Proxy Statement – Form DEF 14A
SECURITIES AND EXCHANGE COMMISSION
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN A PROXY STATEMENT
SCHEDULE 14A INFORMATION
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NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD
Dear Focus Universal Shareholders,
The 2024 Annual Meeting of Shareholders (the "Annual Meeting") of
| 1. | To elect five (5) members to the Board of Directors of the Company to serve until the 2025 Annual Meeting of Shareholders; |
| 2. | To ratify the selection of |
| 3. | To approve, subject to the Board of Directors' discretion to adopt, an amendment to our Articles of Incorporation to increase the number of authorized shares of our common stock, |
and such other business as may properly come before the meeting or any adjournment thereof.
The Board of Directors of the Company has fixed the close of business on
YOUR VOTE IS VERY IMPORTANT. YOU MAY VOTE BY MAIL, THROUGH THE INTERNET, BY TELEPHONE OR BY ATTENDING THE ANNUAL MEETING AND VOTING BY BALLOT, ALL AS DESCRIBED IN THE ACCOMPANYING PROXY STATEMENT.
The accompanying proxy statement provides a detailed description of the Proposals. We urge you to read the accompanying proxy statement, including the annex, carefully and in their entirety. If you have any questions concerning the Proposals or the accompanying proxy statement of which this notice forms a part, would like additional copies of the accompanying proxy statement, please contact Secretary,
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON
Whether or not you plan to attend the Annual Meeting, please sign, date and retuthe enclosed proxy card in the prepaid envelope provided, as soon as possible, so your shares can be voted at the meeting in accordance with your instructions. If you prefer, you may instead vote electronically through the internet or by telephone. The instructions on your proxy card describe how to use these convenient services. Your vote is important no matter how many shares you own. If you plan to attend the Annual Meeting and wish to vote your shares personally, you may do so at any time before your proxy is voted. The Company asks that shareholders planning to attend the Annual Meeting notify the Company at least 48 hours in advance of the meeting by calling (626) 272-3883. Your prompt cooperation is greatly appreciated.
All shareholders as of the Record Date are cordially invited to attend the Annual Meeting.
Admission to Annual Meeting
Attendance at the Annual Meeting is limited to shareholders of the Company as of the Record Date. For safety and security reasons, video and audio recording devices and other electronic devices will not be allowed in the meeting. If your shares are held in the name of your bank, brokerage firm or other nominee, you must bring to the Annual Meeting a copy of your proxy card, an account statement, or a letter from the nominee indicating that you beneficially owned the shares as of the Record Date for voting. If you do not have proof of share ownership, you will not be admitted to the Annual Meeting.
For registered shareholders, a copy of your proxy card can serve as verification of stock ownership. Shareholders who do not present a copy of their proxy card at the Annual Meeting will be admitted only upon verification of stock ownership, as indicated herein. If you do not have proof of share ownership, you will not be admitted to the Annual Meeting. In addition, all Annual Meeting attendees will be asked to present valid government-issued photo identification, such as a driver's license or passport, as proof of identification before entering the Annual Meeting, and attendees may be subject to security inspections.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Desheng Wang
Chief Executive Officer and Secretary
2024 ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD
PROXY STATEMENT
This proxy statement is furnished in connection with the solicitation by the Board of Directors (the "Board") of
Shares represented by a duly executed proxy in the accompanying form received by the Company prior to the Annual Meeting will be voted at the Annual Meeting in accordance with instructions given by the shareholder in the proxy. Any shareholder granting a proxy may revoke it at any time before it is exercised by granting a proxy bearing a later date, by giving notice in writing to the Secretary of the Company or by voting in person at the Annual Meeting.
At the Annual Meeting, the shareholders will be asked: (i) to elect five (5) members to the Board to serve until the 2025 Annual Meeting of Shareholders; (ii) to ratify the selection of
The persons acting under the accompanying proxy have been designated by the Board and, unless contrary instructions are given, will vote the shares represented by a properly executed proxy (i) for the election of the five (5) members to the Board named in Proposal One below;(ii) for the ratification of the appointment of
If a shareholder is not the record holder, such as where the shares are held through a broker, bank or other financial institution, the shareholder must provide voting instructions to the record holder of the shares in accordance with the record holder's requirements in order to ensure the shares are properly voted. Your broker will not be permitted to vote on your behalf unless you provide specific instructions by completing and returning the voting instruction form or following the instructions provided to you to vote your shares. For your vote to be counted, you now will need to communicate your voting decisions to your broker, bank or other financial institution before the date of the shareholders meeting.
The close of business on
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Abstentions, votes withheld and shares not voted, including broker non-votes, are not included in determining the number of votes cast for the election of the directors, for the ratification of
All shares entitled to vote and represented by proxies received prior to the Annual Meeting, and not revoked, will be voted at the Annual Meeting in accordance with the instructions provided. If you hold shares through an account with a broker, bank or other nominee, and you fail to provide voting instructions to your broker, bank or other nominee either using your voting instruction card or by telephone or over the Internet, in accordance with the instructions provided, then your shares will not be voted with respect to any of the proposals being considered at the Annual Meeting. Therefore, if you hold shares through a broker, bank or other nominee it is important that you provide your broker, bank or other nominee with your voting instructions.
Dissenters Rights
Under
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PROPOSAL ONE
ELECTION OF DIRECTORS
The nominees listed below have been selected by the Board, and all are currently members of the Board. If elected, each nominee will serve until the annual meeting of shareholders to be held in 2025 (or action by written consent of shareholders in lieu thereof), or until his or her successor has been duly elected and qualified.
Composition of Board of Directors
Our bylaws provide that the Board shall consist of not less than one (1) and not more than nine (9) directors. The Board currently consists of five (5) members. The Board has fixed the size of the Board to be elected in 2024 at five (5) members.
In the event that a nominee is unable or declines to serve as a director at the time of the Annual Meeting, the Board's
Nominees for Election as Directors
The following is certain information as of the Record Date regarding the nominees for election as directors.
| Position with the Company | Age | Director Since | |
| Dr. |
Chief Executive Officer, Secretary, and Director | 60 | |
| Dr. |
Director and Chairman | 60 | |
| Independent Director(1)(2)(3)(4) | 44 | ||
| Independent Director(1)(2)(3)(5) | 61 | ||
| Independent Director(1)(2)(3)(6) | 53 |
_____________
| (1) | Member of Audit Committee. |
| (2) | Member of Compensation Committee. |
| (3) | Member of |
| (4) | Chairperson of Audit Committee. |
| (5) | Chairperson of Compensation Committee. |
| (6) | Chairperson of |
The following provides certain information with respect to the diversity of our nominees and continuing directors.
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| Board of Directors Diversity Matrix | ||
| Total Director Nominees and Continuing Directors | 5 | |
| Female | Male | |
| Gender Identity | ||
| Directors | 1 | 4 |
| Demographic Background | ||
| - | - | |
| - | - | |
| Asian | - | 2 |
| Hispanic, Latinx or Spanish Origin | - | - |
| Native Hawaiian or Pacific Islander | - | - |
| White | 1 | 2 |
| Other | - | - |
| Two or More Races of Ethnicities | - | - |
| LGBTQ+ | - | |
| Did not Disclose Demographic Background | - |
Vote Required
If a quorum is present, the nominees receiving the highest number of votes will be elected to the Board. Abstentions and broker non-votes will have no effect on the election of directors.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE "FOR" THE ELECTION OF DR.
Biographical Information Regarding Directors and Nominees
Dr.
Dr.
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Other Executive Officers of the Company
The following is certain information as of the Record Date regarding the other executive officers of the Company not discussed above.
| Position with the Company | Age | Officer Since | |
| Chief Financial Officer | 49 |
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CORPORATE GOVERNANCE
Board of Directors
Our Board currently consists of five (5) members. Our Chairperson of the Board is Dr.
Director Attendance at Meetings
Our Board conducts its business through meetings, both in person and telephonic, and by actions taken by written consent in lieu of meetings. During the year ended
Our Board encourages all directors to attend our annual meetings of shareholders unless it is not reasonably practicable for a director to do so.
Committees of our Board of Directors
Our Board has established and delegated certain responsibilities to its standing Audit Committee, Compensation Committee and
Audit Committee
We have a separately designated standing Audit Committee established in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). The Audit Committee's primary duties and responsibilities include monitoring the integrity of our financial statements, monitoring the independence and performance of our external auditors, and monitoring our compliance with applicable legal and regulatory requirements. The functions of the Audit Committee also include reviewing periodically with our independent registered public accounting firm the performance of the services for which they are engaged, including reviewing the scope of the annual audit and its results, reviewing with management and the auditors the adequacy of our internal accounting controls, reviewing with management and the auditors the financial results prior to the filing of quarterly and annual reports, reviewing fees charged by our independent registered public accounting firm and reviewing any transactions between our Company and related parties. Our independent registered public accounting firm reports directly and is accountable solely to the Audit Committee. The Audit Committee has the sole authority to hire and fire the independent registered public accounting firm and is responsible for the oversight of the performance of their duties, including ensuring the independence of the independent registered public accounting firm. The Audit Committee also approves in advance the retention of, and all fees to be paid to, the independent registered public accounting firm. The rendering of any auditing services and all non-auditing services by the independent registered public accounting firm is subject to prior approval of the Audit Committee.
The Audit Committee operates under a written charter. The Audit Committee is required to be composed of directors who are independent under the rules of the
The current members of the Audit Committee are directors Mr.
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Compensation Committee
The primary duties and responsibilities of our standing Compensation Committee are to review, modify and approve the overall compensation policies for the Company, including the compensation of the Company's Chief Executive Officer and other senior management; establish and assess the adequacy of director compensation; and approve the adoption, amendment and termination of the Company's stock option plans, pension and profit-sharing plans, bonus plans and similar programs. The Compensation Committee may delegate to one or more officers the authority to make grants of options and restricted stock to eligible individuals other than officers and directors, subject to certain limitations. Additionally, the Compensation Committee has the authority to form subcommittees and to delegate authority to any such subcommittee. The Compensation Committee also has the authority, in its sole discretion, to select, retain and obtain, at the expense of the Company, advice and assistance from internal or external legal, accounting or other advisors and consultants. Moreover, the Compensation Committee has sole authority to retain and terminate any compensation consultant to assist in the evaluation of director, Chief Executive Officer or senior executive compensation, including sole authority to approve such consultant's reasonable fees and other retention terms, all at the Company's expense.
The Compensation Committee operates under a written charter. All members of the Compensation Committee must satisfy the independence requirements of NASDAQ applicable to compensation committee members.
The Compensation Committee currently consists of directors Ms.
Nominating and Corporate Governance Committee
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Communications with our Board of Directors
In order to provide the Company's security holders and other interested parties with a direct and open line of communication to the Board, the Board has adopted the following procedures for communications to directors. The Company's security holders and other interested persons may communicate with the Chairperson of the Company's Audit Committee or with the non-management directors of the Company as a group by mailing a letter addressed in care of the Corporate Secretary to
All communications received in accordance with these procedures will be reviewed initially by the Company's Secretary and/or other executive officers. The Company will relay all such communications to the appropriate director or directors unless the Secretary determines that the communication:
| · | does not relate to the business or affairs of the Company or the functioning or constitution of the Board or any of its committees; |
| · | relates to routine or insignificant matters that do not warrant the attention of the Board; |
| · | is an advertisement or other commercial solicitation or communication; |
| · | is frivolous or offensive; or |
| · | is otherwise not appropriate for delivery to directors. |
The director or directors who receive any such communication will have discretion to determine whether the subject matter of the communication should be brought to the attention of the full Board or one or more of its committees, and whether any response to the person sending the communication is appropriate. Any such response will be made only in accordance with applicable law and regulations relating to the disclosure of information.
The Secretary will retain copies of all communications received pursuant to these procedures for a period of at least one (1) year.
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Oversight of Risk Management
Risk is inherent with every business, and how well a business manages risk can ultimately determine its success. We face a number of risks, including economic risks, financial risks, legal and regulatory risks and others, such as the impact of competition. Management is responsible for the day-to-day management of the risks that we face, while our Board, as a whole and through its committees, has responsibility for the oversight of risk management. In its risk oversight role, our Board is responsible for satisfying itself that the risk management processes designed and implemented by management are adequate and functioning as designed. Our Board assesses major risks facing our Company and options for their mitigation in order to promote our shareholders' interests, the long-term health of our Company and our overall success and financial strength. A fundamental part of risk management is not only understanding the risks a company faces and what steps management is taking to manage those risks, but also understanding what level of risk is appropriate for us. The involvement of our full Board in the risk oversight process allows our Board to assess management's appetite for risk and also determine what constitutes an appropriate level of risk for our Company. Our Board regularly includes agenda items at its meetings relating to its risk oversight role and meets with various members of management on a range of topics, including corporate governance and regulatory obligations, operations and significant transactions, risk management, insurance, pending and threatened litigation and significant commercial disputes.
While our Board is ultimately responsible for risk oversight, various committees of our Board oversee risk management in their respective areas and regularly report on their activities to our entire Board. In particular, the Audit Committee has the primary responsibility for the oversight of financial risks facing our Company. The Audit Committee's charter provides that it will discuss our major financial risk exposures and the steps we have taken to monitor and control such exposures. Our Board has also delegated primary responsibility for the oversight of all executive compensation and our employee benefit programs to the Compensation Committee. The Compensation Committee strives to create incentives that encourage a level of risk-taking behavior consistent with our business strategy.
We believe the division of risk management responsibilities described above is an effective approach for addressing the risks facing our Company and that our Board's leadership structure provides appropriate checks and balances against undue risk taking.
Code of Business Conduct and Ethics
Our Board has adopted a code of ethical conduct that applies to our principal executive officer, principal financial officer and senior financial management. This code of ethical conduct is embodied within our Code of Business Conduct and Ethics, which applies to all persons associated with our Company, including our directors, officers and employees (including our principal executive officer, principal financial officer, principal accounting officer and controller). In order to satisfy our disclosure requirements under Item 5.05 of Form 8-K, we will disclose amendments to, or waivers of, certain provisions of our Code of Business Conduct and Ethics relating to our chief executive officer, chief financial officer, chief accounting officer, controller or persons performing similar functions on our corporate website, www.focusuniversal.com, promptly following the adoption of any such amendment or waiver. The Code of Business Conduct and Ethics provides that any waivers of, or changes to, the code that apply to the Company's executive officers or directors may be made only by the Audit Committee. In addition, the Code of Business Conduct and Ethics includes updated procedures for non-executive officer employees to seek waivers of the code.
Director Independence
Our Company is governed by our Board. Currently, each member of our Board, other than Dr.
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EXECUTIVE COMPENSATION
Compensation Discussion and Analysis
Compensation Program and Philosophy
The Compensation Committee administers the Company's executive compensation program. The Compensation Committee has the authority to review and determine the salaries and bonuses of the executive officers of the Company, including the Chief Executive Officer and the other named executive officers, and to establish the overall compensation policies for the Company. The Compensation Committee also has the authority to make discretionary option grants to all of the Company's employees under the Company's equity incentive plans.
The Compensation Committee operates under a written charter. The duties and responsibilities of a member of the Compensation Committee are in addition to his or her duties as a member of the Board. The charter reflects these various responsibilities, and the Compensation Committee is charged with periodically reviewing the charter. The Compensation Committee's membership is determined by the Board and is composed entirely of independent directors. In addition, the Compensation Committee has the authority to engage the services of outside advisors, experts and others, including independent compensation consultants who do not advise the Company, to assist the Compensation Committee. The Compensation Committee currently consists of directors Ms.
The Compensation Committee believes that the compensation programs for the Company's executive officers should reflect the Company's performance, support the short- and long-term strategic goals and values of the Company, reward individual contribution to the Company's success and align the interests of the Company's executive officers with the interests of the Company's shareholders. The Company is engaged in a very competitive industry, and the Company's success depends upon its ability to attract and retain qualified executives through the competitive compensation packages it offers to such individuals. To that end, it is the view of the Board that the total compensation program for executive officers should consist of all or most of the following components:
| · | base salary; | |
| · | bonus; and | |
| · | equity-based compensation. |
The Compensation Committee does not rely solely on predetermined formulas or a limited set of criteria when it evaluates the performance of the Company's Chief Executive Officer and the Company's other executive officers. Typically, our Chief Executive Officer makes compensation recommendations to the Committee with respect to the compensation of our officers, and the Committee may accept or adjust such recommendations in its discretion.
The total compensation packages for executive officers are determined initially by evaluating the responsibilities of the position, the experience of the individual and the competition in the marketplace for management talent, and also may include comparison with companies confronting problems of the magnitude and complexity faced by the Company.
Compensation of our executive officers is intended to be competitive with the overall marketplace, commensurate with the qualifications and experience of the named executive officer. The Company's compensation structure is intended to provide the necessary incentive to retain and motivate qualified personnel. Individuals are encouraged to add value and provide benefit in all aspects of the Company's operations currently and in the future.
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Total compensation packages and adjustments thereto are evaluated on a number of factors, both internal and external in nature. The most important factors are the executive's performance and contribution to the Company, followed by the performance of the Company, any increased responsibilities assumed by the executive and the competition in the marketplace for similarly experienced executives.
The compensation packages of the named executive officers are reviewed on an annual basis and may also be adjusted from time to time based on changes in responsibilities or as a result of other external and economic factors.
We offer health, dental and vision insurance to all of our employees, including the named executive officers.
Deductibility of Executive Compensation
Section 162(m) of the Internal Revenue Code disallows a tax deduction to publicly held companies for compensation paid to certain of their executive officers, to the extent that compensation exceeds
Compensation of Officers
The following summary compensation table sets forth information concerning compensation for services rendered in all capacities during fiscal years 2023 and 2022 awarded to, earned by or paid to our "named executive officers."
Summary Compensation Table
| (a) | (b) | (c) | (d) | (e) | (f) | (g) | (h) | (i) | (j) | |||||||||
| Salary | Bonus | Stock Awards | Option Awards | Non-Equity Incentive Plan Compensation | Change in Pension Value & Non-qualified Deferred Compensation Earnings | All Other Compensation |
Totals | |||||||||||
| Position | Year | ($)* | ($) | ($) | ($) | (S) | ($) | ($) | ($) | |||||||||
| 2023 | 122,308 | 0 | 0 | 0 | 21,000 | 0 | 0 | 143,308 | ||||||||||
| CEO, Secretary and Director | 2022 | 120,000 | 0 | 0 | 0 | 21,020 | 0 | 0 | 141,020 | |||||||||
| 2023 | 203,532 | 0 | 0 | 0 | 27,863 | 0 | 0 | 231,395 | ||||||||||
| Chief Financial Officer | 2022 | 150,000 | 0 | 0 | 0 | 10,000 | 0 | 0 | 160,000 |
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Narrative Disclosure Requirement for Summary Compensation Table
Compensation
Dr.
As of the date of this Proxy Statement, no other officer or director has formally entered into any compensation arrangement for services provided under consulting agreements or employment agreements. We offer health, dental and vision insurance to all of our employees, including the named executive officers.
Retirement, Resignation or Termination Plans
We sponsor no plan, whether written or verbal, that would provide compensation or benefits of any type to an executive upon retirement, or any plan that would provide payment for retirement, resignation, or termination as a result of a change in control of our Company or as a result of a change in the responsibilities of an executive following a change in control of our Company.
Directors' Compensation
The persons who served as affiliated members of our Board, including executive officers, did not receive any compensation for services as directors in 2022 or 2023. As of the date of this Proxy Statement, no director has formally entered into any compensation arrangement for services provided under consulting agreements or employment agreements.
As of the date of this Proxy Statement, all directors have been issued 22,500 options per person pursuant to our 2018 Stock Option Plan and such options will vest over a period of one year. In 2022, all of our current independent directors were paid
Option Exercises and Stock Vested
On
Pension Benefits and Nonqualified Deferred Compensation
The Company does not maintain any qualified retirement plans or non-nonqualified deferred compensation plans for its employees or directors.
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Executive Officer Outstanding Equity Awards at Fiscal Year-End
The following table provides certain information concerning any Common Stock purchase options, stock awards or equity incentive plan awards held by each of our named executive officers that were outstanding as of
| Option Awards | Stock Awards | ||||||||||||||||||
|
Number of Securities Underlying Unexercised Options (#) |
Number of Securities Underlying Unexercised Options (#) |
Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned |
Option Exercise Price |
Option Expiration |
Number of Shares or Units of Stock That Have Not Vested |
Market Value of Shares or Units of Stock That Have Not |
Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not |
Equity Incentive Plan Awards:Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not | |||||||||||
| Exercisable | Unexercisable | Options (#) | ($) | Date | (#) | Vested | Vested | Vested | |||||||||||
| 45,000 | - | - | $ | 3.80 | - | - | - | - | |||||||||||
| 22,500 | - | - | $ | 2.00 | - | - | - | - | |||||||||||
| 22,500 | - | - | $ | 5.91 | - | - | - | - | |||||||||||
| 22,500 | - | - | $ | 4.27 | - | - | - | - | |||||||||||
| 45,000 | - | - | $ | 3.80 | - | - | - | - | |||||||||||
| 22,500 | - | - | $ | 2.00 | - | - | - | - | |||||||||||
| 22,500 | - | - | $ | 5.91 | - | - | - | - | |||||||||||
| 22,500 | - | - | $ | 4.27 | - | - | - | - | |||||||||||
| - | - | - | - | 25,000 | - | - | - | ||||||||||||
| 45,000 | - | - | $ | 3.80 | - | - | - | - | |||||||||||
| 22,500 | - | - | $ | 2.00 | - | - | - | - | |||||||||||
| 22,500 | - | - | $ | 5.91 | - | - | - | - | |||||||||||
| 11,312 | - | - | $ | 4.27 | - | - | - | - | |||||||||||
| 9,375 | - | - | $ | 5.91 | - | - | - | - | |||||||||||
| 22,500 | - | - | $ | 4.27 | - | - | - | - | |||||||||||
| 45,000 | - | - | $ | 3.80 | - | - | - | - | |||||||||||
| 22,500 | - | - | $ | 2.00 | - | - | - | - | |||||||||||
| 22,500 | - | - | $ | 5.91 | - | - | - | - | |||||||||||
| 22,500 | - | - | $ | 4.27 | - | - | - | - | |||||||||||
| 9,375 | - | - | $ | 5.91 | - | - | - | - | |||||||||||
| 11,312 | - | - | $ | 4.27 | - | - | - | - | |||||||||||
| 22,500 | - | - | $ | 4.27 | - | - | - | - |
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED SHAREHOLDER MATTERS
The following table sets forth certain information regarding beneficial ownership of our Common Stock as of
| Amount and | ||||||
| Nature | Percentage of | |||||
| of Beneficial | Beneficial | |||||
| Ownership | Ownership | |||||
| Title of Class | (1) | % | ||||
| Common | 21,597,600 | 33.45% | ||||
| Common | 11,022,500 | 16.05% | ||||
| Common | 4,420,342 | 6.43% | ||||
| Common | 36,000 | * | ||||
| Common | 2,319 | * |
| (1) | Applicable percentage of ownership is based on 68,667,760 shares of Common Stock outstanding on |
| (2) | As of the date of this Proxy Statement, due to the purchase of PIPE shares on |
| (3) | As of the date of this Proxy Statement, due to the purchase of PIPE shares on |
Percentage ownership is determined based on shares owned together with securities exercisable or convertible into shares of Common Stock within 60 days of
As of
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act requires our executive officers, directors, and persons who own more than 10% of a registered class of our equity securities (collectively, the "Reporting Persons") to file reports of ownership and changes in ownership with the
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CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
Consulting services provided by the President, Chief Executive Officer, Secretary, Treasurer and Chief Financial Officer for the years ended
|
For the 2023 |
For the
|
|||||||
| President | $ | 0 | $ | 0 | ||||
| Chief Executive Officer, Secretary and Treasurer | 143,328 | 141,020 | ||||||
| Chief Financial Officer | 231,395 | 37,020 | ||||||
| $ | 374,723 | $ | 178,040 |
Related Party Transactions
Revenue generated from
Service revenue generated from the installation of home security equipment by
On
On
Director Independence
A director is not considered to be independent if he or she is also an executive officer or employee of the corporation. Our director Dr.
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REPORT OF THE COMPENSATION COMMITTEE
The information contained in this Report of the Compensation Committee shall not be deemed incorporated by reference in any filing under the Securities Act or the Exchange Act, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing (except to the extent that we specifically incorporate this information by reference) and shall not otherwise be deemed "soliciting material" or "filed" with the
The Compensation Committee is comprised of directors Ms.
The Compensation Committee has reviewed and discussed with management the Compensation Discussion and Analysis and based on such review and discussions recommended to the Board that the Compensation Discussion and Analysis be included in this Proxy Statement.
By the
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PROPOSAL TWO
RATIFICATION OF SELECTION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Upon approval of the
Based on the direction of the Audit Committee, the Board is proposing that the shareholders ratify the appointment of
Vote Required
If a quorum is present, the affirmative vote of a majority of the shares present and entitled to vote at the Annual Meeting will be required to ratify the appointment of
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE "FOR"
Principal Accountant Fees and Services
The following table summarizes the fees billed by Reliant CPA PC, our former independent registered public accounting firm, for the fiscal years ended
| Year ended 2023 |
Year ended 2022 |
|||||||
| Audit fees | $ | 92,000 | $ | 94,000 | ||||
| Audit - related fees | $ | Nil | $ | Nil | ||||
| Tax fees | $ | Nil | $ | Nil | ||||
| All other fees | $ | Nil | $ | Nil |
Audit fees consist of fees related to professional services rendered in connection with the audit of our annual financial statements and review of our quarterly financial statements. Tax fees represent fees related to preparation of our corporation income tax returns. Our policy is to pre-approve all audit and permissible non-audit services performed by the independent accountants. These services may include audit services, audit-related services, tax services and other services.
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REPORT OF THE AUDIT COMMITTEE
The information contained in this Report of the Audit Committee shall not be deemed incorporated by reference in any filing under the Securities Act or the Exchange Act, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing (except to the extent that we specifically incorporate this information by reference) and shall not otherwise be deemed "soliciting material" or "filed" with the
The Audit Committee is comprised of directors Mr.
The Audit Committee's primary duties and responsibilities include monitoring the integrity of the Company's financial statements, monitoring the independence and performance of the Company's external auditors, and monitoring the Company's compliance with applicable legal and regulatory requirements. The functions of the Audit Committee also include reviewing periodically with the Company's independent registered public accounting firm the performance of the services for which they are engaged, including reviewing the scope of the annual audit and its results, reviewing with management and the auditors the adequacy of the Company's internal accounting controls, reviewing with management and the auditors the financial results prior to the filing of quarterly and annual reports, reviewing fees charged by the Company's independent registered public accounting firm and reviewing any transactions between the Company and related parties. The Company's independent registered public accounting firm reports directly and is accountable solely to the Audit Committee. The Audit Committee has the sole authority to hire and fire the independent registered public accounting firm and is responsible for the oversight of the performance of their duties, including ensuring the independence of the independent registered public accounting firm. The Audit Committee also approves in advance the retention of, and all fees to be paid to, the independent registered public accounting firm. The rendering of any auditing services and all non-auditing services by the independent registered public accounting firm is subject to prior approval of the Audit Committee.
Management is responsible for the Company's internal controls and the financial reporting process. The Company's independent registered public accounting firm is responsible for performing an independent audit of the Company's consolidated financial statements in accordance with the standards of the
In carrying out these responsibilities, the Audit Committee monitored the Company's operational effectiveness regarding the progress and completion of the implementation of the Company's internal controls.
In overseeing the preparation of the Company's financial statements, the Audit Committee met with the Company's Chief Financial Officer and management, and held meetings with the Company's independent registered public accounting firm, both in the presence of management and privately, to review and discuss all financial statements prior to their issuance, the overall scope and plans for the preparation of the financial statements and respective audit, and the evaluation of the Company's internal controls and significant accounting issues. Management advised the Audit Committee that all financial statements were prepared in accordance with accounting principles generally accepted in
With respect to the Company's independent registered public accounting firm, the Audit Committee, among other things, discussed with
On the basis of these reviews and discussions, the Audit Committee (i) appointed
By the
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PROPOSAL THREE
APPROVAL OF AN AMENDMENT TO THE COMPANY'S ARTICLES OF INCORPORATION TO INCREASE THE NUMBER OF AUTHORIZED SHARES OF ITS COMMON STOCK,
Background
Our Articles of Incorporation currently authorize a total of 75,000,000 shares of the Company's Common Stock. After careful consideration, our Board recommends that our shareholders approve a proposal to amend, at the sole discretion of the Board, our Articles of Incorporation to authorize an additional 75,000,000 shares of Common Stock, which would result in total authorized shares under our Articles of Incorporation of 150,000,000 shares of Common Stock. The text of the proposed Certificate of Amendment to our Articles of Incorporation (the "Certificate of Amendment"), is attached as Appendix A to this Proxy Statement.
The Board has adopted a resolution (i) declaring the advisability of a possible amendment to our Articles of Incorporation to authorize an additional 75,000,000 shares of Common Stock, subject to shareholder approval, (ii) in connection therewith, approving a form of amendment to our Articles of Incorporation to authorize an additional 75,000,000 shares of Common Stock, subject to shareholder approval, and (iii) authorizing any other action the Board deems necessary to effect such amendment to our Articles of Incorporation, without further approval or authorization of the Company's shareholders.
The adoption of the Certificate of Amendment is expressly conditioned upon the approval of the Certificate of Amendment by our shareholders. Accordingly, if we do not receive the required shareholder approval for the Certificate of Amendment, we will not adopt the Certificate of Amendment. However, even if approved by the shareholders at the Annual Meeting, the Board will retain the discretion to determine whether to file the Certificate of Amendment with the Secretary of State of the
Text of the Proposed Amendment
Approval of this Proposal Three, if the Certificate of Amendment is subsequently adopted and filed by the Board in its sole discretion, will result in the following changes to the Articles of Incorporation:
Article Three of the Articles of Incorporation would be amended and restated in its entirety to read as follows:
"3. Authorized Stock: The total number of shares of Capital Stock of the Corporation shall be 150,000,000 shares of Common Stock, par value
Appendix A to this Proxy Statement shows the proposed changes to Article Three of the Articles of Incorporation resulting from the proposed amendment, with deletions indicated by strike-outs and additions indicated by underlining.
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Purpose of the Proposed Amendment
The purpose of the proposed amendment is to increase the number of Common Stock shares available (without delay or the necessity for a special shareholders' meeting) for issuance to investors who agree to provide the Company with the funding it requires to continue its operations, and/or to persons in connection with potential acquisition transactions, warrant or option exercises and other transactions under which our Board may determine are in the best interest of the Company and our stockholders. Our Board believes it is in the best interest of our Company to increase the number of authorized shares of Common Stock in order to give us greater flexibility in considering and planning for future corporate needs, including, but not limited to, future financing and recapitalization efforts as well as other general corporate transactions. The Board believes that additional authorized shares of Common Stock will enable us to take timely advantage of market conditions and favorable financing and acquisition opportunities that become available to us. We are considering issuing part of the additional shares of Common Stock that will result from the adoption of the proposed amendment to raise funds as may be required from time to time to pursue our business objectives, including research and development of our products; however, we do not have any definitive plans, arrangements, understandings or agreements to issue any of the proposed additional authorized shares of Common Stock that will become available for issuance if this proposal is approved and the Certificate of Amendment is subsequently adopted and filed by the Board.
Reasons for the Proposed Amendment
After careful consideration, our Board determined by written consent effective
The additional shares of Common Stock, if the Certificate of Amendment is subsequently adopted by the shareholders and filed by the Board, will be available for issuance by the
The Certificate of Amendment will ensure that we will continue to have an adequate number of authorized and unissued shares of Common Stock available for future use. As is the case with the shares of Common Stock which are currently authorized but unissued, if the Certificate of Amendment is adopted by the Company's shareholders and the Certificate of Amendment is subsequently adopted and filed by the Board, the Board will only have authority to issue the additional shares of Common Stock from time to time without further action on the part of shareholders to the extent not prohibited by applicable law or by the rules of any stock exchange or market on which our securities may then be listed or authorized for quotation.
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Effect of the Proposed Amendment
If the proposed Certificate of Amendment to authorize an additional 75,000,000 shares of Common Stock described above is approved and adopted by our shareholders and subsequently adopted and filed by the Board, we will have the authority under our Certificate of Incorporation to have up to 150,000,000 shares of Common Stock issued and outstanding. As of
The Board has not proposed the increase in the amount of authorized shares with the intention of discouraging tender offers or takeover attempts of the Company. However, the availability of additional authorized shares for issuance may have the effect of discouraging a merger, tender offer, proxy contest, or other attempt to obtain control of the Company.
If the shareholders approve the proposal and if the Certificate of Amendment is subsequently adopted and filed by the Board, the Certificate of Amendment will become effective upon the filing of the Certificate of Amendment as set out above and in Appendix A with the Secretary of State of the
Risks/Impacts of Non-approval
If the proposed Certificate of Amendment to authorize an additional 75,000,000 shares of Common Stock described above is not approved and adopted by our shareholders, our Certificate of Incorporation will not be amended as set forth above and we will continue to have the authority under our Certificate of Incorporation to have up to 75,000,000 shares of Common Stock issued and outstanding.
Interest of Certain Persons in Matter to be Acted Upon
No officer or director has any substantial interest, direct or indirect, by security holdings or otherwise, in the share increase proposed above that is not shared by all other shareholders.
Vote Required
The affirmative vote of a majority of the votes cast at the Annual Meeting is required to approve the proposed Certificate of Amendment to authorize, at the sole discretion of the Board, a total of 150,000,000 shares of Common Stock.
RECOMMENDATION OF THE BOARD OF DIRECTORS
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE "FOR" THE APPROVAL OF, SUBJECT TO THE BOARD OF DIRECTORS' DISCRETION TO ADOPT, AN AMENDMENT TO THE CERTIFICATE OF INCORPORATION TO INCREASE THE NUMBER OF AUTHORIZED SHARES OF COMMON STOCK TO 150,000,000 SHARES AS DESCRIBED UNDER PROPOSAL III AND SET FORTH IN APPENDIX A HERETO.
Unless otherwise instructed, the proxyholders will vote all properly submitted proxies "FOR" the approval of, subject to the Board's discretion to adopt, an amendment to the Certificate of Incorporation to increase the number of authorized shares of Common Stock to 150,000,000 shares.
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DELIVERY OF PROXY MATERIALS TO HOUSEHOLDS
Only one copy of the Company's Annual Report on Form 10-K for the fiscal year ended
If you are a shareholder who lives at a shared address and you would like additional copies of the Annual Report on Form 10-K, this Proxy Statement or any future annual reports or proxy statements, please contact
ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON
ADDITIONAL INFORMATION
The Company's Annual Report on Form 10-K for the year ended
The accompanying proxy is solicited by and on behalf of the Company's Board. The cost of such solicitation will be borne by the Company. In addition to solicitation by mail, regular employees of the Company may, if necessary to assure the presence of a quorum, solicit proxies in person, or by telephone, facsimile or other electronic means. Arrangements have been made with brokerage houses and other custodians, nominees and fiduciaries, for the forwarding of solicitation materials to the beneficial owners of Common Stock held of record by such persons, and the Company will reimburse such entities for reasonable out-of-pocket expenses incurred in connection therewith. The Company has engaged
If any matter not described in this Proxy Statement should properly come before the Annual Meeting, the persons named in the accompanying proxy will vote the shares represented by that proxy in accordance with their best judgment unless a shareholder, by striking out the appropriate provision of the proxy, chooses to withhold authority to vote on such matters. As of the date this Proxy Statement was printed, the directors knew of no other matters to be brought before the Annual Meeting.
Copies of Quarterly Reports on Form 10-Q, Annual Reports on Form 10-K and Proxy Statements can also be obtained directly from the Company free of charge by sending a request to the Company by mail as follows:
Attention: Investor Relations
In addition, the Company's public reports, including Quarterly Reports on Form 10-Q, Annual Reports on Form 10-K and Proxy Statements, can be obtained through the
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Desheng Wang
Chief Executive Officer, Secretary, and Director
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APPENDIX A
CERTIFICATE OF AMENDMENT TO THE ARTICLES OF INCORPORATION OF
| 1. | The name of the Corporation is |
| 2. | Article 3 of the Articles of Incorporation of the Corporation is hereby deleted in its entirety and replaced with the following: |
"3. The total number of stock authorized that may be issued by the Corporation is one hundred fifty million (150,000,000) shares of Common Stock with a par value of one tenth of
| 3. | The vote by which the stockholders holding shares in the Corporation entitling them to exercise at least a majority of the voting power, or such greater proportion of the voting power as may be required in the case of a vote by classes or series, or as may be required by the provisions of the Articles of Incorporation have voted in favor of the amendment is ___%. |
| 4. | Effective date of filing (optional): ______________ |
| 5. | Signature (required): |
/s/
Signature of Officer:
| 23 |
FOCUS UMVCRSAL INC Ell EASTLOCVSTCWRT Of,ffA ೦ O, CA 91761 Ƒ SCAN TO VIEW MATERIALS &VOTE [> VOTE BY INTERNET - www.proxyvote.com or scan the QR Barcode above Use the Internet to transmit your voting instructions and to, electronic del very TO VOTE,
Disclaimer
Preliminary Proxy Statement – Form PRE 14A
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