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14A INFORMATION
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Cleantech
Solutions International, Inc.
(Name
of Registrant as Specified In Its Charter)
N.A.
(Name
of Person(s) Filing Proxy Statement if other than the Registrant)
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CLEANTECH
SOLUTIONS INTERNATIONAL, INC.
No.
9 Yanyu Middle Road
Qianzhou
Village, Huishan District, Wuxi City
Jiangsu
Province, People’s Republic of China
NOTICE
OF ANNUAL MEETING OF STOCKHOLDERS
December
14, 2017
NOTICE
IS HEREBY GIVEN that the 2017 annual meeting of stockholders of Cleantech Solutions International, Inc., a Nevada corporation
(the “Company”), will be held at Loeb & Loeb LLP, 21st Floor, CCB Tower, 3 Connaught Road Central, Hong Kong,
on Thursday, December 14, 2017, at 2:00 P.M. local time. At the meeting, you will be asked to vote on:
(1)
The election of five (5) directors to serve until the next annual meeting of stockholders and until their successors are elected
and qualified;
(2)
To amend the Company’s Articles of Incorporation to change of the name of the Company to Sharing Economy International Inc.;
(3)
To amend the Company’s 2016 Long-Term Incentive Plan (the “Plan”) to increase the number of shares of common
stock, par value $0.001 per share (the “Shares”) authorized for issuance under the Plan to 390,000 Shares;
(4)
To amend the Company’s Articles of Incorporation to increase the number of Shares which the Company is authorized to issue
to 250,000,000 Shares; and
(5)
The transaction of such other and further business as may properly come before the meeting.
The
Board of Directors has fixed the close of business on November 1, 2017 as the record date for the determination of stockholders
entitled to notice of and to vote at the annual meeting. A list of stockholders of record on the record date will be available
for inspection by stockholders at the office of the Corporation, No. 9 Yanyu Middle Road, Qianzhou Village, Huishan District,
Wuxi City, Jiangsu Province, People’s Republic of China 214181, during the ten (10) days prior to the meeting.
The
enclosed proxy statement contains information pertaining to the matters to be voted on at the annual meeting.
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By
order of the Board of Directors,
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Jianhua Wu
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Chief Executive Officer
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Wuxi,
China
November
13, 2017
THIS
MEETING IS VERY IMPORTANT TO US AND TO OUR STOCKHOLDERS. WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, YOU ARE URGED TO
COMPLETE, SIGN, DATE AND RETURN THE ENCLOSED PROXY CARD IN THE ACCOMPANYING PRE-ADDRESSED POSTAGE-PAID ENVELOPE AS DESCRIBED ON
THE ENCLOSED PROXY CARD. YOUR PROXY, GIVEN THROUGH THE RETURN OF THE ENCLOSED PROXY CARD, MAY BE REVOKED PRIOR TO ITS EXERCISE
BY FILING WITH OUR CORPORATE SECRETARY PRIOR TO THE MEETING A WRITTEN NOTICE OF REVOCATION OR A DULY EXECUTED PROXY BEARING A
LATER DATE, OR BY ATTENDING THE MEETING AND VOTING IN PERSON.
CLEANTECH
SOLUTIONS INTERNATIONAL, INC.
No.
9 Yanyu Middle Road
Qianzhou
Village, Huishan District, Wuxi City
Jiangsu
Province, People’s Republic of China 214181
PROXY
STATEMENT
Annual
Meeting of Stockholders
December
14, 2017
The
accompanying proxy and this proxy statement have been prepared by our management for the Board of Directors. Your proxy is being
solicited by the Board of Directors for use at the 2017 annual meeting of stockholders to be held at Loeb & Loeb LLP, 21st
Floor, CCB Tower, 3 Connaught Road Central, Hong Kong, on Thursday, December 14, 2017 at 2:00 P.M., local time, or at any adjournment
thereof. This proxy statement contains information about the matters to be considered at the meeting or any adjournments or postponements
of the meeting and is first being mailed to stockholders, on or about November 15, 2017. In this proxy statement, we refer to
Cleantech Solutions International, Inc. as “the Company,” “we,” “us,” our” and word
of similar import.
ABOUT
THE MEETING
What
is being considered at the meeting?
You
will be voting for:
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The
election of five (5 ) directors to serve until the next annual meeting of stockholders and until their successors are elected
and qualified;
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To
amend the Company’s Articles of Incorporation to change of the name of the Company to Sharing Economy International
Inc.;
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To
amend the Company’s 2016 Long-Term Incentive Plan (the “Plan”) to increase the number of shares of common
stock, par value $0.001 per share (the “Shares”) authorized for issuance under the Plan to 390,000 Shares;
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To
amend the Company’s Articles of Incorporation to increase the number of Shares which the Company is authorized to issue
to 250,000,000 Shares; and
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The
transaction of such other and further business as may properly come before the meeting.
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Who
is soliciting your proxy?
Your
proxy is being solicited by our Board of Directors.
Who
is entitled to vote at the meeting?
You
may vote if you owned Shares as of the close of business on November 1, 2017, which is the record date for determining who is
eligible to vote at the annual meeting. Each Share is entitled to one (1) vote.
What
is the difference between holding shares as a stockholder of record and as a beneficial owner?
Most
of our stockholders hold their Shares in an account at a brokerage firm, bank or other nominee holder, rather than holding share
certificates in their own name. As summarized below, there are some distinctions between Shares held of record and those owned
beneficially.
Stockholder
of Record
If,
on the record date, your Shares were registered directly in your name with our transfer agent, Empire Stock Transfer, Inc., you
are a “stockholder of record” who may vote at the annual meeting, and we are sending these proxy materials directly
to you. As the stockholder of record, you have the right to direct the voting of your Shares by returning the enclosed proxy card
to us or to vote in person at the annual meeting. Whether or not you plan to attend the annual meeting, please complete, date
and sign the enclosed proxy card to ensure that your vote is counted.
Beneficial
Owner
If,
on the record date, your Shares were held in an account at a brokerage firm or at a bank or other nominee holder, you are considered
the beneficial owner of shares held “in street name,” and these proxy materials are being forwarded to you by your
broker or nominee who is considered the stockholder of record for purposes of voting at the annual meeting. As the beneficial
owner, you have the right to direct your broker on how to vote your Shares and to attend the annual meeting. However, since you
are not the stockholder of record, you may not vote these Shares in person at the annual meeting unless you receive a valid proxy
from your brokerage firm, bank or other nominee holder. To obtain a valid proxy, you must make a special request of your brokerage
firm, bank or other nominee holder. If you do not make this request, you can still vote by using the voting instruction card enclosed
with this proxy statement; however, you will not be able to vote in person at the annual meeting.
How
do I vote?
(1)
You may vote by mail.
You may vote by mail by completing, signing and dating your proxy card and returning it in the enclosed,
postage-paid and addressed envelope. If we receive your proxy card prior to the annual meeting and if you mark your voting instructions
on the proxy card, your Shares will be voted:
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according
to the best judgment of the proxies if a proposal comes up for a vote at the annual meeting that is not on the proxy card.
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If
you return a signed card, but do not provide voting instructions, your Shares will be voted:
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for
the election of Messrs. Jianhua Wu, Ping Kee Lau, Cho Fu Li and Xue Leng, and Ms. Ying Ying Wong, who are the nominees of
the Board of Directors, as directors;
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to
approve the amendment to the Company’s Articles of Incorporation to change of the name of the Company to Sharing Economy
International Inc.;
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to
approve the amendment to the Company’s Plan to increase the number of Shares authorized for issuance under the Plan
to 390,000 Shares;
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to
approve the amendment to the Company’s Articles of Incorporation to increase the number of Shares which the Company
is authorized to issue to 250,000,000 Shares; and.
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according
to their best judgment if a proposal comes up for a vote at the annual meeting that is not on the proxy card.
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(2)
You may vote in person at the annual meeting.
We will pass out written ballots to anyone who wants to vote at the annual meeting.
However, if you hold your Shares in street name, you must bring to the annual meeting a valid proxy from the broker, bank or other
nominee holding your shares that confirms your beneficial ownership of the Shares and gives you the right to vote your Shares.
Holding Shares in street name means you hold them through a brokerage firm, bank or other nominee, and therefore the shares are
not held in your individual name. We encourage you to examine your proxy card closely to make sure you are voting all of your
Shares in the Company.
How
does the board of directors recommend that I vote?
The
Board of Directors unanimously recommends that you vote in favor of the Board of Directors’ nominees for director and in
favor of the other proposals being brought before the meeting as set forth in this proxy statement.
Can
I change my mind after I vote?
Yes,
you may change your mind at any time before the polls close at the meeting. You can change your vote by signing another proxy
with a later date and returning it to us prior to the meeting or by voting again at the meeting. If your Shares are held in a
brokerage account, you must provide your broker with instructions as to any changes in the voting instructions which you previously
provided to your broker.
What
if I sign and return my proxy card but I do not include voting instructions?
If
you sign your proxy card and return it to us but you do not include voting instructions as to any proposal, your proxy will be
voted FOR the election of the board of directors’ nominees for directors and FOR all proposals put before our stockholders
at the annual meeting.
What
does it mean if I receive more than one proxy card?
It
means that you have multiple accounts with brokers and/or our transfer agent. Please vote all of these Shares. We recommend that
you contact your broker and/or our transfer agent to consolidate as many accounts as possible under the same name and address.
Our transfer agent is Empire Stock Transfer, Empire Stock Transfer Inc., 1859 Whitney Mesa Dr., Henderson, NV 89014.
Will
my Shares be voted if I do not provide my proxy?
If
your Shares are held in a brokerage account, they may be voted if you provide your broker with instructions as to how you want
your Shares voted. Your broker will send you instructions as to how you can vote shares that are held in your brokerage account.
If you do not give your broker instructions as to how you want your shares to be voted, then your Shares will not be voted either
for the election of directors or any of the proposals being voted on at the meeting.
If
you hold your Shares directly in your own name, they will only be voted if you either sign and deliver a proxy or attend and vote
at the meeting.
How
many votes must be present to hold the meeting?
In
order for us to conduct our meeting, we must have a quorum. We will have a quorum, and be able to conduct the meeting, if one-third
of our outstanding Shares as of November 1, 2017, are present at the meeting. Your Shares will be counted as being present at
the meeting if you attend the meeting or if you properly return a proxy by mail or if you give your broker voting instructions
and the broker votes your Shares.
On
the record date, November 1, 2017, we had 2,230,632 Shares outstanding. We will have a quorum if 743,544 Shares are present and
voting at the annual meeting.
What
vote is required to elect directors?
Directors
are elected by a plurality of the votes cast, which means that, as long as a quorum is present, the five (5) nominees for director
who receive the most votes will be elected. Abstentions will have no effect on the voting outcome with respect to the election
of directors.
How
many votes are required to approve the Company’s name change?
The
proposal to approve the amendment to the Company’s Articles of Incorporation to change of the name of the Company to Sharing
Economy International Inc. requires the affirmative vote of a majority of the issued and outstanding Shares on the record date.
Abstentions and broker non-votes will count as votes against this proposal.
How
many votes are required for approval of amendment to the Company’s Plan?
The
proposal to approve the amendment to the Company’s Plan to increase the number of Shares authorized for issuance under the
Plan to 390,000 Shares requires the affirmative vote of a majority of the votes cast at the annual meeting. Abstentions and broker
non-votes will not be counted as “for” or “against” the approval of the amendment to the Plan and thus
will have no effect on the proposal.
How
many votes are required to approve the amendment to the Company’s Articles of Incorporation?
The
proposal to approve the amendment to the Company’s Articles of Incorporation to increase the number of Shares which the
Company is authorized to issue to 250,000,000 Shares requires the affirmative vote of a majority of the issued and outstanding
Shares on the record date. Abstentions and broker non-votes will count as votes against this proposal.
How
many votes are required to approve other matters that may come before the stockholders at the annual meeting?
An
affirmative vote of a majority of the votes cast at the annual meeting is required for approval of all other items being submitted
to the stockholders for their consideration.
Who
is paying the cost of the meeting?
We
will pay for preparing, printing and mailing this proxy statement. Proxies may be solicited on our behalf by our directors, officers
or employees in person or by telephone, electronic transmission and facsimile transmission. We will reimburse banks, brokers and
other custodians, nominees and fiduciaries for their out-of-pocket costs of sending the proxy materials to our beneficial owners.
We estimate our costs at approximately $15,000.
Is
my vote kept confidential?
Proxies,
ballots and voting tabulations identifying stockholders are kept confidential and will not be disclosed except as may be necessary
to meet legal requirements.
Where
do I find the voting results of the annual meeting?
We
will announce voting results at the annual meeting and file a current report on Form 8-K announcing the voting results of the
annual meeting.
Who
can help answer my questions?
You
can contact our Chief Operating Officer, Mr. Parkson Yip at Room 315 – 316, 3/F, Building W12, Hong Kong Science Park, Shatin,
New Territories, Hong Kong or by email at parkson.yip@cleantechsolutionsinternational.com, with any questions about proposals
described in this Proxy Statement or how to execute your vote.
ELECTION
OF DIRECTORS
Directors
are elected annually by the stockholders to serve until the next annual meeting of stockholders and until their respective successors
are duly elected. Our Bylaws provide that the number of directors comprising the whole board shall be determined from time to
time by the Board. The size of the Board for the ensuing year is five (5) directors. Our nominating committee recommended, and
our Board of Directors accepted the committee’s recommendation, that the directors named below be elected. If any nominee
becomes unavailable for any reason, a situation which is not anticipated, a substitute nominee may be proposed by the board, and
any Shares represented by proxy will be voted for the substitute nominee, unless the Board reduces the number of directors.
Our
current Board consists of Jianhua Wu, Furen Chen, Xi Liu, Chengqing Tang and Ping Kee Lau. Messrs. Chen, Liu and Tang will not
stand for election at the annual meeting. Messrs. Wu, Lau, Cho Fu Li and Xue Leng, and Ms. Ying Ying Wong were recommended by
our nominating committee for election to the Board of Directors at this year’s annual meeting.
The
following table sets forth certain information concerning the Board of Directors’ nominees for directors:
Name
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Age
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Principal
Occupation
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Director
Since
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Jianhua
Wu
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62
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Chairman
of the Board and Chief Executive Officer
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November
2007
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Ping
Kee Lau
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67
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Executive
Director
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March
2017
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Cho
Fu Li
1,2,3
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40
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Member
of the Hong Kong Institute of Certified Public Accountants
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Director
Nominee
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Xue
Leng
1,2,3
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38
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Management
Consultant
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Director
Nominee
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Ying
Ying Wong
1,2,3
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37
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Director
of World Sharing Economy Coalition
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Director
Nominee
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1
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Member
of the audit committee.
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2
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Member
of the compensation committee.
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3
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Member
of the corporate governance/nominating committee.
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Jianhua
Wu
has been our Chief Executive Officer, Chairman and a director since the completion of the reverse acquisition in November
2007. Mr. Wu founded our predecessor companies, Wuxi Huayang Dyeing Machinery Co., Ltd. and Wuxi Huayang Electrical Power Equipment
Co., Ltd., in 1995 and 2004, respectively, and was executive director and general manager of these companies prior to becoming
our Chief Executive Officer. Mr. Wu was nominated as a director because of his position as our Chief Executive Officer. Mr. Wu
is a certified mechanical engineer.
Ping
Kee Lau
has been our Executive Director since March 2017. Mr Lau has years of experience in the marine and shipping industry
and has been a director of various marine and investment companies for a number of years. We nominated Mr. Lau as a director because
we believe that his experience as a director and in investment is important for the Company as we continue to grow and develop
our business.
Cho
Fu Li
has over ten years of experience in auditing, accounting and banking, and is a member of the Hong Kong Institute
of Certified Public Accountants and a fellow member of the Association of Chartered Certified Accountants. We nominated Mr. Li
as a director because we believe that his accounting and finance experience is important to improve our financial accounting controls.
Xue
Leng
has years of experience in sales and marketing as well as general management in China. He was a director or a supervisor
of various trading companies in China. Previously, he served as general manager of Hebei Tangshan Chengxin Steel Pipe Co., Ltd.
and as sales manager of Hebei Global Steel Pipe Co., Ltd. He graduated from Hebei Polytechnic University and also studied futures
and securities investment at China Agricultural University. We nominated Mr. Leng as a director because we believe that his sales
and management experiences in China is important for the future development of the Company in the market.
Ying
Ying Wong
is a director of World Sharing Economy Coalition which promotes global sharing economic development. Ms. Wong
has over ten years of experience in banking and financial services with China Construction Bank (Asia) Corporation Limited and
Standard Chartered Bank in Hong Kong. We nominated Ms. Wong as a director because we believe that her banking and finance experience
is important for the future development of the Company.
Our
directors are elected for a term of one (1) year and until their successors are elected and qualified.
We
are incorporated in Nevada and are subject to the provisions of the Nevada corporate law. Our Articles of Incorporation and Bylaws
provide that we will indemnify and hold harmless our officers and directors to the fullest extent permitted by law. Our Articles
of Incorporation also provide that, except as otherwise provided by law, no director or officer is individually liable to us or
our stockholders or creditors for any damages as a result of any act or failure to act in his or her capacity as a director or
officer unless it is proven that (a) the director’s or officer’s act or failure to act constituted a breach of his
or her fiduciary duties as a director or officer and (b) the breach of those duties involved intentional misconduct, fraud or
a knowing violation of law.
Nevada
Revised Statutes Section 78.7502 gives us broad authority to indemnify our officers and directors. under certain prescribed circumstances
and subject to certain limitations against certain costs and expenses, including attorney’s fees actually and reasonably
incurred in connection with any action, suit or proceeding, whether civil, criminal, administrative or investigative, to which
a person is a party by reason of being a director or officer it is determined that such person acted in accordance with the applicable
standard of conduct set forth in such statutory provisions.
Director
Independence
We
believe that three (3) of our nominees for director, Mr. Li, Mr. Leng and Ms. Wong, are independent directors, pursuant to the
Nasdaq definition of independence. Our Board has determined that Mr. Li is an audit committee financial expert. Mr.
Wu and Mr. Lau are not independent directors.
Committees
Our
business, property and affairs are managed by or under the direction of the Board of Directors. Members of the Board are kept
informed of our business through discussion with the Chief Executive and Financial Officers and other officers, by reviewing materials
provided to them and by participating at meetings of the Board and its committees.
Our
Board of Directors has three (3) committees - the audit committee, the compensation committee and the corporate governance/nominating
committee. The audit committee is comprised of Mr. Li, Mr. Leng and Ms. Wong, with Mr. Li serving as Chairman. The compensation
committee is comprised of Mr. Leng, Mr. Li and Ms. Wong, with Mr. Leng serving as Chairman. The corporate governance/nominating
committee is comprised of Ms. Wong, Mr. Leng and Mr. Li, with Ms. Wong serving as Chairman. Our Plan is administered by the compensation
committee.
Our
audit committee is involved in discussions with our independent auditor with respect to the scope and results of our year-end
audit, our quarterly results of operations, our internal accounting controls and the professional services furnished by the independent
auditor. Our Board of Directors has adopted a written charter for the audit committee which the audit committee reviews and reassesses
for adequacy on an annual basis. A copy of the audit committee’s current charter is available on our website at:
http://www.cleantechsolutionsinternational.com/Asl%20cleantech%20audit%20committee%20charter%20(00172533).doc
.
The
compensation committee oversees the compensation of our Chief Executive Officer and our other executive officers and reviews our
overall compensation policies for employees generally. If so authorized by the Board of Directors, the committee may also serve
as the granting and administrative committee under any option or other equity-based compensation plans which we may adopt. The
compensation committee does not delegate its authority to fix compensation; however, as to officers who report to the Chief Executive
Officer, the compensation committee consults with the Chief Executive Officer, who may make recommendations to the compensation
committee. Any recommendations by the Chief Executive Officer are accompanied by an analysis of the basis for the recommendations.
The committee will also discuss compensation policies for employees who are not officers with the Chief Executive Officer and
other responsible officers. The compensation committee has the responsibilities and authority relating to the retention, compensation,
oversight and funding of compensation consultants, legal counsel and other compensation advisers, as well as the requirement to
consider six independence factors before selecting, or receiving advice from, such advisers. A copy of the compensation committee’s
current charter is available on our website at:
http://www.cleantechsolutionsinternational.com/Asl%20cleantech%20compensation%20committee%20charter%20(00172534).doc
.
The
corporate governance/nominating committee is be involved evaluating the desirability of and recommending to the Board any changes
in the size and composition of the Board, evaluation of and successor planning for the Chief Executive Officer and other executive
officers. The qualifications of any candidate for director will be subject to the same extensive general and specific criteria
applicable to director candidates generally. A copy of the corporate governance/ nominating committee charter is available on
our website at:
http://www.cleantechsolutionsinternational.com/Asl%20cleantech%20nominating-governance%20committee%20charter%20(00172535).doc
.
The
Board and its committees held the following number of meetings during 2016:
Board of directors
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4
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Audit committee
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4
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Compensation committee
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0
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Nomination committee
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0
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The
meetings include meetings that were held by means of a conference telephone call, but do not include actions taken by unanimous
written consent.
Each
director attended at least 75% of the total number of meetings of the board and those committees on which he served during the
year.
Compensation
Committee Interlocks and Insider Participation
Aside
from his service as director, no member of our compensation committee had any relationship with us as of December 31, 2016, and
none of our executive officers served as a director or compensation committee member of another entity.
Code
of Ethics
We
have adopted a code of ethics that applies to our officers, directors and employees. We have filed copies of our code of ethics
and our board committee charters as exhibits to our filings with the Securities and Exchange Commission (the “SEC”).
Audit
Committee Report*
The
audit committee of the Board is composed of three directors: Furen Chen, who is the chairman, Xi Liu and Chengqing Tang, each
of whom is “independent” as defined by the rules of the NASDAQ Stock Market. The board has adopted a written Audit
Committee Charter.
Management
is responsible for our financial statements, financial reporting process and systems of internal accounting and financial reporting
control. Our independent auditor is responsible for performing an independent audit of our financial statements in accordance
with auditing standards generally accepted in the United States and for issuing a report thereon. The audit committee’s
responsibility is to oversee all aspects of the financial reporting process on behalf of the board. The responsibilities of the
audit committee also include engaging and evaluating the performance of the accounting firm that serves as the Company’s
independent auditor.
The
audit committee discussed with our independent auditor, with and without management present, such auditor’s judgments as
to the quality, not just acceptability, of our accounting principles, along with such additional matters required to be discussed
under the Statement on Auditing Standards No. 61, “Communication with Audit Committees.” The audit committee has discussed
with the independent auditor, the auditor’s independence from us and our management, including the written disclosures and
the letter submitted to the audit committee by the independent auditor as required by the Independent Standards Board Standard
No. 1, “Independence Discussions with Audit Committees.”
In
reliance on such discussions with management and the independent auditor, review of the representations of management and review
of the report of the independent auditor to the audit committee, the audit committee recommended (and the board approved) that
our audited financial statements be included in our Annual Report on Form 10-K for the year ended December 31, 2016.
Submitted
by:
Audit
Committee of the Board of Directors
/s/
Furen Chen
/s/
Xi Liu
/s/
Chengqing Tang
*
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The
information contained in this Audit Committee Report shall not be deemed to be “soliciting material” or “filed”
or incorporated by reference in future filings with the SEC, or subject to the liabilities of Section 18 of Securities
Exchange Act of 1934, as amended (the “Exchange Act”), except to the extent that the Company specifically requests
that the information be treated as soliciting material or specifically incorporates it by reference into a document filed
under the Securities Act of 1933, as amended or the Exchange Act.
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Section
16(a) Compliance
Section
16(a) of the Exchange Act requires our directors, executive officers and persons who own more than 10% of our Shares to file with
the SEC initial reports of ownership and reports of changes in ownership of Shares and other of our equity securities. During
the year ended December 31, 2016, we believe that all of our Section 16 reports were timely filed with the SEC.
Executive
Compensation
The
following summary compensation table indicates the cash and non-cash compensation earned during the years ended December 31, 2016
and 2015 by each person who served as Chief Executive Officer and Chief Financial Officer. No other executive officer received
compensation equal or exceeding $100,000.
Summary
Annual Compensation Table
Name and Principal Position
|
|
Fiscal Year
|
|
|
Salary
($)
|
|
|
Bonus
($)
|
|
|
Stock Awards
($)
|
|
|
All Other Compensation
($)
|
|
|
Total
($)
|
|
Jianhua Wu,
|
|
|
2016
|
|
|
|
36,126
|
|
|
|
0
|
|
|
|
132,000
|
|
|
|
0
|
|
|
|
168,126
|
|
Chief Executive
Officer
(1)
|
|
|
2015
|
|
|
|
35,384
|
|
|
|
0
|
|
|
|
68,600
|
|
|
|
0
|
|
|
|
103,984
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Wanfen Xu,
|
|
|
2016
|
|
|
|
7,542
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
7,542
|
|
Chief Financial Officer (2)
|
|
|
2015
|
|
|
|
7,616
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
7,616
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adam Wasserman, former
|
|
|
2016
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
Chief Financial Officer (3)
|
|
|
2015
|
|
|
|
52,000
|
|
|
|
0
|
|
|
|
61,740
|
|
|
|
0
|
|
|
|
113,740
|
|
(1)
|
Mr.
Wu’s 2016 compensation consisted of cash salary of $36,126 and 50,000 Shares valued at $132,000. Mr. Wu’s 2015
compensation consisted of salary of $35,384 and 5,000 Shares valued at $68,600.
|
(2)
|
Ms.
Xu served as our Chief Financial Officer in 2016 after Mr. Wasserman resigned.
|
(3)
|
Mr.
Wasserman had been our Chief Financial Officer from December 2012 until his resignation on February 26, 2016. Mr.
Wasserman’s compensation was paid to CFO Oncall Inc. where he serves as Chief Executive Officer. Mr. Wasserman’s
2015 compensation included cash salary of $52,000 and stock based compensation of $61,740.
|
Employment
Agreements
On
June 3, 2017, Parkson Yip was appointed as the Company’s Chief Operating Officer.
In
connection with Mr. Yip’s appointment, the Company entered into an employment agreement (the “Agreement”) with
Mr. Yip. Pursuant to the Agreement, Mr. Yip will receive an annual base salary of $150,000 and a sign-on bonus of $19,250. Mr.
Yip’s annual salary will be reviewed annually by the compensation committee and may be changed in the sole direction of
the committee.
The
term of the Agreement is effective as of June 19, 2017 and will end on May 31, 2018 (the “Initial Term”). After the
Initial Term, Mr. Yip’s employment will continue on a month-to-month basis with each additional term (each, an “Extension”)
ending on the last day of the calendar month unless either party provides the other party with 30 days’ notice of non-renewal
prior to the expiration of an Extension.
Prior
to the expiration of the Initial Term or an Extension, the Agreement can be terminated by the Company with or without cause or
upon Mr. Yip’s death or disability. “Cause,” as defined in the Agreement, includes, but is not limited to: (i)
repeated failure or refusal to follow instructions from the Board or the Company’s Chief Executive Officer, provided that
such instructions are reasonable, specific, lawful and consistent with Mr. Yip’s duties set forth in the Agreement, (ii)
willful neglect or material breach of duty, (iii) breach of confidentiality, non-compete and non-solicitation provisions under
the Agreement, (iv) breach of trust for personal gain or benefit, (v) fraudulent or dishonest conduct and (vi) conviction of felony
and certain other crimes. The Company may also terminate the Agreement without cause upon thirty (30) days’ written notice.
In addition, upon the Company’s material breach, Mr. Yip has the right to terminate the Agreement by providing ten (10)
days’ written notice.
If
the Agreement is terminated by the Company without cause or by Mr. Yip upon the Company’s material breach, the Company shall
pay Mr. Yip severance in the amount equal to one (1) month’s salary. Upon termination for any other reason set forth in
the Agreement, the Company is only obligated to pay Mr. Yip any unpaid base salary and any unreimbursed expenses incurred up to
the termination.
The
Agreement includes a confidentiality provision that lasts perpetually and also a non-competition and non-solicitation provision
during Mr. Yip’s employment and for a period of one year following termination.
Directors’
Compensation
We
do not have any agreements or formal plan for compensating our current directors for their service in their capacity as directors,
although our Board may, in the future, award stock options to purchase Shares to our directors.
The
following table provides information concerning the compensation of each member of our Board of Directors whose compensation is
not included in the Summary Compensation Table for his or her services as a director and committee member for the fiscal year
ended December 31, 2016. The value attributable to any stock grants is computed in accordance with ASC Topic 718.
Name
|
|
Fees earned or paid in cash
($)
|
|
|
Stock
awards
($)
|
|
|
Total
($)
|
|
Chengqing Tang (1)
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
Xi Liu
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
Furen Chen
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
Frank Zhao (2)
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
Baowen Wang
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
(1)
|
Mr.
Tang has been our director since March 22, 2016.
|
(2)
|
Mr.
Zhao resigned as a director in March 2016.
|
(3)
|
Mr.
Baowen Wang resigned as a director on March 20, 2017.
|
Communications
with our Board of Directors
Any
stockholder who wishes to send a communication to our Board of Directors should address the communication either to the Board
of Directors or to the individual director c/o Parkson Yip, Chief Operating Officer, Room 315 – 316, 3/F, Building W12,
Hong Kong Science Park, Shatin, New Territories, Hong Kong. Mr. Yip will forward the communication either to all of the directors,
if the communication is addressed to the Board, or to the individual director, if the communication is directed to a director.
APPROVAL
TO AMEND THE COMPANY’S ARTICLES OF INCORPORATION TO EFFECT THE NAME CHANGE
We
are asking our stockholders to approve an amendment to the Company’s Articles of Incorporation to effect a name change (the
“Name Change”). The Company has obtained Board approval for the Name Change of the Company to “Sharing Economy
International Inc.” The Board believes that the name “Sharing Economy International Inc.” will more accurately
reflect the business and operations of the Company going forward. The Name Change will amend the Articles of Incorporation of
the Company to formalize the new name. Furthermore, the Company is considering changing the ticker symbol to more closely reflect
that of the Company after the Name Change. The Name Change will be implemented by filing an amendment to our Articles of Incorporation
with the Nevada Secretary of State. The Name Change will become effective on the date of the filing.
AMENDMENT
TO 2016 LONG-TERM INCENTIVE PLAN
Summary
and Purpose of the Amendment to the Plan
In
September 2016, the Board of Directors adopted, and in November 2016, the stockholders approved the Plan, covering 125,000 Shares.
The Plan provides for the grant of incentive and non-qualified options and stock grants to employees, including officers, directors
and consultants. The Plan is administered by a committee of not less than three directors, each of whom is to be an independent
director. In the absence of a committee, the Plan is administered by the Board of Directors. The Board has granted the compensation
committee the authority to administer the Plan. Members of the committee are not eligible for stock options or stock grants pursuant
to the Plan unless such stock options or stock grant are granted by a majority of our independent directors other than the proposed
grantee. As of December 31, 2016, we had issued a total of 105,000 Shares pursuant to the Plan. The Board of Directors has voted
to amend the Plan to increase the number of Shares authorized for issuance under the plan to 390,000 Shares.
Increase
in Number of Authorized Shares under the Plan
As
of the record date, the Company has granted 125,000 Shares of restricted stock under the Plan. As a result, the Company presently
has no Shares available for future issuance under the Plan. The Board of Directors believes that the proposed increase in the
number of Shares available for issuance as provided in the Plan will provide the compensation committee with greater flexibility
in 2018 in the administration of the Plan and is appropriate in light of the growth of the Company.
Awards
to be Granted to Certain Individuals and Groups
As
of the date hereof, the Company cannot determine the benefits or amounts that will be received by or allocated to any individual
or group resulting from the approval of the amendment to the Plan. The following table sets forth the aggregate number of Shares
subject to option grants and grants of Shares of restricted stock to certain individuals and groups under the Plan during the
last fiscal year, which ended December 31, 2016.
Name of Group
|
|
Number of
Options
Granted
|
|
|
Number of Shares of Restricted Stock Granted
|
|
Named Executive Officer
|
|
|
0
|
|
|
|
50,000
|
|
All executive officers, as a group
|
|
|
0
|
|
|
|
50,000
|
|
All directors who are not executive officers, as a group
|
|
|
0
|
|
|
|
0
|
|
All employees, including all current officers who are not executive officers, as a group
|
|
|
0
|
|
|
|
0
|
|
Equity
Compensation Plan Information
The
following table summarizes information, as of December 31, 2016, with respect to Shares that may be issued under the Company’s
existing equity compensation plans.
Plan Category
|
|
Number of Securities
to be Issued Upon
Exercise of
Outstanding Options,
Warrants and Rights
(a)
|
|
|
Weighted-Average
Exercise Price of
Outstanding Options,
Warrants and Rights
(b)
|
|
|
Number of Securities
Remaining Available
for Future Issuance
Under Equity
Compensation Plans
(Excluding Securities
Reflected in
Column (a))
(c)
|
|
Equity compensation plans approved by security holders
|
|
|
0
|
(1)
|
|
$
|
N/A
|
|
|
|
20,000
|
|
Equity compensation plans not approved by security holders
|
|
|
0
|
|
|
$
|
N/A
|
|
|
|
0
|
|
Total
|
|
|
0
|
|
|
$
|
N/A
|
|
|
|
20,000
|
|
(1)
Consists of options and restricted stock granted under the Plan.
APPROVAL
OF AMENDMENT TO ARTICLES OF INCORPORATION
The
Board of Directors has adopted a resolution proposing an amendment to the Company’s Articles of Incorporation to increase
the number of authorized Shares of Company from 12,500,000 Shares to 250,000,000 Shares. As of the record date, the Company had
2,230,632 Shares issued and outstanding. An additional 125,000 authorized Shares were reserved for issuance under the Company’s
Plan, of which 125,000 Shares were covered by outstanding grants as of the record date.
The
Board of Directors believes that the authorized Shares available for issue is not sufficient to enable the Company to respond
to potential business opportunities and to pursue important objectives designed to enhance stockholder value. The additional authorized
Shares will provide the Company with greater flexibility to use its capital stock, without further stockholder approval, for various
purposes including, without limitation, expanding the Company’s businesses and product lines through the acquisition of
other businesses or products, stock dividends (including stock splits in the form of stock dividends), raising capital, providing
equity incentives to employees, officers and directors and establishing strategic relationships with other companies. The Company
currently does not have specific agreements or plans that would involve the issuance of the proposed additional authorized Shares,
although it intends to continue to consider transactions from time to time that may result in such issuances. The Company cannot
assure the stockholders that any such transactions will be consummated on favorable terms or at all or, if consummated, that any
such transaction will enhance stockholder value. The issuance of additional Shares may have a dilutive effect on earnings per
Share and, for a stockholder who does not purchase additional Shares to maintain his or her pro rata interest, on a stockholder’s
percentage voting power.
The
authorized Shares in excess of those issued or reserved will be available for issuance at such times and for such corporate purposes
as the Board of Directors may deem advisable without further action by the Company’s stockholders, except as may be required
by applicable laws or the rules of any stock exchange or national securities association trading system on which the Shares may
be listed or traded. Upon issuance, such Shares will have the same rights as the outstanding Shares. Holders of Shares do not
have preemptive rights.
The
additional Shares that would become available for issuance if the proposal were adopted could also be used by the Company to oppose
a hostile takeover attempt or delay or prevent changes in control or management of the Company. For example, without further stockholder
approval, the Board of Directors could strategically sell Shares in a private transaction to purchasers who would oppose a takeover
or favor the current Board of Directors. Although this proposal to increase the authorized Shares has been prompted by business
and financial considerations and not by the threat of any hostile takeover attempt (nor is the Board of Directors currently aware
of any such attempts directed at the Company), nevertheless, stockholders should be aware that approval of the proposal could
facilitate future efforts by the Company to deter or prevent changes in control of the Company, including transactions in which
the stockholders might otherwise receive a premium for their shares over then current market prices.
The
proposal to amend the Company’s Articles of Incorporation to increase the number of authorized Shares available for issuance
will be implemented by filing the amendment to our Articles of Incorporation with the Nevada Secretary of State. The amendment
will become effective on the date of the filing.
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
AND
RELATED STOCKHOLDER MATTERS.
The
following table provides information as to Shares beneficially owned as of November 1, 2017, by:
|
●
|
Each
director and each nominee for election as a director;
|
|
●
|
Each
current officer named in the summary compensation table;
|
|
●
|
Each
person owning of record or known by us, based on information provided to us by the persons named below, at least 5% of our
Shares; and
|
|
●
|
All
directors and officers as a group
|
For
purposes of the following table, “beneficial ownership” means the sole or shared power to vote, or to direct the voting
of, a security, or sole or shared investment power with respect to a security, or any combination thereof, and the right to acquire
such power (for example, through the exercise of employee stock options granted by the Company) within sixty (60) days of November
1, 2017.
Name of Beneficial Owner
|
|
Amount and
Nature of
Beneficial
Ownership
|
|
|
% of Class
|
|
|
|
|
|
|
|
|
Jianhua Wu, CEO(3)
|
|
|
0
|
|
|
|
0.0
|
%
|
Wanfen Xu, CFO(3)
|
|
|
0
|
|
|
|
0.0
|
%
|
Parkson Yip, COO(3)
|
|
|
0
|
|
|
|
0.0
|
%
|
Xi Liu, Director(3)
|
|
|
0
|
|
|
|
0.0
|
%
|
Ping Kee Lau, Director(3)
|
|
|
0
|
|
|
|
0.0
|
%
|
Chengqing Tang, Director(3)
|
|
|
0
|
|
|
|
0.0
|
%
|
Furen Chen, Director(3)
|
|
|
0
|
|
|
|
0.0
|
%
|
All current officers and directors as a group
|
|
|
0
|
|
|
|
0.0
|
%
|
YSK 1860 Co., Ltd.(1)(2)
|
|
|
416,249
|
|
|
|
|
|
Eos Holdings LLC
|
|
|
160,000
|
|
|
|
|
|
Total
|
|
|
576,249
|
|
|
|
|
|
(1)
|
Ms.
Deborah Wai Min Yuen owns 100% of the issued and outstanding ordinary shares of YSK 1860 Co., Limited.
|
(2)
|
Address
is
Villa Cornwall, 85 Castle Peak Road, N.T., K3 00000.
|
(3)
|
Address
is No. 9 Yanyu Middle Road, Qianzhou Village, Huishan District, Wuxi City, Jiangsu Province, P.R.C.
|
MANAGEMENT
Executive
Officers
The
following table sets forth certain information with respect to our executive officers.
Name
|
|
Age
|
|
|
Position
|
Jianhua
Wu
|
|
|
62
|
|
|
Chief
Executive Officer
|
Wanfen
Xu
|
|
|
36
|
|
|
Chief
Financial Officer
|
Parkson
Yip
|
|
|
46
|
|
|
Chief
Operating Officer
|
All
of our officers serve at the pleasure of the Board of Directors. Mr. Wu is also a director. See “Election of Directors”
for information concerning Mr. Wu.
Wanfen
Xu has been our Chief Financial Officer since March 1, 2016. Ms. Xu previously served as our Chief Financial Officer from March
14, 2012 through December 12, 2012. From December 2012 until February 2016, Ms. Xu served as the financial controller of the Wuxi
Huayang Heavy Industries, Co., Ltd., formerly known as Wuxi Huayang Electrical Power Equipment Co., Ltd., and Wuxi Huayang Dyeing
Machinery Co., Ltd. (collectively, the “Huayang Companies”). Ms. Xu also served as the financial controller of Hauyang
Companies from 2009 to 2011. The Huayang Companies are variable interest entities owned by Mr. Wu and Ms. Tang whose financial
statements are included in our consolidated financial statements.
Parkson
Yip has been our Chief Operating Officer since June 3, 2017. Mr. Yip is a seasoned executive with over twenty (20) years of industry
experience. Prior to joining the Company, Mr. Yip served as Co-Chairman and Executive Director of Share Economy Group from November
2016 to April 2017 where he managed business development and merger and acquisition (“M&A”) activities of the
company. Prior to Share Economy Group, Mr. Yip served as Managing Director of ECrent Worldwide Company Limited from December 2014
to November 2016 where he managed online platform developments, business developments and M&A activities. From December 2005
to January 2014, Mr. Yip served as Managing Director of 88DB Hong Kong Limited where he managed worldwide operations of the company’s
online platforms, including product development, strategic partnership and marketing strategies. Mr. Yip also served as Chief
Technology Officer of Guangzhou Ruixin Technology from December 2002 to November 2005. Prior to becoming a corporate executive,
Mr. Yip worked as a software engineer at GeoTel Communications Corporation and Lotus Development. He has also served as a director
of ECrent (America) Company Limited since August 2016. Mr. Yip holds a Bachelor’s degree in Computer Engineering from Boston
University.
FINANCIAL
STATEMENTS
Our
audited financial statements, which include our consolidated balance sheets at December 31, 2016 and 2015, and the related consolidated
statements of income and comprehensive income, stockholders’ equity and cash flows for each of the two years in the period
ended December 31, 2016, and the notes to our consolidated financial statements, are included in our Form 10-K for the year ended
December 31, 2016. A copy of our Form 10-K for the year ended December 31, 2016, either accompanied or preceded the delivery of
this proxy statement.
Copies
of our Form 10-K for the year ended December 31, 2016 may be obtained without charge by writing to Parkson Yip, Chief Operating
Officer, Room 315 – 316, 3/F, Building W12, Hong Kong Science Park, Shatin, New Territories, Hong Kong. Exhibits will be
furnished upon request and upon payment of a handling charge of $.25 per page, which represents our reasonable cost on furnishing
such exhibits. Copies of our Form 10-K are available on our website at
http://www.cleantechsolutionsinternational.com/sec.php
.
The SEC maintains a web site that contains reports, proxy and information statements and other information regarding registrants
that file electronically with the Commission. The address of such site is
http//www.sec.gov
OTHER
MATTERS
Other
Matters to be Submitted
Our
Board of Directors does not intend to present to the meeting any matters not referred to in the form of proxy. If any proposal
not set forth in this proxy statement should be presented for action at the meeting, and is a matter which should come before
the meeting, it is intended that the Shares represented by proxies will be voted with respect to such matters in accordance with
the judgment of the persons voting them.
Deadline
for Submission of Stockholder Proposals for the 2018 Annual Meeting
Proposals
of stockholders intended to be presented at the 2018 Annual Meeting of Stockholders pursuant to SEC Rule 14a-8 must be received
at our principal office within a reasonable time before the Company prints and mails its proxy statement for the 2018 Annual Meeting
to be included in the proxy statement for the meeting. If notice of any stockholder proposal is considered untimely, we are not
required to present such proposal at the 2018 Annual Meeting.
November
13, 2017
|
By
Order of the Board of Directors
|
|
|
|
|
|
Jianhua
Wu
|
|
Chief
Executive Officer
|
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