DEF 14A: HUSA to Hold Virtual Annual Meeting, Elect Directors

Houston American Energy Corp. announces its 2025 Annual Meeting of Stockholders to be held virtually on December 16, 2025, to elect directors, ratify auditors, and approve executive compensation.

Summary

• The 2025 Annual Meeting of Stockholders will be held virtually on December 16, 2025, at 11:00 a.m. Central Standard Time.
• Stockholders will vote on three proposals: electing five directors, ratifying CBIZ CPAs P.C. as the independent registered public accountants for fiscal year 2025, and approving, on a non-binding advisory basis, the compensation paid to named executive officers.
• The Board of Directors unanimously recommends a vote FOR all proposals.
• As of the record date, November 13, 2025, there were 34,632,566 shares of common stock outstanding and entitled to vote.
• A change of control occurred on July 1, 2025, when the Company acquired all units of Abundia Global Impact Group, LLC from Abundia Financial and Bower Family Holdings, LLC, issuing 31,778,032 shares of Common Stock, representing 94% of the Company's outstanding shares.
• Following the Share Exchange, Abundia Financial directly held 84.6% and Bower Family Holdings, LLC directly held 10.4% (and indirectly 46.3%) of the outstanding shares.
• The Audit Committee dismissed Baker Tilly US, LLP and Marcum LLP as independent auditors on October 2, 2025, and engaged CBIZ CPAs P.C. for the fiscal year ending December 31, 2025.
• Material weaknesses in internal control over financial reporting were previously reported by both AGIG (audited by Baker Tilly) and the Company (audited by Marcum).

Sentiment

Score: 3

Explanation: The filing reveals significant negative financial performance, including consistent net losses and a drastic decline in Total Shareholder Return over three years. Governance issues such as material weaknesses in internal controls and late Section 16(a) filings are also present. While new management and a change of control have occurred, the overall picture suggests a company facing substantial challenges and uncertainty.

Positives

• The Board of Directors unanimously recommends approval of all proposals, indicating internal alignment on governance and executive compensation.
• New independent registered public accountants, CBIZ CPAs P.C., have been appointed, potentially signaling a fresh start for audit oversight.
• The appointment of new executive officers and directors brings diverse experience in finance, operations, and capital markets to the Company.

Negatives

• The Company reported net losses for three consecutive fiscal years: $(0.74) million in 2022, $(3.21) million in 2023, and $(8.22) million in 2024, indicating worsening financial performance.
• Total Shareholder Return (TSR) based on an initial $100 investment declined significantly from $140.56 in 2022 to $9.79 in 2024, reflecting substantial value destruction.
• Material weaknesses in internal control over financial reporting were previously reported for both Abundia Global Impact Group, LLC and the Company.
• Certain directors and a significant beneficial owner had late Section 16(a) beneficial ownership reports, indicating compliance issues.

Risks

• Material weaknesses in internal control over financial reporting were previously reported for Abundia Global Impact Group, LLC.
• Material weaknesses in the Company's internal control over financial reporting were previously reported.

Future Outlook

The filing does not provide specific forward-looking statements or guidance regarding financial performance or strategic initiatives beyond the general objectives of the executive compensation program to attract, motivate, and retain key executives.

Management Comments

• "We cordially invite you to attend the Annual Meeting of Stockholders of Houston American Energy Corp."
• "The Board recommends that you vote FOR approval of all of the proposals presented at the Annual Meeting."
• "Our compensation policies and procedures are centered on a pay-for-performance philosophy, and we believe that they are strongly aligned with the long-term interests of our stockholders."
• "Our compensation program is designed to attract, motivate, and retain the key executives who drive our success."

Industry Context

The filing is a standard proxy statement for an energy company, Houston American Energy Corp. The recent change of control and new management, particularly with the acquisition of Abundia Global Impact Group, LLC, suggest a potential shift in strategic direction. The consistent net losses and declining Total Shareholder Return are concerning within the competitive and often volatile energy sector, indicating the Company's struggle to achieve profitability and deliver shareholder value.

Comparison to Industry Standards

• The significant decline in Total Shareholder Return from $140.56 in 2022 to $9.79 in 2024 indicates substantial underperformance compared to the broader energy sector during this period, which, while volatile, generally did not experience such drastic value destruction.
• The consistent net losses for three consecutive fiscal years (2022-2024) suggest the Company is struggling to achieve profitability, contrasting with many established energy companies that capitalized on fluctuating commodity prices.
• The reported material weaknesses in internal control over financial reporting are a governance concern that may fall below best practices for publicly traded companies in the energy industry, potentially indicating operational inefficiencies or compliance risks.

Management Changes

Corporate Governance

Legal Proceedings

• No current directors or executive officers have been convicted in a criminal proceeding, subject to bankruptcy petitions, court orders limiting business involvement, or found to have violated securities/commodities law during the past ten years.

Related Party Transactions

• On July 1, 2025, the Company acquired all outstanding units of Abundia Global Impact Group, LLC from Abundia Financial, LLC and Bower Family Holdings, LLC (AGIG Unitholders) in exchange for 31,778,032 shares of Common Stock, resulting in a change of control. Edward Gillespie, Joseph Gasik, and Kevin Bower, managers of Abundia Financial, may be deemed to have shared voting and investment discretion.
• On November 12, 2025, Bower Family Holdings, LLC acquired the majority of a senior secured convertible note, with a principal amount of $3,500,000, which was originally issued by the Company to a third-party investor to finance the purchase of the Company's Cedar Port property.

Stakeholder Impact

• Shareholders experienced significant dilution due to the issuance of 31,778,032 shares in the Share Exchange, leading to a change of control and concentrated ownership by Abundia Financial and Bower Family Holdings, LLC.
• Shareholders have seen substantial value erosion, with Total Shareholder Return declining from $140.56 in 2022 to $9.79 in 2024, alongside consistent net losses.
• Executive officers have undergone significant changes, with new CEO, CFO, and COO appointments, and a former CEO receiving an $800,000 termination payment.
• Creditors are impacted by Bower Family Holdings, LLC becoming a significant creditor through the acquisition of a $3.5 million senior secured convertible note.

Next Steps

• Stockholders will vote on the election of directors, ratification of independent auditors, and approval of executive compensation at the Annual Meeting on December 16, 2025.
• The Board will reconsider the selection of CBIZ CPAs P.C. if the ratification of their appointment is not approved by stockholders.
• The Board will review the advisory voting results on executive compensation and take them into account when making future executive compensation decisions.
• The Company intends to post on its website or file under Form 8-K all disclosures required by law or NYSE American listing standards concerning any amendments to, or waivers from, its Code of Conduct and Ethics.
• Stockholders wishing to submit proposals for the 2026 annual meeting (not under Exchange Act Rule 14a-8) must ensure they are received between September 17, 2026, and October 7, 2026.
• Stockholders intending to solicit proxies in support of director nominees other than the Company's nominees must provide notice by October 17, 2026.

Key Dates

Recommendation

The Company exhibits severe financial underperformance, marked by three consecutive years of net losses and a drastic decline in Total Shareholder Return. Governance concerns, including reported material weaknesses in internal controls and late Section 16(a) filings, add to the risk profile. A recent change of control, while bringing new management, also involved significant share dilution and concentrated ownership. These factors collectively suggest a high-risk investment with a strong likelihood of continued value erosion, making a 'sell' recommendation appropriate for a seasoned investor.

Keywords

Houston American Energy Corp, HUSA, Proxy Statement, Annual Meeting, Director Election, Executive Compensation, Auditor Ratification, Corporate Governance, Share Exchange, Change of Control, Abundia Financial, Bower Family Holdings, Energy Sector, SEC Filing, DEF 14A