UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
SCHEDULE
14A INFORMATION
Proxy
Statement Pursuant to Section 14(a) of the Securities Exchange Act of
1934
Filed by
the Registrant Q
Filed by
a Party other than the Registrant £
Check the
appropriate box:
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£
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Preliminary
Proxy Statement
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£
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Confidential,
For Use of the Commission Only (As Permitted by Rule
14a-6(e)(2))
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Q
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Definitive
Proxy Statement
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£
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Definitive
Additional Materials
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£
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Soliciting
Material under Rule 14a-12
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CHINA PRECISION STEEL,
INC.
(Name of
Registrant as Specified In Its Charter)
_____________________________________________________________
(Name of
Person(s) Filing Proxy Statement, if other than the Registrant)
Payment
of Filing Fee (Check the appropriate box):
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No
fee required
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Fee
computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11.
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number of securities to which transaction applies:
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Per
unit price or other underlying value of transaction computed pursuant to
Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
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maximum aggregate value of transaction:
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fee paid:
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paid previously with preliminary materials.
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previously. Identify the previous filing by registration statement number,
or the form or schedule and the date of its filing.
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CHINA
PRECISION STEEL, INC.
18th
Floor, Teda Building
87 Wing
Lok Street, Sheung Wan,
Hong
Kong, People’s Republic of China
+852-2543-2290
NOTICE
OF ANNUAL MEETING OF STOCKHOLDERS
JUNE
30, 2010
Dear
Stockholder:
Notice is
hereby given that the Annual Meeting of Stockholders (the “Meeting”) of China
Precision Steel, Inc., a Delaware corporation (the “Company”), will be held on
Tuesday, June 30, 2010, at 11:00 a.m., local time, at the Meeting Room, 8th
Floor, Teda Building, 87 Wing Lok Street, Sheung Wan, Hong Kong, People’s
Republic of China.
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1.
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To elect six persons to the Board
of Directors of the Company, each to serve until the next annual meeting
of stockholders of the Company or until such person shall resign, be
removed or otherwise leave
office;
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2.
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To ratify the selection by the
Audit Committee of Moore Stephens as the Company’s independent registered
public accounting firm for the fiscal year ending June 30, 2010;
and
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3.
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To transact such other business
as may properly come before the Meeting or any adjournment
thereof.
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If you
owned our common stock at the close of business on May 13, 2010, you may attend
and vote at the meeting.
A Proxy
Statement describing the matters to be considered at the Meeting is attached to
this Notice. Our 2009 Annual Report accompanies this Notice, but it is not
deemed to be part of the Proxy Statement.
This year
we are furnishing our proxy materials to our stockholders who hold their shares
through brokers over the Internet, as permitted by rules adopted by the
Securities and Exchange Commission. We believe that this “Notice and
Access” process will provide you with a convenient and quick way to access our
proxy materials and vote your shares, while allowing us to conserve natural
resources and reduce the costs of printing and distributing the proxy materials.
On or about May 21, 2010, we will mail a Notice of Internet Availability of
Proxy Materials containing instructions on how to access our proxy statement and
the Form 10-K for our fiscal year ended June 30, 2009 and vote online to the
stockholders eligible to vote at our annual meeting. The Notice also contains
instructions on how to receive a paper copy of our proxy materials. We will not
mail the Notice to stockholders who had previously elected either to receive
notice and access proxy materials and vote electronically via the Internet, or
who receive paper copies of proxy materials.
If you
plan to attend the meeting, please or notify us of your intentions via telephone
or the Internet as directed on the proxy card. This will assist us
with meeting preparations. If your shares are not registered in your
own name and you would like to attend the meeting, please ask the broker, trust,
bank or other nominee that holds your shares to provide you with evidence of
your share ownership. This will enable you to gain admission to the
meeting.
Your
vote is important. Whether or not you plan to attend the meeting, I hope that
you will vote as soon as possible. You may vote your shares by either
completing, signing and returning the accompanying proxy card or casting your
vote via a toll-free telephone number or over the Internet.
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Sincerely,
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| /s/ Hai Sheng Chen | |
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Hai
Sheng Chen
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Chief
Executive Officer
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1
MEETING
TO BE HELD ON JUNE 30, 2010
Under
rules adopted by the U.S. Securities and Exchange Commission (“SEC”), we
are furnishing proxy materials to our stockholders primarily via the Internet,
instead of mailing printed copies of those materials to each stockholder. On or
about May 21, 2010, we will mail to our stockholders (other than those who
previously requested electronic or paper delivery and registered stockholders)
an Important Notice Regarding Availability of Proxy Materials (“Notice”)
containing instructions on how to access our proxy materials, including our
proxy statement and our annual report. The Notice also instructs you on how to
access your proxy card to vote through the Internet or by
telephone.
This
process is designed to expedite stockholders’ receipt of proxy materials, lower
the cost of the annual meeting, and help conserve natural resources. However, if
you would prefer to receive printed proxy materials, please follow the
instructions included in the Notice. If you have previously elected to receive
our proxy materials electronically, you will continue to receive these materials
via e-mail until you elect otherwise. If you have previously elected to receive
printed proxy materials, you will continue to receive these materials in paper
format until you elect otherwise.
2
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CHINA
PRECISION STEEL, INC.
18th
Floor, Teda Building
87
Wing Lok Street, Sheung Wan,
Hong
Kong, People’s Republic of China
+852-2543-2290
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PROXY
STATEMENT
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This
Proxy Statement and the accompanying proxy are being furnished with respect to
the solicitation of proxies by the Board of Directors of China Precision Steel,
Inc., a Delaware corporation (the “Company,” “CPSL” or “we”), for the 2009
Annual Meeting of Stockholders (the “Meeting”). The Meeting will be held on
Tuesday, June 30, 2010, at 11:00 a.m., local time, at 8th Floor, Teda Building,
87 Wing Lok Street, Sheung Wan, Hong Kong, People’s Republic of
China.
The
purposes of the Meeting are to seek stockholder approval of two proposals: (i)
electing six (6) directors to the Board and (ii) ratifying the appointment of
the Company’s accountants for fiscal year 2010.
Who
May Vote
Only
stockholders of record of our common stock, $0.01 par value (the “Common
Stock”), as of the close of business on May 13, 2010 (the “Record Date”) are
entitled to notice and to vote at the Meeting and any adjournment
thereof.
A list of
stockholders entitled to vote at the Meeting will be available at the Meeting,
and will also be available for ten days prior to the Meeting, during office
hours, at the Meeting Room, 8th Floor, Teda Building, 87 Wing Lok Street, Sheung
Wan, Hong Kong, People’s Republic of China.
The
presence at the Meeting of holders of a majority of the outstanding shares of
Common Stock as of the Record Date, in person or by proxy, is required for a
quorum. Should you submit a proxy, even though you abstain as to one or more
proposals, or you are present in person at the Meeting, your shares shall be
counted for the purpose of determining if a quorum is present.
Broker
“non-votes” are included for the purposes of determining whether a quorum of
shares is present at the Meeting. A broker “non-vote” occurs when a nominee
holder, such as a brokerage firm, bank or trust company, holding shares of
record for a beneficial owner does not vote on a particular proposal because the
nominee holder does not have discretionary voting power with respect to that
item and has not received voting instructions from the beneficial
owner.
Each
holder of Common Stock on the Record Date is entitled to one vote for each share
then held on all matters to be voted at the Meeting. No other class of voting
securities is outstanding on the date of mailing of this Proxy
Statement.
Voting
Whether
you hold shares directly as a registered stockholder of record or beneficially
in street name, you may vote without attending the meeting. You may vote by
granting a proxy or, for shares held beneficially in street name, by submitting
voting instructions to your stockbroker, trustee or nominee. In most cases, you
will be able to do this by using the Internet or telephone or by mail if you
received a printed set of the proxy materials.
3
By Internet
– If you have Internet access, you may submit your proxy via the
Internet by following the instructions provided in the Notice, or if you
received a printed version of the proxy materials by mail, by following the
instructions provided with your proxy materials and on your proxy card or voting
instruction card.
By Telephone or
Mail – If you received printed proxy materials, you may submit your
proxy by telephone by following the instructions provided on your proxy card or
voting instruction card. If you received a Notice, you may submit your proxy by
telephone after accessing the proxy materials via the Internet. You may also
submit your proxy by mail by signing your proxy card if your shares are
registered or, for shares held beneficially in street name, by following the
voting instructions included by your stockbroker, trustee or nominee, and
mailing it in the envelope provided. If you provide specific voting
instructions, your shares will be voted as you have
instructed. Voting by telephone is not available to persons outside
of the United States.
The
shares represented by any proxy duly given will be voted at the Meeting in
accordance with the instructions of the shareholder. If no specific instructions
are given, the shares will be voted FOR the election of the
nominees for director set forth herein and FOR ratification of Moore
Stephens as the Company’s independent registered public accounting firm. In
addition, if other matters come before the Meeting, the persons named in the
accompanying proxy card will vote in accordance with their best judgment with
respect to such matters.
Under
Proposal 1 (Election of Directors), the six candidates for election as directors
at the Meeting are uncontested. In uncontested elections, directors
are elected by plurality of the votes cast at the meeting. Proposal 2
(Ratification of Independent Auditors) requires the vote of a majority of the
shares present in person or by proxy at the Meeting for approval.
Absentions
and broker non-votes will not be counted as votes in favor of a matter being
voted on, and will also not be counted as shares voting on such
matter. Accordingly, abstentions and “broker non-votes” will have no
effect on the voting on matters (such as the election of directors, and the
ratification of the selection of the independent registered public accounting
firm) that require the affirmative vote of a plurality or a majority of the
votes cast or the shares voting on the matter.
Revoking
Your Proxy
Even if
you execute a proxy, you retain the right to revoke it and to change your vote
by notifying us at any time before your proxy is voted. Mere attendance at
the meeting will not revoke a proxy. Such revocation may be effected by
calling the toll-free telephone number identified in the Notice, or by accessing
the Internet website specified in the Notice, or in writing by execution of a
subsequently dated proxy, or by a written notice of revocation, sent to the
attention of the Secretary at the address of our principal office set forth in
the Notice of Annual Meeting of Stockholders accompanying this Proxy Statement,
or by attending and voting in person at the Meeting. Unless revoked, the
shares represented by timely received proxies will be voted in accordance with
the directions given therein.
If the
Meeting is postponed or adjourned for any reason, at any subsequent reconvening
of the Meeting, all proxies will be voted in the same manner as the proxies
would have been voted at the previously convened Meeting (except for any proxies
that have at that time effectively been revoked or withdrawn), even if the
proxies had been effectively voted on the same or any other matter at a previous
Meeting.
Solicitation
of Proxies
The
expenses of solicitation of proxies will be paid by the Company. We may solicit
proxies by mail, and the officers and employees of the Company, who will receive
no extra compensation therefore, may solicit proxies personally or by
telephone. The Company will reimburse brokerage houses and other nominees
for their expenses incurred in sending proxies and proxy materials to the
beneficial owners of shares held by them.
4
Delivery
of Proxy Materials to Households
The SEC
has adopted rules that allow a company to deliver a single proxy statement or
annual report to an address shared by two or more of its stockholders. This
method of delivery, known as “householding,” permits us to realize significant
cost savings, reduces the amount of duplicate information stockholders receive,
and reduces the environmental impact of printing and mailing documents to you.
Under this process, certain stockholders of record who do not participate in
electronic delivery of proxy materials will receive only one copy of our proxy
materials and any additional proxy materials that are delivered until such time
as one or more of these stockholders notifies us that they want to receive
separate copies. Any stockholders who object to or wish to begin householding
may contact our Corporate Secretary, orally or in writing at the telephone
number or address, as applicable, at China Precision Steel, Inc., 18th Floor,
Teda Building, 87 Wing Lok Street, Sheung Wan, Hong Kong, People’s Republic of
China, telephone number (+852) 2543 2290. We will send an individual copy of the
proxy statement to any stockholder who revokes their consent to householding
within 30 days of our receipt of such revocation.
Notice
of Voting Results
The
preliminary voting results will be announced at the Annual
Meeting. The final results will be published in our current report on
Form 8-K to be filed with the Securities and Exchange Commission within four
business days after the date of the Annual Meeting, provided that the final
results are available at such time. In the event the final results
are not available within such time period, the preliminary voting results will
be published in our current report on Form 8-K to be filed within such time
period, and the final results will be published in an amended current report on
Form 8-K/A to be filed within four business days after the final results are
available. Any stockholder may also obtain the results from the
Secretary, China Precision Steel, Inc., 18th Floor, Teda Building, 87 Wing Lok
Street, Sheung Wan, Hong Kong, People’s Republic of China.
Interest
of Officers and Directors in Matters to Be Acted Upon
None of
the Company’s officers or directors has any interest in any of the matters to be
acted upon, except to the extent that a director is named as a nominee for
election to the Board of Directors.
Directors
and Executive Officers
The
following sets forth the name and position of each of our current executive
officers and directors.
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NAME
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AGE
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POSITION
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Wo
Hing Li
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63
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Director
(Chairman)
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Hai
Sheng Chen
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47
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Chief
Executive Officer and Director
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Leada
Tak Tai Li
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29
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Chief
Financial Officer
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Zu
De Jiang
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64
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Chief
Operation Officer
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Tung
Kuen Tsui
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65
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Director
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David
Peter Wong
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54
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Director
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Che
Kin Lui
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48
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Director
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Daniel
Carlson
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42
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Non-Executive
and Non-Voting Director
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Wo Hing Li. Mr. Wo
Hing Li has been the Chairman of the Company’s Board of Directors since December
28, 2006, and served as the Company’s President and Chief Executive Officer from
December 2006 through May 2010. In addition, he has been the Chairman and
Executive Director of PSHL since May 2002 and the Executive Director of
Chengtong since June 2004. From April 2004 until March 2006, Mr. Li served as a
Non-Executive Director of China Petrotech Holdings Limited, an oil software and
exploration company listed on the Singapore Stock Exchange. From October 2001 to
June 2008, Mr. Li served as a director of Medical China Limited, a company
listed on the GEM Board of the Hong Kong Stock Exchange. From 1997 to 2001, Mr.
Li served as a director of Teda (HK) Holdings Limited. Mr. Li served in various
positions within the Grand Finance Group between 1984 and 1997, serving the last
seven years as the General Manager of its subsidiary, Grand International
(China) Investment Holding Co., Limited. Mr. Li has a Master’s Degree in
Business Administration from the Murdoch University of Australia, and a PhD in
Management through a program co-organized by the University of International
Business & Economics of China and the European University of
Ireland.
5
Hai Sheng Chen. Mr. Hai Sheng
Chen is a co-founder of the Company and has been the Company’s Chief Executive
Officer since May 1, 2010. He also served as an Executive Director
and General Manager of the Company and its operating subsidiary, Chengtong,
since July 2002. Prior to joining the Company, Mr. Chen served from
July 2001 to July 2002, as the Managing Director of Shanghai Krupp Stainless
Steel Co. Limited, a steel processing company, and from August 1999 to May 2001,
as the Deputy General Manager of Pudong Steel Co. Limited, a subsidiary of the
Baosteel Group, a steel processing company. Mr. Chen has an Executive
MBA Degree from China Europe International Business School and a Bachelors
Degree in Metallic Pressure Processing from the Beijing University of Science
and Technologies.
Leada Tak Tai Li. Leada
Tak Tai Li has been the Chief Financial Officer of the Company since December
28, 2006. From October 2005 until December 28, 2006, Ms. Li was the Chief
Financial Officer of PSHL. Ms. Li has been a Non-Executive Director of STAR
Pharmaceutical Limited since August 2009, and was an assistant to the Chairman
for the same company between June 2004 and October 2005, where she was assisting
with group activities and financial reporting. From November 2003 until May
2004, Ms. Li was an accountant with KPMG Hong Kong, a company engaged in audit,
assurances and consulting services, conducting commercial due diligence on
businesses in China. From January 2002 until September 2002, Ms. Li was an
investment advisor conducting research and analysis with the private equity firm
Suez Asia Holdings (Hong Kong) Ltd. In 2003, Ms. Li received her Master’s Degree
in Accounting and Finance from Napier University in the U.K., and a Bachelors
Degree in Commerce from the University of Melbourne in 2001.
Zu De
Jiang. Zu De Jiang has been the Company’s Chief
Operating Officer since May 1, 2010, and has been with the Company since its
founding in 2002. He served as the Company’s Assistant General
Manager from February 2002 to February 2007, and has served as Assistant CEO
since March 2007. Prior to joining the Company, Mr. Jiang served from
September 1996 to June 2001, as the Deputy General Manager of Shanghai Pudong
Stainless Steel Thin Plate Co., Ltd. and from April 1984 to September
1996, as the Deputy Head of Operations of the Cold Rolling Plant at Shanghai
Pudong Steel (Group) Co., Ltd. Prior to that, Mr. Jiang held various
positions between September 1967 and April 1984 at Shanghai No. 3 Steel Factory,
including Division Chief of the Cold Rolling Division. Mr. Jiang graduated from
Shanghai Metallurgical Academy in September 1967 and holds a diploma in Steel
Rolling.
Tung Kuen
Tsui. Tung Kuen Tsui has been a member of our board of
directors since December 28, 2006. Mr. Tsui has been retired since
1998. From 1995 to 1998, Mr. Tsui served as a Senior Credit Controller for
PricewaterhouseCoopers. Prior to working as the Senior Credit Controller, Mr.
Tsui held a variety of positions with PricewaterhouseCoopers since 1971,
including Senior Manager, Information Systems. Mr. Tsui has a Master of Business
Administration from the University of Macau. Mr. Tsui graduated as an Associate
Member of Chartered Institute of Secretaries and Administrators in the United
Kingdom.
David Peter
Wong. David Peter Wong has been a member of our board of
directors since December 28, 2006. Mr. Wong is the Chief Financial Officer of
Private Wealth Partners, LLC, an SEC-registered investment adviser based in
California, and has been since November 2005. Mr. Wong served as the Corporate
Controller for H&Q Asia Pacific, an Asian private equity firm from November
2002 to October 2005. Mr. Wong was the Corporate Controller of Hellman &
Friedman, a private equity firm from January 2002 to September 2002. Mr. Wong is
a U.K. Chartered Accountant with six years of public accounting experience with
Ernst & Young in London and PriceWaterhouseCoopers in Hong Kong. Mr. Wong
has a Bachelor of Arts degree in Economics and Geography from the University of
Leeds in the United Kingdom.
Che Kin Lui. Che
Kin Lui has been a member of our board of directors since December 28, 2006. Mr.
Lui has been the Chief Financial Officer of Mirach Energy Limited, an oil
exploration and production company listed on the Singapore Stock Exchange, since
April 2007. Mr. Lui served as a consultant for Synthesis Consultancy Limited
from July 2002 until March 2007. From June 1999 to July 2002, Mr. Lui served as
a manager for MVP (HK) Industries Limited, a company engaged in manufacturing
household tools. Mr. Lui has a Master’s Degree in Business Administration from
the University of Ballarat, Australia, and a diploma in Business Administration
from Hong Kong Shue Yan College.
6
Daniel Carlson. Mr. Carlson
has served as a non-executive and non-voting member of our Board of Directors
since February 2008. He is currently a member of the Business Development
Advisory Team of Clean Coal Resources USA Corporation, a company specializing in
underground coal gasification on a commercial scale. Mr. Carlson is also a
Series 7 licensed registered representative of European American Equities, a
niche investment bank focused on natural resources and alternative energy. Prior
to joining Clean Coal Resources USA, Mr. Carlson has 18 years’ experience
working in various capacities in the money management industry. Between 2002 and
2008, Mr. Carlson worked in the hedge fund industry focusing on PIPE
investments, including sourcing and structuring of transactions. From 2001 to
2002 he served as the Head of Trading at Husic Capital Management, where he
assisted in managing several billion dollars of pension fund assets and assisted
in the management and risk management of hedge fund products. Prior to joining
Husic Capital, Mr. Carlson served from served from July 2000 through December
2001 as an Analyst and Head of Trading at Azure Capital Partners, a Venture
Capital/Crossover fund investing in the technology industry. Mr. Carlson started
in the asset management industry with RCM Capital Management, where he was a
Senior Trader from 1995 to 2000. Mr. Carlson graduated in 1989 from Tufts
University with a degree in Economics.
Except as
noted above, there are no agreements or understandings for any of our executive
officers or directors to resign at the request of another person and no officer
or director is acting on behalf of, nor will any of them act at the direction
of, any other person. Directors are elected until their successors
are duly elected and qualified.
Family
Relationships
Wo Hing
Li is the father of Leada Tak Tai Li, the Company’s Chief Financial Officer.
There are no other family relationships among any of our officers and
directors.
Involvement
in Certain Legal Proceedings
To the
best of our knowledge, none of our directors or executive officers has been
convicted in a criminal proceeding, excluding traffic violations or similar
misdemeanors, or has been a party to any judicial or administrative proceeding
during the past five years that resulted in a judgment, decree or final order
enjoining the person from future violations of, or prohibiting activities
subject to, federal or state securities laws, or a finding of any violation of
federal or state securities laws, except for matters that were dismissed without
sanction or settlement. Except as set forth in our discussion below
in “Certain Relationships and Related Transactions, and Director Independence,”
none of our directors, director nominees or executive officers has been involved
in any transactions with us or any of our directors, executive officers,
affiliates or associates which are required to be disclosed pursuant to the
rules and regulations of the SEC.
Promoters
and Certain Control Persons
We did
not have any promoters at any time during the past five fiscal
years.
Section
16(A) Beneficial Ownership Reporting Compliance
Under
U.S. securities laws, directors, certain executive officers and persons holding
more than 10% of our common stock must report their initial ownership of the
common stock, and any changes in that ownership, to the SEC. The SEC has
designated specific due dates for these reports. Based solely on our review of
copies of such reports filed with the SEC, we believe that the required reports
were filed on time in fiscal year 2009.
Company Code of Conduct and
Ethics
Our board
of directors has adopted a Code of Conduct and Ethics that applies to our
directors, officers and employees. A copy of this policy is available via
our website at http://www.chinaprecisionsteelinc.com.
7
CORPORATE
GOVERNANCE
Our
current corporate governance practices and policies are designed to promote
stockholder value and we are committed to the highest standards of corporate
ethics and diligent compliance with financial accounting and reporting rules.
Our Board provides independent leadership in the exercise of its
responsibilities. Our management oversees a system of internal controls and
compliance with corporate policies and applicable laws and regulations, and our
employees operate in a climate of responsibility, candor and
integrity.
Corporate
Governance Guidelines
We and
our Board are committed to high standards of corporate governance as an
important component in building and maintaining stockholder value. To this end,
we regularly review our corporate governance policies and practices to ensure
that they are consistent with the high standards of other companies. We also
closely monitor guidance issued or proposed by the SEC and the provisions of the
Sarbanes-Oxley Act, as well as the emerging best practices of other
companies. The current corporate governance guidelines are available on
the Company’s website at
http://www.chinaprecisionsteelinc.com. Printed copies of our corporate
governance guidelines may be obtained, without charge, by contacting the
Corporate Secretary, China Precision Steel, Inc., 18th Floor, Teda Building, 87
Wing Lok Street, Sheung Wan, Hong Kong, People’s Republic of China.
The
Board and Committees of the Board
Our board
of directors currently consists of six members: Wo Hing Li, Hai Sheng Chen, Tung
Kuen Tsui, Che Kin Lui, David Peter Wong and Daniel Carlson; Mr. Carlson serves
as a non-executive, non-voting member of the board of directors. Our board of
directors has established three committees: an audit committee, a compensation
committee, and a nominating and governance committee. Each committee is
comprised entirely of independent directors. From time to time, our board of
directors may establish other committees. Our board of directors has adopted a
written charter for each of the committees which is available on our website
http://www.chinaprecisionsteelinc.com.
Printed copies of these charters may be obtained, without charge, by contacting
the Corporate Secretary, China Precision Steel, Inc., 18th Floor, Teda Building,
87 Wing Lok Street, Sheung Wan, Hong Kong, People’s Republic of
China.
Governance
Structure
The Board
believes the interests of all stockholders are best served at the present time
through a leadership model that separates the roles of the Chairman of the
Board of Directors and the Chief Executive Officer. On May 1, 2010,
the Board appointed Hai Sheng Chen, to serve as Chief Executive Officer, in lieu
of Wo Hing Li, who resigned from this position on the same day, but continues in
his role as Chairman of the Board. We have chosen to implement
such a governance structure to allow our Chief Executive Officer the ability to
focus the majority of his time and efforts on the day to day operations of the
Company. Each of our Chief Executive Officer and Board Chairman possesses
an in-depth knowledge of the Company, its integrated operations, the domestic
and international industry, and the array of challenges to be faced, gained
through over 25 years of combined experience. The Board believes that these
experiences and other insights put each of them in the best position to provide
broad leadership for the Board as it considers strategy and as it exercises its
fiduciary responsibilities to its stockholders. We believe that this governance
structure will serve the Company’s shareholders well in the coming
years.
Further,
the Board has demonstrated its commitment and ability to provide independent
oversight of management. A majority of the Board is comprised of independent
directors, and 100 percent of the Audit, Compensation, and Corporate Governance
committees are independent. Each independent director has access to the Chief
Executive Officer and other Company executives on request, may call meetings of
the independent directors, and may request agenda topics to be added or dealt
with in more detail at meetings of the full Board or an appropriate Board
committee.
We
encourage our stockholders to learn more about our Company’s governance
practices at our website, http://www.chinaprecisionsteelinc.com.
8
The
Board’s Role in Risk Oversight
The Board
oversees that the assets of the Company are properly safeguarded, that the
appropriate financial and other controls are maintained, and that the Company’s
business is conducted wisely and in compliance with applicable laws and
regulations and proper governance. Included in these responsibilities is the
Board of Directors’ oversight of the various risks facing the Company. In this
regard, the Board seeks to understand and oversee critical business risks. The
Board does not view risk in isolation. Risks are considered in virtually every
business decision and as part of the Company’s business strategy. The
Board recognizes that it is neither possible nor prudent to eliminate all
risk. Indeed, purposeful and appropriate risk-taking is essential for the
Company to be competitive on a global basis and to achieve its
objectives.
While the
Board oversees risk management, Company management is charged with managing
risk. The Company has robust internal processes and a strong internal control
environment to identify and manage risks and to communicate with the Board. The
Board and the Audit Committee monitor and evaluate the effectiveness of the
internal controls and the risk management program at least annually. Management
communicates routinely with the Board, Board Committees and individual Directors
on the significant risks identified and how they are being managed. Directors
are free to, and indeed often do, communicate directly with senior
management.
The Board
implements its risk oversight function both as a whole and through Committees.
Much of the work is delegated to various Committees, which meet regularly and
report back to the full Board. All Committees play significant roles in carrying
out the risk oversight function. In particular:
|
·
|
The Audit Committee oversees
risks related to the Company’s financial statements, the financial
reporting process, accounting and legal matters. The Audit Committee
oversees the internal audit function and the Company’s ethics programs,
including the Code of Business Conduct. The Audit Committee members meet
separately with representatives of the independent auditing
firm.
|
|
·
|
The Compensation Committee
evaluates the risks and rewards associated with the Company’s compensation
philosophy and programs. The Compensation Committee reviews and approves
compensation programs with features that mitigate risk without diminishing
the incentive nature of the compensation. Management discusses with the
Compensation Committee the procedures that have been put in place to
identify and mitigate potential risks in
compensation.
|
Independent
Directors; Committees and Meetings
Our Board
currently has three standing committees which, pursuant to delegated authority,
perform various duties on behalf of and report to the Board: (i) Audit
Committee, (ii) Compensation Committee and (iii) Corporate Governance and
Nominating Committee. Each of the Audit Committee, Compensation Committee and
Corporate Governance and Nominating Committee are comprised entirely of
independent directors. From time to time, the Board may establish other
committees.
During
the fiscal year ended June 30, 2009, each of our three committees met 4 times.
Copies of the charters for each of our four standing committees may be obtained
from our website at http://www.chinaprecisionsteelinc.com.
Audit
Committee and Audit Committee Financial Expert
Tung Kuen
Tsui, Che Kin Lui and David Peter Wong serve as members of the Company’s Audit
Committee, each of whom our Board determined to be “independent” as that term is
defined by Rule 4200(a)(15) of the Nasdaq Marketplace Rules. Mr. Wong
serves as chair of the Audit Committee.
9
Our Board
of Directors has determined that David Peter Wong possesses the accounting or
related financial management experience that qualifies him as financially
sophisticated within the meaning of Rule 4350(d)(2)(A) of the Nasdaq Marketplace
Rules and that he is an “audit committee financial expert” as defined by the
rules and regulations of the SEC.
The
Report of the Audit Committee regarding the audited financials statements of the
Company for the fiscal year ended June 30, 2009 is located on Exhibit A to this
Proxy Statement.
Compensation
Committee
Our
compensation committee consists of Tung Kuen Tsui, Che Kin Lui and David Peter
Wong, each of whom are “independent” as that term is defined by Rule 4200(a)(15)
of the Nasdaq Marketplace Rules. Our compensation committee assists
the Board in reviewing and approving the compensation structure of our directors
and executive officers, including all forms of compensation to be provided to
our directors and executive officers. Our chief executive officer may not be
present at any committee meeting during which his compensation is
deliberated. Mr. Che Kin Lui serves as Chair of the compensation
committee.
The
compensation committee is responsible for, among other things:
|
·
|
approving
and overseeing the compensation package for our executive
officers;
|
|
·
|
reviewing
and making recommendations to the Board with respect to the compensation
of our directors;
|
|
·
|
reviewing
and approving corporate goals and objectives relevant to the compensation
of our chief executive officer, evaluating the performance of our chief
executive officer in light of those goals and objectives, and setting the
compensation level of our chief executive officer based on this
evaluation; and
|
|
·
|
reviewing
periodically and making recommendations to the Board regarding any
long-term incentive compensation or equity plans, programs or similar
arrangements, annual bonuses, employee pension and welfare benefit
plans.
|
The
Report of the Compensation Committee of the Company for the fiscal year ended
June 30, 2009 is located on Exhibit B to this
Proxy Statement.
Corporate
Governance and Nominating Committee
Our
corporate governance and nominating committee consists of Tung Kuen Tsui, Che
Kin Lui and David Peter Wong, each of whom is “independent” as that term is
defined by Rule 4200(a)(15) of the Nasdaq Marketplace Rules. The corporate
governance and nominating committee assists the Board of Directors in
identifying individuals qualified to become our directors and in determining the
composition of the Board and its committees. Mr. Tung Kuen Tsui serves as Chair
of the corporate governance and nominating committee.
10
The
corporate governance and nominating committee is responsible for, among other
things:
|
·
|
identifying
and recommending to the Board nominees for election or re-election to the
board, or for appointment to fill any
vacancy;
|
|
·
|
reviewing
annually with the Board the current composition of the Board in light of
the characteristics of independence, age, skills, experience and
availability of service to
us;
|
|
·
|
identifying
and recommending to the Board the directors to serve as members of the
Board’s committees; and
|
|
·
|
monitoring
compliance with our code of business conduct and
ethics.
|
In
identifying and recommending nominees for election or re-election to the board,
or for appointment to fill any vacancy, the corporate governance and nominating
committee is also committed to engendering Board strength and effectiveness by
seeking candidates with a diverse set of business, academic and life experiences
and backgrounds who also possess knowledge and skills in areas of importance to
the Company. The Committee does not use quotas but considers diversity when
evaluating potential new directors.
The
Committee identifies director candidates primarily through recommendations made
by the non-employee directors. These recommendations are developed based on the
directors’ own knowledge and experience in a variety of fields. Additionally the
Committee considers recommendations made by the employee directors,
stockholders, and others. All recommendations, regardless of the source, are
evaluated on the same basis.
Stockholders
may send recommendations for director candidates to the Corporate Secretary,
China Precision Steel, Inc., 18th Floor, Teda Building, 87 Wing Lok Street,
Sheung Wan, Hong Kong, People’s Republic of China. A submission
recommending a candidate should include:
|
·
|
Sufficient
biographical information to allow the Committee to evaluate the
candidate;
|
|
·
|
Information
concerning any relationship between the candidate and the stockholder
recommending the candidate;
and
|
|
·
|
Material
indicating the willingness of the candidate to serve if nominated and
elected.
|
The
procedures by which stockholders may recommend nominees have not changed
materially since last year’s proxy statement.
Code of Ethics
Our
amended and restated Code of Ethics conforms to the rules and regulations of The
Nasdaq Stock Market, Inc., or Nasdaq. The Code of Ethics applies to all of our
directors, officers and employees, including our principal executive officer,
principal financial officer and principal accounting officer, and addresses,
among other things, honesty and ethical conduct, conflicts of interest,
compliance with laws, regulations and policies, including disclosure
requirements under the federal securities laws, confidentiality, trading on
inside information, and reporting of violations of the code. A copy of the Code
of Ethics has been filed as Exhibit 14 to our annual report on Form 10-K, filed
on March 31, 2008. Our Code of Ethics is also posted on the corporate governance
page of our website at http://www.chinaprecisionsteelinc.com. During
the fiscal year ended June 30, 2009, there were no waivers of our Code of
Ethics.
Stockholder Communication with the
Board of Directors.
Stockholders
may communicate with the Board, including non-management directors, by sending a
letter to our board of directors, c/o Corporate Secretary, China Precision
Steel, Inc., 18th Floor, Teda Building, 87 Wing Lok Street, Sheung Wan, Hong
Kong, People’s Republic of China, for submission to the board or
committee or to any specific director to whom the correspondence is directed.
Stockholders communicating through this means should include with the
correspondence evidence, such as documentation from a brokerage firm, that the
sender is a current record or beneficial stockholder of the Company. All
communications received as set forth above will be opened by the Corporate
Secretary or her designee for the sole purpose of determining whether the
contents contain a message to one or more of our directors. Any contents that
are not advertising materials, promotions of a product or service, patently
offensive materials or matters deemed, using reasonable judgment, inappropriate
for the Board will be forwarded promptly to the chairman of the Board, the
appropriate committee or the specific director, as applicable
11
There
have been no material changes to the procedures by which stockholders may
recommend nominees to our Board of Directors since such procedures were last
disclosed.
EXECUTIVE
COMPENSATION
Summary
Compensation Table
The
following table sets forth information concerning all cash and non-cash
compensation awarded to, earned by or paid to the named persons for services
rendered in all capacities during the noted periods. No other executive officers
received total annual salary and bonus compensation in excess of
$100,000.
|
Name
and
Principal
Position
|
Year
|
Salary
($)
|
Bonus
($)
|
Stock
Awards
($)
|
Option
Awards
($)
|
Non-Equity
Incentive
Plan
Compensation
Earnings
($)
|
Non-
Qualified
Deferred
Compensation
Earnings
($)
|
All
Other
Compensation
($)
|
Total
($)
|
|||||||||||||||||||||||||
| Hai Sheng Chen, Chief Executive Officer(1) |
2007
|
8,824 | - |
|
- | - | - | 8,824 | ||||||||||||||||||||||||||
|
2008
|
9,706 | 2,426 |
|
- | - | - | 12,132 | |||||||||||||||||||||||||||
|
2009
|
9,653 | - |
|
- | - | - | - | 9,653 | ||||||||||||||||||||||||||
| Wo Hing Li, Chairman and Former Chief Executive Officer (1) |
2007
|
140,000 | - | - | - | - | - | - | 140,000 | |||||||||||||||||||||||||
|
2008
|
140,000 | 35,000 | - | - | - | - | - | 175,000 | ||||||||||||||||||||||||||
|
2009
|
140,000 | - | - | - | - | - | - | 140,000 | ||||||||||||||||||||||||||
| Leada Tak Tai Li Chief Financial Officer |
2007
|
60,000 | - | - | - | - | - | - | 60,000 | |||||||||||||||||||||||||
|
2008
|
60,000 | 15,000 | - | - | - | - | - | 75,000 | ||||||||||||||||||||||||||
|
2009
|
60,000 | - | - | - | - | - | - | 60,000 | ||||||||||||||||||||||||||
|
Zu
De Jiang,
Chief
Operating Officer(2)
|
2007
|
6,897 | - | - | - | - | - | - | 6,897 | |||||||||||||||||||||||||
|
2008
|
8,243 | 2,061 | - | - | - | - | - | 10,304 | ||||||||||||||||||||||||||
|
2009
|
8,776 | - | - | - | - | - | 8,776 | |||||||||||||||||||||||||||
|
(1)
|
On
May 1, 2010, Dr. Wo Hing Li resigned from his position as Chief
Executive Officer, effective immediately, and the Company's board of
directors appointed Mr. Hai Sheng Chen, the Company’s General Manager, as
Chief Executive Officer in Mr. Li’s stead. Mr. Li remains in his position as
Chairman of the Company’s Board of Directors. The compensation
reported for Mr. Chen reflects compensation that he received prior to his
appointment as Chief Executive
Officer.
|
|
(2)
|
On
May 1, 2010, and appointed Mr. Zu De Jiang as the Company’s Chief
Operation Officer. The compensation reported for Mr. Jiang
reflects compensation that he received prior to his appointment as Chief
Operation Officer.
|
Narrative
Disclosure to Summary Compensation Table
Each of
our Named Executive Officers has entered into an executive employment agreement,
as described below, with the Company pursuant to which they receive annual
compensation as well as discretionary bonuses as may be determined by the
Committee.
12
Employment
and Severance Agreements
We have
entered into executive employment agreements with each of Hai Sheng Chen, our
Chief Executive Officer, Leada Tak Tai Li, our Chief Financial Officer, Zu De
Jiang, our Chief Operation Officer, and Wo Hing Li, our Board Chairman and
former Chief Executive Officer. All executive employment agreements
were entered into as of January 1, 2007, except Mr. Jiang’s employment agreement
which was entered into on May 1, 2010, and will continue indefinitely until
terminated in accordance with the terms of agreement. The base salary shown in
the Summary Compensation Table above is described in each of the executive
officer’s respective employment agreement, and each of them has the right to
participate in our employee benefit plans. The executives are also entitled to
reimbursement, to the fullest extent authorized by Delaware law, of all expenses
incurred or suffered by them in connection with any claim brought against them
because of or in connection with their positions with us or any of our
affiliates, except to the extent that, such expenses arise as a result of the
bad faith, willful misconduct or gross negligence of the executive, or as a
result of his or her conviction for a felony.
Each of
the executive employment agreements permits us to terminate the executive’s
employment at any time by giving a written notice to the executive officer,
provided that, if we terminate the executive’s employment without cause, the
executive will be entitled to a termination payment equal to six months of his
or her then current base salary, payable in six equal installments over the
six-month period immediate following the date of termination. We may also
terminate for cause, at any time, without notice or remuneration, for certain
acts of the executive, including but not limited to a conviction or plea of
guilty to a felony, negligence or dishonesty to our detriment and failure to
perform agreed duties after a reasonable opportunity to cure the failure. An
executive may terminate his or her employment upon thirty days’ written notice
if there is a material reduction in his authority, duties and responsibilities
or if there is a material breach by the us of the terms or conditions of the
agreement after a reasonable opportunity to cure the breach. The agreements also
provide that, if within 12 months following a change of control, any of the
executives are terminated without cause or any of them terminate for good
reason, then the vesting and exercisability of 50% of his or her stock options
that are unvested at the time of the termination (if any) will accelerate and
immediately become vested and exercisable as of the termination date, and will
remain exercisable for 12 months following the termination date.
Each of
the executive employment agreements contains customary non-competition,
confidentiality, and non-disclosure covenants. Specifically, each executive
officer has agreed, both during and after he or she is no longer employed by us,
to hold in strict confidence and not to use, except as required in the
performance of his duties in connection with the employment, any confidential
information, technical data, trade secrets and know-how of our company or the
confidential information of any third party, including our affiliated entities
and our subsidiaries, received by us. The executive officers have also agreed to
disclose in confidence to us all inventions, designs and trade secrets which
they conceive, develop or reduce to practice and to assign all right, title and
interest in them to us. In addition, each of the executive officers has agreed
not to, while employed by us and for a period of 3 years following the
termination or expiration of the agreement:
|
·
|
approach our clients, customers
or contacts or other persons or entities, and not to interfere with the
business relationship between us and such persons and/or
entities;
|
|
·
|
assume employment with or provide
services as a director for any of our competitors, or engage in any
business which is in direct or indirect competition with our business;
or
|
|
·
|
solicit the services of any of
our employees.
|
Plan-Based
Awards
No
plan-based awards were granted to any of the Named Executive Officers during the
year ended June 30, 2009.
Outstanding
Equity Awards at June 30, 2009
No
unexercised options or warrants were held by any of the Named Executive Officers
at year end. No equity awards were made during the year ended June 30,
2009.
Option
Exercises and Stock Vested
No
options to purchase capital stock of the Company were exercised by any of the
Named Executive Officers, nor was any restricted stock held by such executive
officers vested during the year ended June 30, 2009.
13
Pension
Benefits
No Named
Executive Officers received or held pension benefits during the year ended June
30, 2009.
Nonqualified
Deferred Compensation
No
nonqualified deferred compensation was offered or issued to any Named Executive
Officer during the year ended June 30, 2009.
Potential
Payments upon Termination or Change in Control
We do not
have change-in-control or severance agreements with our named executive
officers. However, each of Mr. Li, Ms. Li and Mr. Chen’s executive employment
agreement provides a payment equaling six months of his or her then current base
salary, payable in six equal installments over the six-month period immediately
following the date of termination, if we terminate any of them without cause or
any of them terminate for good reason. In addition, if any of them are
terminated without cause or any of them terminate for good reason within 12
months following a change of control, then the vesting and exercisability of
fifty percent of his or her stock options that are unvested at the time of the
termination will accelerate and immediately become vested and exercisable as of
the termination date, and will remain exercisable for 12 months following the
termination date.
The
following table reflects amounts payable to each of Mr. Li, Ms. Li and Mr. Chen
(1) assuming their employment was terminated without cause or for good reason on
June 30, 2009 and (2) assuming a termination without cause or for good reason
occurred on June 30, 2009 and within 12 months following a change in
control.
|
Name
|
Termination
Without Cause(1)
|
Change in
Control(2)
|
||||||
|
Wo
Hing Li
|
$
|
70,000
|
$
|
-
|
||||
|
Leada
Tak Tai Li
|
$
|
30,000
|
$
|
-
|
||||
|
Hai
Sheng Chen
|
$
|
4,827
|
$
|
-
|
||||
|
(1)
|
Amounts
in this column reflect the value of unvested options that would be
accelerated upon termination without cause or for good reason within 12
months following a change in control. Amounts are calculated based on (1)
the difference between (a) the closing market price of a share of Common
Stock on June 30, 2009 and (b) the exercise price per share for an option
grant (2) multiplied by the number of shares subject to the option
grant.
|
|
(2)
|
In
accordance with their employment agreements, Mr. Li, Ms. Li and Mr. Chen,
if terminated without cause on the last day of the 2009 fiscal year, would
have been entitled to a payment of their 2009 base salary in six equal
installment over a six-month
period.
|
Director
Compensation
The
following table provides information about the compensation earned by directors
who served during fiscal year 2009:
|
Name
|
Fees Earned or
Paid in Cash
($)
|
All Other
Compensation
($)
|
Total
($)
|
|||||||
|
Wo
Hing Li
|
-
|
140,000
|
(1)
|
140,000
|
||||||
|
Hai
Sheng Chen
|
-
|
9,653
|
(1)
|
9,653
|
||||||
|
Che
Kin Lui
|
30,000
|
-
|
30,000
|
|||||||
|
David
Peter Wong
|
36,000
|
-
|
36,000
|
|||||||
|
Tung
Kuen Tsui
|
30,000
|
-
|
30,000
|
|||||||
|
Daniel
Carlson (1)
|
30,000
|
-
|
30,000
|
|||||||
|
(1)
|
The
compensation reported for Mr. Li and Mr. Chen reflects compensation that
they received as executives of the Company. Neither Mr. Li nor
Mr. Chen received compensation for serving as our
Directors.
|
|
(2)
|
Mr.
Carlson serves on our Board of Directors as a non-executive
director.
|
14
Narrative
to Director Compensation Table
For the
year ended June 30, 2009, we paid fees in the total amount of $126,000 for our
three independent directors and one non-executive director for service on our
board of directors and service to the Company. The fees paid to our independent
directors and non-executive director were standard monthly director fees
pursuant to the independent director and non-executive director agreements
entered into with these directors. David P. Wong receives $3,000/month as
compensation for his services as our independent director and audit committee
chair, and Che Kin Lui and Tung Kuen Tsui each receives $2,500/month as
compensation for their services as our independent directors, and Daniel Carlson
receives $2,500/month as compensation for his services as our non-executive
director.
The
bonuses granted to our directors are discretionary cash bonuses based on the
overall performance of the Company for the year, and specifically on the
Company’s ability to meet of its Net Income target. There was no
bonus payment to our directors during the year. Other than monthly director fees
and discretionary bonuses, we have no other compensation arrangements with our
directors for committee service, service as chairman of the board or a
committee, meeting attendance or the like.
During
the year ended June 30, 2009, Messrs. Tsui, Lui and Wong fulfilled all functions
of the Compensation Committee with regard to determining compensation of
executive officers of the Company.
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The
following table sets forth, as of May 13, 2010, certain information with respect
to the beneficial ownership of our common stock by (i) each director and
executive officer, (ii) each person known by us to be the beneficial owner f
five percent or more of the outstanding shares of common stock, and (iii) all
directors and executive officers as a group. Unless otherwise indicated, the
person or entity listed in the table is the beneficial owner of, and has sole
voting and investment power with respect to, the shares indicated.
Unless
otherwise specified, the address of each of the persons set forth below is in
care of China Precision Steel, Inc., 18th Floor, Teda Building, 87 Wing Lok
Street, Sheung Wan, Hong Kong, People’s Republic of China.
|
Name & Address of
Beneficial
Owner
|
Office, If Any
|
Title of Class
|
Amount and
Nature of
Beneficial
Ownership(1)
|
Percent of
Class(2)
|
|||||||||
|
Officers
and Directors
|
|||||||||||||
|
Wo Hing Li
|
CEO,
President, and
Chairman
|
Common Stock,
$0.01 par value
|
15,349,240 | 33.0 | % | ||||||||
|
Leada Tak Tai Li
|
Chief Financial
Officer
|
Common Stock,
$0.01 par value
|
200,000 | * | |||||||||
|
Hai Sheng Chen
|
Director
|
Common Stock,
$0.01 par value
|
0 | * | |||||||||
|
Che Kin Lui
|
Director
|
Common Stock,
$0.01 par value
|
0 | * | |||||||||
|
Tung Kuen Tsui
|
Director
|
0 | * | ||||||||||
|
David Peter Wong
|
Director
|
0 | * | ||||||||||
|
Daniel Carlson
|
Director
|
Common Stock,
$0.01 par value
|
10,000 | * | |||||||||
|
All officers and directors as a group (7 persons named above)
|
Common Stock,
$0.01 par value
|
15,559,240 | 33.0 | % | |||||||||
|
5%
Security Holders
|
|||||||||||||
|
Wo
Hing Li
|
Common Stock,
$0.01 par value
|
15,349,240 | 33.0 | % | |||||||||
|
Hudson Bay Overseas
Fund, Ltd.
120 Broadway, 40th Floor
New York, New York 10271
|
Common Stock,
$0.01 par value
|
2,711,110 | 5.8 | % | |||||||||
|
Sander Gerber
c/o Hudson Bay Fund, LP
120 Broadway, 40th Floor
New York, New York 10271
|
Common Stock,
$0.01 par value
|
3,851,110 |
(3)
|
8.3 | % | ||||||||
|
Yoav Roth
c/o Hudson Bay Fund, LP
120 Broadway, 40th Floor
New York, New York 10271
|
Common Stock,
$0.01 par value
|
3,851,110 |
(3)
|
8.3 | % | ||||||||
|
Charles Winkler
c/o Hudson Bay Fund, LP
120 Broadway, 40th Floor
New York, New York 10271
|
Common Stock,
$0.01 par value
|
3,851,110 |
(3)
|
8.3 | % | ||||||||
|
*
|
Less
than 1%
|
|
(1)
|
Beneficial
Ownership is determined in accordance with the rules of the SEC and
generally includes voting or investment power with respect to
securities. Each of the beneficial owners listed above has
direct ownership of and sole voting power and investment power with
respect to the shares of our common
stock.
|
|
(2)
|
As
of September 21, 2009, a total of 46,562,955 shares of our common stock
are considered to be outstanding pursuant to SEC Rule 13d-3(d)(1).
For each Beneficial Owner above, any options exercisable within 60
days have been included in the
denominator.
|
|
(3)
|
Includes
2,711,110 shares of our common stock held by Hudson Bay Overseas Fund, Ltd
and 1,140,000 shares of our common stock held by the Hudson Bay Fund, LP.
Sander Gerber, Yoav Roth and Charles Winkler share voting and investment
power over, but disclaim beneficial ownership over, such
shares.
|
15
Changes
in Control
There are
currently no arrangements which may result in a change in control of the
Company.
Securities
Authorized for Issuances under Equity Compensation Plans
The
following table includes the information as of the end of fiscal year 2009 for
each category of our equity compensation plan:
|
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(1)
|
-
|
-
|
2,165,220
|
|||||||||
|
Equity
compensation plans not approved by security holders
|
-
|
-
|
-
|
|||||||||
|
Total
|
-
|
-
|
2,165,220
|
|||||||||
|
(1)
|
The
China Precision Steel, Inc. 2006 Omnibus Long-Term Incentive Plan was
approved by our stockholders on December 27, 2006. The plan is
administered by our Compensation Committee and allows us to grant awards
of stock options (including incentive stock options), stock appreciation
rights, restricted stock, restricted stock units, unrestricted stock and
cash awards to: (i) any employee, officer or director of the Company or
our affiliates, or a consultant or adviser currently providing services to
the Company or an affiliate; (ii) any outside director; and (iii) any
other individual whose participation in the plan is determined to be in
the best interests of the Company by the Compensation
Committee. We have reserved a maximum of 2,165,220 shares of
our common stock to be issued under the plan. No shares have
been awarded under the 2006 Omnibus Long-Term Incentive
Plan.
|
16
CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
Related
Party Transactions
The
following includes a summary of transactions since the beginning of the 2009
fiscal year, or any currently proposed transaction, in which we were or are to
be a participant and the amount involved exceeded or exceeds the lesser of
$120,000 or one percent of the average of our total assets at year end for the
last two completed fiscal years, and in which any related person had or will
have a direct or indirect material interest (other than compensation described
under Item 11. “Executive Compensation”). We believe the terms obtained or
consideration that we paid or received, as applicable, in connection with the
transactions described below were comparable to terms available or the amounts
that would be paid or received, as applicable, in arm’s-length
transactions.
None of
our directors, director nominees or executive officers has been involved in any
transactions with us or any of our directors, executive officers, affiliates or
associates which are required to be disclosed pursuant to the rules and
regulations of the SEC.
Review
and Approval of Related Person Transactions
We review
all relationships and transactions in which the Company and our directors and
executive officers or their immediate family members are participants to
determine whether such persons have a direct or indirect material interest. Our
Chief Financial Officer is primarily responsible for the development and
implementation of processes and controls to obtain information from the
directors and executive officers with respect to related person transactions and
for then determining, based on the facts and circumstances, whether the company
or a related person has a direct or indirect material interest in the
transaction. As required under SEC rules, transactions that are determined to be
directly or indirectly material to the Company or a related person are disclosed
in our proxy statement. In addition, the disinterested members of the board of
directors or audit committee review and approve or ratify any related person
transaction that is required to be disclosed. Though the audit committee and
board of directors do not follow a written policy or procedure in reviewing
related party transactions, in the course of their review and approval or
ratification of a disclosable related party transaction, as disclosed in the
respective minutes of the meetings of such entities, consider:
|
·
|
the nature of the related
person’s interest in the
transaction;
|
|
·
|
the material terms of the
transaction, including, without limitation, the amount and type of
transaction;
|
|
·
|
the importance of the transaction
to the related person;
|
|
·
|
the importance of the transaction
to the company;
|
|
·
|
whether the transaction would
impair the judgment of a director or executive officer to act in the best
interest of the company; and
|
|
·
|
any other matters deemed
appropriate.
|
17
Any
member of the audit committee who is a related person with respect to a
transaction under review may not participate in the deliberations or vote
respecting approval or ratification of the transaction, provided, however, that
such director may be counted in determining the presence of a quorum at a
meeting of the committee that considers the transaction.
Director
Independence
Our board
of directors has determined that the majority of the board is comprised of
“independent directors” within the meaning of applicable NASDAQ listing
standards relating to board composition and Section 301 of the Sarbanes-Oxley
Act of 2002. Our independent directors are: Mr. Tsui, Mr. Wong and Mr.
Lui.
PROPOSAL
1
ELECTION OF
DIRECTORS
The Board
of Directors (the “Board”) is responsible for establishing broad corporate
policies and monitoring the overall performance of the Company. It selects the
Company’s executive officers, delegates authority for the conduct of the
Company’s day-to-day operations to those officers, and monitors their
performance. Members of the Board are kept informed of the Company’s business by
participating in Board and Committee meetings, by reviewing analyses and
reports, and through discussions with the Chairman and other
officers.
There are
currently six (6) directors serving on the Board. At the Meeting, six (6)
directors will be elected. The individuals who have been nominated for election
to the Board at the Meeting are listed in the table below. Each of the nominees
is a current director of the Company.
If, as a
result of circumstances not now known or foreseen, any of the nominees is
unavailable to serve as a nominee for the office of Director at the time of the
Meeting, the holders of the proxies solicited by this Proxy Statement may vote
those proxies either (i) for the election of a substitute nominee who will be
designated by the proxy holders or by the present Board or (ii) for the balance
of the nominees, leaving a vacancy. Alternatively, the size of the Board may be
reduced accordingly. The Board has no reason to believe that any of the nominees
will be unwilling or unable to serve, if elected as a Director. The six nominees
for election as directors are uncontested. In uncontested elections, directors
are elected by plurality of the votes cast at the meeting. Proxies submitted on the accompanying
proxy card will be voted for the election of the nominees listed below, unless
the proxy card is marked otherwise.
NOMINEES
The
names, the positions with the Company and the ages as of the Record Date of the
individuals who are our nominees for election as directors are:
|
Name
|
Age
|
Position
With the Company
|
Term
as Director of Company
|
Arrangements
for Selection
as
Director
|
||||
|
Hai
Sheng Chen
|
47
|
Chief
Executive Officer, Director
|
December
28, 2006 – present
|
None
|
||||
|
Wo
Hing Li
|
63
|
Director
|
December
28, 2006 – present
|
None
|
||||
|
Tung
Kuen Tsui
|
65
|
Director
|
December
28, 2006 – present
|
None
|
||||
|
David
Peter Wong
|
54
|
Director
|
December
28, 2006 – present
|
None
|
||||
|
Che
Kin Lui
|
48
|
Director
|
December
28, 2006 – present
|
None
|
||||
|
Daniel
Carlson
|
42
|
Non-Executive
Director
|
February
19, 2008 – present
|
None
|
18
For
information as to the shares of the Common Stock held by each nominee, see
“Security Ownership of Certain Beneficial Owners and Management,” elsewhere in
this Proxy Statement. See “Directors and Executive Officers”
above for biographical summaries for each of our director nominees.
All
directors will hold office for the terms indicated, or until their earlier
death, resignation, removal or disqualification, and until their respective
successors are duly elected and qualified. There are no arrangements or
understandings between any of the nominees, directors or executive officers and
any other person pursuant to which any of our nominees, directors or executive
officers have been selected for their respective positions. No nominee, member
of the Board of Directors or executive officer is related to any other nominee,
member of the Board of Directors or executive officer.
Directors
are responsible for overseeing the Company’s business consistent with their
fiduciary duty to shareowners. This significant responsibility requires
highly-skilled individuals with various qualities, attributes and professional
experience. The Board believes that there are general requirements for service
on the Company’s Board of Directors that are applicable to all Directors and
that there are other skills and experience that should be represented on the
Board as a whole but not necessarily by each Director. The Board and the
Governance and Nominating Committee of the Board consider the qualifications of
Directors and Director candidates individually and in the broader context of the
Board’s overall composition and the Company’s current and future
needs.
Qualifications
for All Directors
In its
assessment of each potential candidate, including those recommended by
shareowners, the Governance and Nominating Committee considers the nominee’s
judgment, integrity, experience, independence, understanding of the Company’s
business or other related industries and such other factors the Governance and
Nominating Committee determines are pertinent in light of the current needs of
the Board. The Governance and Nominating Committee also takes into account the
ability of a Director to devote the time and effort necessary to fulfill his or
her responsibilities to the Company.
The Board
and the Governance and Nominating Committee require that each Director be a
recognized person of high integrity with a proven record of success in his or
her field. Each Director must demonstrate innovative thinking, familiarity with
and respect for corporate governance requirements and practices, an appreciation
of multiple cultures and a commitment to sustainability and to dealing
responsibly with social issues. In addition to the qualifications required of
all Directors, the Board assesses intangible qualities including the
individual’s ability to ask difficult questions and, simultaneously, to work
collegially.
The Board
does not have a specific diversity policy, but considers diversity of race,
ethnicity, gender, age, cultural background and professional experiences in
evaluating candidates for Board membership. Diversity is important because a
variety of points of view contribute to a more effective decision-making
process.
Qualifications,
Attributes, Skills and Experience to be Represented on the Board as a
Whole
The Board
has identified particular qualifications, attributes, skills and experience that
are important to be represented on the Board as a whole, in light of the
Company’s current needs and business priorities. The Company is a
NASDAQ listed company that offers products in the steel industry in
China. Therefore, the Board believes that a diversity of professional
experiences in the steel industry, specific knowledge of key geographic growth
areas, and knowledge of U.S. capital markets and of U.S. accounting
and financial reporting standards should be represented on the
Board. Set forth below is a tabular disclosure summarizing some of
the specific qualifications, attributes, skills and experiences of our
directors.
19
|
Director
|
Titles
|
Material
Qualifications
|
||
|
Wo
Hing Li
|
Chairman
|
· Co-founder
of the Company
· Chief
Executive Officer of the Company’s oldest subsidiary since its
inception
· PhD
in Management and Masters in Business Administration
· Mr.
Li contributes invaluable strategic vision to the Company’s long-term
growth with in-depth knowledge of operations in China
|
||
|
Hai
Sheng Chen
|
Director
and Chief Executive Officer
|
· Co-founder
of the Company and its oldest subsidiary
· EMBA
in Business Administration
· Expertise
in cold rolling and general knowledge of the steel industry with over 20
years of experience since graduating with a Bachelors in Metallic Pressure
Processing
· Mr.
Chen contributes invaluable long-term knowledge of the Company’s business
and operations and of the steel industry and the cold rolling niche
markets in China
|
||
|
Tung
Kuen Tsui
|
Director
|
· Masters
in Business Administration
· Mr.
Tsui served with PricewaterhouseCoopers for 27 years prior to his
retirement in 1998
· The
Company receives invaluable benefit from Mr. Tsui’s knowledge of U.S.
accounting and financial reporting standards.
|
||
|
David
Peter Wong
|
Director
|
· Chief
Financial Officer of a registered California-based investment
adviser
· U.K.
Chartered Accountant with six years of public accounting experience with
Ernst & Young in London and PriceWaterhouseCoopers in Hong
Kong
· Mr.
Wong’s up-to-date knowledge of U.S. accounting and financial reporting
standards and his knowledge of SEC reporting requirements makes him an
ideal candidate for the Chairman of the Company’s Audit
Committee
|
||
|
Che
Kin Lui
|
Director,
Audit Committee Financial Expert
|
· Masters
in Business Administration
· Chief
Financial Officer of a China-based company listed on the Singapore Stock
Exchange
· Mr.
Lui’s experience in accounting, as well as his experience as CFO of a
listed company contributes invaluable knowledge to the helps the Company
to implement best public company practices and to remain compliant with
listing rules.
|
||
|
Daniel
Carlson
|
Non-Executive
Director
|
· Degree
in Economics and a Series 7 licensed registered
representative
· Over
15 years of experience in asset and money management industry
· Mr.
Carlson’s experience in the US finance industry and his knowledge of U.S.
capital markets helps guide the Company in making important financing
decisions and with investor relations
|
General
Information
For
information as to the shares of the Common Stock held by each nominee, see
“Security Ownership of Certain Beneficial Owners and Management,”
above.
See
“Directors and Executive Officers” above for biographical summaries for each of
our director nominees.
20
All
directors will hold office for the terms indicated, or until their earlier
death, resignation, removal or disqualification, and until their respective
successors are duly elected and qualified. There are no arrangements
or understandings between any of the nominees, directors or executive officers
and any other person pursuant to which any of our nominees, directors or
executive officers have been selected for their respective
positions. No nominee, member of the Board of Directors or executive
officer is related to any other nominee, member of the Board of Directors or
executive officer.
PROPOSAL
2
RATIFICATION
OF SELECTION OF INDEPENDENT AUDITORS
The Audit
Committee has selected Moore Stephens to serve as the independent registered
public accounting firm of the Company for the fiscal year ending June 30, 2010.
Moore Stephens was the Company’s independent registered public accounting firm
for the fiscal years ending June 30, 2009 and 2008. Prior to the appointment of
Moore Stephens on November 29, 2007, Murrell, Hall, McIntosh & Co. PLLP
(“Murrell”) served as the Company’s the independent registered public accounting
firm for the fiscal years ended June 30, 2007 and 2006.
We are
asking our shareholders to ratify the selection of Moore Stephens as our
independent registered public accounting firm. Although ratification is not
required by our bylaws or otherwise, the Board is submitting the selection of
Moore Stephens to our shareholders for ratification as a matter of good
corporate practice. In the event our shareholders fail to ratify the
appointment, the Audit Committee may reconsider this appointment.
The
Company has been advised by Moore Stephens that neither the firm nor any of its
associates had any relationship with the Company other than the usual
relationship that exists between independent registered public accountant firms
and their clients during the last fiscal year. Representatives of Moore Stephens
will be available via teleconference during the Meeting, at which time they may
make any statement they consider appropriate and will respond to appropriate
questions raised at the Meeting.
Independent
Registered Public Accounting Firm’s Fees
The
following are the fees billed to us by our former auditors, Murrell, for
services rendered to us during 2008, and by Moore Stephens, for services
rendered to us during 2009 and 2008:
|
Year Ended June 30,
|
||||||||
|
2009
|
2008
|
|||||||
|
Audit
Fees
|
$
|
114,000
|
$
|
115,159
|
||||
|
Audit-Related
Fees
|
$
|
55,000
|
$
|
55,000
|
||||
|
Tax
Fees
|
$
|
-
|
$
|
7,500
|
||||
|
All
Other Fees
|
$
|
3,000
|
$
|
15,855
|
||||
|
TOTAL
|
$
|
172,00
|
$
|
193,514
|
||||
“Audit
Fees” consisted of the aggregate fees billed for professional services rendered
for the audit of our annual financial statements and the reviews of the
financial statements included in our Forms 10-Q and for any other services that
were normally provided by Murrell and Moore Stephens, respectively, in
connection with our statutory and regulatory filings or
engagements.
“Audit
Related Fees” consisted of the aggregate fees billed for professional services
rendered for assurance and related services that were reasonably related to the
performance of the audit or review of our financial statements and were not
otherwise included in Audit Fees.
“Tax
Fees” consisted of the aggregate fees billed for professional services rendered
for tax compliance, tax advice and tax planning. Included in such Tax Fees were
fees for preparation of our tax returns and consultancy and advice on other tax
planning matters.
21
“All
Other Fees” consisted of the aggregate fees billed for products and services
provided by Murrell and Moore Stephens, respectively, and not otherwise included
in Audit Fees, Audit Related Fees or Tax Fees. Included in such Other Fees were
fees for services rendered by Murrell and Moore Stephens, respectively, in
connection with our S3 registration statements and private and public offerings
conducted during such years.
Our audit
committee has considered whether the provision of the non-audit services
described above is compatible with maintaining auditor independence and
determined that such services are appropriate. Before auditors are engaged to
provide us audit or non-audit services, such engagement is (without exception,
required to be) approved by the audit committee of our board of
directors.
Pre-Approval
Policies and Procedures
Under the
Sarbanes-Oxley Act of 2002, all audit and non-audit services performed by our
auditors must be approved in advance by our board of directors to assure that
such services do not impair the auditors’ independence from us. In accordance
with its policies and procedures, our board of directors pre-approved the audit
service performed by Moore Stephens, Certified Public Accounts for our financial
statements as of and for the year ended June 30, 2009.
The Board of Directors recommends a
vote FOR ratification of the selection of Moore Stephens as the Company’s
independent registered public accounting firm for the fiscal year ending June
30, 2010.
STOCKHOLDER
PROPOSALS FOR THE 2011 ANNUAL MEETING
If you
wish to have a proposal included in our proxy statement for next year’s annual
meeting in accordance with Rule 14a-8 under the Exchange Act, your proposal must
be received by the Secretary of China Precision Steel, Inc. at 18th Floor, Teda
Building, 87 Wing Lok Street, Sheung Wan, Hong Kong, People’s Republic of China,
no later than the close of business on June 30, 2010. A proposal which is
received after that date or which otherwise fails to meet the requirements for
stockholder proposals established by the SEC will not be included. The
submission of a stockholder proposal does not guarantee that it will be included
in the proxy statement.
ANNUAL
REPORT ON FORM 10-K
We will
provide without charge to each person solicited by this Proxy Statement, on the
written request of such person, a copy of our Annual Report on Form 10-K,
including the financial statements and financial statement schedules, as filed
with the SEC for our most recent fiscal year. Such written requests should be
directed to our Corporate Secretary, at 18th Floor, Teda Building, 87 Wing Lok
Street, Sheung Wan, Hong Kong, People’s Republic of China. A copy of our Annual
Report on Form 10-K is also made available on our website after it is filed with
the SEC.
OTHER
MATTERS
As of the
date of this Proxy Statement, the Board of Directors has no knowledge of any
business which will be presented for consideration at the Meeting other than the
election of directors and the ratification of the appointment of the accountants
of the Company. Should any other matters be properly presented, it is intended
that the enclosed proxy card will be voted in accordance with the best judgment
of the persons voting the proxies.
|
By
Order of the Board of Directors
|
|||
|
May
17, 2010
|
|
/s/ Leada Tak Tai
Li
|
|
|
Leada
Tak Tai Li
|
|||
|
Corporate
Secretary
|
|||
22
REPORT
OF THE AUDIT COMMITTEE
Our audit
committee, at the direction of our board of directors, has prepared the
following report for inclusion in this Annual Report. The audit committee is
comprised of Messrs. Wong, Lui and Tsui, three non-employee directors who meet
the independence criteria prescribed by applicable law and the rules of the SEC
for audit committee membership and is an “independent director” within the
meaning of the NASDAQ Marketplace Rules. Each audit committee member meets the
NASDAQ’s financial literacy requirements. The board of directors has named Mr.
David Peter Wong, who meets the NASDAQ’s professional experience requirements,
as its audit committee financial expert as such term is defined in Item 401(h)
of Regulation S-K promulgated by the SEC. The audit committee acts pursuant to a
written charter, which complies with the applicable provisions of the
Sarbanes-Oxley Act of 2002 and related rules of the SEC and NASDAQ, which is
available via our website at http://www.chinaprecisionsteelinc.com.
The audit
committee reviewed and discussed our audited consolidated financial statements
for the fiscal year ended June 30, 2009 with management and with Moore Stephens,
the independent registered public accounting firm retained by the Company to
audit its financial statements. The audit committee received and reviewed
management’s representation and the opinion of the independent registered public
accounting firm that the Company’s audited financial statements were prepared in
accordance with United States generally accepted accounting principles. The
audit committee also discussed with the independent registered public accounting
firm during the 2009 fiscal year the matters required to be discussed by
Statement on Auditing Standards No. 61 (Communication with Audit
Committees), as amended, and other standards of the Public Company Accounting
Oversight Board, rules of the SEC and other applicable regulations.
The audit
committee received from Moore Stephens the written disclosures and the letter
required by Independence Standards Board Standard No. 1 (Independence
Discussions with Audit Committees) and discussed with Moore Stephens the
independence of their firm.
Based
upon the review and discussions referenced above, the audit committee
recommended to our board of directors, and the board of directors approved, that
the audited consolidated financial statements be included in the Company’s
Annual Report on Form 10-K for the fiscal year ended June 30, 2009, for filing
with the SEC.
|
Respectfully
submitted,
|
|
|
/s/
The Audit Committee
|
|
|
David
Peter Wong, Chairman
|
|
|
Che
Kin Lui
|
|
|
Tung
Kuen Tsui
|
The Audit Committee Report above
does not constitute “soliciting material” and will not be deemed “filed” or
incorporated by reference into any of our filings under the Securities Act or
the Exchange Act that might incorporate our SEC filings by reference, in whole
or in part, notwithstanding anything to the contrary set forth in those
filings, except to
the extent that the Company specifically incorporates it by reference into such
filing.
23
EXHIBIT
B
REPORT
OF THE COMPENSATION COMMITTEE
Our
Compensation Committee, at the direction of our board of directors has prepared
the following report for inclusion in this Annual Report. The Compensation
Committee is comprised of Messrs. Tsui, Lui and Wong, three non-employee
directors who are “disinterested persons” within the meaning of Rule 16b-3 of
the Exchange Act and who are “independent” as required by applicable
laws and regulations, and the NASDAQ Marketplace Rules.
The
Compensation Committee has the responsibility for all compensation matters
concerning our executive officers. The Compensation Committee is also
responsible for oversight of our compensation plans and benefit programs and
equity based awards to our non-executive employees and consultants. The
Compensation Committee acts pursuant to a written charter, which is available at
our website at http://www.chinaprecisionsteelinc.com.
The
Compensation Committee has reviewed and discussed the Compensation Discussion
and Analysis with management. Based on such review and discussions, the
Compensation Committee recommended to the board of directors, and the board of
directors has approved, the inclusion of the Compensation Discussion and
Analysis in our Annual Report on Form 10-K.
|
Respectfully
submitted,
|
|
|
/s/
The Compensation Committee
|
|
|
Che
Kin Lui, Chairman
|
|
|
David
Peter Wong
|
|
|
Tung
Kuen Tsui
|
The Compensation Committee Report
above does not constitute “soliciting material” and will not be deemed “filed”
or incorporated by reference into any of our filings under the Securities Act or
the Exchange Act that might incorporate our SEC filings by reference, in whole
or in part, notwithstanding anything to the contrary set forth in those
filings, except to
the extent that the Company specifically incorporates it by reference into such
filing.
24
CHINA
PRECISION STEEL, INC.
ANNUAL
MEETING OF STOCKHOLDERS
TO
BE HELD ON JUNE 30, 2010
This
Proxy is Solicited on Behalf of the Board of Directors
The
undersigned stockholder of CHINA PRECISION STEEL, INC.., a Delaware corporation
(the “Company”), hereby constitutes and appoints Hai Sheng Chen and Leada Tak
Tai Li, or either of them acting singly in the absence of the other, with full
power of substitution and resubstitution in either of them, the proxies of the
undersigned to vote with the same force and effect as the undersigned all shares
of the Company’s Common Stock which the undersigned is entitled to vote at the
2010 Annual Meeting of Stockholders to be held on June 30, 2010, at 11:00 a.m.,
local time, at the Meeting Room, 8th Floor, Teda Building, 87 Wing Lok Street,
Sheung Wan, Hong Kong, People’s Republic of China, and at any adjournment or
adjournments thereof, upon the matters described in the accompanying Notice of
Annual Meeting of Stockholders and Proxy Statement, receipt of which is hereby
acknowledged, and upon any other business that may properly come before the
meeting or any adjournment thereof. Said proxies are directed to
vote, as designated on the other side, all the shares of the Company which the
undersigned is entitled to vote at the meeting, and otherwise in their
discretion upon such other business as may properly come before the meeting or
any adjournment thereof.
Important
Notice Regarding the Availability of Proxy Materials
for the 2010 Annual Meeting of
Stockholders to be Held on June 30, 2010
This
proxy statement and the Company’s 2009 Annual Report are available at:
https://materials.proxyvote.com/16941J. To obtain directions to
attend the annual meeting in person, contact the Corporate Secretary by writing
to, China Precision Steel, Inc., 18th Floor, Teda Building, 87 Wing Lok Street,
Sheung Wan, Hong Kong, People’s Republic of China, telephone number (+852)
2543-2290.
(Continued, and to be signed, on the
other side)
25
Fold and Detach
Here
Please
mark your votes as indicated in this example x
THIS PROXY, WHEN PROPERLY EXECUTED,
WILL BE VOTED IN THE MANNER DIRECTED; IF NO DIRECTION IS MADE, THIS PROXY WILL
BE VOTED FOR ALL NOMINEES and FOR THE RATIFICATION OF THE SELECTION OF
MOORE STEPHENS, AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS. IN
THEIR DIRECTION, THE PROXIES ARE ALSO AUTHORIZED TO VOTE UPON SUCH OTHER MATTERS
AS MAY PROPERLY COME BEFORE THE MEETING, INCLUDING THE ELECTION OF ANY PERSON TO
THE BOARD OF DIRECTORS WHERE A NOMINEE NAMED IN THE PROXY STATEMENT DATED MAY
17, 2010 IS UNABLE TO SERVE OR WILL NOT SERVE.
| 1. | To elect six directors to serve until the 2011 Annual Meeting of Stockholders: | ||
|
Hai
Sheng Chen
|
Tung
Kuen Tsui
|
Che
Kin Lui
|
|
|
Wo
Hing Li
|
David
Peter Wong
|
||
| o | FOR all nominees listed above | ||
| o | WITHHOLD AUTHORITY for all nominees listed above | ||
| o | FOR ALL EXCEPT (see Instructions below) | ||
| (Instructions: To withhold authority to vote for any individual nominee, mark “FOR ALL EXCEPT” and strike a line through the nominee’s name in the list above) | |||
| 2. | Approve the ratification of Moore Stephens as the Company’s accountant for fiscal year 2010. | ||
|
FOR £
|
AGAINST £
|
ABSTAIN
£
|
|
| 3. | In their discretion, the proxies are authorized to vote upon such other business as may properly come before the Meeting, and any adjournment or adjournments thereof. | ||
The
undersigned acknowledges receipt from China Precision Steel, Inc. of, prior to
the execution of this proxy, a notice of the annual meeting, a proxy statement,
and a 2009 annual report.
Please
complete, date and sign this proxy and return it promptly in the enclosed
envelope, whether or not you plan to attend the annual meeting. If you attend
the meeting, you may vote in person if you wish, even if you have previously
returned your proxy.
|
Name
________________________________________________________
Name
(if
joint)
______________________________________________________________
Date
_____________, 2010
Please
sign your name exactly as it appears hereon. When signing as attorney,
executor, administrator, trustee or guardian, please give your full title
as it appears hereon. When signing as joint tenants, all parties in the
joint tenancy must sign. When a proxy is given by a corporation, it should
be signed by an authorized officer and the corporate seal affixed. No
postage is required if returned in the enclosed
envelope.
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