Milton Ault III

About Milton C. Ault III

Milton C. Ault III, age 55, joined Universal Safety Products, Inc. (UUU) as an independent director on May 22, 2025, with his current term expiring in 2027. He is Executive Chairman of Hyperscale Data, Inc. and holds or has held multiple public company roles; the Board has determined him “independent” under NYSE American Section 802(a) . His background spans executive leadership and investment roles across data centers, digital assets, and diversified holdings .

Past Roles

External Roles

Board Governance

• Independence status: Independent director; appointed May 22, 2025 .
• Committees: FY2025 Audit Committee (Bormel—Chair, Seff, Luskin) and Compensation Committee (Luskin—Chair, Seff, Bormel). Ault’s specific committee assignment not disclosed for FY2025; Cary Luskin resigned July 28, 2025, implying potential reconstitution thereafter (not disclosed) .
• Attendance: FY2025 Board met three times; no incumbent director participated in fewer than 75% of Board and committee meetings (Ault joined after fiscal year-end) .
• Governance structure: Independent directors act as nominating committee; no formal nominating charter .

Fixed Compensation

Performance Compensation

Performance award framework under UUU’s 2025 Stock Incentive Plan includes metrics such as revenues, EBITDA, EPS, TSR, ROE/ROA, margins, cash flow, debt reduction, market share, customer satisfaction, and working capital; plan prohibits option/SAR repricing without stockholder approval and imposes minimum one-year vesting on full-value awards (5% carve-out) .

Other Directorships & Interlocks

• Cross-company ties with Hyperscale Data (Executive Chairman), Alzamend (director), and RiskOn International (Chairman & CEO), alongside Henry Nisser (also HDI executive) joining UUU’s Board simultaneously per MOU with A&C (potential information flow/interlocks) .
• Prior chairmanship of AVLP, which entered Chapter 7 bankruptcy in March 2025 (track-record red flag) .

Expertise & Qualifications

• Multi-decade experience across equities, fixed income, commodities, real estate, and operating leadership; public company founder/chair experience; broad capital markets background supporting risk oversight and financing discussions .

Equity Ownership

• Ownership guidelines: UUU has no formal stock ownership guidelines for employees or directors .
• Pledging/Hedging: No explicit pledging disclosure for Ault; insider trading and 10b5-1 plan policies referenced broadly; no formal ownership guidelines .
• Clawback: Erroneously Awarded Compensation Policy compliant with Exchange Act Section 10D and NYSE American listing standards .

Governance Assessment

• Strengths:

  • Independent status; diversified external experience in capital markets and operating companies .
  • Board is adopting modern equity plan with performance criteria and anti-repricing; clawback policy exists .

• Concerns / RED FLAGS:

  • Rapidly rising beneficial ownership (13D/A at 5.4%) via affiliated entities and option grants to directors; potential influence dilution and conflicts, especially given MOU with A&C for board appointments .
  • Company governance moves toward dual-class stock with 10-vote Class B and blank-check preferred increase—anti-takeover potential and shareholder rights dilution risk .
  • Material weaknesses in internal controls (segregation of duties, tax accounting, ledger controls) and NYSE American notice of noncompliance due to delayed Form 10-K filing .
  • Convertible notes (PIPE) with potential issuance >50% of post-transaction shares to SJC at floor pricing; large dilution and influence risk .
  • Prior chairmanship of AVLP culminating in Chapter 7 liquidation (track-record risk) .

Notes on Independence, Attendance, and Engagement

• Independence: Affirmed by UUU .
• Attendance: FY2025 Board/committee attendance by incumbents ≥75%; Ault appointed after FY2025 period—no attendance data disclosed for him yet .
• Lead roles: No lead independent director or executive session frequency disclosed .

Compensation Structure Analysis

• Mix shifting from cash-only director retainer ($10,000) to inclusion of equity options for directors post-August 2025—greater equity alignment but with dilution and potential approval-dependent vesting .
• Equity plan implements performance metrics and minimum vesting standards; prohibits repricing without stockholder consent (positive governance signal) .

Related Party Transactions & Conflicts

• Board appointment of Ault and Henry Nisser tied to MOU with Ault & Company, Inc. (A&C), indicating negotiated governance changes and potential influence from affiliated entities .
• Beneficial ownership through Ault Lending (subsidiary of Hyperscale Data), A&C, and Alpha Structured Finance LP suggests multi-entity ties requiring ongoing related-party oversight by the Audit Committee .

Say-on-Pay & Shareholder Feedback

• Advisory vote on executive compensation approved Nov 7, 2024 (annual cadence), indicating prior support; not specific to director pay .

Compensation Committee Analysis

• FY2025 Compensation Committee comprised of independent directors Luskin (Chair), Seff, Bormel; use of equity plan and clawback policy adopted thereafter; independence maintained; external consultant use not disclosed .

Performance Compensation – Metric Detail

Equity Ownership – Vested vs. Unvested

• Unvested equity: 50,000 director options granted Aug 27, 2025, vesting contingent on stockholder approval; exercisability contingent on NYSE and stockholder approval .
• Vested equity: As of Sep 17, 2025, 21,700 shares via affiliated entities; as of Oct 23, 2025, 125,407 beneficial shares reported on 13D/A (composition as reported) .

Governance Implications for Investors

• Ault’s growing stake and affiliated entity ties increase alignment but raise potential influence and conflict risks; rigorous Audit Committee related-party oversight is necessary .
• Strategic charter amendments (authorized share increase, preferred, and dual-class) plus the PIPE may materially alter shareholder rights and dilution profile—monitor voting outcomes and subsequent equity issuances .
• Control environment weaknesses and listing compliance issues heighten governance risk in near term; track remediation and timely filings .

Bottom line: While Ault brings capital markets and operational expertise and now holds a meaningful stake, the combination of increasing affiliated ownership, negotiated board changes, aggressive capital structure proposals, and the PIPE’s dilution warrants heightened scrutiny on conflicts, dilution, and the company’s governance discipline.