SCHEDULE 13D/A: FiEE, Inc. Major Shareholders Adjust Holdings to Correct Ownership Discrepancy

Key shareholders of FiEE, Inc. have received an additional 31,258 Series A Convertible Preferred Stock shares to rectify an ownership percentage discrepancy stemming from the original purchase agreement.

Summary

• This document is Amendment No. 1 to the Schedule 13D filed by Cao Yu, Hu Bin, Youxin Consulting Limited, and Li Wai Chung (the "Reporting Persons") regarding their beneficial ownership in FiEE, Inc.
• On April 10, 2025, an Additional Securities Purchase Agreement was executed, resulting in the transfer of 31,258 additional shares of Series A Convertible Preferred Stock from David Elliot Lazar (Seller) to the Purchasers (Reporting Persons).
• This transfer was made without additional consideration to correct a discrepancy in the number of shares of FiEE's Common Stock believed to be outstanding at the closing of the original Purchase Agreement on February 18, 2025.
• The original intent of the Amended and Restated Securities Purchase Agreement (SPA) was for the Purchasers to collectively own 55% of FiEE's outstanding common stock on a fully diluted basis.
• The actual number of common shares issued and outstanding at the original SPA closing was 3,713,792, which was higher than the previously believed 3,557,501 shares, leading to the Purchasers initially owning less than the agreed percentage.
• Following this adjustment, the Reporting Persons' beneficial ownership percentages are: Cao Yu at 38.1% (3,029,646 shares), Hu Bin at 31.6% (2,272,087 shares), and Youxin Consulting Limited (and Li Wai Chung) at 60.0% (3,382,747 shares).
• These beneficial ownership figures include shares of Series A Convertible Preferred Stock convertible into common stock at a ratio of 1.4 shares of common stock for each preferred share, and warrants to purchase additional common stock at an exercise price of $1.00 per share.

Sentiment

Score: 6

Explanation: The sentiment is moderately positive. While a discrepancy occurred, it was promptly identified and corrected by the parties involved, demonstrating commitment to the original agreement. The correction was made without additional cost to the purchasers, which is a positive for them. The underlying issue of a discrepancy in share count is a minor negative, but the resolution mitigates its impact.

Positives

• The company and its major shareholders are actively correcting discrepancies to ensure agreed-upon ownership percentages are maintained, indicating good faith and adherence to contractual agreements.
• The transfer of additional shares was made for no additional consideration beyond the original purchase price, benefiting the purchasers by solidifying their intended ownership without further cost.

Negatives

• A discrepancy in the reported number of outstanding shares at the time of the original purchase agreement suggests potential issues with initial due diligence or reporting accuracy.

Risks

• Potential for future discrepancies or miscalculations in share counts, which could lead to further adjustments or disputes.
• The complexity of beneficial ownership calculations involving convertible preferred stock and warrants could lead to misunderstandings or misrepresentations.

Future Outlook

The document does not contain explicit forward-looking statements or guidance regarding the company's future operations or financial performance, focusing solely on the adjustment of beneficial ownership.

Management Comments

• "The transfer was made due to a discrepancy between the number of shares of the Issuer's Common Stock that was believed to have been issued and outstanding at closing of the Purchase Agreement on February 18, 2025, and the actual number of shares of the Issuer's Common Stock issued and outstanding on such date that would result in the Purchasers owning less than the agreed percentage of the Issuer provided for in the Purchase Agreement."
• "Therefore, these 31,258 additional shares of Series A Convertible Preferred Stock were transferred to the Purchasers for no additional consideration beyond the consideration provided in the Purchase Agreement so that the Purchasers would own the agreed percentage of the Issuer provided for in the Purchase Agreement."

Industry Context

This filing is a specific disclosure related to a change in beneficial ownership for FiEE, Inc. and does not provide broader industry context or trends. It primarily addresses a contractual adjustment between specific parties.

Corporate Governance

Related Party Transactions

• The transfer of shares occurred between David Elliot Lazar (Seller) and the Reporting Persons (Purchasers), who are significant shareholders and are filing this Schedule 13D. This transaction is between parties with existing relationships and significant stakes in the company.

Stakeholder Impact

• Shareholders: Existing shareholders might view this as a positive sign of contractual adherence and stability in major ownership, as the correction ensures the intended ownership structure is maintained.
• Management: The correction of the share count discrepancy reflects on the accuracy of company records, which management is responsible for.

Key Dates

Recommendation

Keywords

FiEE Inc., Schedule 13D, Beneficial Ownership, Convertible Preferred Stock, Warrants, Share Transfer, Ownership Discrepancy, SEC Filing, Corporate Governance, Shareholder Agreement