in accordance with his
or her best judgment. At the time we began printing this proxy statement,
we did not know of any matters that needed to be acted upon at the meeting
other than those discussed in this proxy statement. However, if any
additional matters are presented to the shareholders for action at the
meeting, your proxy will vote in accordance with his or her best
judgment. | |
| --- | --- | --- |
| Proxies Solicited
By: | The Board of Directors. | |
| Revoking Your
Proxy: | You may revoke your proxy before it is voted
at the meeting. Proxies may be revoked if you: | |
| | 1. | deliver a signed, written revocation letter, dated later
than the proxy, to Daniel Iesu, Secretary, Siebert Financial Corp., 885
Third Avenue, Suite 1720, New York, New York 10022; |
| | 2. | deliver a signed proxy, dated later than the first proxy, to Mr.
Iesu at the address above; or |
| | 3. | attend the Annual Meeting and vote in person or by proxy. Attending
the meeting without doing more will not revoke your proxy. |
| Cost of
Solicitation: | We will
pay all costs of soliciting these proxies, estimated at $5,000.00 in the aggregate. Although we are mailing these
proxy materials, our directors, officers and employees may also solicit proxies by telephone, facsimile, mail or
personal contact. These persons will receive no compensation for their services, but we may reimburse them for
reasonable out-of-pocket expenses. We will also furnish copies of solicitation materials to fiduciaries, custodians,
nominees and brokerage houses for forwarding to beneficial owners of our shares of common stock held in their
names, and we will reimburse them for reasonable out-of-pocket expenses. Broadridge Financial Solutions, Inc. is
assisting us in the solicitation of proxies for the meeting for no additional fee. | |
| Your Comments: | Your comments about any aspects
of our business are welcome. Although we may not respond on an individual
basis, your comments help us to measure your satisfaction, and we may
benefit from your
suggestions. | |

2

PROPOSAL 1

ELECTION OF DIRECTORS

| Generally: | Our Board of
Directors nominated six directors for election at the annual meeting. All
the nominees for election as director are currently serving as our
directors. All the nominees have consented to be named and have indicated
their intent to serve if elected. If elected, each director will hold
office until the next annual meeting or until the director’s successor has
been duly elected. All our directors, other than Ms. Siebert, are
“independent directors” within the meaning of Rule 5605(a)(2) of The
Nasdaq Stock Market. | |
| --- | --- | --- |
| Nominees: | MURIEL F.
SIEBERT Age 79 | Muriel Siebert
has been Chairwoman, Chief Executive Officer, President and a director of
Muriel Siebert & Co., Inc. since 1969 and of Siebert Financial Corp.
(the “Company”) since November 8, 1996. She is a director of the New York
State Business Council, and the Greater New York Council of the Boy Scouts
of America. |
| | | Specific experience, qualifications,
attributes or skills: |
| | | On December 28, 1967, Ms. Siebert became the
first woman member of the New York Stock Exchange. Ms. Siebert served as
Superintendent of Banks of the State of New York from 1977 to 1982. In
March 2009, Ms. Siebert was inducted into the U.S. Business Hall of Fame.
Ms. Siebert previously served on the executive committee of the Economic
Club of New York, of which she is still a member, and formerly served on
the New York State Commission on Judicial Nomination, which is involved in
the selection of Associate Judges for the Court of Appeals. She is a
member of the Council on Foreign Relations, Committee of 200 (an
international organization of pre-eminent businesswomen), the
International Women’s Forum and the New York Women’s Forum of which she
was a founder and former president. Ms. Siebert provides expertise on
financial brokerage matters, and is a sought-after speaker on current
financial matters and a frequent commentator on the major financial news
networks. |

3

| PATRICIA L.
FRANCY Age 66 | Patricia Francy
retired as Special Advisor for Alumni Relations and Treasurer & Controller,
Columbia University, December 31, 2005. Ms. Francy is a director of Old
Westbury Funds, Inc., the Matheson Foundation, the Siebert Foundation and
the Respect for Law and Alliance. Ms. Francy became a director on March
11, 1997. Specific experience, qualifications, attributes or
skills: Patricia Francy served as Treasurer and
Controller of Columbia University from 1989 until 2003. Ms. Francy had
been affiliated with Columbia University since 1968, and has served as a
Director of Finance and Director of Budget Operations. Ms. Francy is
Governor of the Columbia University Club of New York, and a former
director for the Children’s Tumor Foundation and the Metropolitan New York
Library Council. She serves on the Outward Bound Advisory Board. Ms.
Francy participates as director emeritus of Junior Achievement Worldwide,
and is a member of the Economic Club of New York and the International
Women’s Forum. Ms. Francy provides expertise on financial
matters. |
| --- | --- |
| NANCY PETERSON HEARN Age
78 | Nancy Peterson Hearn is President and Chief Executive Officer of
Peterson Tool Company, Inc. since 1979 and is Chairman of the Board. Ms. Hearn became a director on June 4,
2001. Specific experience, qualifications, attributes or
skills: A nationally recognized business entrepreneur, Nancy
Peterson Hearn is chairman and chief executive officer of Peterson Tool Company, Inc. Under her leadership, the
company has made exponential gains in sales, production and reputation, and is ranked among the world’s premier
designers and manufacturers of custom insert tooling. Peterson Tool successfully received ISO 9001 certification, |

4

| | and has earned
numerous quality and certification awards including General Motors’
Targets for Excellence Award and Caterpillar’s coveted Certified Supplier
of Quality Materials awards. She was the first American to earn the prestigious
Veuve Clicquot Business Woman of the Year Award (1990). Ms. Hearn has a
distinguished leadership record that includes roles on some of the most
prestigious boards in the nation. She has served as Vice Chair of the
Foundation, Southeast Region Chair and Membership Chair for Committee of 200, an international organization of businesswomen, which has established the Nancy Sanders Peterson Scholars Award in her honor. She
chaired the C200 Auction from 2000 to 2008, and her efforts helped
raise several millions of dollars for the C200 Foundation. She has
also served on the boards of The Society of International Business
Fellows, the Aquinas College Board of Governors, the Mississippi
University for Women’s National Board of Distinguished Women, Nashville Symphony, Cheekwood Museum and Botanical Gardens and Nashville Ballet. Ms. Hearn has a longstanding record of
community activism that includes roles in Leadership Nashville, the Tennessee
Workforce Development Board, the Tennessee Council on Vocational
Education, and has been recognized by The National Federation of Parents
for Drug Free Youth. As a spokesperson for private industry, she champions
the advancement of sound economic policies and professional healthcare
standards. Ms. Hearn is the mother of six adult
children, two of whom are actively involved in Peterson Tool Company, Inc.
She is married to Billy Ray Hearn and lives in Nashville, Tennessee. |
| --- | --- |
| LEONARD M. LEIMAN Age
80 | Leonard Leiman is of counsel to the law firm
of Fulbright & Jaworski L.L.P., New York, New York. Fulbright &
Jaworski L.L.P. provides legal services to us. Mr. Leiman became a
director on May 2, 2002. |

5

| | Specific
experience, qualifications, attributes or skills: Prior to
becoming of counsel in 2002, Mr. Leiman was a partner in Fulbright & Jaworski
L.L.P. from 1963 to 2001 except for two years during which he was an
official of the Securities and Exchange Commission. During his practice,
Mr. Leiman has specialized in corporate and securities law, and has
represented large and small broker-dealers, investment advisers,
investment companies and investment bankers, as well as other business
organizations. He was a member of the Municipal Securities Rulemaking
Board, was a member of the Legal Affairs Committee of the New York Stock
Exchange, and has been a director of several New York Stock Exchange and
NASDAQ traded corporations. Mr. Leiman is a member of the Committee on
Federal Regulation of Securities of the American Bar Association and has
served as chair of the Committee on Securities Regulation of the New York
City Bar Association. Mr. Leiman provides experience with legal matters
and with private and publicly traded business
organizations. |
| --- | --- |
| JANE H. MACON Age
65 | Jane Macon has been a partner in the law
firm of Fulbright & Jaworski L.L.P., San Antonio, Texas since 1984.
Fulbright & Jaworski L.L.P. provides legal services to us. Ms. Macon
became a director on November 8, 1996. Specific experience, qualifications, attributes or
skills: Ms. Macon centers her legal practice on public finance and
administrative law, public and private partnerships, real estate, zoning,
platting, condemnation and municipal bonds. Prior to joining Fulbright
& Jaworski L.L.P. in 1983, Ms. Macon served as the first female city
attorney of the City of San Antonio where she served in that position from
1977 to 1983. |

6

| | Active in
professional organizations, Ms. Macon is a past president of the
International Women’s Forum, the Women Lawyers of Texas and the San
Antonio Young Lawyers Association. She presently serves as the program
chair of the San Antonio Bar Association. She has served as a member of
the Board of Directors for the following national boards: NOW Legal
Defense Fund, Child Care Action Campaign, Center for Democracy, National
Women’s Political Caucus, National Nurses League and National Civic League
(formerly National Municipal League). Ms. Macon is also a member of the
San Antonio and American Bar Associations and the State Bar of Texas. She
has received both awards as Outstanding Young Lawyer of Texas and the
Outstanding Young Lawyer of San Antonio and is listed in Who’s Who in
America. Ms. Macon was recently awarded the Prevent Blindness Texas Person
of Vision Award signed by Gov. Rick Perry and the Hope Award by the WOW
(Women’s Opportunity Week by the Greater San Antonio Chamber of Commerce).
Ms. Macon provides expertise on legal matters. |
| --- | --- |
| ROBERT P. MAZZARELLA Age
65 | Robert Mazzarella serves as a director and
as a member of the audit and compensation committees of Placemark
Investments, Inc., a registered investment adviser in Wellesley,
Massachusetts and Investors Capital Holdings Ltd., in Lynfield
Massachusetts. He likewise serves as a Board Member of NASDAQ OMX BX and
as the Chairman of the Boston Options Exchange Regulatory Board. Mr.
Mazzarella also acts as a consultant to a number of major financial
services firms and venture capital firms. Mr. Mazzarella became a director
on March 1, 2004. |

7

| Vote Required: | The six nominees for director who receive
the most votes will be elected. The enclosed proxy allows you to vote for
the election of all the nominees listed, to withhold authority to vote for
one or more of the nominees or to withhold authority to vote for all the
nominees. If you withhold authority to vote for any nominee on your proxy
card, your vote will not count either for or against the
nominee. The persons named in the enclosed proxy
intend to vote “FOR” the election of all the nominees. Each of the
nominees currently serves as a director and has consented to be nominated.
We do not foresee that any of the nominees will be unable or unwilling to
serve, but if such a situation should arise, your proxy will vote in
accordance with his or her best
judgment. |
| --- | --- |

THE BOARD OF DIRECTORS DEEMS THIS PROPOSAL TO BE IN THE BEST INTEREST OF SIEBERT FINANCIAL CORP. AND ITS SHAREHOLDERS AND RECOMMENDS THAT YOU VOTE “FOR” THE ELECTION OF EACH OF THE NOMINEES FOR DIRECTOR.

8

CORPORATE GOVERNANCE

| Board
Meetings: | The Board of
Directors held seven meetings during 2011. Each incumbent director
attended at least 75% of his or her Board of Directors meetings and all of
his or her committee meetings. |
| --- | --- |
| Controlled
Company: | We are
a “Controlled Company” as defined in Rule 5615(c)(1) of The Nasdaq Stock
Market because Muriel Siebert holds more than 50% of our voting power for
the election of directors. As a “Controlled Company” we are not required
to have a majority of our Board of Directors comprised of independent
directors, a compensation committee comprised solely of independent
directors or a nominating committee comprised solely of independent
directors. |
| Audit Committee of the Board of
Directors: | The Audit Committee of our Board of Directors currently
consists of Ms. Francy, Chairwoman, Ms. Hearn and Mr. Mazzarella. The
Board of Directors has determined that Ms. Francy, Ms. Hearn and Mr.
Mazzarella is each an “independent director” within the meaning of Rule
5605(a)(2) of The Nasdaq Stock Market and within the meaning of the
applicable rules and regulations of the Securities and Exchange
Commission. The Audit Committee held five meetings during 2011. The Board of Directors has determined that Mr. Mazzarella
qualifies as an “audit committee financial expert” under the applicable
rules of the Securities and Exchange Commission. The Audit Committee was established to (i) assist the
Board of Directors in its oversight responsibilities regarding the
integrity of our financial statements, our compliance with legal and
regulatory requirements and our auditor’s qualifications and independence,
(ii) prepare the report of the Audit Committee contained herein, (iii)
retain, consider the continued retention and terminate our independent
auditors, (iv) approve audit and non-audit services performed by our
independent auditors and (v) perform any other functions from time to time
delegated by the Board of Directors. The
Board of Directors has adopted a written charter for the Audit Committee, which is
available on the website of Muriel Siebert & Co., Inc. at
https://www.siebertnet.com/html/StartAboutAuditCommittee.aspx. |
| Compensation Committee of the
Board of Directors: | The Compensation Committee of our Board of Directors currently
consists of Ms. Macon, Chairwoman, Ms. Francy and Mr. Mazzarella. The
Compensation Committee reviews and determines all forms of compensation
provided to our executive officers and directors. The Compensation
Committee also administers our stock option and other employee benefit
plans. The Compensation Committee does not function pursuant to a formal
written charter and as a “Controlled Company” we are not required to
comply with The Nasdaq Stock Market’s independence requirements. The
Compensation Committee held one meeting during
2011. |

9

PART B

| The Compensation Committee evaluates the
performance of the Chief Executive Officer in terms of our operating
results and financial performance and determines her compensation in
connection therewith. For the 2011 fiscal year, our Chief Executive
Officer requested that her cash compensation be limited to $150,000. The
Compensation Committee determined that the cash compensation for the Chief
Executive Officer be $150,000 for the 2011 fiscal year. This amount was
unchanged from 2010. |
| --- |
| In accordance with general practice in the
securities industry, our executive compensation includes base salaries, an
annual cash bonus, and stock options and other equity incentives that are
intended to align the financial interests of our executives with the
returns to our shareholders. The Compensation Committee determines
compensation of our executive officers (other than the Chief Executive
Officer) after carefully reviewing self-evaluations completed by the
executive officers, each executive officer’s business responsibilities,
current compensation, the recommendation of our Chief Executive Officer
and our financial performance. We did not change the 2011 base salaries of
any of our executive officers from the levels in effect at the end of
2010. After evaluating our financial performance in 2011, our Compensation
Committee did not award our executive officers or any other employees of
the Company bonuses in 2011. In addition, we did not award any stock
options or other equity incentives to our executive officers in
2011. |
| As part of its oversight of the Company’s
executive compensation, the Compensation Committee considers the impact of
the Company’s executive compensation, and the incentives created by the
compensation awards that it administers, on the Company’s risk profile. In
addition, the Company reviews all of its compensation policies and
procedures, including the incentives that they create and factors that may
reduce the likelihood of excessive risk taking, to determine whether they
present a significant risk to the Company. The review found that there
were no excessive risks encouraged by the Company’s rewards programs and
the rewards programs do not produce payments that have a material impact
on the financial performance of the
Company. |

10

| Nominating
Committee of the Board of Directors: |
| --- |
| The purpose of the Nominating Committee is
to identify individuals qualified to become members of our Board of
Directors and to recommend to the Board of Directors or the shareholders
that such individuals be selected for directorship. In identifying and
evaluating nominees for director, the Nominating Committee considers each
candidate’s experience, integrity, background and skills as well as other
qualities that the candidate may possess and factors that the candidate
may be able to bring to the Board of Directors. We do not have a formal
policy with regard to the consideration of diversity in identifying
director nominees. However, the Board of Directors believes that it is
essential that its members represent diverse viewpoints, with a broad
array of experiences, professions, skills, geographic representation and
backgrounds that, when considered as a group, provide a sufficient mix of
perspectives to allow the Board of Directors to best fulfill its
responsibilities to the long-term interests of our
shareholders. |
| The Nominating Committee will consider
shareholder nominees for election to our Board of Directors. In evaluating
such nominees, the Nominating Committee will use the same selection
criteria the Nominating Committee uses to evaluate other potential
nominees. Any shareholder wishing to recommend a director candidate for
consideration by, the Nominating Committee must do so by sending written
notice to our Secretary, Daniel Iesu, at 885 Third Avenue, Suite 1720, New
York, New York 10022, no later than January 4, 2013. Such notice must
include the recommended candidate’s name,
experience,qualifications and biographical data, as well as information as to
whether such candidate would qualify as an “independent director” within
the meaning of Rule 5605(a)(2) of The Nasdaq Stock Market and the
applicable rules and regulations of the Securities and Exchange Commission
or as an “audit committee financial expert” under applicable rules and
regulations of the Securities and Exchange Commission. The submission must
be accompanied by a written consent by the nominee to stand for election
if nominated by the Board of Directors and to serve if elected by the
shareholders and a representation that the information with respect to
such nominee is truthful and
accurate. |

11

| Indemnification of Officers and Directors: | We indemnify our
executive officers and directors to the extent permitted by applicable law
against liabilities incurred as a result of their service to us and
against liabilities incurred as a result of their service as directors of
other corporations when serving at our request. We have a director’s and
officer’s liability insurance policy, underwritten by Illinois National
Insurance Company, a member of the American International Group, Inc., in
the annual aggregate amount of $10 million. As to reimbursements by the
insurer of our indemnification expenses, the policy has a $250,000
deductible; there is no deductible for covered liabilities of individual
directors and officers. |
| --- | --- |
| Annual
Shareholders Meeting Attendance Policy: | It is the policy of
our Board of Directors that all of our directors are strongly encouraged
to attend each annual shareholders meeting. All of our directors attended
the 2011 annual meeting of shareholders. |
| Code of
Ethics: | We have adopted a Code of Ethics for Senior
Financial Officers applicable to our chief executive officer, chief
financial officer, treasurer, controller, principal accounting officer,
and any of our other employees performing similar functions. A copy of the
Code of Ethics for Senior Financial Officers is available on our website
at
https://www.siebertnet.com/html/StartAboutGovernance.aspx. |
| Board Leadership Structure and Board
of Directors: | Ms. Muriel Siebert
serves as both our Chairwoman of the Board of Directors and Chief
Executive Officer and President. The Board of Directors does not have a
lead independent director. The Company believes this structure allows all
of the directors to participate in the full range of the Board’s
responsibilities with respect to its oversight of the Company’s
management. The Board of Directors has determined that this leadership
structure is appropriate given the size of the Company, the number of
directors overseeing the Company and the Board of Directors’ oversight
responsibilities. |
| | The Board of
Directors holds five to seven regular meetings each year to consider and
address matters involving the Company. The Board of Directors also may
hold special meetings to address matters arising between regular meetings.
These meetings may take place in person or by telephone. The independent
directors also regularly meet in executive sessions outside the presence
of management. The Board of Directors has access to legal counsel for
consultation concerning any issues that may occur during or between
regularly scheduled Board meetings. As discussed above, the Board has
established an Audit Committee, a Compensation Committee and a Nominating
Committee to assist the Board in performing its oversight
responsibilities. |

12

| The Board of
Directors’ Role in Risk Oversight: |
| --- |
| The Board of Directors’ role in
the Company’s risk oversight process includes regular reports from senior
management on areas of material risk to the Company, including
operational, financial, legal, regulatory, strategic and reputational
risks. The full Board of Directors (or the appropriate committee) receives
these reports from management to identify and discuss such
risks. |
| The Board of Directors
periodically reviews with management its strategies, techniques, policies
and procedures designed to manage these risks. Under the overall
supervision of the Board of Directors, management has implemented a
variety of processes, procedures and controls to address these
risks. |
| The Board of Directors requires
management to report to the full Board of Directors on a variety of
matters at regular meetings of the Board of Directors and on an as-needed
basis, including the performance and operations of the Company and other
matters relating to risk management. The Audit Committee also receives
regular reports from the Company’s independent registered public
accounting firm on internal control and financial reporting matters. These
reviews are conducted in conjunction with the Board of Directors’ risk
oversight function and enable the Board of Directors to review and assess
any material risks facing the
Company. |

13

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

Management Ownership: The following table lists share ownership of our common stock as of April 10, 2012. The information includes beneficial ownership by each of our directors, the persons named in the Summary Compensation Table, all directors and executive officers as a group and beneficial owners known by our management to hold at least 5% of our common stock. To our knowledge, each person named in the table has sole voting and investment power with respect to all shares of common stock shown as beneficially owned by such person. No persons or groups filed statements with the Securities and Exchange Commission during 2011 disclosing that they held more than 5% of our common stock.

| Name of Beneficial Owner (1) — Muriel F.
Siebert | 20,628,700 | (2) | Percent of Class — 89.9 % |
| --- | --- | --- | --- |
| Ameen Esmail | 25,000 | (3) | * |
| Joseph M. Ramos,
Jr. | 25,000 | (3) | * |
| Jeanne M. Rosendale | 25,000 | (3) | * |
| Timothy O’Leary | 0 | | * |
| Daniel Iesu | 0 | | * |
| Patricia L.
Francy | 61,000 | (4) | * |
| Nancy Peterson Hearn | 60,000 | (3) | * |
| Leonard M.
Leiman | 62,000 | (4) | * |
| Jane H. Macon | 61,000 | (4) | * |
| Robert P.
Mazzarella | 60,000 | (3) | * |
| Directors and current executive officers as
a group (11 persons) | 21,007,700 | (5) | 90.2 % |

---

*	Less than 1%
(1)	The address for each person named in the
table is c/o Siebert Financial Corp., 885 Third Avenue, Suite 1720, New
York, New York 10022.
(2)	Includes an option to purchase 750,000
shares of our common stock which is currently exercisable.
(3)	Represents options to purchase shares of our
common stock which are currently exercisable.
(4)	Includes options to purchase 60,000 shares
of our common stock which are currently exercisable.
(5)	Includes options to purchase an aggregate of
1,125,000 shares of our common stock described above which are currently
exercisable.

14

EXECUTIVE COMPENSATION

Summary Compensation Table

The following table shows, for the years ended December 31, 2011 and 2010, the annual compensation paid to or earned by (1) our Chief Executive Officer and (2) each of the five most highly compensated individuals who were serving as our executive officers at December 31, 2011 (collectively, the “Named Executive Officers”). (1)

							Non-qualified
						Non-Equity	Deferred
				Stock	Option	Incentive Plan	Compensation	All Other
Name and
principal		Salary	Bonus	Awards	Awards	Compensation	Earnings	Compensation	Total
position	Year	($)	($)	($)	($) (1)	($)	($)	($)	($)
Muriel F.
Siebert	2011	150,000	—	—	—	—	—	—	150,000
Chairwoman and President	2010	150,000	—	—	—	—	—	—	150,000
Joseph M. Ramos,
Jr. (2)	2011	285,000	—	—	—	—	—	—	285,000
Executive Vice President
and Chief Financial Officer	2010	285,000	—	—	—	—	—	—	285,000
Ameen Esmail	2011	185,000	—	—	—	—	—	—	185,000
Executive Vice President
and Director of Business
Development	2010	185,000	—	—	—	—	—	—	185,000
Jeanne M.
Rosendale	2011	300,000	—	—	—	—	—	—	300,000
Executive Vice President
and General Counsel	2010	300,000	—	—	—	—	—	—	300,000
Timothy O’Leary	2011	200,000	—	—	—	—	—	—	200,000
Executive Vice President	2010	200,000	—	—	—	—	—	—	200,000
Daniel Iesu	2011	120,000	—	—	—	—	—	—	120,000
Secretary	2010	120,000	—	—	—	—	—	—	120,000

---

| (1) | Represents the dollar
amount recognized for financial statement reporting in accordance with ASC
Topic 718. |
| --- | --- |
| (2) | Mr. Ramos also serves
as Chief Financial Officer of Siebert, Brandford, Shank & Co., L.L.C.
and is separately compensated by Siebert Brandford Shank for such
services. |

15

Grants of Plan-Based Awards

Our Compensation Committee did not approve grants of options to purchase our common stock or other equity awards under our 2007 Long-Term Incentive Plan to any of our Named Executive Officers in 2011.

Outstanding Equity Awards at December 31, 2011

The following table sets forth the outstanding equity award holdings of our Named Executive Officers at December 31, 2011.

						STOCK AWARDS
									Equity
								Equity	Incentive
								Incentive	Plan
								Plan	Awards:
			Equity					Awards:	Market
or
			Incentive					Number of	Payout
Value
			Plan
Awards:				Market	Unearned	of Unearned
	Number of	Number of	Number of			Number	Value of	Shares,	Shares,
	Securities	Securities	Securities			of Shares	Shares or	Units or	Units
or
	Underlying	Underlying	Underlying			or Units
of	Units of	Other	Other
	Unexercised	Unexercised	Unexercised	Option	Option	Stock That	Stock That	Rights That	Rights That
	Options (#)	Options (#)	Unearned	Exercise	Expiration	Have Not	Have Not	Have Not	Have
Not
Name	Exercisable	Unexercisable	Options (#)	Price
($)	Date	Vested (#)	Vested
($)	Vested (#)	Vested (#)
Muriel F.
Siebert	750,000	—	—	4.30	4/19/2012	—	—	—	—
Joseph M. Ramos, Jr.	25,000	—	—	2.75	8/17/2016	—	—	—	—
Ameen Esmail	25,000	—	—	5.06	7/3/2013	—	—	—	—
Jeanne M. Rosendale	25,000	—	—	4.75	5/4/2014	—	—	—	—
Timothy O’Leary	—	—	—	—	—	—	—	—	—
Daniel Iesu	—	—	—	—	—	—	—	—	—

---

16

Termination of Employment and Change-in-Control Arrangements

Employment Agreements. We are not a party to an employment agreement with any Named Executive Officer. All of our Named Executive Officers are employees at will.

Option Agreements. The Option Agreements we entered into with our Named Executive Officers provide that in the event of a Change in Control (as defined below) of our Company, the options shall immediately become fully exercisable. A Change in Control means the occurrence of (i) any consolidation or merger in which we are not the continuing or surviving entity or pursuant to which shares of our common stock are converted into cash, securities or other property, other than a consolidation or merger in which the holders of our common stock immediately prior to such consolidation or merger own not less than 50% of the total voting power of the surviving entity immediately after the consolidation or merger, (ii) any sale, lease, exchange or other transfer of all or substantially all of our assets, (iii) the approval by our shareholders of any plan or proposal for our complete liquidation or dissolution or (iv) any person or entity becoming the owner of 50% or more of our common stock. All options to purchase our common stock issued to Ms. Siebert, Mr. Esmail, Mr. Ramos, and Ms. Rosendale have vested and are fully exercisable.

Compensation of Directors

During 2011 our non-employee directors received cash compensation of $30,000 for service on our Board of Directors. We do not compensate our employees or employees of our subsidiaries for service as directors. The chairs of the Board of Directors’ Audit and Compensation Committees and the Audit Committee Financial Expert each receive an additional annual fee of $10,000. Directors’ fees are paid quarterly.

| Director
Compensation | | | | | | | |
| --- | --- | --- | --- | --- | --- | --- | --- |
| | Fees | | | Non-Equity | Nonqualified | | |
| | Earned | | | Incentive | Deferred | | |
| | or Paid | Stock | Option | Plan | Compensation | All Other | |
| | in | Awards | Awards | Compensation | Earnings | Compensation | Total |
| Name | Cash ($) | ($) | ($) | ($) | ($) | ($) | ($) |
| Muriel F.
Siebert (1) | — | — | — | — | — | — | — |
| Patricia L. Francy (2) | 40,000 | — | — | — | — | — | 40,000 |
| Nancy Peterson
Hearn | 30,000 | — | — | — | — | — | 30,000 |
| Leonard M. Leiman | 30,000 | — | — | — | — | — | 30,000 |
| Jane H.
Macon (3) | 40,000 | — | — | — | — | — | 40,000 |
| Robert P. Mazzarella (4) | 40,000 | — | — | — | — | — | 40,000 |

---

| (1) | Ms. Siebert is the Chairwoman,
President and Chief Executive Officer and accordingly does not receive any
compensation for her services as a director. |
| --- | --- |
| (2) | Ms. Francy is the Chairwoman of
the Audit Committee. |
| (3) | Ms. Macon is the Chairwoman of
the Compensation Committee. |
| (4) | Mr. Mazzarella is the Audit
Committee Financial Expert. |

17

| Audit Committee Report
to Shareholders: | The Audit Committee has reviewed
and discussed with management the audited financial statements for the
fiscal year ended December 31, 2011. The Audit Committee has also
discussed with our independent registered public accounting firm the
matters required to be discussed by Statement on Auditing Standards No.
61, “Communications with Audit Committees,” as amended, including our
critical accounting policies and our interests, if any, in “off balance
sheet” entities. Additionally, the Audit Committee has received the
written disclosures and representations from the independent registered
public accounting firm required by Independence Standards Board Standard
No. 1, “Independence Discussions with Audit Committees,” and has discussed
with the independent registered public accounting firm the independent
registered public accounting firm’s independence. Based on the review and
discussions referred to within this report, the Audit Committee
recommended to the Board of Directors that the audited financial
statements for the fiscal year ended December 31, 2011 be included in
Siebert Financial Corp.’s Annual Report on Form 10-K for filing with the
Securities and Exchange Commission. |
| --- | --- |
| | Audit Committee, Patricia L. Francy, Chairwoman Nancy Peterson
Hearn Robert P. Mazzarella |
| Section 16(a) Beneficial
Ownership Reporting Compliance: | Section 16(a) of the Exchange Act
requires our executive officers and directors and persons who beneficially
own more than 10% of our common stock to file initial reports of ownership
and reports of changes in ownership with the Securities and Exchange
Commission. These executive officers,
directors and shareholders are required by the Securities and Exchange
Commission to furnish us with copies of all forms they file pursuant to
Section 16(a). No forms were filed under Section
16(a) or were furnished to us during fiscal 2011. Based solely upon this
review, we believe that during fiscal 2011 all Section 16(a) filing
requirements applicable to our executive officers, directors and greater
than 10% beneficial owners were complied with on a timely
basis. |
| Householding: | If you share an address with
another shareholder, only one copy of our Annual Report and proxy
statement is being delivered unless we have received contrary instructions
from you. We will promptly deliver a separate copy of either document to,
any shareholder upon written or oral request to our Secretary, Daniel
Iesu, at Siebert Financial Corp., 885 Third Avenue, Suite 1720, New York,
New York 10022, telephone (212) 644-2400. If you share an address with
another shareholder and (i) would like to receive multiple copies of the
proxy statement or Annual Report to Shareholders in the future, or (ii) if
you are receiving multiple copies and would like to receive only one copy
per household in the future, please contact your bank, broker, or other
nominee record holder, or you may contact us at the above address and
phone number. |

18

RELATIONSHIP WITH INDEPENDENT AUDITORS

EisnerAmper LLP currently serves as our independent registered public accounting firm. A representative of EisnerAmper LLP will be present at the Annual Meeting and will have an opportunity to make a statement if he or she desires to do so, and will respond to appropriate questions from shareholders.

Audit Fees

Audit Fees. The aggregate fees billed by EisnerAmper LLP for professional services rendered for the audit of our annual financial statements and reviews of our quarterly financial statements were $192,000 for the years ended December 31, 2011 and December 31, 2010, respectively.

Audit-Related Fees. EisnerAmper LLP did not perform any audit-related services during the years ended December 31, 2011 and December 31, 2010.

Tax Fees. The aggregate fees billed by EisnerAmper LLP during the years ended December 31, 2011 and December 31, 2010 for tax compliance services totaled $96,000 and $68,000, respectively.

All Other Fees. The aggregate fees billed by EisnerAmper LLP during the years ended December 31, 2011 and December 31, 2010 for other products and services totaled $21,000 for each year, respectively. Other fees during the years ended December 31, 2011 and December 31, 2010 related to the audit of our 401(k) Plan.

Our Audit Committee has determined that the services described above that were rendered by EisnerAmper LLP are compatible with the maintenance of EisnerAmper LLP’s independence from our management.

Pre-Approval Policy

The Audit Committee pre-approves all audit and non-audit services provided by our independent auditors prior to the engagement of the independent auditors with respect to such services. With respect to audit services and permissible non-audit services not previously approved, the Audit Committee has authorized the Chairwoman of the Audit Committee to approve such audit services and permissible non-audit services, provided the Chairwoman informs the Audit Committee of such approval at the next regularly scheduled meeting. All “Audit Fees”, “Tax Fees” and “All Other Fees” set forth above were pre-approved by the Audit Committee in accordance with its pre-approval policy.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Review and Approval of Related Party Transactions

As set forth in our Amended and Restated Audit Committee Charter, the Audit Committee is responsible for reviewing and approving all related party transactions.

Our Code of Ethics for Senior Financial Officers, applicable to our chief executive officer, chief financial officer, controller, treasurer, principal accounting officer and other employees performing similar functions, provides that our Senior Financial Officers should endeavor to avoid any actual or potential conflict of interest between their personal and professional relationships and requires them to promptly report and disclose all material facts relating to any such relationships or financial interests which give rise, directly or indirectly, to an actual or potential conflict of interest to the Audit Committee. The Code of Ethics also provides that no Senior Financial Officer should knowingly

19

become involved in any actual or potential conflict of interest without the relationship or financial interest having been approved by the Audit Committee. Our Code of Ethics does not specify the standards that the Audit Committee would apply to a request for a waiver of this policy.

SHAREHOLDER PROPOSALS FOR THE 2013 ANNUAL MEETING AND COMMUNICATIONS

If you wish to submit proposals to be presented at the 2013 Annual Meeting of Shareholders, the proposals must be received by us no later than January 4, 2013 to be included in our proxy materials for that meeting.

The Board of Directors maintains a process for shareholders to communicate with the Board of Directors or individual directors as follows. Shareholders who wish to communicate with the Board of Directors or an individual director should direct written correspondence to our Secretary, Daniel Iesu, at our principal office at 885 Third Avenue, Suite 1720, New York, New York 10022. Any such communication must contain (i) a representation that the shareholder is a holder of record of our common stock, (ii) the name and address, as they appear on our books, of the shareholder sending such communication and (iii) the number of shares of our common stock that are beneficially owned by such shareholder. The Secretary will forward such communications to the Board of Directors or a specified individual director to whom the communication is directed unless such communication is unduly hostile, threatening, illegal or similarly inappropriate, in which case the Secretary has the authority to discard the communication or take appropriate legal action regarding such communication.

OTHER MATTERS

The Board does not know of any other matters to be presented at the meeting. If any additional matters are properly presented to the shareholders for action at the meeting, the persons named in the enclosed proxies and acting thereunder will have discretion to vote on these matters in accordance with their best judgment.

YOU MAY OBTAIN A COPY OF OUR ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED DECEMBER 31, 2011 FILED WITH THE SECURITIES AND EXCHANGE COMMISSION WITHOUT CHARGE BY WRITING TO: DANIEL IESU, SECRETARY, SIEBERT FINANCIAL CORP., 885 THIRD AVENUE, SUITE 1720, NEW YORK, NEW YORK 10022 OR CALLING 800-872-0711.

Dated: April 30,
2012

PLEASE VOTE BY INTERNET OR TELEPHONE OR COMPLETE, DATE AND SIGN THE ENCLOSED PROXY AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE.

PLEASE VOTE—YOUR VOTE IS IMPORTANT

20

Proxy

| SIEBERT FINANCIAL CORP. C/O AMERICAN STOCK
TRANSFER 6201 15th AVENUE BROOKLYN, NY 11219 |
| --- |
| Use the Internet to transmit your
voting instructions and for electronic delivery of information up until
11:59 P.M. Eastern Time the day before the meeting date. Have your proxy
card in hand when you access the web site and follow the instructions to
obtain your records and to create an electronic voting instruction
form. |
| VOTE BY PHONE -
1-800-690-6903 |
| Use any touch-tone telephone to
transmit your voting instructions up until 11:59 P.M. Eastern Time the day
before the meeting date. Have your proxy card in hand when you call and
then follow the instructions. |
| VOTE BY
MAIL |
| Mark, sign and date your proxy card
and return it in the postage-paid envelope we have provided or return it
to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY
11717. |

| TO VOTE, MARK BLOCKS BELOW IN BLUE
OR BLACK INK AS FOLLOWS: |
| --- |
| KEEP THIS PORTION FOR
YOUR RECORDS |
| DETACH AND RETURN THIS
PORTION ONLY |
| THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED. |

| | | | Withhold All | For
All Except | |
| --- | --- | --- | --- | --- | --- |
| | The Board of Directors
recommends you vote FOR the following Item (1): | | | | |
| | | o | o | o | |
| | 1. | Election of Directors Nominees | | | |
| | 01 Muriel F.
Siebert
02 Patricia L.
Francy
03 Nancy Peterson
Hearn
04 Leonard
Leiman
05 Jane Macon | | | | |
| | 06 Robert P. Mazzarella | | | | |
| | NOTE: Discretionary authority is
hereby granted with respect to any other business which may properly come
before the meeting or any adjournments thereof. | | | | |
| | UNLESS OTHERWISE
SPECIFIED IN THE SPACES PROVIDED, THE UNDERSIGNED'S VOTE WILL BE CAST FOR
ALL NOMINEES LISTED IN ITEM (1). | | | | |
| ● | For address change/comments, mark here. | | | o | |
| | (see reverse for
instructions) | Yes | No | | |
| | Please indicate if you plan to
attend this meeting | o | o | | |
| | Please sign exactly as your name(s)
appear(s) hereon. When signing as attorney, executor, administrator, or
other fiduciary, please give full title as such. Joint owners should each
sign personally. All holders must sign. If a corporation or partnership,
please sign in full corporate or partnership name, by authorized
officer. | | | | |
| | Signature [PLEASE SIGN
WITHIN BOX] | Date | | Signature (Joint
Owners) | Date |

Please date, sign and mail your proxy card in the envelope provided as soon as possible.

ANNUAL MEETING OF SHAREHOLDERS OF SIEBERT FINANCIAL CORP.

June 11, 2012 The meeting will be held at 10:00 A.M., eastern daylight time, at The Harmonie Club, 4 East 60th Street, New York, NY.

Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting: The Proxy Statement, and Annual Report is/are available at www.proxyvote.com .

SIEBERT FINANCIAL CORP. PROXY FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD JUNE 11, 2012

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

The undersigned hereby appoints Daniel Iesu and Patricia L. Francy, and each of them, the proxies of the undersigned, with power of substitution to each of them to vote all shares of Siebert Financial Corp. which the undersigned is entitled to vote at the Annual Meeting of Shareholders of Siebert Financial Corp. to be held Monday, June 11, 2012, at 10:00 A.M., eastern daylight time, and at any adjournments thereof. Please call 212-355-7400 to obtain directions to the Annual Meeting to vote in person. Any and all proxies heretofore given are hereby revoked.

UNLESS OTHERWISE SPECIFIED IN THE SPACES PROVIDED, THE UNDERSIGNED’S VOTE WILL BE CAST FOR ALL NOMINEES LISTED IN ITEM (1).

Address change/comments:

(If you noted any Address Changes and/or Comments above, please mark corresponding box on the reverse side.)

Continued and to be signed on reverse side