🧾 What This Document Is

This is an exhibit to a Form 8-K filing by Focus Universal Inc. (FCUV). It contains the legal forms for two types of securities the company is issuing as part of a Private Investment in Public Equity (PIPE) financing deal. Think of it as the official rulebook for investors who are giving the company money in exchange for special rights to buy stock later.

🏢 What The Company Does

👉 In simple terms… Focus Universal Inc. is a technology company focused on developing universal remote control products and smart home/platform technologies. They are listed on the OTCQB market under the ticker FCUV.

🤝 The Deal: PIPE Financing

The company is raising capital by selling securities directly to private investors. This filing details two key pieces of that deal:

• Pre-Funded Warrants (EX-4.1): Investors pay most of the money upfront. They get a warrant that is essentially "pre-paid," requiring only a tiny nominal fee ($0.00001 per share) to later convert into common stock.
• Series A Common Warrants (EX-4.2): These are more traditional warrants. Investors get the right to buy common stock at a set price (Exercise Price, to be determined) within a specific time frame.

🔍 The Details: Pre-Funded Warrant (EX-4.1)

This warrant is designed to get the cash into the company's hands immediately.

• Initial Exercise Date: April 6, 2026.
• Exercise Price: A nominal $0.00001 per share. The real price was paid when the investor bought the warrant.
• Termination Date: The warrant can be exercised at any time until it is exercised in full.
• Cashless Exercise Option: The holder can choose to receive shares without paying the nominal fee by using a formula based on the stock's market price (VWAP).
• Beneficial Ownership Limit: A holder cannot exercise the warrant if it would cause them to own more than 4.99% (or 9.99% if elected) of the company's outstanding common stock. This prevents sudden, large ownership changes.

🔍 The Details: Series A Common Warrant (EX-4.2)

This is a standard warrant giving the right to buy shares in the future.

• Initial Exercise Date: April 6, 2026.
• Termination Date: Expires at 5:00 p.m. (NYC time) on April 7, 2028. It's a two-year window.
• Exercise Price: To be specified (marked as [●] in the form). This is typically set at or above the market price when the deal is signed.
• Same Key Protections: Includes the same 4.99%/9.99% beneficial ownership limit and cashless exercise provisions as the pre-funded warrant.

⚙️ How It Works: Key Mechanics

• Exercise Process: The holder submits a "Notice of Exercise" form. The company then delivers the new shares, usually via electronic transfer (DWAC).
• Transfer Agent: VStock Transfer (18 Lafayette Pl, Woodmere, NY 11598) handles the share issuance.
• No Registration: The warrants and the shares underlying them are "restricted securities." They are not registered with the SEC and cannot be freely sold unless later registered or sold under specific exemptions (like Rule 144).
• Adjustments: The number of shares and exercise price can be adjusted for corporate events like stock splits, dividends, or mergers.

📅 Key Dates & Contacts

• Agreement Date: The Securities Purchase Agreement was dated April 6, 2026.
• Issuance Date: The warrants were issued on April 7, 2026.
• Company Contact: For official notices, contact the CEO:

  Desheng Wang, Chief Executive Officer 1515 W. Cameron Ave., Ste 210, West Covina, CA Email: [email protected]

💡 Why This Matters

• For the Company: This PIPE deal provides immediate cash (from the pre-funded warrants) to fund operations, pay off debt, or invest in growth without waiting for investors to exercise options.
• For Investors: It offers a potential discount or favorable terms on future shares. The pre-funded structure is often used to help investors manage tax or regulatory timing.
• For the Market: It signals that private investors are willing to provide capital, which can be a confidence boost. However, it also means potential future dilution for existing shareholders when these warrants are exercised and new shares are created.

⚖️ Big Picture: Strengths & Risks

👍 Strengths:

• Provides the company with much-needed capital.
• Structured to be investor-friendly, which helps attract funding.
• Clear terms and processes are defined.

⚠️ Risks:

• Future Dilution: When warrants are exercised, the number of company shares increases, which can reduce the ownership percentage and potentially the earnings per share for existing investors.
• Market Price Pressure: If warrant holders exercise and immediately sell their new shares, it could push the stock price down.
• Complexity: These are complex financial instruments with conditions that average investors may find difficult to understand.

🧠 The Analogy

Think of this like a non-refundable deposit on a custom-made item. The investors (buyers) pay Focus Universal (the craftsman) a large sum upfront (the pre-funded warrant) to secure the right to later receive a product (shares) for a very small final fee. The Series A warrant is like a separate coupon they also received, giving them the option to buy another standard item at a set price within the next two years. The company gets the cash now to build its business, while the investors get preferential access to shares in the future.

🧩 Final Takeaway

Focus Universal is raising cash through a complex PIPE deal, issuing "pre-paid" warrants and traditional warrants to private investors. This gives the company immediate funding but will likely lead to stock dilution for existing shareholders when the investors eventually convert their warrants into common stock.