NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
You are cordially invited to attend the
Annual Meeting of Stockholders (the “Annual Meeting”) of Highpower International, Inc., a Delaware corporation (the
“Company”), to be held on November 17, 2013 at 10:00 a.m. China Standard Time at the Company’s principal executive
offices located at Building A7, Luoshan Industrial Zone, Shanxia, Pinghu, Longgang, Shenzhen, Guangdong, 518111, People’s
Republic of China.
The Annual Meeting of the Company is being held for the following
purposes:
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1.
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To elect five (5) members to the Board of Directors to serve for one-year
terms ending at the 2014 annual meeting of stockholders
;
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2.
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To ratify the appointment of Marcum Bernstein & Pinchuk LLP as the independent registered public accounting firm of the
Company for the year ending December 31, 2013;
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3.
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To approve, on an advisory basis, the compensation of our named executive officers;
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4.
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To vote, on an advisory basis, on the frequency of holding an advisory vote on the compensation of our named executive officers;
and
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5.
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To transact such other business as may properly come before the meeting or any adjournments thereof.
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The Board of Directors has fixed the close
of business on October 8, 2013 as the record date (the “Record Date”) for determining those stockholders who will be
entitled to vote at the Annual Meeting.
The Company’s
Annual Report on Form 10-K for the year ended December 31, 2012, as filed with the Securities and Exchange Commission on April
2, 2013 is enclosed with this notice. The following proxy statement and enclosed proxy card is being sent to each stockholder as
of the Record Date. You are cordially invited to attend the Annual Meeting, but if you do not expect to attend, or if you plan
to attend, but desire the proxy holders to vote your shares, please date and sign your proxy card and return it in the enclosed
postage paid envelope. The giving of this proxy card will not affect your right to vote in person in the event you find it convenient
to attend. Please return the proxy card promptly to avoid the expense of additional proxy solicitation.
If
you are a stockholder who owns shares through a nominee and attends the Annual Meeting, you should bring a letter from your nominee
identifying you as the beneficial owner of the shares and acknowledging that you will vote your shares
Important Notice Regarding the Availability of Proxy Materials
for the Stockholder Meeting to Be Held on November 17, 2013. The 2013 Proxy Statement and the Annual Report on Form 10-K
for the year ended December 31, 2012 are also available at https://materials.proxyvote.com/43113X.
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FOR THE BOARD OF DIRECTORS
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/s/ Henry Sun
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Henry Sun, Chief Financial Officer and Corporate Secretary
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on behalf of the Board of Directors
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Dated: October 15, 2013
Shenzhen, China
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HIGHPOWER INTERNATIONAL, INC.
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PROXY STATEMENT
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For Annual Meeting to be Held on
November 17, 2013, 10:00 a.m., China
Standard Time
The enclosed proxy is solicited by the Board
of Directors of Highpower International, Inc. (“we,” “us,” the “Company,” or “Highpower”),
a Delaware corporation, in connection with the Annual Meeting of Stockholders of the Company to be held on November 17, 2012 at
10:00 a.m. China Standard Time at the Company’s principal executive offices located at Building A7, Luoshan Industrial Zone,
Shanxia, Pinghu, Longgang, Shenzhen, Guangdong, 518111, People’s Republic of China (the “Annual Meeting”). The
approximate mailing date for this proxy statement and the enclosed proxy is October 18, 2013.
The purpose of the Annual Meeting is to
vote on the following items of business: (1) the election of five directors to the Board of Directors
to serve one-year terms ending at the 2014 annual meeting of stockholders
; (2)
ratification
of
the appointment of Marcum Bernstein & Pinchuk LLP as the Company’s independent registered public accounting
firm for the year ending December 31, 2013; (3)
the approval, on an advisory basis, of the compensation
of our named executive officers; (4) to vote, on an advisory basis, on the frequency of holding an advisory vote on the compensation
of our named executive officers; and (5) to transact such other business as may properly come before the meeting or any adjournments
thereof.
Annual Report
Our annual report
to stockholders for the year ended December 31, 2012 will be concurrently provided to each stockholder at the time we send
this proxy statement and the enclosed proxy card and is not to be considered a part of the proxy soliciting material.
Quorum; Voting Rights
Holders of
our common stock of record at the close of business on October 8, 2013 (“the Record Date”) will be entitled to vote
at the Annual Meeting
or any adjournment
or postponement of the Annual Meeting
. There were
13,732,106
shares of common stock outstanding as of the Record Date. Each share of our common stock is entitled to one vote on each
matter to be voted on at the Annual Meeting, and the presence, in person or by proxy, of holders of a majority of the outstanding
shares of our common stock, is necessary to constitute a quorum for the Annual Meeting. If a quorum is not present at
the Annual Meeting, we expect that the Annual Meeting will be adjourned to solicit additional proxies. Stockholders may not cumulate
their votes.
Voting Your Proxy
Your vote is important. Your shares can
be voted at the Annual Meeting only if you are present in person or represented by proxy. Even if you plan to attend
the Annual Meeting, we urge you to vote in advance. Please follow the appropriate instructions described below:
Stockholder of Record:
Shares Registered in Your Name
–
If you are a stockholder of record, you may vote
in person at the Annual Meeting
or you may vote by mail by completing, signing, dating and returning the accompanying proxy
card in the prepaid envelope provided.
You may still attend the Annual Meeting and vote in person if
you have already voted by proxy or given your proxy authorization.
Stockholders of record may vote in person by attending
the Annual Meeting and completing a ballot distributed at the meeting.
Beneficial Owner: Shares Registered
in the Name of Broker, Bank or Other Agent
– Stockholders who hold their shares beneficially in “street
name” through a nominee (such as a bank or broker) may be able to vote by telephone, the Internet or mail. You should follow
the instructions you receive from your nominee to vote those shares. If you are a stockholder who owns shares through a nominee
and you attend the Annual Meeting
, you may vote in person at the Annual Meeting only if you
bring
a letter from your nominee identifying you as the beneficial owner of the shares and acknowledging that you will vote your shares
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We are not aware
of any matter to be presented at the Annual Meeting other than that described in this proxy statement. If, however, other matters
properly are brought before the Annual Meeting, or any adjournment or postponement of the Annual Meeting, your proxy includes discretionary
authority on the part of the individuals appointed to vote your common stock or act on those matters according to their best judgment,
including adjournment of the Annual Meeting.
How the Board Recommends that You
Vote
The Board of Directors recommends the
following votes:
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(1)
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“FOR” the election of the five (5) nominees for director named herein;
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(2)
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“FOR” the ratification of the
appointment of Marcum Bernstein & Pinchuk LLP
as the Company’s independent registered
public
accounting firm for the year ending December
31, 2013;
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(3)
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“FOR” the
approval
, on an advisory basis, of the compensation paid to our named
executive officers; and
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(4)
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For the
approval
, on an advisory basis, of a THREE YEAR advisory vote on the compensation
of our named executive officers.
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Counting of Votes
Your shares will be voted in accordance
with the instructions you indicate on your duly executed and returned proxy card. If you submit the proxy card but do not indicate
your voting instructions, your shares will be voted as follows:
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(1)
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“FOR”
the
election of the five (5) nominees for director named herein;
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(2)
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“FOR” the
ratification
of the appointment of Marcum Bernstein & Pinchuk LLP
as the Company’s independent registered public accounting firm for the year ending December 31, 2012;
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(3)
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“FOR” the approval, on an advisory basis, of the compensation paid to our named executive officers; and
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(4)
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For the
approval
, on an advisory basis, of a THREE YEAR advisory vote on the compensation
of our named executive officers.
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All properly executed proxies delivered
pursuant to this solicitation and not revoked will be voted at the Annual Meeting in accordance with the directions given. Representatives
of Broadridge Financial Solutions, Inc. and our transfer agent will assist us in the tabulation of the votes.
Abstentions and Broker Non-Votes
An abstention is the voluntary act of not
voting by a stockholder who is present at a meeting and entitled to vote.
A "broker non-vote" occurs on
a matter when a broker does not vote on a particular proposal because it has not received voting instructions from the beneficial
owner and does not have discretionary authority to vote the shares with respect to that proposal. Brokers
that
hold shares of common stock in a “street name” for customers that are the beneficial owners of those shares
generally have discretionary authority to vote on routine matters without specific instructions from their customers.
However,
brokers generally do not have discretionary voting power (i.e. they cannot vote) on non-routine matters without specific instructions
from their customers.
Proposals are determined to be routine or non-routine matters based on the rules of the various regional
and national exchanges of which the brokerage firm is a member.
Abstentions and broker non-votes will count
toward the presence of a quorum. Refer to each proposal for a discussion of the effect of abstentions and broker non-votes on the
results of each proposal.
Revoking Your Proxy
Any proxy given may be revoked at any time
prior to it is voted by notifying the Corporate Secretary of the Company in writing of such revocation, by duly executing and delivering
another proxy bearing a later date, or by attending and voting in person at the Annual Meeting. The Company’s principal executive
office is located at Building A7, Luoshan Industrial Zone, Shanxia, Pinghu, Longgang, Shenzhen, Guangdong, 518111, People’s
Republic of China.
Solicitation of Proxies
The cost of this solicitation of proxies
will be borne by the Company. The Company will solicit stockholders by mail. The Company may, in a limited number of
circumstances, use the services of its officers and regularly engaged employees to solicit proxies, personally or by telephone,
without additional compensation.
The Company will reimburse banks, brokerage firms, other custodians,
nominees and fiduciaries for reasonable expenses incurred in sending proxy materials to beneficial owners of the common stock of
the Company.
Delivery of Proxy Materials to Households
“Householding”
is a program, approved by the Securities and Exchange Commission (the “SEC”), which allows companies and intermediaries
(e.g. brokers) to satisfy the delivery requirements for proxy statements and annual reports by delivering only one package of stockholder
proxy material to any household at which two or more stockholders reside. If you and other residents at your mailing address own
shares of our common stock in “street name,” your broker or bank may have notified you that your household will receive
only one copy of our proxy materials. Once you have received notice from your broker that it will be “householding”
materials to your address, “householding” will continue until you are notified otherwise or until you revoke your consent.
If, at any time, you no longer wish to participate in “householding” and would prefer to receive a separate proxy statement,
or if you are receiving multiple copies of the proxy statement and wish to receive only one, please notify your broker if your
shares are held in a brokerage account. If you hold shares of our common stock in your own name as a holder of record, “householding”
will not apply to your shares.
Interest of Executive Officers and Directors
None of the Company’s executive officers
or directors or any of their associates has any interest in any of the matters to be acted upon at the Annual Meeting, except,
with respect to each director, to the extent that a director is named as a nominee for election to the Board of Directors.
PROPOSAL NO. 1
ELECTION OF DIRECTORS
The Company currently has five authorized
members on its Board of Directors. The Company’s Bylaws give the Board of Directors the authority to establish, increase
or decrease the number of directors.
Upon recommendation of the Nominating Committee,
the Board of Directors has nominated Dang Yu Pan, Wen Liang Li, Xinhai Li, T. Joseph Fisher, III, and Ping Li as nominees for election
as directors. If elected, each nominee will serve as a director until our Annual Meeting of Stockholders in 2014 or until his or
her successor is elected and qualified.
Unless you otherwise
instruct us, your properly executed proxy that is returned in a timely manner will be voted for election of these five nominees.
Each of the nominees currently serves on the Board of Directors and each has advised the Company of his or her willingness
to serve as a member of the Company’s Board of Directors if elected
. If, however, any of these
nominees should be unable or should fail to act as a nominee because of an unexpected occurrence, your proxy will be voted for
such other person as the holders of your proxy, acting in their discretion, may determine. Y
ou can find information about
the nominees below under the section “Board of Directors and Executive Officers.”
Vote Required
You may vote in favor or withhold your vote
as to any or all of the nominees. If a quorum exists at the Annual Meeting, the affirmative vote of a plurality of the votes of
the shares present or in person or represented by proxy at the Annual Meeting and entitled to vote on the election of directors
is required for the election of each of the nominees for director. There is no cumulative voting for the Board of Directors. If
stockholders do not specify the manner in which their shares represented by a validly executed proxy solicited by the Board of
Directors are to be voted on this proposal, such shares will be voted in favor of all of the nominees. Broker non-votes will not
be counted and will have no effect on the result of the vote.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” EACH OF
THE DIRECTOR NOMINEES.
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PROPOSAL NO. 2
RATIFICATION OF APPOINTMENT OF INDEPENDENT
AUDITORS
The Audit Committee has recommended the
reappointment of Marcum Bernstein & Pinchuk LLP (“MBP”) as the Company’s independent registered public accounting
firm for the fiscal year ending December 31, 2013.
The Company appointed MBP as its independent
registered public accounting firm on September 30, 2011 to replace Dominic K.F. Chan & Co. (“DKFC”), who the Company
dismissed as its independent registered public accounting firm on September 30, 2011. DKFC had served as the Company’s auditor
since November 2007 and had audited the Company’s financial statements for the years ended December 31, 2010 and 2009. MBP
audited the Company’s financial statements for the years ended December 31, 2012 and 2011.
The decision to change accountants was approved
and ratified by the Company’s Audit Committee and Board of Directors. The reports of DKFC on the financial statements of
the Company for the fiscal years ended December 31, 2010 and 2009 did not contain any adverse opinion or disclaimer of opinion
and was not qualified or modified as to uncertainty, audit scope, or accounting principle. Additionally, during the Company’s
two most recent fiscal years and any subsequent interim period through the date of dismissal, there were no disagreements with
DKFC on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure.
While DKFC was engaged by the Company, there
were no disagreements with DKFC on any matter of accounting principles or practices, financial statement disclosure, or auditing
scope or procedure with respect to the Company, which disagreements if not resolved to the satisfaction of DKFC would have caused
it to make reference to the subject matter of the disagreements in connection with its reports on the Company’s financial
statements for the fiscal years ended December 31, 2010 and 2009.
During the Company’s fiscal years
ended December 31, 2010 and 2009 and through September 30, 2011, neither the Company, nor anyone acting on its behalf, consulted
with MBP regarding the application of accounting principles to a specific completed or proposed transaction or the type of audit
opinion that might be rendered on the Company’s financial statements, and no written report or oral advice was provided that
MBP concluded was an important factor considered by the Company in reaching a decision as to any such accounting, auditing or financial
reporting issue.
As required by Instruction 2 to Item 304
of Regulation S-K, the Company has provided DKFC and MBP with a copy of the disclosures contained in this Proxy
Statement with respect to the Company’s change of independent registered public accounting firm and has given DKFC and
MBP the opportunity to present their respective views with respect to any incorrect or incomplete disclosures made by the Company.
Neither DKFC nor MBP submitted a statement to the Company regarding any disagreement with the disclosures provided herein.
The Company anticipates
that a representative of
MBP
will attend the Annual Meeting. The representative will have an
opportunity to make a statement and to respond to appropriate stockholder questions.
The stockholders are being requested to
ratify the reappointment of MBP at the Annual Meeting. We are not required to obtain stockholder ratification of the reappointment
of our independent auditors, and our Audit Committee and Board of Directors retain the authority and discretion to change independent
auditors at any time.
Fees to Independent Registered Public Accounting Firm for
Fiscal Years 2012 and 2011
The following table presents professional
audit service fees, including reimbursements for expenses and related fees billed for other services rendered by our former auditor,
DKFC, who reviewed the Company’s quarterly financial statements for the quarters ended March 31 and June 30, 2011. The table
also includes the professional audit service fees and all the audit-related expenses rendered by MBP, who reviewed the Company’s
Form 10-Q for the quarter ended September 30, 2011 and audited the annual financial statements for the years ended December 31,
2011 and 2012:
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Year Ended December 31,
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2012
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2011
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Audit Fees (1)
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$
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198,123
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$
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112,000
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Audit-Related Fees
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-
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-
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Tax Fees
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-
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-
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All Other Fees
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-
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Total
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$
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198,123
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$
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112,000
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(1)
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These were fees for professional services performed by our former auditor DKFC and current auditor
MBP for the review of quarterly financial reports and audits of annual financial statements in 2011 and 2012
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Pre-Approval Policy
In accordance with our Audit Committee Charter,
the Audit Committee pre-approves all auditing services and permitted non-audit services, if any, to be performed for us by our
independent auditor, subject to the de minimis exceptions for non-audit services described in Section 10A(i)(1)(B) of the
Securities Exchange Act of 1934, as amended, which are approved by the Audit Committee prior to the completion of the audit. The
scope of the pre-approval includes pre-approval of all fees and terms of engagement. The Audit Committee may form and delegate
authority to subcommittees consisting of one or more members when appropriate, including the authority to grant pre-approvals of
audit and permitted non-audit services, provided that decisions of such subcommittee to grant pre-approvals shall be presented
to the full Audit Committee at its next scheduled meeting.
REPORT OF THE AUDIT COMMITTEE
The Audit Committee consists of three non-employee
directors who are independent under the standards adopted by the Board of Directors and applicable NASDAQ Stock Market Rules and
SEC standards. The Audit Committee represents and assists the Board of Directors in fulfilling its responsibility for oversight
and evaluation of the quality and integrity of the Company’s
consolidated
financial statements,
the Company’s compliance with legal and regulatory requirements, the qualifications and independence of the Company’s
registered public accounting firm, MBP, and the performance of the Company’s internal controls and of MBP.
The Audit Committee has reviewed and discussed
with the Company’s management and internal finance staff and MBP, with and without management present, the Company’s
audited consolidated financial statements for the fiscal year ended December 31, 2012 and management’s assessment of
the effectiveness of the Company’s internal controls over financial reporting. The Audit Committee has also discussed with
MBP the results of the independent auditors’ examinations and the judgments concerning the quality, as well as the acceptability,
of the Company’s accounting principles and such other matters that the Company is required to discuss with the independent
auditors under applicable rules, regulations or generally accepted auditing standards (including the Statement on Auditing Standards
No. 61, as amended). In addition, the Audit Committee has received from MBP the written disclosures and the letter required
by applicable requirements of the Public Company Accounting Oversight Board regarding MBP’s communications with the Audit
Committee concerning independence, and has discussed with MBP their independence from the Company and management, including a consideration
of the compatibility of non-audit services with their independence, the scope of the audit and the fees paid to MBP during the
year.
Based on our review
and the discussions referred to above, the Audit Committee recommended to the Board of Directors that the audited consolidated
financial statements be included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2012 for filing
with the SEC.
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Respectfully submitted,
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Xinhai Li
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Ping Li
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T. Joseph Fisher, III
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Vote Required
You may vote in favor or against this proposal
or you may abstain from voting. Assuming a quorum is present at the Annual Meeting, the affirmative vote of a majority of all votes
cast
at the Annual Meeting is required to ratify the appointment of MBP as Highpower’s
independent registered public accounting firm. If stockholders do not specify the manner in which their shares represented by a
validly executed proxy solicited by the Board of Directors are to be voted on this proposal, such shares will be voted in favor
of the ratification of the appointment of MBP as our independent registered public accounting firm.
Abstentions
will have the same effect as votes cast against this proposal.
Broker non-votes are not expected because brokers
and
other nominees that do not receive instructions are entitled to vote
on this matter. However, should a broker non-vote occur,
it will not be counted as a vote cast and will have no effect on the result of the vote
(i.e. it will
be neither a vote “for” nor “against” the proposal).
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OUR BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE RATIFICATION OF THE APPOINTMENT OF MARCUM BERNSTEIN & PINCHUK LLP AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE FISCAL YEAR ENDING DECEMBER 31, 2013.
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PROPOSAL NO. 3
ADVISORY VOTE ON NAMED EXECUTIVE OFFICER
COMPENSATION
The recently enacted Dodd-Frank Wall Street
Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”) added Section 14A to Securities Exchange
Act of 1934, as amended (the “Exchange Act”), which enables our stockholders to vote to approve, on an advisory, non-binding
basis, the compensation of our named executive officers as disclosed in this proxy statement in accordance with the SEC’s
rules.
Our named executive
officer compensation program is designed to attract, motivate and retain our named executive officers, who are critical to our
success. The Compensation Committee believes an effective compensation program is one that is designed to align the interests of
executive officers with those of our stockholders by tying long-term incentive compensation to financial performance and ultimately
to the creation of stockholder value. The Compensation Committee believes that it has taken a responsible approach to compensating
our named executive officers.
Please read the
“Executive Compensation” section of this proxy statement for additional details about our executive compensation program.
We are asking
our stockholders to indicate their support for our named executive officer compensation as described in this proxy statement. This
proposal, commonly known as a “say-on-pay” proposal, gives our stockholders the opportunity to express their views
on the compensation of our named executive officers. This vote is not intended to address any specific item of compensation, but
rather the overall compensation of our named executive officers and the philosophy, policies and practices described in this proxy
statement. Accordingly, we will ask our stockholders to vote “FOR” the following resolution at the Annual Meeting:
“RESOLVED, that the Company’s
stockholders approve, on an advisory basis, the compensation of the named executive officers, as disclosed in the Company’s
proxy statement for the 2013 Annual Meeting of Stockholders pursuant to the compensation disclosure rules of the Securities and
Exchange Commission.”
The say-on-pay
vote is advisory, and therefore not binding on the Company, the Compensation Committee or our Board of Directors. Our Board of
Directors and our Compensation Committee value the views of our stockholders and will consider the outcome of the vote when determining
future compensation arrangements for our named executive officers.
Vote Required
This vote is an
advisory vote and is therefore not binding on the Company or the Board of Directors. The affirmative vote of a majority of all
votes cast at the Annual Meeting is required for advisory approval of this proposal. If stockholders do not specify the manner
in which their shares represented by a validly executed proxy solicited by the Board of Directors are to be voted on this proposal,
such shares will be voted in favor of the this proposal. Brokers are not authorized to vote without instructions on this proposal.
Abstentions will have the same effect as voting against the proposal and broker non-votes will not be deemed votes cast and will
have no effect on the vote outcome.
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THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE APPROVAL OF THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS, AS DISCLOSED IN THIS PROXY STATEMENT PURSUANT TO THE COMPENSATION DISCLOSURE RULES OF THE SEC.
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PROPOSAL NO.
4
ADVISORY VOTE
ON THE FREQUENCY OF THE ADVISORY VOTE ON EXECUTIVE COMPENSATION
Section 14A
of the Exchange Act, as added by the Dodd-Frank Act, also enables our stockholders to indicate their preference as to how frequently
we should seek an advisory vote on the compensation of our named executive officers. The proxy card provides stockholders with
the opportunity to choose among four options (holding the advisory vote on executive compensation every one, two or three years,
or abstain from voting) and, therefore, stockholders will not be voting to approve or disapprove the recommendation of the Board
of Directors. You may cast your vote on your preferred voting frequency by choosing the option of once every year (“1 year”),
once every two years (“2 years”), once every three years (“3 years”), or you may abstain from
voting.
After careful
consideration of this proposal, the Board of Directors has determined that an advisory vote on executive compensation that occurs
every three years is the most appropriate alternative for the Company, and therefore your Board recommends that you vote for a
three year (3-year) frequency for the advisory vote on executive compensation.
In formulating
its recommendation, our Board considered that a triennial vote will allow stockholders to better evaluate our executive compensation
program in relation to our short- and long-term company performance. Additionally, a triennial vote will provide us with time to
respond to stockholder concerns and implement appropriate revisions.
The purpose of
this proposal is to assess stockholder preferences on the frequency of future advisory votes on executive compensation, and as
such, there will be no approval or adoption of a resolution establishing the frequency of future advisory votes on executive compensation. The
option of one year, two years or three years that receives the highest number of votes cast by stockholders will be considered
the frequency for the advisory vote on executive compensation that is preferred by our stockholders. However, because this vote
is advisory and not binding on the Board of Directors or the Company in any way, the Board may decide that it is in the best interests
of our stockholders and the Company to hold an advisory vote on executive compensation more or less frequently than the option
preferred by our stockholders.
Vote Required
This vote is an
advisory vote and is therefore not binding on the Company or the Board of Directors. You may choose from the following alternatives:
every year, every two years, every three years or you may abstain. Brokers are not authorized to vote without instructions on this
proposal. The option of one year, two years or three years that receives the highest number of votes cast by stockholders will
be considered the frequency for the advisory vote on executive compensation that is preferred by our stockholders. Abstentions
and broker non-votes will have no effect on the vote outcome. While the Board of Directors will consider our stockholders’
preference as reflected in the vote on this proposal in determining how frequently the advisory vote on executive compensation
occurs in the future, our Board of Directors will have the discretion to determine the actual frequency at which the required advisory
stockholder vote on the compensation of our named executive officers will be conducted, because the vote on such frequency is only
advisory and non-binding. The Board’s determination on the actual frequency of such vote will be disclosed in a Form 8-K
to be filed in accordance with the rules of the SEC.
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THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR A THREE YEAR (3-YEAR) FREQUENCY FOR THE ADVISORY VOTE ON EXECUTIVE COMPENSATION.
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BOARD OF DIRECTORS AND EXECUTIVE OFFICERS
Information Concerning Director Nominees
Our current directors and our director nominees
who have been nominated for election as directors at the Annual Meeting, the positions held by them and their ages as of the date
of this proxy statement:
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Name
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Age
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Position
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Dang Yu Pan
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45
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Chairman of the Board and Chief Executive Officer, and director nominee
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Wen Liang Li
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48
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Vice President, Chief Technology Officer, Director, and director nominee
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Xinhai Li (1)(2)(3)
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50
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Director and director nominee
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T. Joseph Fisher, III (1)(2)(3)
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61
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Director and director nominee
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Ping Li (1)
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48
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Director and director nominee
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(1) Member of the Audit Committee (Ping Li, Chair).
(2) Member of Compensation Committee
(Xinhai Li, Chair)
(3) Member of the Nominating Committee
(T. Joseph Fisher, III, Chair)
Dang Yu Pan
has been the Chairman
of the Board and Chief Executive officer of the Company and Hong Kong Highpower Technology Co., Ltd., a wholly-owned subsidiary
of the Company (“HKHT”) since November 2007 and July 2003, respectively. Mr. Pan is the founder of Shenzhen Highpower
Technology Co., Ltd., a wholly owned subsidiary of HKHT (“SZ Highpower”), and has served as the Chairman of the Board
and Chief Executive Officer of SZ Highpower since October 2002. Mr. Pan has served as a director of HKHT’s wholly owned subsidiary,
Icon Energy System Co., Ltd. (“ICON”), since February 2011; as a director and Chief Executive Officer of HKHT’s
wholly owned subsidiary, Springpower Technology (Shenzhen) Co., Ltd. (“SZ Springpower”), since June 2008; and as a
director of SZ Highpower’s wholly-owned subsidiary, Huizhou Highpower Technology Co., Ltd. (“HZ HTC”), since
March 2012. From May 2001 to October 2002, Mr. Pan was the General Manager and Chairman of the Board of Guangzhou HaoPeng Technology
Co., Ltd. From January 1997 to July 2000, Mr. Pan was the Vice General Manager of Nanhai Shida Battery Co., Ltd. From January 1995
to December 1996, Mr. Pan served as a director of the HuangPu Aluminum Factory. Additionally, from August 1990 to December 1994,
Mr. Pan worked in the sales department of the Guangzhou Aluminum Products Factory. Mr. Pan received a bachelor’s degree in
metallurgical engineering from Central South University in China in 1990. We believe Mr. Pan’s qualifications to sit
on our Board include his extensive understanding of our business, our products and the battery industry that he has acquired over
his 16 years working in the battery industry, including over 10 years as an officer and director of as a director of Shenzhen Highpower.
Wen Liang Li
has been a director
of the Company since November 2007 and a director of HKHT since July 2003. Since January 2003, Mr. Li. has served as a director
and as Vice General Manager and Chief Technology Officer of SZ Highpower. Mr. Li has served as a director SZ Springpower since
June 2008, as a director of HZ HTC since March 2012 and as a director of SZ Highpower’s 60%-owned subsidiary, Ganzhou Highpower
Technology Co., Ltd (“GZ Highpower”), since September 2010. From January 1996 to December 2002, Mr. Li served as Vice
General Manager of Zhuhai Taiyi Battery Co., Ltd., a battery manufacturer. Mr. Li received a master’s degree in Electrochemistry
from the Harbin Institute of Technology in China in 1991. We believe that Mr. Li’s 22 years of work experience in the battery
industry, including 10 years as an officer and director of SZ Highpower, well qualify Mr. Li to serve on our Board.
Xinhai Li
has served as a
director of the Company since January 2008. Sine August 1990, Mr. Li has served as a director and professor at the China Central
South University Metallurgical Science and Engineering School in China. Mr. Li received a PhD in Physical Chemistry of Metallurgy
from China Central South University in August 1990. We believe that Mr. Li’s qualifications to sit on our Board
include his extensive understanding of our business and his understanding of U.S. GAAP and financial statements.
T. Joseph Fisher, III
has
served as a director of the Company since April 2011.
He has served as the CEO and President of Valence
Technology, Inc. (OTCBB: VLNCQ) since November 2012. Mr. Fisher has served as a director of Valence since July 2012.
Prior to joining Valence, Mr. Fisher was the CEO and President of Contour Energy Systems, a power company specializing in the commercialization
of customizable battery technologies, from February 2008 to January 2012. Since May 2007, he has served as president of JCF International,
LLC, an advisory and consulting firm for portable power companies. Prior to joining Contour, Mr. Fisher was employed for 30
years at Energizer Battery, where he had held numerous senior management positions including Vice President – Global Rechargeable
Battery Business Unit from April 2001 to May 2007, Vice President and General Manager – Energizer Power Systems, Vice President
– Business Development, General Manager – Miniature Batteries, as well as holding several international management
assignments in Europe, Argentina and South Africa. He also worked for Xerox, General Electric and Union Carbide earlier in
his career. Mr. Fisher received a B.S. in Industrial Management from the University of Cincinnati and an MBA from the West Virginia
College of Graduate Studies, now a part of Marshall University. We believe that Mr. Fisher’s qualifications to sit on
our Board include his extensive understanding of our business and over 30 years of experience in the battery industry, as well
as his knowledge of U.S. GAAP and financial statements.
Ping Li
has served as
a director of the Company since January 2008. Since November 2008, Mr. Li has served as Director at Intel Capital, focusing on
Intel’s investment activities in China. From July 2003 to October 2008, Mr. Li served as the Managing Director of Investment
at ChinaVest, a venture capital firm. From February 2002 to July 2003, Mr. Li served as Chief Financial Officer of Great Wall Technology
Co., Ltd., an investment technology company. Mr. Li received a master’s degree in biology from Columbia University in 1989
and an MBA in finance in 1994 from the Wharton School of the University of Pennsylvania. We believe that Mr. Li’s qualifications
to sit on our Board include his knowledge of the capital markets and his experience, expertise and background with respect to accounting
matters, including his experience as a chief financial officer and familiarity with U.S. GAAP and financial statements.
Information Concerning Executive Officers
The following table sets forth certain information with respect
to our executive officers who are not also members of the Company’s Board of Directors.
|
Name
|
|
Age
|
|
Position
|
|
Wen Wei Ma
|
|
43
|
|
Vice President of Manufacturing
|
|
Henry Sun
|
|
41
|
|
Chief Financial Officer and Corporate Secretary
|
|
Bin Ran
|
|
43
|
|
Vice President of Strategy and Human Resources
|
|
Wen Jia Xiao
|
|
36
|
|
Vice President of Quality Control
|
Wen Wei Ma
has served as the
Company’s Vice President of Manufacturing since November 2007 and as a director of HKHT since July 2003. Mr. Ma has served
as a director and as a Vice General Manager of Manufacturing of SZ Highpower since October 2002. Mr. Ma received a diploma in chymic
analysis from the Guangzhou Trade School of Light Industry in China in 1989.
Henry Sun
has
served as the Chief Financial Officer of the Company since January 2011. Mr. Sun joined the Company in November 2010 as the President’s
Assistant. Prior to joining the Company, Mr. Sun was the Chief Financial Officer of Zoomlion Concrete Machinery Company from
November 2009 to October 2010. From November 2008 to September 2009, Mr. Sun served as the Finance Director of Yasheng Group
USA (OTCBB: YHGG). From December 2006 to November 2008, he was the senior finance manager of Cepheid, Inc. (NASDAQ: CPHD). From
October 2003 to September 2006, he was a financial consultant at Merrill Lynch. Mr. Sun received a BSEE degree from Beijing
University of Post and Telecommunications, and a master degree from the Thunderbird School of Global Management.
Bin Ran
joined Highpower in
June 2010 as General Manager of Human Resources and was appointed Vice President of Strategy and Human Resources in March 2011.
From April 2004 to April 2010, he worked for Shenzhen Joint Financial Group Co., Ltd, serving in positions at various of its portfolio
companies, including General Manager of several companies such as Shenzhen Cbhandsun Management Consulting Co., Ltd., Guangzhou
Cbhandsun Management Consulting Co., Ltd., Shenzhen Flink Training Center and Singapore Flink Training Center. From
July 1998 to March 2004, he worked as a management consultant at various companies including Shenzhen Quanxi Management Consulting
Company and Singapore Corey Consulting Company. He was also invited to be a visiting professor at Zhongshan University, University
of Northern Virginia, Inter American University. From 1995 to 1997, Mr. Ran worked as an Engineer of GP Batteries International
Limited. Mr. Ran received a bachelor’s degree in Electrochemistry from the Sichuan Light Chemical Engineering Institute in
1993.
Wen Jia Xiao
has served
as Vice President of Quality Control of the Company since November 2007 and as Vice General Manager of Quality Control of SZ Highpower
since October 2005. Mr. Xiao has served as a director of SZ Highpower since November 2007. From October 2002 to September 2005,
Mr. Xiao served as the Minister of the Quality Control Department of SZ Highpower. Mr. Xiao received a bachelor’s degree
in Check Technology and Instrument in 2000 from the China Institute of Metrology.
CORPORATE GOVERNANCE AND BOARD MATTERS
Director Independence
Our Board of Directors has determined that
each of the non-management directors, Xinhai Li, T. Joseph Fisher, III and Ping Li, is an “independent” director as
defined by the listing standards of the NASDAQ Stock Market currently in effect and approved by the SEC and all applicable rules
and regulations of the SEC. All members of the Audit, Compensation and Nominating Committees satisfy the “independence”
standards applicable to members of each such committee. The Board of Directors made this affirmative determination regarding these
directors’ independence based on discussion with the directors and on its review of the directors’ responses to a standard
questionnaire regarding employment and compensation history; affiliations, family and other relationships; and transactions with
the Company. The Board of Directors considered relationships and transactions between each director or any member of his immediate
family and the Company and its subsidiaries and affiliates. The purpose of the Board of Director’s review with respect to
each director was to determine whether any such relationships or transactions were inconsistent with a determination that the director
is independent under the NASDAQ Stock Market Rules.
Board Committees
Audit Committee
The Audit Committee consists of Xinhai Li,
T. Joseph Fisher, III and Ping Li, each of whom is an independent director. Mr. Ping Li, Chairman of the Audit Committee, is an
“audit committee financial expert” as defined under Item 407(d) of Regulation S-K. The Audit Committee held 4 meetings
during 2012. The purpose of the Audit Committee is to represent and assist our Board of Directors in its general oversight of our
accounting and financial reporting processes, audits of the consolidated financial statements and internal control and audit functions.
The Audit Committee’s responsibilities include:
|
|
·
|
The appointment, replacement, compensation, and oversight of work of the independent registered public accounting firm, including resolution of disagreements between management and the independent registered public accounting firm regarding financial reporting, for the purpose of preparing or issuing an audit report or performing other audit, review or attestation services.
|
|
|
|
|
|
|
·
|
Reviewing and discussing with management and the independent auditor various topics and events that may have a significant financial impact on our company or that are the subject of discussions between management and the independent auditors.
|
The Board of Directors has adopted a written
charter for the Audit Committee. A copy of the Audit Committee Charter
is available in the corporate
governance section of the investor relations page of the Company’s Web site located at
www.highpowertech.com
.
During the four month period from September
2012 to December 2012, we paid Mr. Fisher an aggregate of $12,000 in fees to provide us with leads and prospects of potential customers,
which services were unrelated to his responsibilities as a member of the board of directors or committee of the board. Mr. Fisher
ceased providing such services in December 2012 and no payments have been made to Mr. Fisher since December 2012, other than payments
related to his service on our board of directors and committees thereof.
We notified NASDAQ of our payment of such
fees on March 20, 2013 when we discovered that our payment of such fees to Mr. Fisher as a member of the audit committee were not
permitted pursuant to NASDAQ listing rules. On March 27, 2013, the Listing Qualifications department of NASDAQ notified us via
letter that due to Mr. Fischer's acceptance from the Company of the $12,000 in fees unrelated to his service as a director or audit
committee member, Mr. Fisher did not meet the independence criteria for audit committee members as set forth in Rule 10A-3(b)(1)
promulgated under the Exchange Act. As a result, the Listing Qualifications department of NASDAQ determined that the Company had
failed to comply with NASDAQ's audit committee composition requirements set forth in Listing Rule 5605(c)(2)(A)(ii). However, NASDAQ
further noted that, because Mr. Fisher is no longer receiving such fees, the matter is now closed. Mr. Fisher remains an independent
director of the Company and member of the audit committee and the Company is again in compliance with the Listing Rule. We reported
our receipt of the March 27, 2013 letter from NASDAQ on a current report on form 8-K filed with the Securities and Exchange Commission
on March 28, 2013.
In response to this issue, we have reviewed
our procedures with respect to these types of payments and plan to take the following steps to assure that no payments are made
to directors in violation of NASDAQ listing rules: (a) revise our Audit Committee Charter to clarify that the Audit Committee is
responsible for reviewing and approving related party transactions with both officers and directors, including any payments made
to such persons either directly or indirectly, and (b) require that any payment made to independent directors, either directly
or indirectly, other than standard director compensation fees, be approved by both the Company's Chief Executive Officer and Chief
Financial Officer, after consultation with counsel.
Compensation Committee
The Compensation Committee consists of Xinhai
Li and T. Joseph Fisher, III, each of whom is an independent director. Xinhai Li is the Chairman of the Compensation Committee.
The Compensation Committee held 4 meetings during 2012.
The Compensation Committee may take other individual
compensation actions during the year as needed.
The Compensation Committee is responsible for the design, review, recommendation
and approval of compensation arrangements for the Company’s directors, executive officers, including our Chief Executive
Officer, and key employees, and for the administration of our equity incentive plans, including the approval of grants under such
plans to our employees, consultants and directors.
The Compensation Committee conducts an annual review
(in connection with the conclusion of our business planning process) of the compensation packages for each of our named executive
officers. The Company does not have a general equity grant policy.
In reviewing and making decisions regarding the compensation
of executive officers other than the Chief Executive Officer, the Committee may consult with the Company’s Chief Executive
Officer and any others who can review the performance of the other executive officers, provide annual recommendations for individual
management objectives, and provide input on strategic initiatives. The Compensation Committee has the authority, to the extent
it deems necessary or appropriate, to retain a compensation consultant and other advisors to assist in the evaluation of director,
Chief Executive Officer or executive officer compensation. The Board of Directors has adopted a written charter for the Compensation
Committee. A current copy of the Compensation Committee Charter is available in the corporate governance section of the investor
relations page of the Company’s Web site located at
www.highpowertech.com.
Nominating Committee
The Nominating Committee consists of Xinhai
Li and T. Joseph Fisher, III, each of whom is an independent director. T. Joseph Fisher, III is the Chairman of the Nominating
Committee. The Nominating Committee held 4 meetings during 2012. The Nominating Committee assists in the selection of director
nominees, approves director nominations to be presented for stockholder approval at our annual general meeting and fills any vacancies
on our Board of Directors, considers any nominations of director candidates validly made by stockholders, and reviews and considers
developments in corporate governance practices. The Board of Directors has adopted a written charter for the Nominating Committee.
A current copy of the Nominating Committee Charter
is available in the corporate
governance section of the investor relations page of the Company’s Web site located at
www.highpowertech.com
.
Code of Business Conduct and Ethics
The Board of Directors has adopted a Code
of Business Conduct and Ethics (the “Code”), which applies to all directors, officers and employees. The purpose of
the Code is to promote honest and ethical conduct. The Code is posted in the corporate governance section of the investor relations
page of the Company’s Web site located at
www.highpowertech.com
, and is available in print, without charge, upon written
request to the Company at Highpower International, Inc., Building A1, Luoshan Industrial Zone, Shanxia, Pinghu, Longgang, Shenzhen,
Guangdong, 518111, People’s Republic of China. The Company intends to post promptly any amendments to or waivers of the Code
on its Web site.
Attendance of Directors at Board Meetings and Annual Meeting
of Stockholders
During the year ended December 31, 2012, the Board of Directors
met 4 times, the Audit Committee met 4 times, the Compensation Committee met 4 times, and the Nominating Committee met 4 times. Each
of the current directors who was on the Board of Directors during 2012 attended at least 75% of the aggregate number of meetings
held by the Board of Directors and those committees of the Board of Directors on which he served during 2012.
The Company does not have a policy requiring
its directors to attend the Annual Meeting of Stockholders. All directors attended our 2012 Annual Meeting of Stockholders.
Board Leadership Structure
The Company does not have a policy regarding
whether the Chairman and Chief Executive Officer roles should be combined or separated. Rather, the Board retains flexibility to
choose its Chairman in any way that it deems best for the Company at any given time. The Company currently has a combined Chairman
and CEO position. Dang Yu Pan serves as our Chairman of the Board and Chief Executive Officer. The Board believes that
Dang Yu Pan’s in-depth knowledge of the battery industry and of the businesses and operations of the Company best equips
him to lead Board meetings and focus the Board discussions on the most critical issues, as well as fostering greater communication
between the Company’s management and the Board.
The Board believes that other aspects of
the current leadership structure ensure effective independent Board leadership and oversight of management. For example, the independent
directors meet in executive sessions without the CEO or other members of management present. Executive sessions are led by our
lead independent director Mr. Ping Li. An executive session is typically held in conjunction with each regularly scheduled Audit
Committee meeting and other sessions may be called by the Audit Committee Chairman in his own discretion or at the request of the
Board of Directors. The independent directors met 4 times in executive session in 2012.
The Board’s Role in Risk Oversight
Our Company faces a variety of risks, including investment risk,
liquidity risk, and operational risk.
The Board of Directors believes an effective risk management system
will (1) timely identify the material risks that the Company faces, (2) communicate necessary information with respect
to material risks to senior executives and, as appropriate, to the Board or committee thereof, (3) implement appropriate and
responsive risk management strategies consistent with the Company’s risk profile, and (4) integrate risk management
into Company decision-making.
It is management’s responsibility to manage the day-to-day risks that we face and bring
to the Board of Directors’ attention the most material risks to the Company. The Board of Directors has oversight responsibility
of the processes established by management to report and monitor systems for material risks applicable to the Company, with the
oversight of certain risk areas delegated to board committees. For example, our Compensation Committee is responsible for assessing
risks associated with our compensation programs and our Audit Committee is responsible for overseeing management of certain financial
and regulatory risk areas.
The Board encourages management to promote a corporate culture that incorporates
risk management into the Company’s corporate strategy and day-to-day business operations. The Board also works, with the
input of the Company’s executive officers, to assess and analyze the most likely areas of future risk for the Company.
The Director Nomination Process
The Nominating Committee considers nominees
from all sources, including stockholders. Stockholder nominees are evaluated by the same criteria used to evaluate potential nominees
from other sources.
The Board of Directors will consist of a majority of directors
who qualify as “independent” directors within the meaning of the listing standards of the NASDAQ Stock Market, as the
same may be amended from time to time.
Minimally, nominees should have a reputation for integrity, honesty and adherence
to high ethical standards. They should have demonstrated business experience and the ability to exercise sound judgment in matters
related to the current and long-term objectives of the Company, and should be willing and able to contribute positively to the
decision-making process of the Company. In addition, a nominee should not have, nor appear to have, a conflict of interest that
would impair the nominee’s ability to represent the interests of the Company or to fulfill the responsibilities of a director.
Although the Board does not maintain a formal
policy regarding diversity, the value of diversity on the Board is considered and the particular or unique needs of the Company
shall be taken into account at the time a nominee is being considered.
The
Nominating Committee seeks a broad range of perspectives and considers both the personal characteristics (gender, ethnicity, age)
and experience (education, industry, professional, public service) of directors and prospective nominees to the Board.
Our
Nominating Committee and Board believe that a diverse representation on the Board fosters a healthy, comprehensive, and balanced
deliberative and decision-making process that is essential to the continued effective functioning of the Board and continued success
of the Company.
Additionally, the Nominating Committee considers
the respective qualifications needed for directors serving on various committees of the Board, and serving as chairs of such committees,
should be taken into consideration. In recruiting and evaluating nominees, the Nominating Committee considers the appropriate mix
of skills and experience and background needed for members of the Board and for members of each of the Board’s committees,
so that the Board and its committees have the necessary resources to perform their respective functions effectively. The Nominating
Committee also believes that a prospective nominee should be willing to limit the number of other corporate boards on which he
or she serves so that the proposed director is able to devote adequate time to his or her duties to the Company, including preparing
for and attending Board and committee meetings. In addition, the re-nomination of existing directors is not viewed as automatic,
but based on continuing qualification under the criteria set forth above. In addition, the Nominating Committee will consider the
existing director’s performance on the Board and on any committee on which such director serves, which will include attendance
at Board and committee meetings.
Director Nominees by Stockholders
.
The Nominating Committee will consider nominees recommended in good faith by our stockholders as long as these nominees for the
appointment to the Board of Directors meet the requirements set forth above. Possible candidates who have been suggested by stockholders
are evaluated by the Board of Directors in the same manner as are other possible candidates. Stockholders wishing to suggest a
qualified director candidate for review and consideration by the Nominating Committee must provide a written statement to our corporate
secretary that includes the following information: a statement that the proposing stockholder is recommending a candidate for consideration
by the Nominating Committee; the candidate’s credentials and contact information; and the candidate’s written consent
to be considered a candidate. Such information can be sent to Highpower International, Inc., Building A7, Luoshan Industrial
Zone, Shanxia, Pinghu, Longgang, Shenzhen, Guangdong, 518111, People’s Republic of China, Attention: Corporate Secretary.
The Nominating Committee may request further
information about the stockholder recommended candidate in order to comply with any applicable laws, rules or regulations or to
the extent that such information is required to be provided by such stockholder pursuant to any applicable laws, rules or regulations. If
a stockholder submits a director recommendation in compliance with the procedure described above, the Nominating Committee will
conduct an initial evaluation of the proposed nominee and, if it determines the proposed nominee may be a qualified candidate,
the Nominating Committee and one or more members of our management team will interview the proposed nominee to determine whether
he or she might be suitable to be a director. If the Nominating Committee determines the proposed nominee would be a valuable addition
to our Board of Directors, based on the criteria for board membership described above and our Board of Directors' specific needs
at the time, it will recommend to our Board of Directors such person's nomination. In connection with its evaluation, the Nominating
Committee may request additional information from the proposed nominee and/or the proposing stockholder.
Family Relationships
There are no family relationships among
any of the officers and directors.
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table sets forth information concerning the compensation
for the fiscal years ended December 31, 2012and 2011 of the principal executive officer and up to two other officers who compensation
exceeded $100,000 during such years (our “named executive officers”).
|
Name and Position
|
|
Year
|
|
Salary
|
|
|
Bonus
|
|
|
Option
Awards (1)
|
|
|
All other
compensation
|
|
|
Total
|
|
|
Dang Yu Pan, CEO and
|
|
2012
|
|
$
|
66,000
|
|
|
$
|
40,000
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
106,000
|
|
|
Chairman
|
|
2011
|
|
$
|
44,000
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
18,000
|
(2)
|
|
$
|
62,000
|
|
|
Henry Sun (3)
|
|
2012
|
|
$
|
75,000
|
|
|
$
|
10,000
|
|
|
$
|
85,299
|
|
|
$
|
-
|
|
|
$
|
170,299
|
|
|
Chief Financial Officer
|
|
2011
|
|
$
|
75,000
|
|
|
$
|
-
|
|
|
$
|
50,650
|
|
|
$
|
-
|
|
|
$
|
125,650
|
|
|
Wen Liang Li
|
|
2012
|
|
$
|
76,000
|
|
|
$
|
25,000
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
101,000
|
|
|
Vice President, Chief Technology Officer and Director
|
|
2011
|
|
$
|
74,000
|
|
|
$
|
23,000
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
97,000
|
|
|
|
(1)
|
Represents the full grant date fair value computed in accordance with
FASB ASC Topic 718.
For assumptions used in calculation of option awards, see Note 17 (Share Based Payment) to our
consolidated financial statements included in our Annual Report on Form 10-K. for the year ended December 31, 2012.
|
|
|
(2)
|
Fees earned or paid for service as a director of the Company.
|
|
|
(3)
|
Henry Sun was appointed Chief Financial Officer and Corporate Secretary of the Company in January
2011.
|
Employment Agreements
and Termination of Employment
and Change of Control Arrangements
We do not have any
employment agreements or change of control arrangements with any of our named executive officers. On January 21, 2011, the Company
granted Mr. Sun ten-year options to purchase an aggregate of 250,000 shares of common stock at an exercise price of $3.55 per share.
With respect to the grant, options to purchase 75,000 shares have vested, while 75,000 will vest on
November 1, 2013 and 100,000 on November 1, 2014.
Outstanding Equity Awards at 2011 Fiscal Year End
The following table sets forth the outstanding stock options
for each of our named executive officers as of December 31, 2012.
|
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END
|
|
|
|
Name
|
|
Number
of
Securities
Underlying
Unexercised
options
(#)
exercisable
|
|
|
Number
of
Securities
Underlying
Unexercised
options
(#)
unexercisable
|
|
|
Option
Exercise
Price
($)
|
|
|
Option
Expiration
Date
|
|
Henry Sun
|
|
|
75,000
|
|
|
|
175,000
|
|
|
|
3.55
|
|
|
1/11/2021
|
Director Compensation
The following
table shows information regarding the compensation earned during the fiscal year ended December 31, 2012 by members of board
of directors. Compensation information for Dang Yu Pan and Wen Liang Li is described in the summary compensation table above
.
|
Name
|
|
Fees Earned or
Paid in Cash
($)
|
|
|
Stock
Awards
($)
|
|
|
Option
Awards
($) (1)
|
|
|
Non-Equity
Incentive Plan
Compensation
($)
|
|
|
Change in
Pension Value
and
Nonqualified
Deferred
Compensation
Earnings
|
|
|
All Other
Compensation
($)
|
|
|
Total
($)
|
|
|
T. Joseph Fisher, III
|
|
|
36,000
|
|
|
|
-
|
|
|
|
3,839
|
|
|
|
-
|
|
|
|
-
|
|
|
|
12,000
|
(2)
|
|
|
51,839
|
|
|
Xin Hai Li
|
|
|
19,020
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
19,020
|
|
|
Ping Li
|
|
|
19,020
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
19,020
|
|
|
|
(1)
|
Represents the full grant date fair value computed in accordance with FASB ASC Topic 718. For assumptions
used in calculation of option awards, see Note 17 (Share Based Payment) to our consolidated financial statements included in the
Annual Report on Form 10-K for the fiscal year ended December 31, 2012.
|
|
|
(2)
|
Represents fees for consulting services provided to the company
.
|
Dang Yu Pan and Wen
Liang Li are management board members. While in previous years, we offered our management board members a total compensation package,
which include salary, bonus and director fees, we now do not pay such directors separate fees for board membership. We now offer
our management board members a compensation package consisting of salary and bonus based on benchmarks reported by Shenzhen Labor
Bureau.
Effective November
1, 2013, we will pay our non-executive directors for their services at the rate of $1,000 to $2,000 per month.
Directors are eligible to receive, from
time to time, grants of options to purchase shares of our common stock and other awards under our 2008 Omnibus Incentive Plan (the
“Plan”).
Securities Authorized for Issuance under Equity Compensation
Plans
The following table provides information as of December 31,
2012 regarding compensation plans, including any individual compensation arrangements, under which equity securities of Highpower
International, Inc. are authorized for issuance.
|
Plan Category
|
|
Number
of Securities
to be issued
upon
exercise of
outstanding
options,
warrants
and rights
|
|
|
Weighted-
average
exercise
price of
outstanding
options,
warrants
and rights
|
|
|
Number
of securities
remaining
available for
future
issuance
under equity
compensation
plans
|
|
|
Equity compensation plans approved by security holders
|
|
|
680,000
|
|
|
$
|
2.82
|
|
|
|
1,303,000
|
|
|
Equity compensation plans not approved by security holders
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
Total
|
|
|
-
|
|
|
|
N/A
|
|
|
|
1,303,000
|
|
As of October
8, 2013, there were
1,418,000
shares available for issuance pursuant to the Plan.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
Beneficial ownership is determined in accordance
with the rules of the SEC. In computing the number of shares beneficially owned by a person and the percentage of ownership of
that person, shares of common stock subject to options and warrants held by that person that are currently exercisable or become
exercisable within 60 days of the Record Date are deemed outstanding even if they have not actually been exercised. Those shares,
however, are not deemed outstanding for the purpose of computing the percentage ownership of any other person.
The following table sets forth as of the
Record Date certain information with respect to beneficial ownership of our common stock based on
13,732,106
issued and outstanding shares of common stock, by:
|
|
·
|
Each person known to be the beneficial owner of 5% or more of the outstanding common stock of our company;
|
|
|
·
|
Each named executive officer;
|
|
|
·
|
All of the executive officers and directors as a group.
|
The number of shares of our common stock
outstanding as of the Record Date excludes 565,000 shares of our common stock issuable upon the exercise of outstanding options. Unless
otherwise indicated, the persons and entities named in the table have sole voting and sole investment power with respect to the
shares set forth opposite the stockholder’s name, subject to community property laws, where applicable. Unless otherwise
indicated, the address of each stockholder listed in the table is c/o Building A7, Luoshan Industrial Zone, Shanxia, Pinghu, Longgang,
Shenzhen, Guangdong, 518111, People’s Republic of China.
Name and Address
Of Beneficial Owner
|
|
Title
|
|
Amount and
Nature of
Beneficial
Ownership
|
|
|
Percent of
Class
|
|
|
|
|
|
|
|
|
|
|
|
|
Directors and Executive Officers
|
|
|
|
|
|
|
|
|
|
|
|
Dang Yu Pan
|
|
Chief Executive Officer and Chairman of the Board
|
|
|
2,932,073
|
(1)
|
|
|
21.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Wen Liang Li
|
|
Vice President, Chief Technology Officer and Director
|
|
|
2,034,770
|
|
|
|
14.8
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Henry Sun
|
|
Chief Financial Officer and Corporate Secretary
|
|
|
150,000
|
(2)
|
|
|
1.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Xinhai Li
|
|
Director
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
T. Joseph Fisher, III
|
|
Director
|
|
|
10,000
|
(2)
|
|
|
0.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ping Li
|
|
Director
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Officers and Directors as a Group (total of 9 persons)
|
|
|
|
|
6,243,740
|
(3)
|
|
|
44.8
|
%
|
* Less than 0.1%
|
|
(1)
|
Includes 269,959 shares held by a company that is 100% owned by Mr. Pan.
|
|
|
(2)
|
Represents shares underlying options to purchase shares of the Company’s common stock exercisable within 60 days of the
Record Date.
|
|
|
(3)
|
Includes 220,000 shares of common stock issuable upon the exercise of outstanding options exercisable within 60 days of the
Record Date.
|
SECTION 16 (A) BENEFICIAL OWNERSHIP REPORTING
COMPLIANCE
The
Company’s securities are currently registered under Section 12 of the Securities Exchange Act of 1934, as amended. As a result,
and pursuant to Rule 16a-2, the Company’s directors and officers and holders of 10% or more of its common stock are currently
required to file statements of beneficial ownership with regards to their ownership of equity securities under Sections 13 or 16
of the Exchange Act. Based on a review of written representations from our executive officers and directors and a review of Forms
3, 4 and 5 furnished to us, we believe that during the fiscal year ended December 31, 2012, no directors, officers or owners of
more than 10% failed to file, on a timely basis, reports required by Section 16(a) of the Exchange Act
.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Subsidiaries of Highpower International, Inc.
Hong Kong Highpower
Technology Co., Ltd. (“HKHT”), a wholly-owned subsidiary of Highpower International, Inc., and Shenzhen Highpower Technology
Co., Ltd., Springpower Technology (Shenzhen) Company Ltd.,
Icon Energy System Co. Ltd., Huizhou Highpower Technology Limited,
and Ganzhou Highpower Technology Co., Ltd., each of which are direct or indirect subsidiaries of HKHT,
have
interlocking executive and director positions with the Company.
Guarantee Agreements
Mr. Dang Yu Pan, our Chairman and Chief
Executive Officer, has provided personal guarantees under certain of our outstanding banking facilities.
The
following table shows the amount outstanding on each of our bank loans as of December 31, 2012 that are guaranteed by Mr. Pan
.
|
Name of Bank
|
|
Amount
Granted
|
|
|
Amount
Outstanding
Under Loan
|
|
|
Guaranteed by
|
|
Shenzhen Development Bank Co., Ltd
|
|
$
|
22.5 million
|
|
|
$
|
13.6 million
|
|
|
Dang Yu Pan and SZ Springpower
|
|
Industrial and Commercial Bank of China
|
|
$
|
6.4 million
|
|
|
$
|
2.3 million
|
|
|
Dang Yu Pan
|
|
China Resources Bank of Zhuhai
|
|
$
|
6.4 million
|
|
|
$
|
6.4 million
|
|
|
Dang Yu Pan
|
|
China Everbright Bank
|
|
$
|
5.3 million
|
|
|
$
|
-
|
|
|
Dang Yu Pan
|
|
Total:
|
|
$
|
40.6 million
|
|
|
$
|
22.3 million
|
|
|
|
Policy for Approval of Related Party Transactions
We do not currently have a formal related
party approval policy for review and approval of transactions required to be disclosed pursuant to Item 404 (a) of Regulation S-K.
STOCKHOLDER PROPOSALS FOR 2014 ANNUAL
MEETING
Proposals to be Included in Proxy Statement
Stockholders are hereby notified that if
they wish a proposal to be included in our proxy statement and form of proxy relating to the 2014 annual meeting of stockholders,
they must deliver a written copy of their proposal no later than June 17, 2014. If the date of next year’s annual meeting
is changed by more than 30 days from the date of this year’s meeting, then the deadline is a reasonable time before
we begin to print and mail proxy materials. Proposals must comply with the proxy rules relating to stockholder proposals, in particular
Rule 14a-8 under the Securities Exchange Act of 1934, in order to be included in our proxy materials.
Proposals to be submitted for the Annual Meeting
A stockholder may wish to have a proposal
presented at the 2014 annual meeting, but not to have such proposal included in the Company’s proxy statement and form of
proxy relating to that meeting. If notice of any such proposal is not received by the Company at its principal executive
offices on or before September 3, 2014 (45 calendar days prior to the anniversary of the mailing date of this proxy statement),
then such proposal shall be deemed “untimely” for purposes of Securities and Exchange Commission Rule 14a-4(c).
If the date of our 2014 annual meeting has
been changed by more than 30 days from the date of our 2013 annual meeting, stockholders’ written notices must be received
by us a reasonable time before we begin to print and mail proxy materials for our 2014 annual meeting.
Mailing Instructions
Proposals should be delivered to Highpower
International, Inc., Building A7, Luoshan Industrial Zone, Shanxia, Pinghu, Longgang, Shenzhen, Guangdong, 518111, People’s
Republic of China, Attention: Dang Yu Pan. To avoid controversy and establish timely receipt by the Company, it is suggested that
stockholders send their proposals by certified mail, return receipt requested.
STOCKHOLDER COMMUNICATION WITH THE BOARD
OF DIRECTORS
Stockholders who wish to contact any of
our directors either individually or as a group may do so by writing to c/o Dang Yu Pan, Highpower International, Inc., Building
A7, Luoshan Industrial Zone, Shanxia, Pinghu, Longgang, Shenzhen, Guangdong, 518111, People’s Republic of China, or by telephone
at (86) 755-89686238 specifying whether the communication is directed to the entire Board or to a particular director. Submitting
stockholders should indicate they are a stockholder of our company. Company personnel will screen stockholder communications and
depending on the subject matter, will: forward the inquiry to the chairman of our Board of Directors, who may forward the inquiry
to a particular director if the inquiry is directed towards a particular director; forward the inquiry to the appropriate personnel
within our company (for instance, if it is primarily commercial in nature); attempt to handle the inquiry directly (for instance,
if it is a request for information about our company or a stock-related matter); or not forward the inquiry if it relates to an
improper or inappropriate topic or is otherwise irrelevant
OTHER BUSINESS
The Board of Directors does not know of
any other matter to be acted upon at the Annual Meeting. However, if any other matter shall properly come before the Annual Meeting,
the proxy holders named in the proxy accompanying this Proxy Statement will have authority to vote all proxies in accordance with
their discretion.
|
|
BY ORDER OF THE BOARD OF DIRECTORS
|
|
|
|
|
|
|
|
|
/s/ Henry Sun
|
|
|
Henry Sun, Chief Financial Officer and Corporate Secretary
|
|
|
on behalf of the Board of Directors
|
Dated: October 15, 2013
Shenzhen, China
ANNUAL MEETING OF STOCKHOLDERS OF
HIGHPOWER INTERNATIONAL, INC.
November 17, 2013, 10:00 a.m., China
Standard Time
Please date, sign and mail
your proxy card in the
envelope provided as soon
as possible.
â
Please detach along perforated line and mail in the envelope provided.
â
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:
x
The Board of Directors recommends you vote
FOR the following:
|
FOR
ALL
|
WITHHOLD
ALL
|
FOR ALL
EXCEPT
|
To withhold authority to vote for any individual nominee(s), mark “For All Except” and write the number(s) of the nominee(s) on the line below.
|
1. Election of Directors
Nominees
|
¨
|
¨
|
¨
|
|
|
01 Dang Yu Pan
|
02 Wen Liang Li
|
03 T. Joseph Fisher, III
|
04 Xinhai Li
|
05 Ping Li
|
|
The Board of Directors recommends you vote FOR proposals 2. and 3.:
|
|
|
|
2. Ratify the selection of Marcum Bernstein & Pinchuk LLP, as the Company’s independent registered public accounting firm for the year ending December 31, 2013.
|
FOR
¨
|
AGAINST
¨
|
ABSTAIN
¨
|
|
|
|
|
|
|
3. Approval on an advisory basis of named executive officer compensation.
|
FOR
¨
|
AGAINST
¨
|
ABSTAIN
¨
|
|
The Board of Directors recommends you vote 3 YEARS on the following proposal:
|
|
|
|
|
|
|
|
|
|
|
4. Recommendation on an advisory basis on the frequency of the advisory vote on executive compensation.
|
1 YEAR
¨
|
2 YEARS
¨
|
3 YEARS
¨
|
ABSTAIN
¨
|
NOTE
: Such other business as may properly come before
the meeting or any adjournment thereof.
|
Please indicate if you plan to attend this meeting
|
YES
|
NO
|
|
|
|
¨
|
¨
|
|
Please sign exactly as your name(s) appear hereon. When signing
as attorney, executor, administrator, or other fiduciary, please give full title as such. Joint owners should each sign personally.
All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name, by authorized officer.
|
|
|
|
|
|
|
|
|
Signature
|
|
Date
|
|
Signature (Joint Owners)
|
|
Date
|
|
HIGHPOWER INTERNATIONAL, INC.
|
ANNUAL MEETING OF STOCKHOLDERS
NOVEMBER 17, 2013 10:00 AM China Standard
Time
This proxy is solicited by the Board
of Directors
The undersigned stockholder(s) of Highpower
International, Inc., a Delaware corporation, hereby acknowledges receipt of the Notice of Annual Meeting of Stockholders and Proxy
Statement dated October 15, 2013, and hereby appoints Dang Yu Pan and Wen Liang Li, or either of them acting singly in the absence
of the other, with full power of substitution, as attorneys-in-fact and proxies for, and in the name and place of, the undersigned,
and hereby authorizes each of them to represent and to vote all of the shares which the undersigned is entitled to vote at the
Annual Meeting of Stockholders of Highpower International, Inc. to be held on November 17, 2013, at 10:00 a.m., China Standard
Time, and at any adjournments thereof, upon the matters as set forth in the Notice of Annual Meeting of Stockholders and Proxy
Statement, receipt of which is hereby acknowledged.
THIS PROXY, WHEN PROPERLY EXECUTED AND
RETURNED IN A TIMELY MANNER, WILL BE VOTED AT THE ANNUAL MEETING AND AT ANY ADJOURNMENTS THEREOF IN THE MANNER DIRECTED HEREIN
BY THE UNDERSIGNED STOCKHOLDER(S). IF NO SPECIFICATION IS MADE, THE PROXY WILL BE VOTED “FOR” ELECTION OF THE NOMINEES
LISTED IN PROPOSAL 1, “FOR” APPROVAL OF PROPOSALS 2 AND 3, AND “3 YEARS” ON PROPOSAL 4 AS DESCRIBED
IN THE PROXY AND IN ACCORDANCE WITH THE JUDGMENT OF THE PERSONS NAMED AS PROXIES HEREIN ON ANY OTHER MATTERS THAT MAY PROPERLY
COME BEFORE THE ANNUAL MEETING.
Continued and to be signed on reverse
side
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