6-K
Abits Group Inc (ABTS)
UNITEDSTATES
SECURITIESAND EXCHANGE COMMISSION
Washington,D.C. 20549
FORM6-K
REPORTOF FOREIGN PRIVATE ISSUER
PURSUANTTO RULE 13a-16 OR 15d-16
UNDERTHE SECURITIES EXCHANGE ACT OF 1934
Forthe month of July 2022
CommissionFile Number: 333-256665
MOXIAN(BVI) INC
Room1202, Block B, Jiahui Center, 6 Jiqing Li, Chaoyangmenwai Street
ChaoyangDistrict
Beijing100020, China
(Addressof principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:
Form 20-F ☒ Form 40-F ☐
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ☐
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ☐
ExplanatoryNote:
The Registrant is filing this Report on Form 6-K to provide its proxy statement for its 2022 annual meeting of shareholders.
ExhibitIndex
| Exhibit No. | Description |
|---|---|
| 99.1 | Proxy Statement for 2022 Annual Meeting of Shareholders |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| MOXIAN (BVI) INC | ||
|---|---|---|
| Date:<br> July 27, 2022 | By: | /s/ Deng Conglin |
| Name: | Deng Conglin | |
| Title: | Chief Executive Officer |
Exhibit99.1
MOXIAN(BVI) INC
Room1202, Block B, Jiahui Center, 6 Jiqing Li, Chaoyangmenwai Street
ChaoyangDistrict,
Beijing100020, China
PROXYSTATEMENT AND NOTICE OF
ANNUAL MEETING OF SHAREHOLDERS
FOR THE FISCAL YEAR ENDED DECEMBER 31, 2021
| July 27, 2022 | |
|---|---|
| To the Shareholders of Moxian (BVI) Inc: | Beijing,China |
It is my pleasure to invite you to our Annual Meeting of Shareholders for the fiscal year ended December 31, 2021 to be held on August 12, 2022, at 10:00 A.M., Beijing Time (10:00 P.M., Eastern Time, on August 11, 2022). The meeting will be held at Level 2, Carpenter Haus, 36 Carpenter Street, Singapore. The matters to be acted upon at the meeting are described in the Notice of Annual Meeting of Shareholders and Proxy Statement.
YOURVOTE IS VERY IMPORTANT. WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING OF SHAREHOLDERS, WE URGE YOU TO VOTE AND SUBMIT YOUR PROXYBY THE INTERNET, BY EMAIL, BY FAX OR BY MAIL. IF YOU ARE A REGISTERED SHAREHOLDER AND ATTEND THE MEETING, YOU MAY REVOKE YOUR PROXY ANDVOTE YOUR SHARES IN PERSON. IF YOU HOLD YOUR SHARES THROUGH A BANK OR BROKER AND WANT TO VOTE YOUR SHARES IN PERSON AT THE MEETING, PLEASECONTACT YOUR BANK OR BROKER TO OBTAIN A LEGAL PROXY. THANK YOU FOR YOUR SUPPORT.
NOTICEOF ANNUAL MEETING OF SHAREHOLDERS
FORTHE FISCAL YEAR ENDED DECEMBER 31, 2021
MOXIAN (BVI) INC
| TIME: | 10:00<br> A.M., Beijing Time, August 12, 2022<br><br> <br>(10:00<br> P.M., Eastern Time, August 11, 2022) |
|---|---|
| PLACE: | Level<br> 2, Carpenter Haus, 36 Carpenter Street, Singapore |
| --- | --- |
ITEMSOF BUSINESS:
| (1) | To<br> elect five members of the Board of Directors, each to serve a term expiring at the Annual Meeting of Shareholders in 2023, or until<br> their successors are duly elected and qualified; |
|---|---|
| (2) | To<br> ratify the appointment of Audit Alliance LLP as the Company’s independent registered public accounting firm for the fiscal<br> year ending December 31, 2022; |
| (3) | To<br>approve the Company’s 2022 Omnibus Equity Incentive Plan; |
| (4) | To<br>approve amendment to the Amended and Restated Memorandum and Articles of Association to provide that the Preferred Shares shall be convertible<br>into the Ordinary Shares of the Company at any time by the holder thereof or upon the occurrence of an reorganization event; |
| (5) | To<br> approve amendment to the Amended and Restated Memorandum and Articles of Association to provide that each Preferred Share shall be<br> entitled to six votes per share; |
| (6) | To<br>approve the Amended and Restated Memorandum and Articles of Association of the Company; and |
| (7) | To<br>transact any other business properly coming before the meeting. |
| WHO MAY VOTE: | You<br> may vote if you were a shareholder of record on July 12, 2022. |
| --- | --- |
| ANNUAL REPORT: | A<br> copy of our 2021 Annual Report on Form 20-F is enclosed. |
| --- | --- |
| DATE OF MAILING: | This<br> notice and the proxy statement are first being mailed to shareholders on or about July 27, 2022. |
| --- | --- |
| By<br> order of the Board of Directors, | |
| --- | |
| /s/ Conglin Deng | |
| Conglin<br> Deng | |
| Chief<br> Executive Officer and Director |
ABOUTTHE ANNUAL MEETING OF SHAREHOLDERS
FOR THE FISCAL YEAR ENDED DECEMBER 31, 2021
Whatam I voting on?
You will be voting on the following:
| (1) | Election<br> of five members of the Board of Directors, each to serve a term expiring at the Annual Meeting of Shareholders in 2023 or until their<br> successors are duly elected and qualified; |
|---|---|
| (2) | Ratification<br> of the appointment of Audit Alliance LLP as the Company’s independent registered public accounting firm for the fiscal year<br> ending December 31, 2022; |
| (3) | Approval<br> of the Company’s 2022 Omnibus Equity Incentive Plan; |
| (4) | Approval<br> of amendment to the Amended and Restated Memorandum and Articles of Association to provide that the Preferred Shares shall be convertible<br> into the Ordinary Shares of the Company at any time by the holder thereof or upon the occurrence of an reorganization event; |
| (5) | Approval<br> of amendment to the Amended and Restated Memorandum and Articles of Association to provide that each Preferred Share shall be entitled<br> to six votes per share; |
| (6) | Approval<br>of the Amended and Restated Memorandum and Articles of Association of the Company; and |
| (7) | To<br>transact any other business properly coming before the meeting. |
Whois entitled to vote?
You may vote if you owned the ordinary shares, par value $0.001 per share (“Ordinary Shares”) and the preferred shares, par value $0.00101 per share (the “Preferred Shares”) of the Company as of the close of business on July 12, 2022. Each Ordinary Share is entitled to one vote and each Preferred Share is entitled to three votes. As of July 12, 2022, we had 35,554,677 Ordinary Shares outstanding and 5,000,000 Preferred Shares outstanding.
Howdo I vote before the meeting?
If you are a registered shareholder, meaning that you hold your shares in certificate form or book entry form, you have four voting options:
1) You may vote online through the Internet:
1. Go to http://onlineproxyvote.com/MOXC/ at any time 24 hours a day.
2. Login using the control number located in the top left hand corner of this proxy card.
3. Access the proxy voting link within that website to vote your proxy.
Ifyou vote your proxy on the Internet, you do not need to mail back, fax or email your Proxy Card.
The Proxy Statement and the form of Proxy Card are available at http://onlineproxyvote.com/MOXC/
2) By Email, and you may sign, date, scan and email your scanned Proxy Card to proxyvote@stctransfer.com
3) By fax, and you may sign, date and submit your Proxy Card by facsimile to +01 (469) 633-0088
4) By mail, and please sign, date and mail this Proxy Card promptly to the following address in the enclosed postage-paid envelope:
Securities Transfer Corporation
2901 N. Dallas Parkway, Suite 380
Plano, Texas 75093
Attention: Proxy Department
If you hold your shares through an account with a bank or broker, your ability to vote by the Internet depends on their voting procedures. Please follow the directions that your bank or broker provides.
MayI vote at the meeting?
If you are a shareholder of record, you may vote in person at the meeting. If you hold your shares through an account with a bank or broker, please follow the directions provided to you by your bank or broker. If you wish to vote in person at the meeting, please contact your bank or broker to learn the procedures necessary to allow you to vote your shares in person. Even if you plan to attend the meeting, we encourage you to vote your shares by proxy. You may vote by proxy through the Internet, by telephone or by mail.
CanI change my mind after I return my proxy?
You may change your vote at any time before the polls close at the conclusion of voting at the meeting. You may do this by (1) signing another proxy card with a later date and returning it to us prior to 12:00 p.m., Eastern Time, on August 11, 2022, (2) voting again via email prior to 12:00 p.m., Eastern Time, on August 11, 2022, (3) voting again via fax prior to 12:00 p.m., Eastern Time, on August 11, 2022, or (4) voting at the meeting if you are a registered shareholder or have followed the necessary procedures required by your bank or broker.
Whatif I return my proxy card but do not provide voting instructions?
Proxies that are signed and returned but do not contain instructions will be voted in favor of Proposals 1, 2, 3, 4, 5 and 6 in accordance with the best judgment of the named proxies on any other matters properly brought before the meeting.
Whatdoes it mean if I receive more than one proxy card or instruction form?
It indicates that your Ordinary Shares are registered differently and are in more than one account. To ensure that all shares are voted, please either vote each account by telephone or on the Internet, or sign and return all proxy cards. We encourage you to register all your accounts in the same name and address. Those holding shares through a bank or broker should contact their bank or broker and request consolidation.
Willmy shares be voted if I do not provide my proxy or instruction form?
If you are a registered shareholder and do not provide a proxy, you must attend the meeting in order to vote your shares. If you hold shares through an account with a bank or broker, your shares may be voted even if you do not provide voting instructions on your instruction form. Brokerage firms have the authority to vote shares for which their customers do not provide voting instructions on certain routine matters. The ratification of Audit Alliance LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2022 is considered a routine matter for which brokerage firms may vote without specific instructions. However, election of directors is no longer considered a routine matter for which brokerage firms may vote without specific instructions. When a proposal is not a routine matter and the brokerage firm has not received voting instructions from the beneficial owner of the shares with respect to that proposal, the brokerage firm cannot vote the shares on that proposal. Shares that a broker is not authorized to vote are counted as “broker non-votes.”
Howcan I attend the meeting?
The meeting is open to all holders of the Company’s Ordinary Shares as of July 12, 2022.
Mayshareholders ask questions at the meeting?
Yes. Representatives of the Company will answer questions of general interest at the end of the meeting. You may also submit questions in advance via email to yf@abitgrp.com or a letter to the offices of the Company at Room 1202, Block B, Jiahui Center, 6 Jiqing Li, Chaoyangmenwai Street, Chaoyang District, Beijing 100020, China. Such questions will also be addressed at the end of the meeting.
Howmany votes must be present to hold the meeting?
Your shares are counted as present at the meeting if you attend the meeting and vote in person or if you properly return a proxy by internet, email, fax or mail. In order for us to conduct our meeting, one-third (1/3) of our outstanding Ordinary Shares and Preferred Shares as of July 12, 2022 must be present in person or by proxy. This is referred to as a quorum. Abstentions and broker non-votes will be counted for purposes of establishing a quorum at the meeting.
Howmany votes are needed to approve the Company’s proposals?
Proposal
- The nominees receiving the highest number of “For” votes will be elected as directors. This number is called a plurality. Shares not voted will have no impact on the election of directors. The proxy given will be voted “For” each of the nominees for director unless a properly executed proxy card is marked “Abstain” as to a particular nominee or nominees for director.
Proposal 2. The ratification of the appointment of Audit Alliance LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2022 requires that a majority of the votes cast at the meeting be voted “For” the proposal. A properly executed proxy card marked “Abstain” with respect to this proposal will not be voted.
Proposal 3. The approval of the Company’s 2022 Omnibus Equity Incentive Plan requires that a majority of the votes cast at the meeting be voted “For” the proposal. A properly executed proxy card marked “Abstain” with respect to this proposal will not be voted.
Proposal 4. The approval of amendment to the Amended and Restated Memorandum and Articles of Association to provide that the Preferred Shares shall be convertible into the Ordinary Shares of the Company at any time by the holder thereof or upon the occurrence of any reorganization event requires that a majority of the votes of each class of shares of the Company cast at the meeting be voted “For” the proposal. A properly executed proxy card marked “Abstain” with respect to this proposal will not be voted.
Proposal 5. The approval of amendment to the Amended and Restated Memorandum and Articles of Association to provide that each Preferred Share shall be entitled to six votes per share requires that a majority of the votes of each class of shares of the Company cast at the meeting be voted “For” the proposal. A properly executed proxy card marked “Abstain” with respect to this proposal will not be voted.
Proposal 6. The approval of the Amended and Restated Memorandum and Articles of Association of the Company requires that a majority of the votes of each class of shares of the Company cast at the meeting be voted “For” the proposal. A properly executed proxy card marked “Abstain” with respect to this proposal will not be voted.
Proposal 7. Transacting any other business properly coming before the meeting requires that a majority of the votes cast at the meeting be voted “For” the proposal. A properly executed proxy card marked “Abstain” with respect to this proposal will not be voted.
PROPOSALONE
ELECTION OF DIRECTORS AND DIRECTOR BIOGRAPHIES
(ITEM 1 ON THE PROXY CARD)
A brief biography of each Director follows. Our Board of Directors, upon the recommendation of the Nominating Committee, has nominated five Directors for election to be on the Board of Directors for a one-year term expiring in 2023. You are asked to vote for these nominees to serve as members of the Board of Directors. All candidates for the Board have consented to serve if elected.
Thefive nominees for election to the Board of Directors to serve a one-year term expiring in 2023:
Conglin(Forrest) Deng
Age— 39
Directorsince 2021
Mr. Conglin Deng was appointed a director of the Company on August 9, 2021. He has previously served as the General Manager of Beijing Jiuteng Investment Limited since 2016, where he was responsible for managing its blockchain and bitcoin mining related investments. Prior to this engagement as the CEO of the Company, he was a co-founder of a company involved in the operation of online games and games publishing. Mr. Deng studied at the Beijing Foreign Studies University and graduated in 2007 with a major in English.
Mr. Deng is re-nominated to serve as a director because of his expertise in the blockchain and bitcoin mining industry and his experience as an investment management executive.
LionelChoong Khuat Leok
Age— 59
Directorsince 2018
Mr. Lionel Choong Khuat Leok, was appointed to the Board of the predecessor company on May 11, 2018 and reappointed as a director of the company as one of its first directors on August 9, 2021. He has over 33 years of working experience in accounting, auditing, internal control, corporate finance and corporate governance. He started his working career with BDO Binder Hamlyn (“BDO”) in London in 1984 where he was later promoted as the supervisor and manager for the banking and financial services team which managed various projects in structured finance as well as consultation projects for BDO’s client’s initial public offerings. During his term with BDO, Mr. Choong gained the Institute of Chartered Accountants in England and Wales (ICAEW) Certification as a certified accountant.
Mr. Choong is the Chief Financial Officer and board member of Logiq Inc., (OTCQX: LGIQ) since July 17, 2015. Mr. Choong was the Vice Chairman, Audit Committee Chair and an independent non-executive director of Emerson Radio Corp. Inc. (NYSE: MSN) from November 2013 to June 2022. Between April 2009 and June 2015, he was the acting Chief Financial Officer of Global Regency Ltd., 2015 and remains as its consultant. Mr. Choong is a director and consultant for Willsing Company Ltd., a position he has held since August 2004 and Board Advisor to Really Sports Co., Ltd., a position he has held since June 2013. Mr. Choong has a wide range of experience in a variety of senior financial positions with companies in China, Hong Kong SAR, and London, UK. His experience encompasses building businesses, restructuring insolvency, corporate finance, and initial public offerings in a number of vertical markets, including branded apparel, consumer and lifestyle, consumer products, pharmaceuticals, and logistics. From June 2008 to May 2011, Mr. Choong was acting Chief Financial Officer of Sinobiomed, Inc. (predecessor company of Logiq, Inc.).
Mr. Choong is a fellow member of the Institute of Chartered Accountants in England and Wales and holds a corporate finance diploma from this Institute. He is also a CPA and practicing member of the Hong Kong Institute of Certified Public Accountants and a member of the Hong Kong Securities Institute. Mr. Choong holds a Bachelor of Arts in Accountancy from London Guildhall University, UK, and a Master of Business Administration from the Hong Kong University of Science and Technology and the Kellogg School of Management at US Northwestern University.
Based on Mr. Choong’s professional work experience, previous directorships, and education, the Board believes that he is qualified to serve as an independent non-executive director and Audit Committee Chair of the Company.
TaoXu
Age— 35
Directorsince 2021
Mr. Tao Xu was appointed to the Board on October 11, 2021. Since January 2020, Mr. Xu has been the General Manager of Beijing Jiu Shi Jiu Technology Services Co. Ltd., a provider of bitcoin mining operations and technical services, including the operation, maintenance and trading of bitcoin mining machines. In that role, he is responsible for the company’s bitcoin mining operations and overall business development. From March 2018 to December 2019, he had served as the Operations Director of Beijing Qinlin Interactive Limited, a company engaged in the promotion and distribution of online games. He graduated from Shandong Lin Yi College in 2008 with a Bachelor’s degree in electrical and mechanical engineering.
Mr. Xu is renominated to serve as a director because of his expertise in the operations and technologies of the bitcoin mining industry.
ChuanZhan
Age— 52
Directorsince 2021
Mr. Chuan Zhan was appointed to the Board on November 30, 2021. Mr. Zhan is a well-known investor in China, having successfully invested in a number of start-ups and public companies in the sectors of new technologies and renewable energies. Since 2014, he has been the Investment Director at Shenzhen Guojin Investment Co. Ltd and the Founding Member of IFC Capital Limited, a private equity firm. He was also previously a Visiting Professor of Economics at Nanjing University in China. He graduated from Changchun Institute of Technology with a Bachelor’s degree in Water Supply and Drainage, followed by a Research Fellowship and a Master’s Degree in Economics from the Hohaii University in Nanjing, China in 1998.
Mr. Zhan is renominated to serve as a director because of his knowledge in investment in new technologies companies and his experience as a seasoned investor.
PanpanWang
Age– 32
Directorsince 2021
Ms. Panpan Wang was appointed to the Board on August 15, 2021 and was reappointed as a director of the company on March 11, 2022. Ms. Wang has been a Deputy Director at the People’s Health Network Co. Ltd., a health news portal based in Beijing since December 2018 where she is responsible for government relations and market expansion. From August 2013 to December 2018, she had served as a Department Manager with the People’s Daily Online, the largest newspaper group in China. Ms. Wang obtained a Bachelor’s degree in Media Economy from the Communication University of China in 2013 and a Master’s degree in Public Administration from Beijing Normal University in 2018.
Ms. Wang is re-nominated to serve as a director because of her experience in marketing and government relations.
Involvementin Certain Legal Proceedings
To the best of our knowledge, none of our directors or officers has been convicted in a criminal proceeding, excluding traffic violations or similar misdemeanors, nor has any been a party to any judicial or administrative proceeding during the past five years that resulted in a judgment, decree or final order enjoining the person from future violations of, or prohibiting activities subject to, federal or state securities laws, or a finding of any violation of federal or state securities laws, except for matters that were dismissed without sanction or settlement. Except as set forth in our discussion in “Related Party Transactions,” our directors and officers have not been involved in any transactions with us or any of our affiliates or associates which are required to be disclosed pursuant to the rules and regulations of the SEC.
RelatedParty Transactions
On November 11, 2021, the Board approved to issue 5,000,000 Preferred Shares to Bridgeforrest (BVI) Inc., a holding company owned by Conglin (Forrest) Deng, the Chief Executive Officer and an Executive Director of the Company, for gross proceeds of $5 million. The preferred shares were issued on December 1, 2021. The proceeds were used as working capital of the Company.
DirectorIndependence
The Board of Directors has reviewed the independence of our directors, applying the NASDAQ independence standards. Based on this review, the Board of Directors determined that each of Lionel Choong, Tao Xu and Chuan Zhan are independent within the meaning of the NASDAQ rules. In making this determination, our Board of Directors considered the relationships that each of these non-employee directors has with us and all other facts and circumstances our Board of Directors deemed relevant in determining their independence. As required under applicable NASDAQ rules, we anticipate that our independent directors will meet on a regular basis as often as necessary to fulfill their responsibilities, including at least annually in executive session without the presence of non-independent directors and management.
BoardLeadership Structure
Mr. Conglin Deng serves as the Chief Executive Officer and is a member of the Board of Directors of the Company. As a smaller public company, we believe it is in the company’s best interest to allow the company to benefit from guidance from key members of management in a variety of capacities. We do not have a lead independent director and do not anticipate having a lead independent director because we will encourage our independent directors to freely voice their opinions on a relatively small company board. We believe this leadership structure is appropriate because we are a relatively small public company.
RiskOversight
Our Board of Directors plays a significant role in our risk oversight. The Board of Directors makes or approve all relevant Company’s decisions. As such, it is important for us to have our Chief Executive Officer serve on the Board as he plays a key role in the risk oversight of the Company. As a smaller reporting company with a small board of directors, we believe it is appropriate to have the involvement and input of all of our directors in risk oversight matters.
WERECOMMEND THAT YOU VOTE FOR THE ELECTION OF All
NOMINEES TO THE BOARD OF DIRECTORS.
PROPOSALTWO
RATIFICATION OF THE APPOINTMENT OF AUDIT ALLIANCE LLP
(ITEM 2 ON THE PROXY CARD)
Whatam I voting on?
A proposal to ratify the appointment of Audit Alliance LLP (“Audit Alliance”) as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2022. The Audit Committee of the Board of Directors has appointed Audit Alliance to serve as the Company’s fiscal year 2022 independent registered public accounting firm. Although the Company’s governing documents do not require the submission of this matter to shareholders, the Board of Directors considers it desirable that the appointment of Audit Alliance be ratified by shareholders.
Hasthe Company changed its independent registered public accounting firm during its two most recent fiscal years?
No, Centurion ZD & Co. served as the Company’s independent registered public accountant for the fiscal years ended December 31, 2021 and 2020, and September 30, 2020.
Effective June 30, 2022, the Company appointed Audit Alliance as its independent registered public accounting firm for the fiscal year ending December 31, 2022 and accepted the resignation of Centurion ZD & Co., effective on the same date. Audit Alliance is headquartered in the Republic of Singapore and will be subject to the inspections by the Public Company Accounting Oversight Board of the United States. During the Company’s two most recent fiscal years ended December 31, 2021 and 2020 and September 30, 2020, through the resignation of Centurion on June 30, 2022, there were no disagreements between the Company or its predecessor, Moxian, Inc., and Centurion on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of Centurion, would have caused it to make reference to the subject matter of the disagreements in connection with its report on the Company’s or its predecessor’s consolidated financial statements for such periods. In addition, Centurion’s reports on the financial statements as of and for the years ended December 31, 2021 and 2020 and September 30, 2020 did not contain an adverse opinion or disclaimer of opinion and were not qualified or modified as to uncertainty, audit scope or accounting principles. During the fiscal years ended December 31, 2021 and 2020 and September 30, 2020 through the resignation of Centurion on June 30, 2022, there were no “reportable events” as that term is defined in Item 16F(a)(1)(v) of Form 20-F.
Whatservices will Audit Alliance provide?
Audit services provided by Audit Alliance for fiscal 2022 will include the examination of the consolidated financial statements of the Company and services related to periodic reports made with the SEC.
Willa representative of Audit Alliance be present at the meeting?
One or more representatives of Audit Alliance will be present at the meeting. The representatives will have an opportunity to make a statement if they desire and will be available to respond to questions from shareholders.
Whatif this proposal is not approved?
If the appointment of Audit Alliance is not ratified, the Audit Committee of the Board of Directors will reconsider the appointment.
WERECOMMEND THAT YOU VOTE FOR THE RATIFICATION OF
AUDIT ALLIANCE LLP AS THE COMPANY’S FISCAL 2022 INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM.
PROPOSALTHREE
APPROVALOF THE 2022 Omnibus EQUITY INCENTIVE PLAN
(ITEM3 ON THE PROXY CARD)
Whatam I voting on?
The Board of Directors adopted the Company’s 2022 Omnibus Equity Incentive Plan (the “2022 Plan”) on July 22, 2022, subject to approval by the shareholders of the Company. The Board of Directors believes that the 2022 Plan will advance the long-term success of the Company by encouraging share ownership among key employees and members of the Board who are not employees.
Howis the 2022 Plan administered?
The 2022 Plan is administered by the Compensation Committee of the Board of Directors. The 2022 Plan provides the Compensation Committee with flexibility to design compensatory awards that are responsive to the Company’s needs. Subject to the terms of the 2022 Plan, the Compensation Committee has the discretion to determine the terms of each award. The Compensation Committee may delegate to one or more officers of the Company the authority to grant awards to participants who are not directors, executive officers or 5% shareholders of the Company.
Whatkind of awards may be granted?
Awards under the 2022 Plan may be in the form of options (including non-qualified options and Incentive Share Options), SARs, Restricted Shares, Performance Share Units (which may be paid in cash), Performance Shares, Deferred Shares, Restricted Share Units, Dividend Equivalents, Bonus Shares or Other Share-Based Awards granted under the Plan.
Whois eligible to receive awards?
Employees of the Company, officers, employee and non-employee directors, consultants, independent contractors and advisors may all be selected by the Compensation Committee to receive awards under the 2022 Plan. The benefits or amounts that may be received by or allocated to participants under the 2022 Plan will be determined at the discretion of the Compensation Committee and are not presently determinable (except that previously designated or agreed to by the Company).
Howmany shares are available for issuance under the 2022 Plan?
The maximum number of shares as to which awards may be granted under the 2022 Plan is 3,500,000 ordinary shares. The fair market value of an ordinary share of the Company on July 22, 2022 was $1.15, as reported on the Nasdaq Capital Market.
Uponwhat terms may options be awarded?
Options may be either incentive stock options or nonqualified stock options, provided that only employees may be granted incentive stock options. All options must be evidenced by an award agreement approved by the Compensation Committee. The Compensation Committee shall determine the number of shares subject to the option, the per share exercise price under the option, the period during which the option may be exercised, and all other terms and conditions of the option, subject to certain restrictions enumerated in the 2022 Plan, attached as Annex B hereto.
Uponwhat terms may shares be awarded?
An award of shares involves the immediate transfer from the Company to a participant of ownership of a specific number of common shares in return for the performance of services. The participant is entitled immediately to voting, dividend and other ownership rights in such shares, subject to the discretion of the Compensation Committee. The transfer may be made without additional consideration from the participant. The Compensation Committee shall determine the number of shares to be awarded. If the share award is being earned upon the satisfaction of performance goals pursuant to a award agreement, then the Compensation Committee shall: (a) determine the nature, length and starting date of any performance period for each share award; (b) select from among any performance factors to be used to measure the performance, if any; and (c) determine the number of shares that may be awarded. The Compensation Committee may also specify performance objectives that must be achieved for any restrictions on the shares to lapse.
Areawards made under the 2022 Plan transferable?
Except as provided below, no award under the 2022 Plan may be transferred by a participant other than by will or the laws of descent and distribution, and options and stock appreciation rights may be exercised during the participant’s lifetime only by the participant or, in the event of the participant’s legal incapacity, the guardian or legal representative acting on behalf of the participant. The Compensation Committee may expressly provide in an award agreement (other than an incentive stock option) that the participant may transfer the award to a spouse or lineal descendant, a trust for the exclusive benefit of such family members, a partnership or other entity in which all the beneficial owners are such family members, or any other entity affiliated with the participant that the Compensation Committee may approve. Notwithstanding the foregoing, any shares awarded (subject to any vesting requirements in a given grant) may be transferred in accordance with applicable law.
Whendoes the 2022 Plan terminate?
The Compensation Committee may terminate the 2022 Plan at any time. If not sooner terminated by the Board of Directors, the 2022 Plan will terminate on the tenth anniversary of its effective date.
Howcan the 2022 Plan be amended?
The 2022 Plan may be amended by the Board of Directors, but without further approval by the shareholders of the Company, the Board shall not amend the 2022 Plan in any manner that requires shareholder approval under the Internal Revenue Code of 1986, as amended. The Board may condition any amendment on the approval of the shareholders if such approval is necessary or deemed advisable with respect to the applicable listing or other requirements of a national securities exchange or other applicable laws, policies or regulations.
Whatare the tax consequences of the 2022 Plan?
The following is a brief summary of certain of the federal income tax consequences of certain transactions under the 2022 Plan. This summary is not intended to be exhaustive and does not describe state or local tax consequences.
In general, an optionee will not recognize income at the time a nonqualified stock option is granted. At the time of exercise, the optionee will recognize ordinary income in an amount equal to the difference between the option price paid for the shares and the fair market value of the shares on the date of exercise. At the time of sale of shares acquired pursuant to the exercise of a nonqualified stock option, any appreciation (or depreciation) in the value of the shares after the date of exercise generally will be treated as capital gain (or loss).
An optionee generally will not recognize income upon the grant or exercise of an incentive stock option. If shares issued to an optionee upon the exercise of an incentive stock option are not disposed of in a disqualifying disposition within two years after the date of grant or within one year after the transfer of the shares to the optionee, then upon the sale of the shares any amount realized in excess of the option price generally will be taxed to the optionee as long-term capital gain and any loss sustained will be a long-term capital loss. If shares acquired upon the exercise of an incentive stock option are disposed of prior to the expiration of either holding period described above, the optionee generally will recognize ordinary income in the year of disposition in an amount equal to any excess of the fair market value of the shares at the time of exercise (or, if less, the amount realized on the disposition of the shares) over the option price paid for the shares. Any further gain (or loss) realized by the optionee generally will be taxed as short-term or long-term capital gain (or loss) depending on the holding period.
Subject to certain exceptions for death or disability, if an optionee exercises an incentive stock option more than three months after termination of employment, the exercise of the option will be taxed as the exercise of a nonqualified stock option. In addition, if an optionee is subject to federal “alternative minimum tax,” the exercise of an incentive stock option will be treated essentially the same as a nonqualified stock option for purposes of the alternative minimum tax.
A recipient of restricted stock generally will be subject to tax at ordinary income rates on the fair market value of the restricted stock (reduced by any amount paid by the recipient) at such time as the shares are no longer subject to a risk of forfeiture or restrictions on transfer for purposes of Code Section 83. However, a recipient who so elects under Code Section 83(b) within 30 days of the date of transfer of the restricted stock will recognize ordinary income on the date of transfer of the shares equal to the excess of the fair market value of the restricted stock (determined without regard to the risk of forfeiture or restrictions on transfer) over any purchase price paid for the shares. If a Code Section 83(b) election has not been made, any dividends received with respect to restricted stock that are subject at that time to a risk of forfeiture or restrictions on transfer generally will be treated as compensation that is taxable as ordinary income to the recipient.
To the extent that a participant recognizes ordinary income in the circumstances described above, the Company or subsidiary for which the participant performs services will be entitled to a corresponding deduction, provided that, among other things, the income meets the test of reasonableness, is an ordinary and necessary business expense, is not an “excess parachute payment” within the meaning of Code Section 280G and is not disallowed by the $1,000,000 limitation on certain executive compensation under Section 162(m) of the Internal Revenue Code.
Wherecan I get a copy of the 2022 Plan?
This summary is not a complete description of all provisions of the 2022 Plan. A copy of the 2022 Plan is attached hereto as Annex B.
WERECOMMEND THAT YOU VOTE FOR THE APPROVAL OF THE 2022 OMNIBUS EQUITY INCENTIVE PLAN.
PROPOSALFOUR
AMENDMENT TO THE AMENDED AND RESTATED MEMORANDUM AND ARTICLES OF
ASSOCIATION THAT THE PREFERRED SHARESSHALL BE CONVERTIBLE into Ordinary
Sharesof the Company
(ITEM 4 ON THE PROXY CARD)
On July 22, 2021, the Board of Directors of the Company approved, and directed that there be submitted to the shareholders of the Company for approval, an amendment to the Company’s Amended and Restated Memorandum and Articles of Association (the “M&A”) to provide that each Preferred Share shall be convertible into one (1) Ordinary Share at any time by the holder thereof or upon the occurrence of any reorganization event, whereupon all Preferred Shares will be converted into the same number of Ordinary Shares.
The text of the proposed changes to the M&A is set forth in Annex A to this Proxy Statement and is incorporated by reference into this Proxy Statement.
If the proposed amendment to the Company’s M&A as set forth in this Proposal Four is not approved, then the proposal set forth in Proposal Four will not be applicable.
The favorable vote of the majority of the votes cast by our outstanding shares of each class of shares of the Company entitled to vote, in person or by proxy, at this annual meeting is required to approve the proposed amendment to our M&A.
WERECOMMEND THAT YOU VOTE FOR THE AMENDMENT TO THE AMENDED AND RESTATED
MEMORANDUM AND ARTICLES OF ASSOCIATION TO PROVIDE THAT THE PREFERRED
SHARES SHALL BE CONVERTIBLE INTO ORDINARY SHARES OF THE COMPANY.
PROPOSALFIVE
AMENDMENT TO THE AMENDED AND RESTATED MEMORANDUM AND ARTICLES OF
ASSOCIATION TO PROVIDE THAT EACH PREFERRED SHARESHALL BE ENTITLED TO SIX
VOTESPER SHARE.
(ITEM 5 ON THE PROXY CARD)
On July 22, 2021, the Board of Directors of the Company approved, and directed that there be submitted to the shareholders of the Company for approval, an amendment to the M&A to change the number of votes to which each Preferred Share is entitled from three votes to six votes at any meeting of the shareholders of the Company or on any resolution of shareholders.
Pursuant to Section 10.2 of the current M&A, each Preferred Share confers upon the shareholder the right to three votes per share. In December 2021, the Company issued 5,000,000 Preferred Shares to Bridgeforrest (BVI) Inc. (“Bridgeforrest”), a holding company owned by Conglin (Forrest) Deng , the Chief Executive Officer and an Executive Director of the Company, for gross proceeds of $5 million. Immediately following the issuance of the Preferred Shares, the Company had 19,554,677 Ordinary Shares and 5,000,000 Preferred Shares outstanding, and Mr. Deng held approximately 43.4% of the total voting power of the Company. Since the issuance of the Preferred Shares, the number of the outstanding Ordinary Shares has increased from 19,554,677 shares to 35,554,677 after the Company had issued an additional 16,000,000 Ordinary Shares upon consummation of a private placement in February 2022. As a result, the voting power of the Preferred Shares has decreased to 29.7% from 43.4%, a significant dilution to the voting power held by the Preferred Shares. The Board has considered the fact that Bridgeforrest’s stake is vital to the Company’s bitcoin mining operations and future business development; and in order to incentivize the holder of the Preferred Shares to remain invested in the Company through its capital contribution and business development, the Board believed it is in the best interest of the Company to restore or adjust the voting rights of the holder of the Preferred Shares to approximately the same position as it was entitled to before the occurrence of dilution as a result of the subsequent share issuances. Therefore, the Board has approved to adjust the voting rights of the Preferred Shares to six votes per shares with respect to all matters put to a vote at any meeting of the shareholders of the Company or on any resolution of shareholders. Following the adjustment of the voting rights, Bridgeforrest would own approximately 45.8% of the total voting power of the Company.
The text of the proposed changes to the M&A is set forth in Annex A to this Proxy Statement and is incorporated by reference into this Proxy Statement.
If the proposed amendment to the Company’s M&A as set forth in this Proposal Five is not approved, then the proposal set forth in Proposal Five will not be applicable.
The favorable vote of the majority of the votes cast by our outstanding shares of each class of shares of the Company entitled to vote, in person or by proxy, at this annual meeting is required to approve the proposed amendment to our M&A.
WERECOMMEND THAT YOU VOTE FOR THE AMENDMENT TO THE AMENDED AND RESTATED
MEMORANDUM AND ARTICLES OF ASSOCIATION TO PROVIDE THAT EACH PREFERRED
SHARE SHALL BE ENTITLED TO SIX VOTES PER SHARE.
PROPOSALSIX
APPROVAL OF THE AMENDED AND RESTATED MEMORANDUM
ANDARTICLES OF ASSOCIATION
(ITEM 6 ON THE PROXY CARD)
On July 22, 2022, the Board of Directors of the Company approved, and directed that there be submitted to the shareholders of the Company for approval, the Amended and Restated Memorandum and Articles of Association (the “Amended and Restated M&A”).
The text of a form of the Amended and Restated M&A is set forth in Annex A to this Proxy Statement and is incorporated by reference into this Proxy Statement.
If the form of the Amended and Restated M&A as set forth in this Proposal Six is not approved, then the proposal set forth in Proposal Six will not be applicable.
The favorable vote of the majority of the votes cast by our outstanding shares of each class of shares of the Company entitled to vote, in person or by proxy, at this annual meeting is required to approve the form of the Amended and Restated M&A.
If the proposal is approved by our shareholders, the amendment will take effect on the registration by the Registrar of Corporate Affairs in the British Virgin Islands of a notice of amendment, or amended and restated M&A, filed by the Company’s registered agent.
WERECOMMEND THAT YOU VOTE FOR THE APPROVAL OF THE FORM OF
THEAMENDED AND RESTATED MEMORANDUM AND ARTICLES OF ASSOCIATION.
BOARDOF DIRECTORS AND CORPORATE GOVERNANCE INFORMATION
Whatif a nominee is unwilling or unable to serve?
The nominee listed in the Proxy Statement has agreed to serve as a director, if elected. If for some unforeseen reason a nominee becomes unwilling or unable to serve, proxies will be voted for a substitute nominee selected by the Board of Directors.
Howare directors compensated?
All directors hold office until the expiration of their respective terms or until their successors have been duly elected and qualified. Officers are elected by and serve at the discretion of the Board of Directors. Employee directors do not receive any compensation for their services as a director. Our non-employee directors on our Board of Directors receive the director’s fees set forth in their appointment letters, which vary between $0 and $36,000 annually. In addition, non-employee directors are entitled to receive reimbursement for any out-of-pocket expenses incurred by them in connection with their services provided in such capacity. We may provide incentive grants of stock, options or other securities convertible into or exchangeable for, our securities.
Howdoes the Board determine which directors are independent?
The Board of Directors reviews the independence of each director yearly. During this review, the Board of Directors considers transactions and relationships between each director (and his or her immediate family and affiliates) and the Company and its management to determine whether any such relationships or transactions are inconsistent with a determination that the director is independent in light of applicable law, listing standards and the Company’s director independence standards. The Company believes that it maintains a majority of independent directors who are deemed to be independent under the definition of independence provided by NASDAQ Listing Rule 5605(a)(2).
Whatrole does the Nominating Committee play in selecting nominees to the Board of Directors?
Two of the primary purposes of the Board’s Nominating Committee are (i) to develop and implement policies and procedures that are intended to ensure that the Board of Directors will be appropriately constituted and organized to meet its fiduciary obligations to the Company and its shareholders and (ii) to identify individuals qualified to become members of the Board of Directors and to recommend to the Board of Directors the director nominees for the annual meeting of shareholders. The Nominating Committee is also responsible for considering candidates for membership on the Board of Directors submitted by eligible shareholders. The Nominating Committee’s charter is available on the Company’s website at www.moxianglobal.com and in print upon request. The Nominating Committee of the Company’s Board of Directors was the only entity or person to nominate and/or recommend any of the director nominees.
Arethe members of the Nominating Committee independent?
Yes. All members of the Nominating Committee have been determined to be independent by the Board of Directors.
Howdoes the Nominating Committee identify and evaluate nominees for director?
The Nominating Committee considers candidates for nomination to the Board of Directors from a number of sources. Current members of the Board of Directors are considered for re-election unless they have notified the Company that they do not wish to stand for re-election. The Nominating Committee also considers candidates recommended by current members of the Board of Directors, members of management or eligible shareholders. From time to time the Board may engage a firm to assist in identifying potential candidates, although the Company did not engage such a firm to identify any of the nominees for director proposed for election at the meeting. The Nominating Committee evaluates all candidates for director, regardless of the person or firm recommending such candidate, on the basis of the length and quality of their business experience, the applicability of such candidate’s experience to the Company and its business, the skills and perspectives such candidate would bring to the Board of Directors and the personality or “fit” of such candidate with existing members of the Board of Directors and management. The nominating committee does not have a specific policy in place with regard to the consideration of diversity when identifying director nominees; however, the nominating committee does consider diversity of opinion and experience when nominating directors.
Whatare the Nominating Committee’s policies and procedures for considering director candidates recommended by shareholders?
The Nominating Committee will consider all candidates recommended by shareholders. A shareholder wishing to recommend a candidate must submit the following documents to the Secretary of the Company at Room 1202, Block B, Jiahui Center, 6 Jiqing Li, Chaoyangmenwai Street, Chaoyang District, Beijing 100020, China:
| ● | a<br> recommendation that identifies the name and address of the shareholder and the person to be nominated; |
|---|---|
| ● | the<br> written consent of the candidate to serve as a director of the Company, if elected; |
| ● | a<br> description of all arrangements between the shareholders and such nominee pursuant to which the nomination is to be made; and |
| ● | such<br> other information regarding the nominee as would be required to be included in a proxy statement filed pursuant to the proxy rules<br> of the SEC. |
If the candidate is to be evaluated by the Nominating Committee, the Secretary will request a detailed resume, an autobiographical statement explaining the candidate’s interest in serving as a director of the Company, a completed statement regarding conflicts of interest, and a waiver of liability for a background check from the candidate.
Whatare the minimum qualifications required to serve on the Company’s Board of Directors?
All members of the Board of Directors must possess the following minimum qualifications as determined by the Nominating Committee:
| ● | A<br> director must demonstrate integrity, accountability, informed judgment, financial literacy, creativity and vision; |
|---|---|
| ● | A<br> director must be prepared to represent the best interests of all Company shareholders, and not just one particular constituency; |
| ● | A<br> director must have a record of professional accomplishment in his or her chosen field; and |
| ● | A<br> director must be prepared and able to participate fully in Board activities, including membership on committees. |
Whatother considerations does the Nominating Committee consider?
The Nominating Committee believes it is important to have directors from various backgrounds and professions in order to ensure that the Board of Directors has a wealth of experiences to inform its decisions. Consistent with this philosophy, in addition to the minimum standards set forth above, business and managerial experience and an understanding of financial statements and financial matters are very important.
Doesthe Board of Directors have diverse directors?
In accordance with Nasdaq Rule 5606, below chart provides information on each of our director’s voluntary, self-identified characteristics.
BoardDiversity Matrix (as of July 12, 2022)
| Country<br> of Principal Executive Offices: | China | ||
|---|---|---|---|
| Foreign<br> Private Issuer: | Yes | ||
| Disclosure<br> Prohibited under Home Country Law: | No | ||
| Total<br> Number of Directors: | 5 | ||
| Gender Identity | Female | Male | |
| Directors | 1 | 4 | |
| Demographic Background | |||
| Underrepresented<br> Individual in Home Country Jurisdiction | 1 | ||
| LGBTQ+ | - | ||
| Did<br> not disclose demographic background | - |
Howmay shareholders communicate with the members of the Board of Directors?
Shareholders and others who are interested in communicating directly with members of the Board of Directors, including communication of concerns relating to accounting, internal accounting controls or audit matters, or fraud or unethical behavior, may do so by writing to the directors at the following address:
Name of Director or Directors
c/o Secretary
Moxian (BVI) Inc
Room 1202, Block B, Jiahui Center, 6 Jiqing Li, Chaoyangmenwai Street,
Chaoyang District, Beijing 100020, China
Doesthe Company have a Code of Business Ethics and Conduct?
The Company has adopted a Code of Business Ethics and Conduct, which is applicable to all directors, officers and associates of the Company, including the principal executive officer and the principal financial and accounting officer. The complete text of the Code of Business Ethics and Conduct is available on the Company’s web site at http://www.moxianglobal.com.and is also available in print upon request. The Company intends to post any amendments to or waivers from its Code of Business Ethics and Conduct (to the extent applicable to the Company’s principal executive officer and principal financial and accounting officer) at this location on its web site.
Howoften did the Board meet in 2021?
Our Board held 4 meetings and acted 8 times by unanimous written consent in connection with matters related to the fiscal year ended December 31, 2021. Our Board has an Audit Committee, a Compensation Committee and a Nominating Committee. The Audit Committee held 2 meetings and acted 3 times by unanimous written consent during the fiscal year ended December 31, 2021. The Compensation Committee did not hold any meeting and acted 2 times by unanimous written consent during the fiscal year ended December 31, 2021. The Nominating Committee did not hold any meeting meeting and acted 5 times by unanimous written consent during the fiscal year ended December 31, 2021. Each incumbent director attended in person, virtually or via telephone all of the meetings of the Board of Directors and of the standing committees of which he or she was a member during 2021. The Board invites, but does not require, directors to attend the annual meeting of shareholders.
Whatare the committees of the Board?
During fiscal 2021, the Board of Directors had standing Audit, Nominating, and Compensation Committees. The members of each of the Committees as of December 31, 2021, their principal functions and the number of meetings held during the year ended December 31, 2021 are shown below.
AuditCommittee
The members of the Audit Committee are:
Lionel Choong
Tao Xu
Chuan Zhang
The Audit Committee is chaired by Lionel Choong. The Audit Committee held 2 meetings and acted 3 times by unanimous written consent during the year ended December 31, 2021. All members of the Audit Committee are independent, as such term is defined by the NASDAQ Capital Market listing standards. The primary responsibility of the Audit Committee is to assist the Board of Directors in monitoring the integrity of the Company’s financial statements and the independence of its external auditors. Our Board has determined that each Audit Committee member has sufficient knowledge in financial and auditing matters to serve on the Audit Committee. The Company believes that Mr. Choong Khuat Leok qualifies as an “audit committee financial expert” in accordance with applicable NASDAQ Capital Market listing standards. In carrying out its responsibility, the Audit Committee undertakes to:
● Review and recommend to the directors the independent auditors to be selected to audit the financial statements of the Company;
● Meet with the independent auditors and management of the Company to review the scope of the proposed audit for the current year and the audit procedures to be utilized, and at the conclusion thereof review such audit, including any comments or recommendations of the independent auditors;
● Review with the independent auditors and financial and accounting personnel the adequacy and effectiveness of the accounting and financial controls of the Company. The Audit Committee elicits recommendations for the improvement of such internal control procedures or particular areas where new or more detailed controls or procedures are desirable. The Audit Committee emphasizes the adequacy of such internal controls to expose any payments, transactions, or procedures that might be deemed illegal or otherwise improper;
● Review the internal accounting function of the Company, the proposed audit plans for the coming year and the coordination of such plans with the Company’s independent auditors;
● Review the financial statements contained in the annual report to shareholders with management and the independent auditors to determine that the independent auditors are satisfied with the disclosure and contents of the financial statements to be presented to the shareholders;
● Provide sufficient opportunity for the independent auditors to meet with the members of the Audit Committee without members of management present. Among the items discussed in these meetings are the independent auditors’ evaluation of the Company’s financial, accounting, and auditing personnel, and the cooperation that the independent auditors received during the course of the audit;
● Review accounting and financial human resources and succession planning within the Company;
● Submit the minutes of all meetings of the Audit Committee to, or discuss the matters discussed at each committee meeting with, the Board of Directors; and
● Investigate any matter brought to its attention within the scope of its duties, with the power to retain outside counsel for this purpose, if, in its judgment, that is appropriate.
The Audit Committee has established procedures for the receipt, retention and treatment of complaints regarding accounting, internal accounting controls and auditing matters, including procedures for the confidential, anonymous submission by employees of concerns regarding questionable accounting or auditing matters.
CorporateGovernance and Nominating Committee
The members of the Corporate Governance and Nominating Committee were:
Chuan Zhan
Tao Xu
Lionel Choong
The Corporate Governance and Nominating Committee is chaired by Chuan Zhan. The Corporate Governance and Nominating Committee did not hold any meetings and acted 5 times by unanimous written consent during the fiscal year ended December 31, 2021. All members of the Corporate Governance and Nominating Committee are independent, as such term is defined by the NASDAQ Capital Market listing standards. The Corporate Governance and Nominating Committee undertakes to:
● Identify individuals qualified to become members of the Board of Directors and to make recommendations to the Board of Directors with respect to candidates for nomination for election at the next annual meeting of shareholders or at such other times when candidates surface and, in connection therewith, consider suggestions submitted by shareholders of the Company;
● Determine and make recommendations to the Board of Directors with respect to the criteria to be used for selecting new members of the Board of Directors;
● Oversee the process of evaluation of the performance of the Company’s Board of Directors and committees;
● Make recommendations to the Board of Directors concerning the membership of committees of the Board and the chairpersons of the respective committees;
● Make recommendations to the Board of Directors with respect to the remuneration paid and benefits provided to members of the Board in connection with their service on the Board or on its committees; and
● Evaluate Board and committee tenure policies as well as policies covering the retirement or resignation of incumbent directors.
CompensationCommittee
The members of the Compensation Committee were:
Tao Xu
Chuan Zhan
Lionel Choong
The Compensation Committee is chaired by Tao Xu. The Compensation Committee did not hold any meetings and acted 2 times by unanimous written consent during the year ended December 31, 2021. The Compensation Committee’s charter is available on the Company’s website at www.moxianglobal.com. The Compensation Committee’s principal responsibilities include:
| ● | Making<br> recommendations to the Board of Directors concerning executive management organization matters generally; |
|---|---|
| ● | In<br> the area of compensation and benefits, making recommendations to the Board of Directors concerning employees who are also directors<br> of the Company, consult with the CEO on matters relating to other executive officers, and make recommendations to the Board of Directors<br> concerning policies and procedures relating to executive officers; |
| ● | Making<br>recommendations to the Board of Directors regarding all contracts of the Company with any officer for remuneration and benefits after<br>termination of regular employment of such officer; |
| ● | Making<br> recommendations to the Board of Directors concerning policy matters relating to employee benefits and employee benefit plans, including<br> incentive compensation plans and equity based plans; and |
| ● | Administering<br> the Company’s formal incentive compensation programs, including equity based plans. |
The Compensation Committee may not delegate its authority to other persons. Similarly, the Compensation Committee has not engaged a compensation consultant to assist in the determination of executive compensation issues. While the Company’s executives will communicate with the Compensation Committee regarding executive compensation issues, the Company’s executive officers do not participate in any executive compensation decisions.
The Board of Directors has determined to provide a process by which shareholders may communicate with the Board as a whole, a Board committee or individual director. Shareholders wishing to communicate with the Board as a whole, a Board committee or an individual member may do so by sending a written communication addressed to the Board of Directors of the Company or to the committee or to an individual director at; c/o Secretary, Moxian (BVI) Inc, Room 1202, Block B, Jiahui Center, 6 Jiqing Li, Chaoyangmenwai Street, Chaoyang District, Beijing 100020, China. All communications will be compiled by the Secretary of the Company and submitted to the Board of Directors or the addressee not later than the next regular Board meeting.
MANAGEMENT— BUSINESS HISTORY OF EXECUTIVE OFFICERS
For information as to the business history of our Chief Executive Officer and a member of the Board of Directors, Mr. Conglin Deng, see the section “Proposal One: Election of Directors” elsewhere in this Proxy Statement.
WanhongTan
ChiefFinancial Officer
Age— 68
Mr. Wanhong Tan has served as our Chief Financial Officer since July 25, 2016. Mr. Tan trained with Grant Thornton in Liverpool, UK and was admitted as an Associate of the Institute of Chartered Accountants (England and Wales) in 1980. He started his career with KPMG Kuala Lumpur in 1981 and in July that year, was promoted to be the Resident Manager of the Penang Office. In 1983, Mr. Tan joined a listed client as the Group Financial Controller before leaving for Sime Darby, Malaysia’s largest Asian-based conglomerate in 1986 as the Group Chief Accountant. He had a successful career with Sime Darby, holding various senior positions over a span of 18 years but left in 2004 following a reorganization of the group. In 2007, Mr. Tan joined Hong Leong Asia, Singapore on a specific assignment in China which he completed in 2009. He then took the post of Head of Investor Relations with 361 Degrees International, a Mainland sportswear group listed on the Stock Exchange of Hong Kong. where he stayed for a further six years.
EMPLOYMENTAGREEMENTS WITH THE COMPANY’S
NAMED EXECUTIVE OFFICERS
Our employment agreements with our officers generally provide for employment for a specific term (typically approximately three years at a time) and pay annual salary, and paid vacation and family leave time. The agreement may be terminated by either party as permitted by law.
ConglinDeng
Mr. Deng has an Employment Agreement with the Company as the Chief Executive Officer for a term of three years, commencing from September 20, 2021. He is entitled to an annual base salary of $120,000 and an annual bonus determined at the sole discretion of the Board of Directors. In addition, Mr. Deng is awarded 600,000 restricted stock units (“RSUs”) to purchase an equal number of ordinary shares of the Company, subject to the Company’s Omnibus Equity Incentive Plan to be approved by the shareholders at the Company’s next annual meeting. The RSUs will vest in equal installments over thirty-six (36) months of the Employment Agreement.
WanhongTan
Mr. Tan has an Employment Agreement with the Company as the Chief Financial Officer for a term of three years, commencing from January 1, 2022. He is entitled to an annual base salary of $120,000 and an annual bonus determined at the sole discretion of the Board of Directors. In addition, Mr. Tan is awarded 180,000 RSUs to purchase an equal number of ordinary shares of the Company, subject to the Company’s Omnibus Equity Incentive Plan to be approved by the shareholders at the Company’s next annual meeting. The RSUs will vest in equal installments over thirty-six (36) months of the Employment Agreement.
SUMMARYCOMPENSATION TABLE
The following table shows the annual compensation paid by us for the last two fiscal years ended December 31, 2021 to our directors and executive officers:
| Name and Principal Position | Fiscal<br> Year | Salary () | Fees () | Total () |
|---|---|---|---|---|
| Conglin Deng | 2021 | |||
| Chief Executive Officer and Director^(1)^ | ||||
| Qinghu Hao^(2)^ | 2021 | |||
| Former Chief Executive Officer and Former Chairman of the Board | 2020 | |||
| Wanhong Tan | 2021 | |||
| Chief Financial Officer | 2020 | |||
| Khuat Leok Choong, Lionel | 2021 | |||
| Audit Committee Chair, Independent Director | 2020 | |||
| Tao Xu | ||||
| Independent Director | 2021 | |||
| Chuan Zhan | ||||
| Independent Director | 2021 | |||
| Panpan Wang | ||||
| Director | 2021 |
All values are in US Dollars.
(1) Conglin Deng was appointed as our Chief Executive Officer, effective on September 21, 2021 and the above compensation represented the amount he received during the 2021 fiscal year.
(2) Qinghu Hao resigned from his position as a member and Chairman of the Board of Directors, effective March 11, 2022.
AUDITCOMMITTEE REPORT AND FEES PAID TO
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Whoserved on the Audit Committee of the Board of Directors during fiscal year 2021?
The members of the Audit Committee as of December 31, 2020 were Khuat Leok Choong, Lionel, Tao Xu and Chuan Zhang, chaired by Khuat Leok Choong, Lionel. Each member of the Audit Committee is independent under the rules of the SEC and the NASDAQ Capital Market. The Board of Directors has determined that Mr. Choong Khuat Leok, who is an independent director, is an “audit committee financial expert” as such term is defined in Item 407(d)(5) of Regulation S-K promulgated under the Exchange Act.
Whatdocument governs the activities of the Audit Committee?
The Audit Committee acts under a written charter, which sets forth its responsibilities and duties, as well as requirements for the Audit Committee’s composition and meetings. The Audit Committee Charter is available on the Company’s website at www.moxianglobal.com.
Howdoes the Audit Committee conduct its meetings?
During fiscal 2021, the Audit Committee Chairman met with the senior members of the Company’s financial management team and the Company’s independent registered public accounting firm on behalf of the Audit Committee. The Audit Committee’s agenda was established by the Chairman. At each meeting, the Audit Committee reviewed and discussed various financial and regulatory issues. The Audit Committee Chairman also had private, separate sessions from time to time with representatives of the Company’s independent registered public accounting firm, at which meetings candid discussions of financial management, accounting and internal control issues took place.
Doesthe Audit Committee review the periodic reports and other public financial disclosures of the Company?
The Audit Committee reviews each of the Company’s interim and annual reports, including Management’s Discussion of Results of Operations and Financial Condition. As part of this review, the Audit Committee discusses the reports with the Company’s management and considers the audit and review reports prepared by the independent registered public accounting firm about the Company’s interim and annual reports, as well as related matters such as the quality (and not just the acceptability) of the Company’s accounting principles, alternative methods of accounting under generally accepted accounting principles and the preferences of the independent registered public accounting firm in this regard, the Company’s critical accounting policies and the clarity and completeness of the Company’s financial and other disclosures.
Whatis the role of the Audit Committee in connection with the financial statements and controls of the Company?
Management of the Company has primary responsibility for the financial statements and internal control over financial reporting. The independent registered public accounting firm has responsibility for the audit of the Company’s financial statements and internal control over financial reporting. The responsibility of the Audit Committee is to oversee financial and control matters, among other responsibilities fulfilled by the Audit Committee under its charter. The Audit Committee meets regularly with the independent registered public accounting firm, without the presence of management, to ensure candid and constructive discussions about the Company’s compliance with accounting standards and best practices among public companies comparable in size and scope to the Company. The Audit Committee also regularly reviews with its outside advisors material developments in the law and accounting literature that may be pertinent to the Company’s financial reporting practices.
Whathas the Audit Committee done with regard to the Company’s audited financial statements for fiscal 2021?
The Audit Committee has:
| ● | reviewed<br> and discussed the audited financial statements with the Company’s management; and |
|---|---|
| ● | discussed<br> with Centurion ZD CPA & Co , the Company’s former independent registered public accounting firm for the 2021 fiscal year,<br> the matters required to be discussed by Statement on Auditing Standards No. 61, Communication with Audit Committees, as amended. |
Hasthe Audit Committee considered the independence of the Company’s auditors?
The Audit Committee had received from Centurion ZD CPA & Co, the written disclosures and the letter required by Independence Standards Board Standard No. 1, Independence Discussions with Audit Committees, and the Audit Committee had discussed with Centurion about their independence. The Audit Committee had concluded that Centurion was independent from the Company and its management.
Hasthe Audit Committee made a recommendation regarding the audited financial statements for fiscal 2021?
Based upon its review and the discussions with management and the Company’s independent registered public accounting firm, the Audit Committee recommended to the Board of Directors that the audited consolidated financial statements for the Company be included in the Company’s Annual Report on Form 20-F for fiscal 2021.
Hasthe Audit Committee reviewed the fees paid to the independent registered public accounting firm during fiscal 2021?
The Audit Committee had reviewed and discussed the fees paid to Centurion during 2021 for audit, audit-related, tax and other services, which are set forth below under “Fees Paid to Independent Registered Public Accounting Firm.” The Audit Committee has determined that the provision of audit and non-audit services was compatible with Centurion’s independence.
Whatis the Company’s policy regarding the retention of the Company’s auditors?
The Audit Committee has adopted a policy regarding the retention of the independent registered public accounting firm that requires pre-approval of all services by the Audit Committee.
Whoprepared this report?
This report has been furnished by the members of the Audit Committee:
Lionel Choong
Tao Xu
Chuan Zhang
FEESPAID TO INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
AuditFees
During the fiscal year ended December 31, 2021, Centurion ZD CPA & Co’s fee for the annual audit of our financial statements was $75,135.
During the fiscal year ended December 31, 2020, Centurion ZD CPA & Co’s total fee for the annual audits of our financial statements was $96, 549, including the audits of our financial statements for the fiscal years ended December 31, 2020 and September 30, 2020.
AuditRelated Fees
The Company had not paid Centurion ZD CPA & Co for audit-related services in fiscal 2021.
The Company has not paid Centurion’s for audit-related services in fiscal 2020.
TaxFees
The Company has not paid Centurion ZD CPA & Co. for tax services in fiscal 2021.
The Company has not paid Centurion ZD CPA & Co. for tax services in fiscal 2020.
AllOther Fees
The Company has not paid Centurion ZD CPA & Co. for any other services in fiscal 2021.
The Company has not paid Centurion ZD CPA & Co. for any other services in fiscal 2020.
AuditCommittee Pre-Approval Policies
Before Centurion ZD CPA & Co. was engaged by the Company to render audit or non-audit services, the engagement was approved by the Company’s audit committee. All services rendered by Centurion ZD CPA & Co. have been so approved.
Percentageof Hours
All hours expended on the principal accountants’ engagement to audit our consolidated financial statements for 2021 that were attributed to work performed by Centurion ZD CPA & Co’s full-time permanent employees.
BENEFICIALOWNERSHIP OF COMMON STOCK
The following table sets forth information with respect to beneficial ownership of our Ordinary Shares as of July 12, 2022 by:
| ● | Each<br> person who is known by us to beneficially own 5% or more of our outstanding shares; |
|---|---|
| ● | Each<br> of our current directors and named executive officers; and |
| --- | --- |
| ● | All<br> directors and named executive officers as a group. |
| --- | --- |
The number and percentage of Ordinary Shares beneficially owned are based on 35,554,677 Ordinary Shares outstanding as of July 12, 2022. Information with respect to beneficial ownership has been furnished by each director, officer or beneficial owner of 5% or greater of our Ordinary Shares. Beneficial ownership is determined in accordance with the rules of the SEC and generally requires that such person have voting or investment power with respect to securities. In computing the number of Ordinary Shares beneficially owned by a person listed below and the percentage ownership of such person, Ordinary Shares underlying options, warrants or convertible securities held by each such person that are exercisable or convertible within 60 days of July 12, 2022 are deemed outstanding, but are not deemed outstanding for computing the percentage ownership of any other person. Except as otherwise indicated in the footnotes to this table, or as required by applicable community property laws, all persons listed have sole voting and investment power for all Ordinary Shares shown as beneficially owned by them. Unless otherwise indicated in the footnotes, the address for each principal shareholder is in the care of the offices of the Company at Room 1202, Block B, Jiahui Center, 6 Jiqing Li, Chaoyangmenwai Street, Chaoyang District, Beijing 100020, China. As of July 12, 2022, we had 447 shareholders of record.
| Number of<br> Ordinary<br><br> Shares | Percentage of<br><br> Ordinary<br> Shares | |||||||
|---|---|---|---|---|---|---|---|---|
| Beneficially | Beneficially | Percentage of | ||||||
| Name of Beneficial Owner | Owned | Owned^(1)^ | Voting Power | |||||
| Directors and Executive Officers: | ||||||||
| Conglin Deng, CEO and Director ^(2)^ | - | - | 29.7 | % | ||||
| Wanhong Tan, CFO | - | - | - | |||||
| Khuat Leok Choong, Lionel, Director | - | - | - | |||||
| Tai Xu, Director | - | - | - | |||||
| Chuan Zhan, Director | - | - | - | |||||
| Panpan Wang, Director | - | - | - | |||||
| All directors and executive officers as a group (six individuals) | - | - | 29.7 | % | ||||
| 5% Beneficial Owners: | ||||||||
| Yunxia Li (3) | 1,900,000 | 5.34 | % | 3.75 | % | |||
| Yonghui Tao (4) | 1,855,000 | 5.22 | % | 3.67 | % | |||
| Danqing Sun (5) | 1,820,000 | 5.12 | % | 3.60 | % |
* Less than 1% of our outstanding shares.
| (1) | Beneficial<br> ownership is determined in accordance with the rules of the SEC and includes voting or investment power with respect to the Ordinary<br> Shares. The percentage of shares beneficially owned is based on 35,554,677 ordinary shares outstanding as of July 12, 2022. |
|---|---|
| (2) | Mr.<br> Deng is the sole shareholder of Bridgeforrest (BVI) Inc, which holds 5,000,000 preferred shares of the Company. Each preferred share<br> carries three votes at meetings of shareholders and as a result, Mr. Deng owns has approximately 29.7% of the outstanding voting<br> power. His address is Unit 17-1008, Sanlitun Service Apartments, Chaoyang District, Beijing, China. |
| (3) | Address<br> is B5-11B, Hujialou Jiedao, Shengshiyipin, Chaoyang District, Beijing, China |
| (4) | Address<br> is 146 Bajia Village, Songmen Town, Wenling City, Zhejiang Province |
| (5) | Address<br> is 16 Xinjian Road, Xinhe Village, Wenling City, Zhejiang Province, China |
GENERAL
CompensationCommittee Interlocks and Insider Participation
None of the members of the Board of Directors who served on the Compensation Committee during the fiscal year ended December 31, 2021 were officers or employees of the Company or any of its subsidiaries or had any relationship with the Company requiring disclosure under SEC regulations.
Availabilityof Annual Report to Shareholders
Rules promulgated by the SEC require us to provide an Annual Report to Shareholders who receive this Proxy Statement. We will also provide copies of the Annual Report to brokers, dealers, banks, voting trustees and their nominees for the benefit of their beneficial owners of record. Additional copies of the Annual Report on Form 20-F for the fiscal year ended December 31, 2021 (without exhibits or documents incorporated by reference), are available without charge to shareholders upon written request by sending a letter to the offices of the Company at Room 1202, Block B, Jiahui Center, 6 Jiqing Li, Chaoyangmenwai Street, Chaoyang District, Beijing 100020, China or to tan.wanhong@moxianglobal.com, along with any questions about proposals described in this proxy statement/prospectus or how to execute your vote.
OtherProposed Actions
If any other items or matters properly come before the meeting, the proxies received will be voted on those items or matters in accordance with the discretion of the proxy holders.
Solicitationby Board; Expenses of Solicitation
Our Board of Directors has sent you this Proxy Statement. Our directors, officers and associates may solicit proxies by telephone or in person. We will also reimburse the expenses of brokers, nominees and fiduciaries that send proxies and proxy materials to our shareholders.
ImportantNotice Regarding the Availability of Proxy Materials for the Annual Meeting: The Notice& Proxy Statement and the Annual Report are available at the Company’s website: www.moxianglobal.com
ANNEXA
Amendedand Restated Memorandum and Articles of Association
BVI COMPANY NUMBER: 2063507
TERRITORYOF THE BRITISH VIRGIN ISLANDS
THEBVI BUSINESS COMPANIES ACT (AS REVISED)
Memorandumand Articles of Association of
[ABitGroup, Inc]
ACOMPANY LIMITED BY SHARES
Incorporated on the 18th day of May 2021
Amended and Restated on the 27th day of May 2021
Amended and Restated on the 28th day of October 2021
Amended and Restated on the [ ] day of [ ] 2022
INCORPORATED IN THE BRITISH VIRGIN ISLANDS
Corporate Services (BVI) Limited
Floor 4, Banco Popular Building
Road Town, Tortola VG1110
British Virgin Islands
TERRITORYOF THE BRITISH VIRGIN ISLANDS
THEBVI BUSINESS COMPANIES ACT (AS REVISED) (the “Act”)
AMENDEDAND RESTATED
MEMORANDUMOF ASSOCIATION
OF
[ABitGroup, Inc]
ACOMPANY LIMITED BY SHARES
| 1. | NAME |
|---|
The name of the Company is [ABit Group, Inc]. The Company may by Resolution of Shareholders or Resolution of Directors resolve to change its name and make application to the Registrar of Corporate Affairs in the approved form to give effect to such change of name in accordance with section 21 of the Act.
| 2. | TYPE OF COMPANY |
|---|
The Company is a company limited by shares.
| 3. | REGISTERED OFFICE |
|---|
The first Registered Office of the Company is located at Floor 4, Banco Popular Building, Road Town, Tortola VG1110, British Virgin Islands, the office of the first registered agent.
| 4. | REGISTERED AGENT |
|---|
The first Registered Agent of the Company is Campbells Corporate Services (BVI) Limited, Floor 4, Banco Popular Building, Road Town, Tortola VG1110, British Virgin Islands.
| 5. | CAPACITY AND POWERS |
|---|
Subject to Clause 6 below, the objects for which the Company is established are unrestricted and the Company shall have full power and authority to carry out any object not prohibited by the BVI Business Companies Act (As Revised) or as the same may be revised from time to time or any other law of the British Virgin Islands.
| 6. | LIMITATIONS ON THE COMPANY’S BUSINESS |
|---|
For the purposes of section 9(4) of the Act, the business and activities of the company are limited to those business and activities which are not prohibited under any law for the time being in force in the British Virgin Islands.
| 7. | NUMBER AND CLASSES OF SHARES |
|---|
The Company is authorised to issue up to a maximum of 200,000,000 shares comprising: i) 150,000,000 ordinary shares of par value US$0.001 each; and ii) 50,000,000 preferred shares of par value $0.00101 each.
| 8. | CURRENCY |
|---|
The shares in the Company shall be issued in the currency of the United States of America.
| 9. | FRACTIONAL SHARES |
|---|
The Company may issue fractional shares. A fractional share shall have the corresponding fractional liabilities, limitations, preferences, privileges, qualifications, restrictions, rights and other attributes of a whole share of the same class and series.
| 10. | DESIGNATIONS, POWERS AND PREFERENCES OF SHARES |
|---|
10.1 Each ordinary share in the Company confers upon the shareholder:
a) the right to one vote at any meeting of the shareholders of the Company or on any resolution of shareholders;
b) the right to an equal share in any dividend paid by the Company; and
c) the right to an equal share in the distribution of the surplus assets of the Company on its liquidation.
10.2 Each preferred share in the Company confers upon the shareholder:
a) the right to six votes at any meeting of the shareholders of the Company or on any resolution of shareholders;
b) no right to share in any dividend paid by the Company;
c) no right to share in the distribution of the surplus assets of the Company on its liquidation; and
d) the right to convert such preferred shares into ordinary shares as set out in clause 11 (the “Conversion Rights”).
10.3 The directors may at their discretion by resolution of directors redeem, purchase or otherwise acquire all or any of the shares in the Company subject to Regulation 3 of the Articles.
10.4 For the purposes of section 9 of the Act, any rights, privileges, restrictions and conditions attaching to any of the shares as provided for in the Articles are deemed to be set out and stated in full in this Memorandum.
| 11. | CONVERSION RIGHTS |
|---|
11.1 Rightto Convert. Each preferred shares shall be convertible, at the option of the holder thereof, at any time after the date of issuance of such share, into such number of fully paid ordinary shares on a one-for-one basis.
11.2 Automatic Conversion. Each preferred share in the Company shall automatically convert into an ordinary share (on a one-for-one basis) immediately and without further action by the holder thereof upon a Reorganisation Event.
11.3 For the purposes of clause 11.2, “Reorganization Event” means:
a) any consolidation or merger of the Company with or into another person (other than a merger or consolidation in which the Company is the continuing entity and in which the ordinary shares outstanding immediately prior to the merger or consolidation is not exchanged for cash, securities or other property of the Company or another person);
b) any sale, transfer, lease or conveyance to another person of all or substantially all of the property and assets of the Company and its subsidiaries taken as a whole;
c) the acquisition by a third party (or third parties acting in concert) of shares of the Company giving that third party (or parties) voting control of the Company;
d) any reclassification of ordinary shares [or preferred shares] into securities, including securities of the Company; or
e) any statutory exchange of securities of the Company with another person (other than in connection with a merger or acquisition), in each case, as a result of which the Company’s ordinary shares [or preferred shares] would be converted into, or exchanged for, securities, cash or property.
11.4 Upon the exercise of a Conversion Right, the Company shall enter or procure the entry of the name of the relevant holder of preferred share as the holder of the relevant number of ordinary shares resulting from the conversion of the preferred share in, and make any other necessary and consequential changes to, the Register of Members.
11.5 Mechanism for Conversion. Before any holder of preferred shares shall be entitled to voluntarily convert the same into ordinary shares pursuant to clause 11.1, such holder shall lodge, at the Company’s registered office or at the office of any transfer agent for the preference shares, a written notice of the election to convert the same (together with any share certificates representing the preferred shares to which it relates) and such written notice shall state therein the name or names that shall be entered on the Register of Members and, if certificates are to be issued, the name or names in which the certificate or certificates for ordinary shares are to be issued. Any conversion of preferred share into ordinary shares pursuant to clause 11 shall be effected by any manner permitted by applicable law, including by means of (i) the re-designation and re-classification of the relevant preferred share as an ordinary shares together with such rights and restrictions for the time being attached thereto and shall rank pari passuin all respects with the ordinary shares then in issue; and/or (ii) the compulsory redemption without notice of preferred shares and the automatic application of the redemption proceeds in paying for such new ordinary shares into which the preferred share have been converted. For the avoidance of doubt, following the conversion to ordinary shares, the holder thereof shall have ordinary share voting rights in respect of such shares and not preferred share voting rights. Such conversion shall become effective forthwith upon entries being made in the Register of Members to record the conversion.
11.6 Effective upon and with effect from the conversion of a preferred share into an ordinary share in accordance with this clause 11, the converted share shall be treated for all purposes as an ordinary share and shall carry the rights and be subject to the restrictions attaching to ordinary shares including, without limitation, the right to one vote on matters subject to a vote at meetings of the shareholders of the Company.
| 12. | VARIATION OF RIGHTS |
|---|
If at any time the Company is authorised to issue shares in different classes, the rights attached to any class of shares may only, whether or not the Company is being wound up, be varied with the consent in writing of or by a resolution passed at a meeting by the holders of more than 50 per cent of the issued shares of that class.
| 13. | RIGHTS NOT VARIED BY THE ISSUE OF SHARES PARI PASSU |
|---|
The rights conferred upon the holders of the shares of any class issued with preferred or other rights shall not, unless otherwise expressly provided by the terms of issue of the shares of that class, be deemed to be varied by the creation or issue of further shares ranking pari passu therewith.
| 14. | REGISTERED SHARES |
|---|---|
| 13.1. | The<br> Company shall issue registered shares only. |
| --- | --- |
| 13.2. | The<br> Company is not authorised to issue bearer shares, convert registered shares to bearer shares or exchange registered shares for bearer<br> shares. |
| --- | --- |
| 15. | AMENDMENT OF MEMORANDUM AND ARTICLES |
| --- | --- |
Subject to Clause 12, the Company may amend its Memorandum or Articles by a resolution of shareholders or by a resolution of directors, save that no amendment may be made by a resolution of directors:
| (a) | to<br> restrict the rights or powers of the shareholders to amend the Memorandum or Articles; |
|---|---|
| (b) | to<br> change the percentage of shareholders required to pass a resolution of shareholders to amend the Memorandum or Articles; |
| --- | --- |
| (c) | in<br> circumstances where the Memorandum or Articles cannot be amended by the shareholders; or |
| --- | --- |
| (d) | to<br> Clauses 11, 12, 13, 14 or this Clause 15. |
| --- | --- |
| 16. | DEFINITIONS |
| --- | --- |
Words used in this Memorandum and not defined herein shall have the meanings set out in the Articles.
We, Campbells Corporate Services (BVI) Limited, Floor 4, Banco Popular Building, Road Town, Tortola VG1110, British Virgin Islands, for the purpose of incorporating a BVI Business Company under the laws of the British Virgin Islands hereby sign our name to this Memorandum of Association this 18th day of May 2021.
Incorporator
Sgd. Tamara Pertabsingh
Forand on behalf of
CampbellsCorporate Services (BVI) Limited
TERRITORYOF THE BRITISH VIRGIN ISLANDS
THEBVI BUSINESS COMPANIES ACT (AS REVISED) (the “Act”)
AMENDEDAND RESTATED
ARTICLESOF ASSOCIATION
OF
[ABitGroup, Inc]
ACOMPANY LIMITED BY SHARES
| 1. | INTERPRETATION |
|---|
References in these Articles of Association (“Articles”) to the Act shall mean the BVI Business Companies Act (As Revised) and any modification, extension, re-enactment or renewal thereof, any amendments thereto and the BVI Business Companies Regulations (As Revised) and any other regulations made thereunder. The following Articles shall constitute the Articles of the Company. In these Articles, words and expressions defined in the Act shall have the same meanings and, unless otherwise required by the context, whenever the singular or plural number, or the masculine, feminine or neuter gender is used in these Articles, it shall equally, where the context admits, include the others.
“Person” means an individual, a corporation, a trust, the estate of a deceased individual, a partnership, an unincorporated association or any legal entity capable of having a legal existence.
| 2. | SHARES |
|---|---|
| 2.1. | Every<br> shareholder is entitled to a certificate signed by a director of the Company or under the seal specifying the number of shares held<br> by him and the signature of the director and the seal may be facsimiles. |
| --- | --- |
| 2.2. | Any<br> shareholder receiving a certificate shall indemnify and hold the Company and its directors and officers harmless from any loss or<br> liability which it or they may incur by reason of any wrongful or fraudulent use or representation made by any person by virtue of<br> the possession thereof. If a share certificate is worn out or lost it may be renewed on production of the worn out certificate or<br> on satisfactory proof of its loss together with such indemnity as may be required by a resolution of directors. |
| --- | --- |
| 2.3. | If<br> several persons are registered as joint holders of any shares, any one of such persons may give an effectual receipt for any distribution. |
| --- | --- |
| 2.4. | Shares<br> and other securities may be issued at such times, to such persons, for such consideration and on such terms as the directors may<br> by resolution of directors determine. |
| --- | --- |
| 2.5. | Without<br> prejudice to the generality of the foregoing, the pre-emption rights set out in Section 46 of the Act shall not apply to the Company. |
| --- | --- |
| 2.6. | The<br> Company may issue securities convertible into shares, bonus shares, partly paid shares and nil paid shares. |
| --- | --- |
| 2.7. | A<br> share may be issued for consideration in any form, including money, a promissory note, or other written obligation to contribute<br> money or property, real property, personal property (including goodwill and know-how), services rendered or a contract for future<br> services. |
| --- | --- |
| 2.8. | Shares<br> may be issued for such amount of consideration as the directors may from time to time by resolution of directors determine, except<br> that in the case of shares issued with a par value, the consideration paid or payable shall not be less than the par value. |
| --- | --- |
| 2.9. | Before<br> issuing shares for a consideration other than money, the directors shall pass a resolution stating: |
| --- | --- |
| (a) | the<br> amount to be credited for the issue of the shares; |
| --- | --- |
| (b) | their<br> determination of the reasonable present cash value of the non-money consideration for the issue; and |
| --- | --- |
| (c) | that,<br> in their opinion, the present cash value of the non-money consideration for the issue is not less than the amount to be credited<br> for the issue of the shares. |
| --- | --- |
| 2.10. | The<br> Company shall keep a register of members containing: |
| --- | --- |
| (a) | the<br> names and addresses of the persons who hold shares; |
| --- | --- |
| (b) | the<br> number of each class and series of shares held by each shareholder; |
| --- | --- |
| (c) | the<br> date on which the name of each shareholder became a shareholder; and |
| --- | --- |
| (d) | the<br> date on which any person ceased to be a shareholder. |
| --- | --- |
| 2.11. | The<br> register of members may be in such form as the directors may approve, but if it is in magnetic, electronic or other data storage<br> form, the Company must be able to produce legible evidence of its contents. Until the directors otherwise determine, the magnetic,<br> electronic or other data storage form shall be the original register of members. |
| --- | --- |
| 2.12. | A<br> share is deemed to be issued on the date of issue entered next to the name of the shareholder in the register of members. |
| --- | --- |
| 3. | REDEMPTION OF SHARES AND TREASURY SHARES |
| --- | --- |
| 3.1. | The<br> Company may purchase, redeem or otherwise acquire and hold its own shares save that the Company may not purchase, redeem or otherwise<br> acquire its own shares without the consent of shareholders whose shares are to be purchased, redeemed or otherwise acquired unless<br> the Company is permitted by the Act or any other provision in the Memorandum or Articles to purchase, redeem or otherwise acquire<br> the shares without their consent. |
| --- | --- |
| 3.2. | The<br> Company may only offer to acquire shares if at the relevant time the directors determine by resolution of directors that immediately<br> after the acquisition the value of the Company’s assets will exceed its liabilities and the Company will be able to pay its<br> debts as they fall due. |
| --- | --- |
| 3.3. | Subject<br> to the provisions of the Act, the Company may make an offer to purchase, redeem or otherwise acquire its own shares from one or more<br> or all of the shareholders: |
| --- | --- |
| (a) | in<br> accordance with Sections 60, 61 and 62 of the Act; or |
| --- | --- |
| (b) | in<br> accordance with a right of a shareholder to have his shares redeemed or to have his shares exchanged for money or other property<br> of the Company; or |
| --- | --- |
| (c) | in<br> exchange for newly issued shares of equal value; or |
| --- | --- |
| (d) | pursuant<br> to the provisions of Section 179 of the Act. |
| --- | --- |
| 3.4. | Shares<br> may only be held as treasury shares where, when aggregated with the number of shares of the same class already held by the Company<br> as treasury shares, the total number of treasury shares does not exceed 50% of the shares of that class previously issued by the<br> Company, excluding those shares that have been cancelled. |
| --- | --- |
| 3.5. | All<br> rights and obligations attaching to a treasury share are suspended and shall not be exercised by or against the Company while it<br> holds the share as a treasury share. |
| --- | --- |
| 3.6. | Treasury<br> shares may be disposed of by the Company on such terms and conditions (not otherwise inconsistent with the Memorandum and Articles)<br> as the Company may by resolution of directors determine. |
| --- | --- |
| 3.7. | Where<br> shares are held by another body corporate of which the Company holds, directly or indirectly, shares having more than 50 per cent<br> of the votes in the election of directors of the other body corporate, all rights and obligations attaching to the shares held by<br> the other body corporate are suspended and shall not be exercised by the other body corporate. |
| --- | --- |
| 4. | MORTGAGES AND CHARGES OF SHARES |
| --- | --- |
| 4.1. | Shareholders<br> may mortgage or charge their shares in the Company and upon satisfactory evidence thereof the Company shall give effect to the terms<br> of any valid mortgage or charge except in so far as it may conflict with any requirements herein contained for consent to the transfer<br> of shares. |
| --- | --- |
| 4.2. | In<br> the case of the mortgage or charge of registered shares there may be entered in the register of members of the Company: |
| --- | --- |
| (a) | a<br> statement that the shares are mortgaged or charged; |
| --- | --- |
| (b) | the<br> name of the mortgagee or chargee; and |
| --- | --- |
| (c) | the<br> date on which the particulars specified in the preceding subparagraphs (a) and (b) are entered in the register of members. |
| --- | --- |
| 4.3. | Where<br> particulars of a mortgage or charge are entered in the register of members, such particulars may be cancelled: |
| --- | --- |
| (a) | with<br> the written consent of the named mortgagee or chargee or anyone authorised to act on his behalf; or |
| --- | --- |
| (b) | upon<br> evidence satisfactory to the directors of the discharge of the liability secured by the mortgage or charge and the issue of such<br> indemnities as the directors shall consider necessary or desirable. |
| --- | --- |
| 4.4. | Whilst<br> particulars of a mortgage or charge over shares are entered in the register of members pursuant to this Regulation: |
| --- | --- |
| (a) | no<br> transfer of any share the subject of those particulars shall be effected; |
| --- | --- |
| (b) | the<br> Company may not purchase, redeem or otherwise acquire any such share; and |
| --- | --- |
| (c) | no<br> replacement certificate shall be issued in respect of such shares, without the written consent of the named mortgagee or chargee. |
| --- | --- |
| 4.5. | The<br> directors may not resolve to refuse or delay the transfer of a share pursuant to the enforcement of a valid security interest created<br> over the share. |
| --- | --- |
| 5. | FORFEITURE |
| --- | --- |
| 5.1. | Shares<br> that are not fully paid on issue are subject to the forfeiture provisions set forth in this Regulation and for this purpose shares<br> issued for a promissory note, or other written obligation to contribute money or property, or a contract for future services are<br> deemed to be not fully paid. |
| --- | --- |
| 5.2. | A<br> written notice of call specifying the date for payment to be made shall be served on the shareholder who defaults in making payment<br> in respect of the shares. |
| --- | --- |
| 5.3. | The<br> written notice of call referred to in Sub-Regulation 5.2 shall name a further date not earlier than the expiration of 14 days from<br> the date of service of the notice on or before which the payment required by the notice is to be made and shall contain a statement<br> that in the event of non-payment at or before the time named in the notice the shares, or any of them, in respect of which payment<br> is not made will be liable to be forfeited. |
| --- | --- |
| 5.4. | Where<br> a written notice of call has been issued pursuant to Sub-Regulation 5.3 and the requirements of the notice have not been complied<br> with, the directors may, at any time before tender of payment, forfeit and cancel the shares to which the notice relates. |
| --- | --- |
| 5.5. | The<br> Company is under no obligation to refund any moneys to the shareholder whose shares have been cancelled pursuant to Sub-Regulation<br> 5.4 and that shareholder shall be discharged from any further obligation to the Company. |
| --- | --- |
| 6. | TRANSFER OF SHARES |
| --- | --- |
| 6.1. | Shares<br> may be transferred by a written instrument of transfer signed by the transferor and containing the name and address of the transferee,<br> which shall be sent to the Company at the office of its registered agent for registration. In the case of the transfer of a share<br> that imposes a liability to the Company on the transferee, the instrument of transfer shall also be signed by the transferee. |
| --- | --- |
| 6.2. | The<br> Company shall, on receipt of an instrument of transfer complying with the above Sub-Regulation 6.1, enter the name of the transferee<br> of a share in the register of members unless the directors resolve to refuse or delay the registration of the transfer for reasons<br> that shall be specified in a resolution of directors. |
| --- | --- |
| 6.3. | The<br> directors may not resolve to refuse or delay the transfer of a share unless the shareholder has failed to pay an amount due in respect<br> of the share, or such refusal or delay is deemed necessary or advisable in the view of the Company or of the Company’s legal<br> counsel in order to avoid violation of, or in order to ensure compliance with, any applicable corporate, securities and other laws<br> and regulations. |
| --- | --- |
| 6.4. | The<br> transfer of a share is effective when the name of the transferee is entered on the register of members. |
| --- | --- |
| 6.5. | If<br> the directors of the Company are satisfied that an instrument of transfer relating to shares has been signed but that the instrument<br> has been lost or destroyed, they may resolve by resolution of directors: |
| --- | --- |
| (a) | to<br> accept such evidence of the transfer of shares as they consider appropriate; and |
| --- | --- |
| (b) | that<br> the transferee’s name should be entered in the register of members notwithstanding the absence of the instrument of transfer. |
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| 6.6. | Subject<br> to the Memorandum, the personal representative of a deceased shareholder may transfer a share even though the personal representative<br> is not a shareholder at the time of the transfer. |
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| 7. | MEETINGS OF MEMBERS |
| --- | --- |
| 7.1. | Any<br> director of the Company may convene meetings of the members at such times and in such manner and places within or outside the British<br> Virgin Islands as the director considers necessary or desirable. |
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| 7.2. | Upon<br> the written request of shareholders entitled to exercise 30% or more of the voting rights in respect of the matter for which the<br> meeting is requested, the directors shall convene a meeting of shareholders within 28 days of receiving the written request. In the<br> event that the directors fail to convene a meeting of shareholders within 28 days, then: |
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| (a) | any<br> one director; |
| --- | --- |
| (b) | the<br> company secretary; or |
| --- | --- |
| (c) | the<br> shareholder who issued the written request, or where there is more than one, any one of those shareholders, |
| --- | --- |
may convene a meeting of shareholders, and the provisions of these Articles with regard to convening a meeting of shareholders shall apply, construing references to the directors as references to the party convening the meeting.
| 7.3. | A<br> member may be represented at a meeting of members by a proxy who may speak and vote on behalf of the member. |
|---|---|
| 7.4. | The<br> instrument appointing a proxy shall be produced at the place designated for the meeting before the time for holding the meeting at<br> which the person named in such instrument proposes to vote. The notice of the meeting may specify an alternative or additional place<br> or time at which the proxy shall be presented. |
| --- | --- |
| 7.5. | The<br> instrument appointing a proxy shall be in substantially the following form or such other form as the chairman of the meeting shall<br> accept as properly evidencing the wishes of the member appointing the proxy. |
| --- | --- |
[ABit Group, Inc]
(the “Company”)
I/We being a member of the above Company HEREBY APPOINT …………………………… of …………………………… or failing him ………..……………… of ………………………..…… to be my/our proxy to vote for me/us at the meeting of members to be held on the …… day of …………..…………, 20…… and at any adjournment thereof.
(Any restrictions on voting to be inserted here.)
Signed this …… day of …………..…………, 20……
……………………………
Member
| 7.6. | The<br> following applies where shares are jointly owned: |
|---|---|
| (a) | if<br> two or more persons hold shares jointly each of them may be present in person or by proxy at a meeting of members and may speak as<br> a member; |
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| (b) | if<br> only one of the joint owners is present in person or by proxy he may vote on behalf of all joint owners; and |
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| (c) | if<br> two or more of the joint owners are present in person or by proxy they must vote as one. |
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| 7.7. | A<br> member shall be deemed to be present at a meeting of members if he participates by telephone or other electronic means and all members<br> participating in the meeting are able to hear each other. |
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| 8. | NOTICE OF MEETINGS OF MEMBERS |
| --- | --- |
| 8.1. | The<br> director convening a meeting shall give not less than seven days notice of a meeting of members to: |
| --- | --- |
| (a) | those<br> members whose names on the date the notice is given appear as members in the register of members of the Company and are entitled<br> to vote at the meeting; and |
| --- | --- |
| (b) | the<br> other directors. |
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| 8.2. | Notwithstanding<br> Sub-Regulation 8.1, a meeting of members held in contravention of the requirement to give notice is valid if members holding at least<br> 90 per cent of the total voting rights on all the matters to be considered at the meeting have waived notice of the meeting and,<br> for this purpose, the presence of a member at the meeting shall constitute waiver in relation to all the shares which that member<br> holds. |
| --- | --- |
| 8.3. | The<br> inadvertent failure of a director who convenes a meeting to give notice of a meeting to a member or another director, or the fact<br> that a member or another director has not received notice, does not invalidate the meeting. |
| --- | --- |
| 8.4. | The<br> director convening a meeting of members may fix as the record date for determining those members that are entitled to vote at the<br> meeting the date notice is given of the meeting or such other date as may be specified in the notice, being a date not earlier than<br> the date of the notice. |
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| 9. | QUORUM FOR MEETINGS OF MEMBERS |
| --- | --- |
| 9.1. | The<br> quorum for a meeting of members is duly constituted if, at the commencement of the meeting, there are present in person or by proxy<br> not less than one-third (1/3) of the votes of the shares or class or series of shares entitled to vote on resolutions of members<br> to be considered at the meeting. A quorum may comprise a single member or proxy and then such person may pass a resolution of members<br> and a certificate signed by such person accompanied where such person be a proxy by a copy of the proxy instrument shall constitute<br> a valid resolution of members. |
| --- | --- |
| 9.2. | If<br>within two hours from the time appointed for the meeting a quorum is not present, the meeting, if convened upon the requisition of members,<br>shall be dissolved; in any other case it shall stand adjourned to the next business day in the jurisdiction in which the meeting was<br>to have been held at the same time and place or to such other time and place as the directors may determine, and if at the adjourned<br>meeting there are present within one hour from the time appointed for the meeting in person or by proxy not less than one third of the<br>votes of the shares or each class or series of shares entitled to vote on the matters to be considered by the meeting, those present<br>shall constitute a quorum but otherwise the meeting shall be dissolved. |
| --- | --- |
| 10. | PROCEEDINGS OF MEETINGS OF MEMBERS |
| --- | --- |
| 10.1. | At<br> any meeting of the members the chairman is responsible for deciding in such manner as he considers appropriate whether any resolution<br> proposed has been carried or not and the result of his decision shall be announced to the meeting and recorded in the minutes of<br> the meeting. If the chairman has any doubt as to the outcome of the vote on a proposed resolution, he shall cause a poll to be taken<br> of all votes cast upon such resolution. If the chairman fails to take a poll then any member present in person or by proxy who disputes<br> the announcement by the chairman of the result of any vote may immediately following such announcement demand that a poll be taken<br> and the chairman shall cause a poll to be taken. If a poll is taken at any meeting, the result shall be announced to the meeting<br> and recorded in the minutes of the meeting. |
| --- | --- |
| 10.2. | At<br> every meeting of members, the chairman of the board shall preside as chairman of the meeting. If there is no chairman of the board<br> or if the chairman of the board is not present at the meeting, the members present shall choose one of their numbers to be the chairman.<br> If the members are unable to choose a chairman for any reason, then the person representing the greatest number of voting shares<br> present in person or by proxy at the meeting shall preside as chairman failing which the oldest individual member or representative<br> of a member present shall take the chair. |
| --- | --- |
| 10.3. | The<br> chairman may, with the consent of the meeting, adjourn any meeting from time to time, and from place to place, but no business shall<br> be transacted at any adjourned meeting other than the business left unfinished at the meeting from which the adjournment took place. |
| --- | --- |
| 10.4. | Any<br> person other than an individual which is a member of the Company may by resolution of its directors or other governing body authorise<br> such individual as it thinks fit to act as its representative at any meeting of members or of any class of members, and the individual<br> so authorised shall be entitled to exercise the same rights on behalf of the person which he represents as that person could exercise<br> if it were an individual. |
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| 10.5. | The<br> chairman of any meeting at which a vote is cast by proxy or on behalf of any person other than an individual may call for a notarial<br> certified copy of such proxy or authority which shall be produced within 7 days of being so requested or the votes cast by such proxy<br> or on behalf of such person shall be disregarded. |
| --- | --- |
| 10.6. | Directors<br> of the Company may attend and speak at any meeting of members and at any separate meeting of the holders of any class or series of<br> shares. |
| --- | --- |
| 10.7. | An<br> action that may be taken by the members at a meeting may also be taken by a resolution of members consented to in writing, without<br> the need for any notice, but if any resolution of members is adopted otherwise than by the unanimous written consent of all members,<br> a copy of such resolution shall forthwith be sent to all members not consenting to such resolution. The consent may be in the form<br> of counterparts, each counterpart being signed by one or more members. If the consent is in one or more counterparts, and the counterparts<br> bear different dates, then the resolution shall take effect on the earliest date upon which persons holding a sufficient number of<br> votes of shares to constitute a resolution of members have consented to the resolution by signed counterparts. |
| --- | --- |
| 10.8. | If<br> the Company shall have only one member the provisions herein contained for meetings of the members shall not apply and in lieu of<br> minutes of a meeting shall record in writing and sign a note or memorandum of all matters requiring a resolution of members. Such<br> a note or memorandum shall constitute sufficient evidence of such resolution for all purposes. |
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| 11. | DIRECTORS |
| --- | --- |
| 11.1. | Subject<br> to any subsequent amendment to change the number of directors, the minimum number of directors shall be one. |
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| 11.2. | No<br> person shall be appointed as a director of the Company, an alternate director or nominated as a reserve director, unless he has consented<br> in writing to act as a director, an alternate director or to be nominated as a reserve director. |
| --- | --- |
| 11.3. | The<br> first directors of the Company shall be appointed by the first registered agent within six months of the incorporation date of the<br> Company; and thereafter, the directors shall be elected by resolution of members or by resolution of directors for such term as the<br> members or directors determine. If, before the Company has any members, the sole director or all of the directors appointed by the<br> first registered agent, resign or die, or in the case of a director that is not an individual, ceases to exist, the first registered<br> agent may appoint one or more further persons as directors of the Company. |
| --- | --- |
| 11.4. | Each<br> director holds office for the term, if any, fixed by the resolution of members or resolution of directors appointing him, or until<br> his earlier death, resignation or removal. If no term is fixed on the appointment of a director, the director serves indefinitely<br> until his earlier death, resignation or removal. |
| --- | --- |
| 11.5. | A<br> vacancy in the board of directors may be filled by a resolution of members or a resolution passed by the majority of the remaining<br> directors. |
| --- | --- |
| 11.6. | A<br> vacancy in relation to directors occurs if a director dies or otherwise ceases to hold office prior to the expiration of his term<br> of office. |
| --- | --- |
| 11.7. | A<br> director may be removed from office by a resolution of members or by resolution of directors. A resolution passed under this Regulation<br> may only be passed at a meeting called for the purpose of removing the director or for purposes including the removal of the director<br> or by a written resolution passed by at least seventy-five percent (75%) of the votes of the members or directors of the Company<br> entitled to vote. |
| --- | --- |
| 11.8. | A<br> director may resign his office by giving written notice of his resignation to the Company and the resignation has effect from the<br> date the notice is received by the Company at the office of its registered agent or from such later date as may be specified in the<br> notice. A director shall resign forthwith as a director if he is, or becomes, disqualified from acting as a director under the Act. |
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| 11.9. | The<br> Company shall keep a register of directors containing: |
| --- | --- |
| (a) | the<br> names and addresses of the persons who are directors of the Company; |
| --- | --- |
| (b) | the<br> date on which each person whose name is entered in the register was appointed as a director of the Company; |
| --- | --- |
| (c) | the<br> date on which each person named as a director ceased to be a director of the Company; and |
| --- | --- |
| (d) | such<br> other information as may be prescribed by the Act. |
| --- | --- |
| 11.10. | The<br> register of directors may be kept in any such form as the directors may approve, but if it is in magnetic, electronic or other data<br> storage form, the Company must be able to produce legible evidence of its contents. Until the directors otherwise determine, the<br> magnetic, electronic or other data storage shall be the original register of directors. |
| --- | --- |
| 11.11. | The<br> directors may, by a resolution of directors, fix the emoluments of directors with respect to services to be rendered in any capacity<br> to the Company. |
| --- | --- |
| 11.12. | A<br> director is not required to hold a share as a qualification to office. |
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| 12. | POWERS OF DIRECTORS |
| --- | --- |
| 12.1. | The<br> business and affairs of the Company shall be managed by, or under the direction or supervision of, the directors of the Company.<br> The directors of the Company have all the powers necessary for managing, and for directing and supervising, the business and affairs<br> of the Company. The directors may pay all expenses incurred preliminary to and in connection with the incorporation of the Company<br> and may exercise all such powers of the Company as are not by the Act or by the Memorandum or the Articles required to be exercised<br> by the members. |
| --- | --- |
| 12.2. | Each<br> director shall exercise his powers for a proper purpose and shall not act or agree to the Company acting in a manner that contravenes<br> the Memorandum, the Articles or the Act. Each director, in exercising his powers or performing his duties, shall act honestly and<br> in good faith in what the director believes to be the best interests of the Company. |
| --- | --- |
| 12.3. | If<br> the Company is the wholly owned subsidiary of a holding company, a director of the Company may, when exercising powers or performing<br> duties as a director, act in a manner which he believes is in the best interests of the holding company even though it may not be<br> in the best interests of the Company. |
| --- | --- |
| 12.4. | Any<br> director which is a body corporate may appoint any individual as its duly authorised representative for the purpose of representing<br> it at meetings of the directors, with respect to the signing of consents or otherwise. |
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| 12.5. | The<br> continuing directors may act notwithstanding any vacancy in their body. |
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| 12.6. | The<br> directors may by resolution of directors exercise all the powers of the Company to incur indebtedness, liabilities or obligations<br> and to secure indebtedness, liabilities or obligations whether of the Company or of any third party. |
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| 12.7. | All<br> cheques, promissory notes, drafts, bills of exchange and other negotiable instruments and all receipts for moneys paid to the Company<br> shall be signed, drawn, accepted, endorsed or otherwise executed, as the case may be, in such manner as shall from time to time be<br> determined by resolution of directors. |
| --- | --- |
| 12.8. | For<br> the purposes of Section 175 (Disposition of assets) of the Act, the directors may by resolution of directors determine that<br> any sale, transfer, lease, exchange or other disposition is in the usual or regular course of the business carried on by the Company<br> and such determination is, in the absence of fraud, conclusive. |
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| 12.9. | The<br> directors may from time to time and at any time by an instrument in writing appoint any person, firm or corporate body whether appointed<br> directly or indirectly as its attorney either generally or in relation to a specific matter. |
| --- | --- |
| 12.10. | An<br> act of an attorney appointed under Sub-Regulation 12.9 in accordance with the instrument under which the attorney was appointed binds<br> the Company. |
| --- | --- |
| 12.11. | An<br> instrument appointing an attorney under Sub-Regulation 12.9 may either be executed as a deed or signed by a person acting under the<br> express or implied authority of the Company. |
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| 13. | PROCEEDINGS OF DIRECTORS |
| --- | --- |
| 13.1. | Any<br> one director of the Company may call a meeting of the directors by sending a written notice to each other director. |
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| 13.2. | The<br> directors of the Company or any committee thereof may meet at such times and in such manner and places within or outside the British<br> Virgin Islands as the directors may determine to be necessary or desirable. |
| --- | --- |
| 13.3. | A<br> director is deemed to be present at a meeting of directors if he participates by telephone or other electronic means and all directors<br> participating in the meeting are able to hear each other. |
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| 13.4. | A<br> director shall be given not less than 3 days’ notice of meetings of directors, but a meeting of directors held without 3 days’<br> notice having been given to all directors shall be valid if all the directors entitled to vote at the meeting waive notice of the<br> meeting, and for this purpose the presence of a director at a meeting shall constitute waiver by that director. The inadvertent failure<br> to give notice of a meeting to a director, or the fact that a director has not received the notice, does not invalidate the meeting. |
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| 13.5. | A<br> director of the Company may appoint any other director or any other person, not disqualified from an appointment as a director, as<br> his alternate to exercise the appointing director’s powers and carry out the appointing director’s responsibilities. |
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| (a) | An<br> alternate director has the same rights as the appointing director in relation to any director’s meeting and any written resolution<br> circulated for written consent. |
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| (b) | Subject<br> to the Act and Regulation 17, an alternate director is liable for his own acts and omission as an alternate director whilst acting<br> in that capacity. |
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| (c) | The<br> appointment and termination of an alternate director must be in writing and written notice of the appointment and termination must<br> be given by the appointing director to the Company as soon as reasonably practicable. |
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| (d) | The<br> appointing director may, at any time, voluntarily terminate the alternate director’s appointment which shall take effect from<br> the time when the written notice of this termination is given to the Company. |
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| (e) | The<br> rights of an alternate director shall terminate upon the death of the appointing director or if the appointing director, otherwise<br> ceases to hold office. |
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| 13.6. | A<br> meeting of directors is duly constituted for all purposes if at the commencement of the meeting there are present in person or by<br> alternate not less than one-half of the total number of directors, unless there are only 2 directors in which case the quorum is<br> 2. |
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| 13.7. | If<br> the Company has only one director the provisions herein contained for meetings of directors do not apply and such sole director has<br> full power to represent and act for the Company in all matters as are not by the Act, the Memorandum or the Articles required to<br> be exercised by the shareholders. In lieu of minutes of a meeting the sole director shall record in writing and sign a note or memorandum<br> of all matters requiring a resolution of directors. Such a note or memorandum constitutes sufficient evidence of such resolution<br> for all purposes. |
| --- | --- |
| 13.8. | At<br> meetings of directors at which the chairman of the board is present, he shall preside as chairman of the meeting. If there is no<br> chairman of the board or if the chairman of the board is not present, the directors present shall choose one of their numbers to<br> be chairman of the meeting. |
| --- | --- |
| 13.9. | An<br> action that may be taken by the directors or a committee of directors at a meeting may also be taken by a resolution of directors<br> or a resolution of a committee of directors consented to in writing or by telex, telegram, cable or other written electronic communication,<br> without the need for any notice by a majority of the directors or members of the committee of directors, but if any resolution is<br> adopted otherwise than by the unanimous written consent of all directors or all members of a committee of directors, a copy of such<br> resolution shall forthwith be sent to all directors or all members of a committee of directors not consenting to such resolution.<br> The consent may be in the form of counterparts each counterpart being signed by one or more directors. If the consent is in one or<br> more counterparts, and the counterparts bear different dates, then the resolution shall take effect on the date upon which sufficient<br> number of directors to constitute a resolution of directors or a resolution of a committee of directors has consented to the resolution<br> by signed counterparts. |
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| 14. | COMMITTEES |
| --- | --- |
| 14.1. | The<br> directors may, by resolution of directors, designate one or more committees, each consisting of one or more directors, and delegate<br> one or more of their powers, including the power to affix the seal, to the committee. |
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| 14.2. | The<br> directors have no power to delegate to a committee of directors any of the following powers: |
| --- | --- |
| (a) | to<br> amend the Memorandum or the Articles; |
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| (b) | to<br> change the registered office or agent; |
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| (c) | to<br> designate committees of directors; |
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| (d) | to<br> delegate powers to a committee of directors; |
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| (e) | to<br> appoint or remove directors; |
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| (f) | to<br> appoint or remove an agent; |
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| (g) | to<br> fix emoluments of directors; |
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| (h) | to<br> approve a plan of merger, consolidation or arrangement; |
| --- | --- |
| (i) | to<br> make a declaration of solvency for the purposes of Section 198(1)(a) of the Act or to approve a liquidation plan; |
| --- | --- |
| (j) | to<br> make a determination under Section 57(1) of the Act that the Company will, immediately after a proposed distribution, satisfy the<br> solvency test; or |
| --- | --- |
| (k) | to<br> authorize the Company to continue as a Company incorporated under the laws of a jurisdiction outside the British Virgin Islands. |
| --- | --- |
| 14.3. | Sub-Regulation<br> 14.2(c) and (d) do not prevent a committee of directors, where authorised by the resolution of directors appointing such committee<br> or by a subsequent resolution of directors, from appointing a sub-committee and delegating powers exercisable by the committee to<br> the sub-committee. |
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| 14.4. | The<br> meetings and proceedings of each committee of directors consisting of 2 or more directors shall be governed mutatis mutandis by<br> the provisions of the Articles regulating the proceedings of directors so far as the same are not superseded by any provisions in<br> the resolution of directors establishing the committee. |
| --- | --- |
| 14.5. | Where<br> the directors delegate their powers to a committee of directors they remain responsible for the exercise of that power by the committee,<br> unless they believed on reasonable grounds at all times before the exercise of the power that the committee would exercise the power<br> in conformity with the duties imposed on directors of the Company under the Act. |
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| 15. | OFFICERS AND AGENTS |
| --- | --- |
| 15.1. | The<br> Company may by resolution of directors appoint officers of the Company at such times as may be considered necessary or expedient.<br> Such officers may consist of a chairman of the board of directors, a president and one or more vice-presidents, secretaries and treasurers<br> and such other officers as may from time to time be considered necessary or expedient. Any number of offices may be held by the same<br> person. |
| --- | --- |
| 15.2. | The<br> officers shall perform such duties as are prescribed at the time of their appointment subject to any modification in such duties<br> as may be prescribed thereafter by resolution of directors. In the absence of any specific prescription of duties it shall be the<br> responsibility of the chairman of the board to preside at meetings of directors and shareholders, the president to manage the day<br> to day affairs of the Company, the vice-presidents to act in order of seniority in the absence of the president but otherwise to<br> perform such duties as may be delegated to them by the president, the secretaries to maintain the register of members, minute books<br> and records (other than financial records) of the Company and to ensure compliance with all procedural requirements imposed on the<br> Company by applicable law, and the treasurer to be responsible for the financial affairs of the Company. |
| --- | --- |
| 15.3. | The<br> emoluments of all officers shall be fixed by resolution of directors. |
| --- | --- |
| 15.4. | The<br> officers of the Company shall hold office until their successors are duly appointed, but any officer elected or appointed by the<br> directors may be removed at any time, with or without cause, by resolution of directors. Any vacancy occurring in any office of the<br> Company may be filled by resolution of directors. |
| --- | --- |
| 15.5. | The<br> directors may, by a resolution of directors, appoint any person, including a person who is a director, to be an agent of the Company.<br> An agent of the Company shall have such powers and authority of the directors, including the power and authority to affix the seal,<br> as are set forth in the Articles or in the resolution of directors appointing the agent, except that no agent has any power or authority<br> with respect to the matters specified in Sub-Regulation 14.2. The resolution of directors appointing an agent may authorise the agent<br> to appoint one or more substitutes or delegates to exercise some or all of the powers conferred on the agent by the Company. The<br> directors may remove an agent appointed by the Company and may revoke or vary a power conferred on him. |
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| 16. | CONFLICT OF INTERESTS |
| --- | --- |
| 16.1. | A<br> director of the Company shall, forthwith after becoming aware of the fact that he is interested in a transaction entered into or<br> to be entered into by the Company, disclose the interest to all other directors of the Company. |
| --- | --- |
| 16.2. | For<br> the purposes of Sub-Regulation 16.1, a disclosure to all other directors to the effect that a director is a member, director or officer<br> of another named entity or has a fiduciary relationship with respect to the entity or a named individual and is to be regarded as<br> interested in any transaction which may, after the date of the entry or disclosure, be entered into with that entity or individual,<br> is a sufficient disclosure of interest in relation to that transaction. |
| --- | --- |
| 16.3. | A<br> director of the Company who is interested in a transaction entered into or to be entered into by the Company may: |
| --- | --- |
| (a) | vote<br> on a matter relating to the transaction; |
| --- | --- |
| (b) | attend<br> a meeting of directors at which a matter relating to the transaction arises and be included among the directors present at the meeting<br> for the purposes of a quorum; and |
| --- | --- |
| (c) | sign<br> a document on behalf of the Company, or do any other thing in his capacity as a director, that relates to the transaction, |
| --- | --- |
and, subject to compliance with the Act shall not, by reason of his office be accountable to the Company for any benefit which he derives from such transaction and no such transaction shall be liable to be avoided on the grounds of any such interest or benefit.
| 17. | INDEMNIFICATION |
|---|---|
| 17.1. | Subject<br> to the limitations hereinafter provided the Company shall indemnify against all expenses, including legal fees, and against all judgments,<br> fines and amounts paid in settlement and reasonably incurred in connection with legal, administrative or investigative proceedings<br> any person who: |
| --- | --- |
| (a) | is<br> or was a party or is threatened to be made a party to any threatened, pending or completed proceedings, whether civil, criminal,<br> administrative or investigative, by reason of the fact that the person is or was a director of the Company; or |
| --- | --- |
| (b) | is<br> or was, at the request of the Company, serving as a director of, or in any other capacity is or was acting for, another body corporate<br> or a partnership, joint venture, trust or other enterprise. |
| --- | --- |
| 17.2. | The<br> indemnity in Sub-Regulation 17.1 only applies if the person acted honestly and in good faith with a view to the best interests of<br> the Company and, in the case of criminal proceedings, the person had no reasonable cause to believe that their conduct was unlawful. |
| --- | --- |
| 17.3. | The<br> decision of the directors as to whether the person acted honestly and in good faith and with a view to the best interests of the<br> Company and as to whether the person had no reasonable cause to believe that his conduct was unlawful is, in the absence of fraud,<br> sufficient for the purposes of the Articles, unless a question of law is involved. |
| --- | --- |
| 17.4. | The<br> termination of any proceedings by any judgment, order, settlement, conviction or the entering of a nolle prosequi does not,<br> by itself, create a presumption that the person did not act honestly and in good faith and with a view to the best interests of the<br> Company or that the person had reasonable cause to believe that his conduct was unlawful. |
| --- | --- |
| 17.5. | The<br> Company may purchase and maintain insurance in relation to any person who is or was a director, officer or liquidator of the Company,<br> or who at the request of the Company is or was serving as a director, officer or liquidator of, or in any other capacity is or was<br> acting for, another body corporate or a partnership, joint venture, trust or other enterprise, against any liability asserted against<br> the person and incurred by the person in that capacity, whether or not the Company has or would have had the power to indemnify the<br> person against the liability as provided in the Articles. |
| --- | --- |
| 18. | RECORDS |
| --- | --- |
| 18.1. | The<br> Company shall keep the following documents at the office of its registered agent: |
| --- | --- |
| (a) | the<br> Memorandum and the Articles; |
| --- | --- |
| (b) | the<br> register of members, or a copy of the register of members; |
| --- | --- |
| (c) | the<br> register of directors, or a copy of the register of directors; and |
| --- | --- |
| (d) | copies<br> of all notices and other documents filed by the Company with the Registrar of Corporate Affairs in the previous ten (10) years. |
| --- | --- |
| 18.2. | If<br> the Company maintains only a copy of the register of members or a copy of the register of directors at the office of its registered<br> agent, it shall: |
| --- | --- |
| (a) | within<br> 15 days of any change in either register, notify the registered agent in writing of the change; and |
| --- | --- |
| (b) | provide<br> the registered agent with a written record of the physical address of the place or places at which the original register of members<br> or the original register of directors is kept. |
| --- | --- |
| 18.3. | The<br> Company shall keep the following records and underlying documentation at the office of its registered agent or at such other place<br> or places, within or outside the British Virgin Islands, as the directors may determine: |
| --- | --- |
| (a) | minutes<br> of meetings and resolutions of members and classes of members; and |
| --- | --- |
| (b) | minutes<br> of meetings and resolutions of directors and committees of directors. |
| --- | --- |
| 18.4. | The<br> records and underlying documentation shall be retained for a period of 5 years from the date of completion of the transaction to<br> which the records and underlying documentation relate or from the date that the Company terminates the business relationship to which<br> the records and underlying documentation relate. |
| --- | --- |
| 18.5. | Where<br> any original records and underlying documentation referred to in this Regulation are maintained other than at the office of the registered<br> agent of the Company, the Company shall provide the registered agent with a written record of the physical address of the place or<br> places at which the records and underlying documentation are kept. |
| --- | --- |
| 18.6. | Where<br> the place at which the original records and underlying documentation of the Company changes, the Company shall provide its registered<br> agent with the physical address of the new location of the records and underlying documentation within 14 days of the change of the<br> location. |
| --- | --- |
| 18.7. | The<br> records and underlying documentation of the Company referred to in this Regulation shall be in such form as are sufficient to show<br> and explain the Company’s transactions and will, at any time, enable the financial position of the Company to be determined<br> with reasonable accuracy. |
| --- | --- |
| 18.8. | The<br> records kept by the Company under this Regulation shall be in written form or either wholly or partly as electronic records complying<br> with the requirements of the Electronic Transactions Act (No. 5 of 2001). |
| --- | --- |
| 19. | SEAL |
| --- | --- |
The Company shall have a common seal and the directors shall provide for the safe custody of the seal and for an imprint thereof to be kept at the office of the registered agent of the Company. Except as otherwise expressly provided herein, the seal when affixed to any written instrument shall be witnessed and attested to by the signature of any one director or other person so authorised from time to time by resolution of directors. Such authorisation may be before or after the seal is affixed, may be general or specific and may refer to any number of sealings. The directors may provide for a facsimile of the seal and of the signature of any director or authorised person which may be reproduced by printing or other means on any instrument and it shall have the same force and validity as if the seal had been affixed to such instrument and the same had been attested to as hereinbefore described.
| 20. | DISTRIBUTIONS |
|---|---|
| 20.1. | The<br> directors of the Company may, by resolution of directors, authorise a distribution by way of dividend at such time at such amount<br> as they think fit if they are satisfied, on reasonable grounds, that, immediately after the distribution, the value of the Company’s<br> assets will exceed its liabilities and the Company will be able to pay its debts as they fall due. |
| --- | --- |
| 20.2. | Dividends<br> may be paid in money, shares, or other property. |
| --- | --- |
| 20.3. | Notice<br> of any dividend that may have been declared shall be given to each shareholder as specified in Sub-Regulation 23.1 and all dividends<br> unclaimed for 3 years after having been declared may be forfeited by resolution of directors for the benefit of the Company. |
| --- | --- |
| 20.4. | No<br> dividend shall bear interest as against the Company and no dividend shall be paid on treasury shares. |
| --- | --- |
| 20.5. | The<br> directors may, before making any distributions, set aside out of the profits of the Company such sum as they think proper as a reserve<br> fund, and may invest the sum so set apart as a reserve fund upon such securities as they may select. |
| --- | --- |
| 20.6. | The<br> directors may determine in their sole discretion to issue bonus shares from time to time. |
| --- | --- |
| 20.7. | A<br> division of the issued and outstanding shares of a class or series of shares into a larger number of shares of the same class or<br> series having a proportionately smaller par value does not constitute the issue of a bonus share. |
| --- | --- |
| 21. | ACCOUNTS |
| --- | --- |
| 21.1. | The<br> Company shall keep records that are sufficient to show and explain the Company’s transactions and that will, at any time, enable<br> the financial position of the Company to be determined with reasonable accuracy. |
| --- | --- |
| 21.2. | The<br> Company may by resolution of shareholders call for the directors to prepare periodically and make available a profit and loss account<br> and a balance sheet. The profit and loss account and balance sheet shall be drawn up so as to give respectively a true and fair view<br> of the profit and loss of the Company for a financial period and a true and fair view of the assets and liabilities of the Company<br> as at the end of a financial period. |
| --- | --- |
| 22. | AUDIT |
| --- | --- |
| 22.1. | The<br> Company may by resolution of shareholders call for the accounts to be examined by auditors. |
| --- | --- |
| 22.2. | The<br> first auditors shall be appointed by resolution of directors; subsequent auditors shall be appointed by a resolution of shareholders. |
| --- | --- |
| 22.3. | The<br> auditors may be shareholders, but no director or other officer shall be eligible to be an auditor of the Company during their continuance<br> in office. |
| --- | --- |
| 22.4. | The<br> remuneration of the auditors of the Company: |
| --- | --- |
| (a) | in<br> the case of auditors appointed by the directors, may be fixed by resolution of directors; and |
| --- | --- |
| (b) | subject<br> to the foregoing, shall be fixed by resolution of shareholders or in such manner as the Company may by resolution of shareholders<br> determine. |
| --- | --- |
| 22.5. | The<br> auditors shall examine each profit and loss account and balance sheet required to be laid before a meeting of the shareholders or<br> otherwise given to shareholders and shall state in a written report whether or not: |
| --- | --- |
| (a) | in<br> their opinion the profit and loss account and balance sheet give a true and fair view respectively of the profit and loss for the<br> period covered by the accounts, and of the assets and liabilities of the Company at the end of that period; and |
| --- | --- |
| (b) | all<br> the information and explanations required by the auditors have been obtained. |
| --- | --- |
| 22.6. | The<br> report of the auditors shall be annexed to the accounts and shall be read at the meeting of shareholders at which the accounts are<br> laid before the Company or shall be otherwise given to the shareholders. |
| --- | --- |
| 22.7. | Every<br> auditor of the Company shall have a right of access at all times to the books of account and vouchers of the Company, and shall be<br> entitled to require from the directors and officers of the Company such information and explanations as he thinks necessary for the<br> performance of the duties of the auditors. |
| --- | --- |
| 22.8. | The<br> auditors of the Company shall be entitled to receive notice of, and to attend any meetings of shareholders at which the Company’s<br> profit and loss account and balance sheet are to be presented. |
| --- | --- |
| 23. | NOTICES |
| --- | --- |
| 23.1. | Any<br> notice, information or written statement to be given by the Company to shareholders may be given by personal service or by mail addressed<br> to each shareholder at the address shown in the register of members. |
| --- | --- |
| 23.2. | Any<br> summons, notice, order, document, process, information or written statement to be served on the Company may be served by leaving<br> it, or by sending it by registered mail addressed to the Company, at its registered office, or by leaving it with, or by sending<br> it by registered mail to, the registered agent of the Company. |
| --- | --- |
| 23.3. | Service<br> of any summons, notice, order, document, process, information or written statement to be served on the Company may be proved by showing<br> that the summons, notice, order, document, process, information or written statement was delivered to the registered office or the<br> registered agent of the Company or that it was mailed in such time as to admit to its being delivered to the registered office or<br> the registered agent of the Company in the normal course of delivery within the period prescribed for service and was correctly addressed<br> and the postage was prepaid. |
| --- | --- |
| 24. | VOLUNTARY WINDING UP AND DISSOLUTION |
| --- | --- |
| 24.1. | The<br> Company may voluntarily commence to wind up and dissolve if |
| --- | --- |
| (a) | it<br> has no liabilities; or |
| --- | --- |
| (b) | is<br> able to pay its debts as they fall due, |
| --- | --- |
by a resolution of shareholders or if, the Company has never issued shares, by a resolution of directors.
| 24.2. | The<br> Company may by a resolution of shareholders or by a resolution of directors appoint a voluntary liquidator. |
|---|---|
| 24.3. | Where<br> a liquidator has been appointed by a resolution of directors, the shareholders of a company may by a resolution of the shareholders<br> appoint an eligible person, subject to the Act, as an additional voluntary liquidator to act jointly with the voluntary liquidator<br> appointed. |
| --- | --- |
| 25. | CONTINUATION |
| --- | --- |
The Company may by resolution of shareholders or by a resolution passed unanimously by all directors of the Company continue as a company incorporated under the laws of a jurisdiction outside the British Virgin Islands in the manner provided under those laws.
We, Campbells Corporate Services (BVI) Limited, Floor 4, Banco Popular Building, Road Town, Tortola VG1110, British Virgin Islands, for the purpose of incorporating a BVI Business Company under the laws of the British Virgin Islands hereby sign our name to these Articles of Association this 18th day of May 2021.
Incorporator
Sgd. Tamara Pertabsingh
Forand on behalf of
CampbellsCorporate Services (BVI) Limited
ANNEXB
ABIT GROUP, INC.
2022 OMNIBUS EQUITY INCENTIVE PLAN
TABLEOF CONTENTS
| PAGE | ||
|---|---|---|
| Article 1. | Effective Date, Objectives and Duration | 1 |
| 1.1 | Effective Date of the Plan | 1 |
| 1.2 | Objectives of the Plan | 1 |
| 1.3 | Duration of the Plan | 1 |
| Article 2. | Definitions | 1 |
| 2.1 | “Applicable Law” | 1 |
| 2.2 | “Award” | 1 |
| 2.3 | “Award Agreement” | 1 |
| 2.4 | “Board” | 1 |
| 2.5 | “Bonus Shares” | 2 |
| 2.6 | “Cause” | 2 |
| 2.7 | “CEO” | 2 |
| 2.8 | “Code” | 2 |
| 2.9 | “Committee” | 2 |
| 2.10 | “Company” | 2 |
| 2.11 | “Compensation Committee” | 2 |
| 2.12 | “Corporate Transaction” | 2 |
| 2.13 | “Deferred Shares” | 2 |
| 2.14 | “Disability” or “Disabled” | 2 |
| 2.15 | “Dividend Equivalent” | 3 |
| 2.16 | “Effective Date” | 3 |
| 2.17 | “Eligible Person” | 3 |
| 2.18 | “Exchange Act” | 3 |
| 2.19 | “Exercise Price” | 3 |
| 2.20 | “Fair Market Value” | 3 |
| 2.21 | “Grant Date” | 3 |
| 2.22 | “Grantee” | 3 |
| 2.23 | “Incentive Share Option” | 3 |
| 2.24 | “Including” or “includes” | 4 |
| 2.25 | means “including, without limitation,” or “includes,<br>without limitation,” respectively. | 4 |
| 2.26 | “Non-Employee Director” | 4 |
| 2.27 | means a member of the Board who is not an employee of the Company<br>or any Subsidiary. | 4 |
| 2.28 | “Option” | 4 |
| 2.29 | “Other Share-Based Award” | 4 |
| 2.30 | “Performance Period” | 4 |
| 2.31 | “Performance Share” and “Performance Share<br>Unit” | 4 |
| 2.32 | “Period of Restriction” | 4 |
| 2.33 | “Person” | 4 |
| 2.34 | “Restricted Shares” | 4 |
| 2.35 | “Restricted Share Units” | 4 |
| 2.36 | “Rule<br>16b-3” | 4 |
| 2.37 | “SEC” | 4 |
| 2.38 | “Section 16 Non-Employee Director” | 4 |
| 2.39 | “Section 16 Person” | 4 |
| 2.40 | “Share” | 4 |
| 2.41 | “Share Appreciation Right” or “SAR” | 4 |
| 2.42 | “Subsidiary” | 4 |
| 2.43 | “Surviving Company” | 5 |
| 2.44 | “Term” | 5 |
| 2.45 | “Termination of Affiliation” | 5 |
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TABLEOF CONTENTS
| PAGE | ||
|---|---|---|
| Article 3. | Administration | 5 |
| 3.1 | Committee | 5 |
| 3.2 | Powers of Committee | 5 |
| 3.3 | No Repricings | 7 |
| Article 4. | Shares Subject to the Plan | 7 |
| 4.1 | Number of Shares Available for Grants | 7 |
| 4.2 | Adjustments in Authorized Shares and Awards; Corporate Transaction,<br>Liquidation or Dissolution | 8 |
| Article 5. | Eligibility and General Conditions of Awards | 9 |
| 5.1 | Eligibility | 9 |
| 5.2 | Award Agreement | 9 |
| 5.3 | General Terms and Termination of Affiliation | 9 |
| 5.4 | Nontransferability of Awards | 9 |
| 5.5 | Cancellation and Rescission of Awards | 10 |
| 5.6 | Stand-Alone, Tandem and Substitute Awards | 10 |
| 5.7 | Compliance with Rule 16b-3 | 10 |
| 5.8 | Deferral of Award Payouts | 11 |
| Article 6. | Share Options | 11 |
| 6.1 | Grant of Options | 11 |
| 6.2 | Award Agreement | 11 |
| 6.3 | Option Exercise Price | 11 |
| 6.4 | Grant of Incentive Share Options | 11 |
| 6.5 | Payment of Exercise Price | 12 |
| Article 7. | Share Appreciation Rights | 13 |
| 7.1 | Issuance | 13 |
| 7.2 | Award Agreements | 13 |
| 7.3 | SAR Exercise Price | 13 |
| 7.4 | Exercise and Payment | 13 |
| Article 8. | Restricted Shares | 13 |
| 8.1 | Grant of Restricted Shares | 13 |
| 8.2 | Award Agreement | 13 |
| 8.3 | Consideration for Restricted Shares | 14 |
| 8.4 | Effect of Forfeiture | 14 |
| 8.5 | Escrow; Legends | 14 |
| Article 9. | Performance Share Units and Performance Shares | 14 |
| 9.1 | Grant of Performance Share Units and Performance Shares | 14 |
| 9.2 | Value/Performance Goals | 14 |
| 9.3 | Earning of Performance Share Units and Performance Shares | 14 |
| Article 10. | Deferred Shares and Restricted Share Units | 15 |
| 10.1 | Grant of Deferred Shares and Restricted Share Units | 15 |
| 10.2 | Vesting and Delivery | 15 |
| 10.3 | Voting and Dividend Equivalent Rights Attributable to Deferred<br>Shares and Restricted Share Units | 16 |
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| --- |
TABLEOF CONTENTS
| PAGE | ||
|---|---|---|
| Article 11. | Dividend Equivalents | 16 |
| Article 12. | Bonus Shares | 16 |
| Article 13. | Other Share-Based Awards | 16 |
| Article 14. | Non-Employee Director Awards | 17 |
| Article 15. | Amendment, Modification, and Termination | 17 |
| 15.1 | Amendment, Modification, and Termination | 17 |
| 15.2 | Awards Previously Granted | 17 |
| Article 16. | Compliance with Code Section 409A | 17 |
| Article 17. | Withholding | 18 |
| 17.1 | Required Withholding | 18 |
| 17.2 | Notification under Code Section 83(b) | 18 |
| Article 18. | Additional Provisions | 18 |
| 18.1 | Successors | 18 |
| 18.2 | Severability | 18 |
| 18.3 | Requirements of Law | 19 |
| 18.4 | Securities Law Compliance | 19 |
| 18.5 | Forfeiture Events | 19 |
| 18.6 | No Rights as a Shareholder | 20 |
| 18.7 | Nature of Payments | 20 |
| 18.8 | Non-Exclusivity of Plan | 20 |
| 18.9 | Governing Law | 20 |
| 18.10 | Unfunded Status of Awards; Creation of Trusts | 20 |
| 18.11 | Affiliation | 20 |
| 18.12 | Participation | 20 |
| 18.13 | Construction | 20 |
| 18.14 | Headings | 21 |
| 18.15 | Obligations | 21 |
| 18.16 | No Right to Continue as Director | 21 |
| 18.17 | Shareholder Approval | 21 |
| 18.18 | Forfeiture of Shares | 21 |
| 18.19 | Share Issuances | 21 |
| 18.20 | No Dividends on Unvested Awards | 21 |
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| --- |
ABIT GROUP, INC.
2022 OMNIBUS EQUITY INCENTIVE PLAN
Article 1.
Effective Date, Objectives and Duration
1.1 Effective Date of the Plan. The Board of ABit Group, Inc, a company limited by shares and incorporated under the laws of the British Virgin Islands (the “Company”) adopted the ABit Group, Inc 2022 Omnibus Incentive Plan (the “Plan”) effective as of July 1, 2022 (the “Effective Date”).
1.2 Objectives of the Plan. The Plan is intended (a) to allow selected employees of and consultants to the Company and its Subsidiaries to acquire or increase equity ownership in the Company, thereby strengthening their commitment to the success of the Company and stimulating their efforts on behalf of the Company, and to assist the Company and its Subsidiaries in attracting new employees, officers and consultants and retaining existing employees and consultants, (b) to optimize the profitability and growth of the Company and its Subsidiaries through incentives which are consistent with the Company’s goals, (c) to provide Grantees with an incentive for excellence in individual performance, (d) to promote teamwork among employees, consultants and Non-Employee Directors, and (e) to attract and retain highly qualified persons to serve as Non-Employee Directors and to promote ownership by such Non-Employee Directors of a greater proprietary interest in the Company, thereby aligning such Non-Employee Directors’ interests more closely with the interests of the Company’s shareholders.
1.3 Duration of the Plan. The Plan shall commence on the Effective Date and shall remain in effect, subject to the right of the Board to amend or terminate the Plan at any time pursuant to Article 15 hereof, until the earlier of the tenth anniversary of the Effective Date, or the date all Shares subject to the Plan shall have been purchased or acquired and the restrictions on all Restricted Shares granted under the Plan shall have lapsed, according to the Plan’s provisions.
Article 2.
Definitions
Whenever used in the Plan, the following terms shall have the meanings set forth below:
2.1 “Applicable Law” means (i) the laws of the British Virgin Islands as they relate to the Company and its Shares; (ii) the legal requirements relating to the Plan and the Awards under applicable provisions of the corporate, securities, tax and other laws, rules, regulations and government orders of any jurisdiction applicable to Awards granted to residents; and (iii) the rules of any applicable securities exchange, national market system or automated quotation system on which the Shares are listed, quoted or traded.
2.2 “Award” means Options (including non-qualified options and Incentive Share Options), SARs, Restricted Shares, Performance Share Units (which may be paid in cash), Performance Shares, Deferred Shares, Restricted Share Units, Dividend Equivalents, Bonus Shares or Other Share-Based Awards granted under the Plan.
2.3 “Award Agreement” means either (a) a written agreement entered into by the Company and a Grantee setting forth the terms and provisions applicable to an Award granted under the Plan, or (b) a written statement issued by the Company to a Grantee describing the terms and provisions of such Award, including any amendment or modification thereof. The Committee may provide for the use of electronic, internet or other non-paper Award Agreements and the use of electronic, internet or other non-paper means for the acceptance thereof and actions thereunder by the Grantee.
2.4 “Board” means the Board of Directors of the Company, from time to time.
2.5 “Bonus Shares” means Shares that are awarded to a Grantee with or without cost and without restrictions either in recognition of past performance (whether determined by reference to another employee benefit plan of the Company or otherwise), as an inducement to become an Eligible Person or, with the consent of the Grantee, as payment in lieu of any cash remuneration otherwise payable to the Grantee.
2.6 “Cause” means, except as otherwise defined in an Award Agreement:
(a) the commission of any act by a Grantee constituting a felony or crime of moral turpitude (or their equivalent in a non-United States jurisdiction);
(b) an act of dishonesty, fraud, intentional misrepresentation, or harassment which, as determined in good faith by the Committee, would: (i) materially adversely affect the business or the reputation of the Company or any of its Subsidiaries with their respective current or prospective customers, suppliers, lenders and/or other third parties with whom such entity does or might do business; or (ii) expose the Company or any of its Subsidiaries to a risk of civil or criminal legal damages, liabilities or penalties;
(c) any material misconduct in violation of the Company’s or a Subsidiary’s written policies; or
(d) willful and deliberate non-performance of the Grantee’s duties in connection with the business affairs of the Company or its Subsidiaries;
provided,however, that if the Grantee has a written employment or consulting agreement with the Company or any of its Subsidiaries or participates in any severance plan established by the Company applicable to Awards granted to the Grantee under the Plan that includes a definition of “cause” (or a substantially equivalent term), then Cause shall have the meaning set forth in such employment or consulting agreement or severance plan.
2.7 “CEO” means the Chief Executive Officer of the Company or any other named executive officer.
2.8 “Code” means the Internal Revenue Code of 1986, as amended from time to time. References to a particular section of the Code include references to regulations and rulings thereunder and to successor provisions.
2.9 “Committee” has the meaning set forth in Section 3.1
2.10 “Company” means ABit Group, Inc.,, an exempted company limited by shares and incorporated under the laws of the British Virgin Islands.
2.11 “Compensation Committee” means the compensation committee of the Board.
2.12 “Corporate Transaction” has the meaning set forth in Section 4.2(b).
2.13 “Deferred Shares” means a right, granted under Article 10, to receive Shares at the end of a specified deferral period.
2.14 “Disability” or “Disabled” means, unless otherwise defined in an Award Agreement, or as otherwise determined under procedures established by the Committee for purposes of the Plan, a Grantee is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months.
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2.15 “Dividend Equivalent” means a right to receive payments equal to dividends or property, if and when paid or distributed, on a specified number of Shares.
2.16 “Effective Date” has the meaning set forth in Section 1.1.
2.17 “Eligible Person” means any individual who is an employee (including any officer) of, a non-employee consultant to, or a Non-Employee Director of, the Company or any Subsidiary; provided, however, that solely with respect to the grant of an Incentive Share Option, an Eligible Person shall be any employee (including any officer) of the Company or any Subsidiary. Notwithstanding the foregoing, an Eligible Person shall also include an individual who is expected to become an employee to, non-employee consultant of or Non-Employee Director of the Company or any Subsidiary within a reasonable period of time after the grant of an Award (other than an Incentive Share Option); provided that any Award granted to any such individual shall be automatically terminated and cancelled without consideration if the individual does not begin performing services for the Company or any Subsidiary within twelve (12) months after the Grant Date. Solely for purposes of Section 5.6(b), current or former employees or non-employee directors of, or consultants to, an Acquired Entity who receive Substitute Awards in substitution for Acquired Entity Awards shall be considered Eligible Persons under this Plan with respect to such Substitute Awards.
2.18 “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time. References to a particular section of the Exchange Act include references to successor provisions.
2.19 “Exercise Price” means (a) with respect to an Option, the price at which a Share may be purchased by a Grantee pursuant to such Option or (b) with respect to an SAR, the price established at the time an SAR is granted pursuant to Article 7, which is used to determine the amount, if any, of the payment due to a Grantee upon exercise of the SAR. Notwithstanding the foregoing, the Exercise Price may never be less than the par value per Share of US$0.001.
2.20 “Fair Market Value” means, as of any date, unless otherwise specifically provided in an Award Agreement, the value of Shares determined as follows:
(a) If the Shares are listed on one or more established and regulated securities exchanges, national market systems or automated quotation systems on which Shares are listed, quoted or traded, Fair Market Value means a price that is based on the opening, closing, actual, high, low, or the arithmetic mean of selling prices of a Share reported on the principal exchange or system on which the Shares are traded on the applicable date or the preceding trading day.
(b) If the Shares are traded over the counter at the time a determination of Fair Market Value is required to be made hereunder, Fair Market Value shall be deemed to be equal to the arithmetic mean between the reported high and low or closing bid and asked prices of a Share on the applicable date, or if no such trades were made that day then the most recent date on which Shares were publicly traded.
(c) In the event Shares are not publicly traded at the time a determination of their value is required to be made hereunder, the determination of their Fair Market Value shall be made by the Committee in such manner as it deems appropriate.
2.21 “Grant Date” means the date on which an Award is granted or such later date as specified in advance by the Committee.
2.22 “Grantee” means a person who has been granted an Award.
2.23 “Incentive Share Option” means an Option that is intended to meet the requirements of Section 422 of the Code.
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2.24 “Including” or “includes” means “including, without limitation,” or “includes, without limitation,” respectively.
2.26 “Non-Employee Director” means a member of the Board who is not an employee of the Company or any Subsidiary.
2.28 “Option” means an option granted under Article 6 of the Plan.
2.29 “Other Share-Based Award” means a right, granted under Article 13 hereof, that relates to or is valued by reference to Shares or other Awards relating to Shares.
2.30 “Performance Period” means, with respect to an Award of Performance Shares or Performance Share Units, the period of time during which the performance vesting conditions applicable to such Award must be satisfied.
2.31 “Performance Share” and “Performance Share Unit” have the respective meanings set forth in Article 9.
2.32 “Period of Restriction” means the period during which Restricted Shares are subject to forfeiture if the conditions specified in the Award Agreement are not satisfied.
2.33 “Person” means any individual, sole proprietorship, partnership, joint venture, limited liability company, trust, unincorporated organization, association, corporation, institution, public benefit corporation, entity or government instrumentality, division, agency, body or department.
2.34 “Restricted Shares” means Shares, granted under Article 8, that are both subject to forfeiture and are nontransferable if the Grantee does not satisfy the conditions specified in the Award Agreement applicable to such Shares.
2.35 “Restricted Share Units” are rights, granted under Article 10, to receive Shares if the Grantee satisfies the conditions specified in the Award Agreement applicable to such rights.
2.36 “Rule 16b-3” means Rule 16b-3 promulgated by the SEC under the Exchange Act, as amended from time to time, together with any successor rule.
2.37 “SEC” means the United States Securities and Exchange Commission, or any successor thereto.
2.38 “Section 16 Non-Employee Director” means a member of the Board who satisfies the requirements to qualify as a “non-employee director” under Rule 16b-3.
2.39 “Section 16 Person” means a person who is subject to potential liability under Section 16(b) of the Exchange Act with respect to transactions involving equity securities of the Company.
2.40 “Share” means an ordinary share of the Company, par value US$0.001, and such other securities of the Company, as may be substituted or resubstituted for Shares pursuant to Section 4.2 hereof.
2.41 “Share Appreciation Right” or “SAR” means an Award granted under Article 7 of the Plan.
2.42 “Subsidiary” means any corporation or other entity, including but not limited to partnerships, limited liability companies, exempted companies and joint ventures, with respect to which the Company, directly or indirectly, owns as applicable (a) shares possessing more than fifty percent (50%) of the total combined voting power of all classes of shares entitled to vote, or more than fifty percent (50%) of the total value of all shares of all classes of shares of such corporation, or (b) an aggregate of more than fifty percent (50%) of the profits interest or capital interest of a non-corporate entity.
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2.43 “Surviving Company” means (a) the surviving entity in any merger, consolidation or similar transaction, involving the Company (including the Company if the Company is the surviving entity), (b) or the direct or indirect parent company of such surviving entity or (c) the direct or indirect parent company of the Company following a sale of substantially all of the issued and outstanding Shares of the Company.
2.44 “Term” of any Option or SAR means the period beginning on the Grant Date of an Option or SAR and ending on the date such Option or SAR expires, terminates or is cancelled. No Option or SAR granted under this Plan shall have a Term exceeding 10 years.
2.45 “Termination of Affiliation” occurs on the first day on which an individual is for any reason no longer performing services for the Company or any Subsidiary in the capacity of an employee of, a non-employee consultant to, or a Non-Employee Director of, the Company or any Subsidiary or with respect to an individual who is an employee of, a non-employee consultant to or a Non-Employee Director of a Subsidiary, the first day on which such entity ceases to be a Subsidiary of the Company unless such individual continues to perform Services for the Company or another Subsidiary without interruption after such entity ceases to be a Subsidiary.
Article 3.
Administration
3.1 Committee.
(a) Subject to Article 14, and to subsection (b) and to Section 3.2, the Plan shall be administered by the Compensation Committee. In the event that the Board determines that the Compensation Committee shall not be the administrator of the Plan, the term “Committee” as used hereunder shall (except as provided for in subsection (b)) mean the committee of the Board designated to administer the Plan, or the full Board should the Board so designate. The Committee may delegate to the CEO any or all of the authority of the Committee with respect to Awards to Grantees other than Grantees who are executive officers, Non-Employee Directors, or Section 16 Persons at the time any such delegated authority is exercised.
(b) Unless the context requires otherwise, any references herein to “Committee” include references to the CEO to the extent the CEO has been delegated authority pursuant to subsection (a); provided that (i) for purposes of Awards to Non-Employee Directors, “Committee” shall include only the full Board, and (ii) for purposes of Awards intended to comply with Rule 16b-3, the “Committee” shall include only the Compensation Committee.
3.2 Powers of Committee. Subject to and consistent with the provisions of the Plan (including Article 14), the Committee has full and final authority and sole discretion as follows; provided that any such authority or discretion exercised with respect to a specific Non-Employee Director shall be approved by a majority of the members of the Board, but excluding the Non-Employee Director with respect to whom such authority or discretion is exercised:
(a) to determine when, to whom and in what types and amounts Awards should be granted;
(b) to grant Awards to Eligible Persons in any number and to determine the terms and conditions applicable to each Award (including the number of Shares or the amount of cash or other property to which an Award will relate, any Exercise Price or purchase price, any limitation or restriction, any schedule for or performance conditions relating to the earning of the Award or the lapse of limitations, forfeiture restrictions, restrictions on exercisability or transferability, any performance goals including those relating to the Company and/or a Subsidiary and/or any division thereof and/or an individual, and/or vesting based on the passage of time, based in each case on such considerations as the Committee shall determine);
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(c) to determine the benefit payable, including where applicable the number of Shares issued, under any Performance Share Unit, Performance Share, Dividend Equivalent, Other Share-Based Award or Cash Incentive Award and to determine whether any performance or vesting conditions have been satisfied;
(d) to determine whether or not specific Awards shall be granted in connection with other specific Awards, and if so, whether they shall be exercisable cumulatively with, or alternatively to, such other specific Awards and all other matters to be determined in connection with an Award;
(e) to determine the Term of any Option or SAR;
(f) to determine the amount, if any, that a Grantee shall pay for Restricted Shares, whether to permit or require the payment of cash dividends thereon to be deferred and the terms related thereto, when Restricted Shares (including Restricted Shares acquired upon the exercise of an Option) shall be forfeited and whether such shares shall be held in escrow;
(g) to determine whether, to what extent and under what circumstances an Award may be settled in, or the exercise price of an Award may be paid in, cash, Shares, other Awards or other property, or an Award may be accelerated, vested, canceled, forfeited or surrendered or any terms of the Award may be waived, and to accelerate the exercisability of, and to accelerate or waive any or all of the terms and conditions applicable to, any Award or any group of Awards for any reason and at any time;
(h) to determine with respect to Awards granted to Eligible Persons whether, to what extent and under what circumstances cash, Shares, other Awards, other property and other amounts payable with respect to an Award will be deferred, either at the election of the Grantee or automatically pursuant to the terms of the Award Agreement;
(i) to offer to exchange or buy out any previously granted Award for a payment in cash, Shares or other Award;
(j) to construe and interpret the Plan and to make all determinations, including factual determinations, necessary or advisable for the administration of the Plan;
(k) to make, amend, suspend, waive and rescind rules and regulations relating to the Plan;
(l) to appoint such agents as the Committee may deem necessary or advisable to administer the Plan;
(m) to determine the terms and conditions of all Award Agreements applicable to Eligible Persons (which need not be identical) and, with the consent of the Grantee, to amend any such Award Agreement at any time, among other things, to permit transfers of such Awards to the extent permitted by the Plan; provided that the consent of the Grantee shall not be required for any amendment (i) which does not adversely affect the rights of the Grantee, or (ii) which is necessary or advisable (as determined by the Committee) to carry out the purpose of the Award as a result of any new Applicable Law or change in an existing Applicable Law, or (iii) to the extent the Award Agreement specifically permits amendment without consent;
(n) to cancel, with the consent of the Grantee, outstanding Awards and to grant new Awards in substitution therefor;
(o) to impose such additional terms and conditions upon the grant, exercise or retention of Awards as the Committee may, before or concurrently with the grant thereof, deem appropriate, including limiting the percentage of Awards which may from time to time be exercised by a Grantee;
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(p) to make adjustments in the terms and conditions of, and the criteria in, Awards in recognition of unusual or nonrecurring events (including events described in Section 4.2) affecting the Company or a Subsidiary or the financial statements of the Company or a Subsidiary, or in response to changes in Applicable Law, regulations or accounting principles;
(q) to correct any defect or supply any omission or reconcile any inconsistency, and to construe and interpret the Plan, the rules and regulations, and Award Agreement or any other instrument entered into or relating to an Award under the Plan; and
(r) to take any other action with respect to any matters relating to the Plan for which it is responsible and to make all other decisions and determinations as may be required under the terms of the Plan or as the Committee may deem necessary or advisable for the administration of the Plan.
Any action of the Committee with respect to the Plan shall be final, conclusive and binding on all persons, including the Company, its Subsidiaries, any Grantee, any person claiming any rights under the Plan from or through any Grantee, and shareholders. If not specified in the Plan, the time at which the Committee must or may make any determination shall be determined by the Committee, and any such determination may thereafter be modified by the Committee. The express grant of any specific power to the Committee, and the taking of any action by the Committee, shall not be construed as limiting any power or authority of the Committee. Subject to Section 3.1(b), the Committee may delegate to officers of the Company or any Subsidiary the authority, subject to such terms as the Committee shall determine, to perform specified functions under the Plan.
3.3 No Repricings. Notwithstanding any provision in Section 3.2 to the contrary, the terms of any outstanding Option or SAR may not be amended to reduce the Exercise Price of such Option or SAR or cancel any outstanding Option or SAR in exchange for other Options or SARs with an Exercise Price that is less than the Exercise Price of the cancelled Option or SAR or for any cash payment (or Shares having a Fair Market Value) in an amount that exceeds the excess of the Fair Market Value of the Shares underlying such cancelled Option or SAR over the aggregate Exercise Price of such Option or SAR or for any other Award, without shareholder approval; provided, however, that the restrictions set forth in this Section 3.3, shall not apply (i) unless the Company has a class of shares that is registered under Section 12 of the Exchange Act or (ii) to any adjustment allowed under to Section 4.2.
Article 4.
Shares Subject to the Plan
4.1 Number of Shares Available for Grants.
(a) Subject to adjustment as provided in Section 4.2 and except as provided in Section 5.6(b), the maximum number of Shares hereby reserved for issuance under the Plan (including Incentive Share Options) shall be 3,500,000 Shares.
(b) If any Shares subject to an Award granted hereunder (other than a Substitute Award granted pursuant to Section 5.6(b)) are forfeited or such Award otherwise terminates without payment or delivery of such Shares, the Shares subject to such Award, to the extent of any such forfeiture or termination, shall again be available for grant under the Plan except where otherwise specified hereunder. For avoidance of doubt, however, if any Shares subject to an Award granted hereunder are withheld or applied as payment in connection with the exercise of an Award or the withholding or payment of taxes related thereto (“Returned Shares”), such Returned Shares will be treated as having been delivered for purposes of determining the maximum number of Shares available for grant under the Plan and shall not again be treated as available for grant under the Plan. Moreover, the number of Shares available for issuance under the Plan may not be increased through the Company’s purchase of Shares on the open market with the proceeds obtained from the exercise of any Options granted hereunder. Upon settlement of an SAR, the number of Shares underlying the portion of the SAR that is exercised will be treated as having been delivered for purposes of determining the maximum number of Shares available for grant under the Plan and shall not again be treated as available for issuance under the Plan.
(c) Shares issued pursuant to the Plan may be, in whole or in part, authorized and unissued Shares, or treasury Shares, including Shares repurchased by the Company for purposes of the Plan. Additionally, at the discretion of the Committee, any Shares distributed pursuant to an Award may be represented by American Depositary Shares.
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4.2 Adjustments in Authorized Shares and Awards; Corporate Transaction, Liquidation or Dissolution.
(a) Adjustment in Authorized Shares and Awards. In the event that the Committee determines that any dividend or other distribution (whether in the form of cash, equity, or other property), recapitalization, forward or reverse share split, subdivision, consolidation or reduction of capital, reorganization, merger, consolidation, scheme of arrangement, split-up, spin-off or combination involving the Company or repurchase or exchange of Shares or other securities of the Company or other rights to purchase Shares or other securities of the Company, or other similar corporate transaction or event affects the Shares such that any adjustment is determined by the Committee to be appropriate in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan, then the Committee shall, in such manner as it may deem equitable, adjust any or all of (i) the number and type of Shares (or other securities or property) with respect to which Awards may be granted, (ii) the number and type of Shares (or other securities or property) subject to outstanding Awards, (iii) the Exercise Price with respect to any Option or SAR or, if deemed appropriate, make provision for a cash payment to the holder of an outstanding Award, and (iv) the number and kind of Shares of outstanding Restricted Shares, or the Shares underlying any other form of Award. Notwithstanding the foregoing, no such adjustment shall be authorized with respect to any Options or SARs to the extent that such adjustment would cause the Option or SAR to violate Section 424(a) of the Code or otherwise subject any Grantee to taxation under Section 409A of the Code; and provided further that the number of Shares subject to any Award denominated in Shares shall always be a whole number.
(b) Merger, Consolidation or Similar Corporate Transaction. In the event of a merger or consolidation of the Company with or into another entity or a sale of substantially all of the Shares of the Company (a “Corporate Transaction”), unless an outstanding Award is assumed by the Surviving Company or replaced with an equivalent Award granted by the Surviving Company in substitution for such outstanding Award, the Committee shall cancel any outstanding Awards that are not vested and non-forfeitable as of the consummation of such Corporate Transaction (unless the Committee accelerates the vesting of any such Awards) and with respect to any vested and non-forfeitable Awards, the Committee may either (i) allow all Grantees to exercise such Awards of Options and SARs within a reasonable period prior to the consummation of the Corporate Transaction and cancel any outstanding Options or SARs that remain unexercised upon consummation of the Corporate Transaction, or (ii) cancel any or all of such outstanding Awards in exchange for a payment (in cash, or in securities or other property) in an amount equal to the amount that the Grantee would have received (net of the Exercise Price with respect to any Options or SARs) if such vested Awards were settled or distributed or such vested Options and SARs were exercised immediately prior to the consummation of the Corporate Transaction. Notwithstanding the foregoing, if an Option or SAR is not assumed by the Surviving Company or replaced with an equivalent Award issued by the Surviving Company and the Exercise Price with respect to any outstanding Option or SAR exceeds the Fair Market Value of the Shares immediately prior to the consummation of the Corporation Transaction, such Awards shall be cancelled without any payment to the Grantee.
(c) Liquidation, Winding-Up or Dissolution of the Company. In the event of the proposed liquidation, winding-up or dissolution of the Company, each Award will terminate immediately prior to the consummation of such proposed action, unless otherwise provided by the Committee. Additionally, the Committee may, in the exercise of its sole discretion, cause Awards to be vested and non-forfeitable and cause any conditions on any such Award to lapse, as to all or any part of such Award, including Shares as to which the Award would not otherwise be exercisable or non-forfeitable and allow all Grantees to exercise such Awards of Options and SARs within a reasonable period prior to the consummation of such proposed action. Any Awards that remain unexercised upon consummation of such proposed action shall be cancelled.
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Article 5.
Eligibility and General Conditions of Awards
5.1 Eligibility. The Committee may in its discretion grant Awards to any Eligible Person, whether or not he or she has previously received an Award; provided, however, that all Awards made to Non-Employee Directors shall be determined by the Board in its sole discretion.
5.2 Award Agreement. To the extent not set forth in the Plan, the terms and conditions of each Award shall be set forth in an Award Agreement.
5.3 General Terms and Termination of Affiliation. The Committee may impose on any Award or the exercise or settlement thereof, at the date of grant or, subject to the provisions of Section 15.2, thereafter, such additional terms and conditions not inconsistent with the provisions of the Plan as the Committee shall determine, including terms requiring forfeiture, acceleration or pro-rata acceleration of Awards in the event of a Termination of Affiliation by the Grantee. Awards may be granted for no consideration other than prior and future services. Except as set forth in an Award Agreement or as otherwise determined by the Committee, (a) all Options and SARs that are not vested and exercisable at the time of a Grantee’s Termination of Affiliation, and any other Awards that remain subject to a risk of forfeiture or which are not otherwise vested at the time of the Grantee’s Termination of Affiliation shall be forfeited to the Company and (b) all outstanding Options and SARs not previously exercised shall expire three months after the Grantee’s Termination of Affiliation. Notwithstanding the foregoing, the Committee may not take any actions hereunder, and no Awards shall be granted, that would violate any Applicable Law.
5.4 Nontransferability of Awards.
(a) Each Award and each right under any Award shall be exercisable only by the Grantee during the Grantee’s lifetime, or, if permissible under Applicable Law, by the Grantee’s guardian or legal representative.
(b) No Award (prior to the time, if applicable, Shares are delivered in respect of such Award), and no right under any Award, may be assigned, alienated, pledged, mortgaged, encumbered, attached, sold or otherwise transferred or encumbered by a Grantee otherwise than by will or by the laws of descent and distribution (or in the case of Restricted Shares, to the Company), and any such purported assignment, alienation, pledge, attachment, sale, transfer or encumbrance shall be void and unenforceable against the Company or any Subsidiary; provided that the designation of a beneficiary to receive benefits in the event of the Grantee’s death shall not constitute an assignment, alienation, pledge, attachment, sale, transfer or encumbrance.
(c) Notwithstanding subsections (a) and (b) above, to the extent provided in the Award Agreement or as otherwise approved by the Committee, Options (other than Incentive Share Options) and Restricted Shares, may be transferred, without consideration, to a Permitted Transferee. For this purpose, a “Permitted Transferee” in respect of any Grantee means any member of the Immediate Family of such Grantee, any trust of which all of the primary beneficiaries are such Grantee or members of his or her Immediate Family, or any partnership (including limited liability companies and similar entities) of which all of the partners or members are such Grantee or members of his or her Immediate Family; and the “Immediate Family” of a Grantee means the Grantee’s spouse, children, stepchildren, grandchildren, parents, stepparents, siblings, grandparents, nieces and nephews. Such Option may be exercised by such transferee in accordance with the terms of the Award Agreement. If so determined by the Committee, a Grantee may, in the manner established by the Committee, designate a beneficiary or beneficiaries to exercise the rights of the Grantee, and to receive any distribution with respect to any Award upon the death of the Grantee. A transferee, beneficiary, guardian, legal representative or other person claiming any rights under the Plan from or through any Grantee shall be subject to and consistent with the provisions of the Plan and any applicable Award Agreement, except to the extent the Plan and Award Agreement otherwise provide with respect to such persons, and to any additional restrictions or limitations deemed necessary or appropriate by the Committee.
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5.5 Cancellation and Rescission of Awards. Unless the Award Agreement specifies otherwise, the Committee may cancel, rescind, suspend, withhold, or otherwise limit or restrict any unexercised Award at any time if the Grantee is not in compliance with all applicable provisions of the Award Agreement and the Plan or if the Grantee has a Termination of Affiliation.
5.6 Stand-Alone, Tandem and Substitute Awards.
(a) Awards granted under the Plan may, in the discretion of the Committee, be granted either alone or in addition to, in tandem with, or in substitution for, any other Award granted under the Plan unless such tandem or substitution Award would subject the Grantee to tax penalties imposed under Section 409A of the Code. If an Award is granted in substitution for another Award or any non-Plan award or benefit, the Committee shall require the surrender of such other Award or non-Plan award or benefit in consideration for the grant of the new Award. Awards granted in addition to or in tandem with other Awards or non-Plan awards or benefits may be granted either at the same time as or at a different time from the grant of such other Awards or non-Plan awards or benefits; provided, however, that if any SAR is granted in tandem with an Incentive Share Option, such SAR and Incentive Share Option must have the same Grant Date, Term and the Exercise Price of the SAR may not be less than the Exercise Price of the Incentive Share Option.
(b) The Committee may, in its discretion and on such terms and conditions as the Committee considers appropriate in the circumstances, grant Awards under the Plan (“Substitute Awards”) in substitution for Shares and Share-based awards (“Acquired Entity Awards”) held by current or former employees or non-employee directors of, or consultants to, another corporation or entity who become Eligible Persons as the result of a merger or consolidation of the employing corporation or other entity (the “Acquired Entity”) with the Company or a Subsidiary or the acquisition by the Company or a Subsidiary of property or shares of the Acquired Entity immediately prior to such merger, consolidation or acquisition in order to preserve for the Grantee the economic value of all or a portion of such Acquired Entity Award at such price as the Committee determines necessary to achieve preservation of economic value. The limitations in Section 4.1(a) on the number of Shares reserved or available for grants shall not apply to Substitute Awards granted under this Section 5.6(b).
5.7 Compliance with Rule 16b-3. The provisions of this Section 5.7 will not apply unless and until the Company has a class of Shares that is registered under Section 12 of the Exchange Act and fails to qualify as a foreign private issuer as defined therein.
(a) Six-Month Holding Period Advice. Unless a Grantee could otherwise dispose of or exercise a derivative security or dispose of Shares issued under the Plan without incurring liability under Section 16(b) of the Exchange Act, the Committee may advise or require a Grantee to comply with the following in order to avoid incurring liability under Section 16(b) of the Exchange Act: (i) at least six months must elapse from the date of acquisition of a derivative security under the Plan to the date of disposition of the derivative security (other than upon exercise or conversion) or its underlying equity security, and (ii) Shares granted or awarded under the Plan other than upon exercise or conversion of a derivative security must be held for at least six months from the date of grant of an Award.
(b) Reformation to Comply with Exchange Act Rules. To the extent the Committee determines that a grant or other transaction by a Section 16 Person should comply with applicable provisions of Rule 16b-3 (except for transactions exempted under alternative Exchange Act rules), the Committee shall take such actions as necessary to make such grant or other transaction so comply, and if any provision of this Plan or any Award Agreement relating to a given Award does not comply with the requirements of Rule 16b-3 as then applicable to any such grant or transaction, such provision will be construed or deemed amended, if the Committee so determines, to the extent necessary to conform to the then applicable requirements of Rule 16b-3.
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(c) Rule 16b-3 Administration. Any function relating to a Section 16 Person shall be performed solely by the Committee or the Board if necessary to ensure compliance with applicable requirements of Rule 16b-3, to the extent the Committee determines that such compliance is desired. Each member of the Committee or person acting on behalf of the Committee shall be entitled to, in good faith, rely or act upon any report or other information furnished to him by any officer, manager or other employee of the Company or any Subsidiary, the Company’s independent certified public accountants or any executive compensation consultant or attorney or other professional retained by the Company to assist in the administration of the Plan.
5.8 Deferral of Award Payouts. The Committee may permit a Grantee to defer, or if and to the extent specified in an Award Agreement require the Grantee to defer, receipt of the payment of cash or the delivery of Shares that would otherwise be due by virtue of the lapse or waiver of restrictions with respect to Restricted Share Units, the satisfaction of any requirements or goals with respect to Performance Share Units or Performance Shares, the lapse or waiver of the deferral period for Deferred Shares, or the lapse or waiver of restrictions with respect to Other Share-Based Awards or Cash Incentive Awards. If the Committee permits such deferrals, the Committee shall establish rules and procedures for making such deferral elections and for the payment of such deferrals. Except as otherwise provided in an Award Agreement, any payment or any Shares that are subject to such deferral shall be made or delivered to the Grantee as specified in the Award Agreement or pursuant to the Grantee’s deferral election.
Article 6.
Share Options
6.1 Grant of Options. Subject to and consistent with the provisions of the Plan, Options may be granted to any Eligible Person in such number, and upon such terms, and at any time and from time to time as shall be determined by the Committee.
6.2 Award Agreement. Each Option grant shall be evidenced by an Award Agreement that shall specify the Exercise Price, the Term of the Option, the number of Shares to which the Option pertains, the time or times at which such Option shall be exercisable and such other provisions as the Committee shall determine.
6.3 Option Exercise Price. The Exercise Price of an Option under this Plan shall be determined in the sole discretion of the Committee but may not be less than 100% of the Fair Market Value of a Share on the Grant Date.
6.4 Grant of Incentive Share Options. At the time of the grant of any Option, the Committee may in its discretion designate that such Option shall be made subject to additional restrictions to permit it to qualify as an Incentive Share Option. Any Option designated as an Incentive Share Option:
(a) shall be granted only to an employee of the Company or a Subsidiary;
(b) shall have an Exercise Price of not less than 100% of the Fair Market Value of a Share on the Grant Date, and, if granted to a person who owns Shares (including Shares treated as owned under Section 424(d) of the Code) possessing more than 10% of the total combined voting power of all classes of shares of the Company or any Subsidiary (a “More Than 10% Owner”), have an Exercise Price not less than 110% of the Fair Market Value of a Share on its Grant Date;
(c) shall be for a period of not more than 10 years (five years if the Grantee is a More Than 10% Owner) from its Grant Date, and shall be subject to earlier termination as provided herein or in the applicable Award Agreement;
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(d) shall not have an aggregate Fair Market Value (as of the Grant Date) of the Shares with respect to which Incentive Share Options (whether granted under the Plan or any other share option plan of the Grantee’s employer or any parent or Subsidiary (“Other Plans”)) are exercisable for the first time by such Grantee during any calendar year (“Current Grant”), determined in accordance with the provisions of Section 422 of the Code, which exceeds US$100,000 (the “$100,000 Limit”);
(e) shall, if the aggregate Fair Market Value of the Shares (determined on the Grant Date) with respect to the Current Grant and all Incentive Share Options previously granted under the Plan and any Other Plans which are exercisable for the first time during a calendar year (“Prior Grants”) would exceed the $100,000 Limit, be, as to the portion in excess of the $100,000 Limit, exercisable as a separate option that is not an Incentive Share Option at such date or dates as are provided in the Current Grant;
(f) shall require the Grantee to notify the Committee of any disposition of any Shares issued pursuant to the exercise of the Incentive Share Option under the circumstances described in Section 421(b) of the Code (relating to holding periods and certain disqualifying dispositions) (“Disqualifying Disposition”) within 10 days of such a Disqualifying Disposition;
(g) shall by its terms not be assignable or transferable other than by will or the laws of descent and distribution and may be exercised, during the Grantee’s lifetime, only by the Grantee; provided, however, that the Grantee may, to the extent provided in the Plan in any manner specified by the Committee, designate in writing a beneficiary to exercise his or her Incentive Share Option after the Grantee’s death; and
(h) shall, if such Option nevertheless fails to meet the foregoing requirements, or otherwise fails to meet the requirements of Section 422 of the Code for an Incentive Share Option, be treated for all purposes of this Plan, except as otherwise provided in subsections (d) and (e) above, as an Option that is not an Incentive Share Option.
Notwithstanding the foregoing and Section 3.2, the Committee may, without the consent of the Grantee, at any time before the exercise of an Option (whether or not an Incentive Share Option), take any action necessary to prevent such Option from being treated as an Incentive Share Option.
6.5 Payment of Exercise Price. Except as otherwise provided in an Award Agreement, Options shall be exercised by the delivery of a written notice of exercise to the Company, setting forth the number of Shares with respect to which the Option is to be exercised, accompanied by full payment for the Shares made by any one or more of the following means:
(a) cash, personal check or wire transfer;
(b) with the approval of the Committee, delivery of Shares owned by the Grantee prior to exercise, valued at Fair Market Value on the date of exercise;
(c) with the approval of the Committee, Shares acquired upon the exercise of such Option, such Shares valued at Fair Market Value on the date of exercise;
(d) with the approval of the Committee, Restricted Shares held by the Grantee prior to the exercise of the Option, valued at Fair Market Value on the date of exercise; or
(e) subject to Applicable Law (including the prohibited loan provisions of Section 402 of the Sarbanes Oxley Act of 2002 if applicable), through the sale of the Shares acquired on exercise of the Option through a broker-dealer to whom the Grantee has submitted an irrevocable notice of exercise and irrevocable instructions to deliver promptly to the Company the amount of sale proceeds sufficient to pay for such Shares, together with, if requested by the Company, the amount of federal, state, local or foreign withholding taxes payable by Grantee by reason of such exercise.
The Committee may in its discretion specify that, if any Restricted Shares (“Tendered Restricted Shares”) are used to pay the Exercise Price, (x) all the Shares acquired on exercise of the Option shall be subject to the same restrictions as the Tendered Restricted Shares, determined as of the date of exercise of the Option, or (y) a number of Shares acquired on exercise of the Option equal to the number of Tendered Restricted Shares shall be subject to the same restrictions as the Tendered Restricted Shares, determined as of the date of exercise of the Option.
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Article 7.
Share Appreciation Rights
7.1 Issuance. Subject to and consistent with the provisions of the Plan, the Committee, at any time and from time to time, may grant SARs to any Eligible Person either alone or in addition to other Awards granted under the Plan. Such SARs may, but need not, be granted in connection with a specific Option granted under Article 6. The Committee may impose such conditions or restrictions on the exercise of any SAR as it shall deem appropriate.
7.2 Award Agreements. Each SAR grant shall be evidenced by an Award Agreement in such form as the Committee may approve and shall contain such terms and conditions not inconsistent with other provisions of the Plan as shall be determined from time to time by the Committee.
7.3 SAR Exercise Price. The Exercise Price of a SAR shall be determined by the Committee in its sole discretion; provided that the Exercise Price shall not be less than 100% of the Fair Market Value of a Share on the date of the grant of the SAR.
7.4 Exercise and Payment. Upon the exercise of an SAR, a Grantee shall be entitled to receive payment from the Company in an amount determined by multiplying:
(a) The excess of the Fair Market Value of a Share on the date of exercise over the Exercise Price; by
(b) The number of Shares with respect to which the SAR is exercised.
SARs shall be deemed exercised on the date written notice of exercise in a form acceptable to the Committee is received by the Company. The Company shall make payment in respect of any SAR within five (5) days of the date the SAR is exercised. Any payment by the Company in respect of a SAR may be made in cash, Shares, other property, or any combination thereof, as the Committee, in its sole discretion, shall determine or, to the extent permitted under the terms of the applicable Award Agreement, at the election of the Grantee.
Article 8.
Restricted Shares
8.1 Grant of Restricted Shares. Subject to and consistent with the provisions of the Plan, the Committee, at any time and from time to time, may grant Restricted Shares to any Eligible Person in such amounts as the Committee shall determine.
8.2 Award Agreement. Each grant of Restricted Shares shall be evidenced by an Award Agreement that shall specify the Period(s) of Restriction, the number of Restricted Shares granted, and such other provisions as the Committee shall determine. The Committee may impose such conditions and/or restrictions on any Restricted Shares granted pursuant to the Plan as it may deem advisable, including restrictions based upon the achievement of specific performance goals, time-based restrictions on vesting following the attainment of the performance goals, and/or restrictions under applicable securities laws; provided that such conditions and/or restrictions may lapse, if so determined by the Committee, in the event of the Grantee’s Termination of Affiliation due to death, Disability, or involuntary termination by the Company or a Subsidiary without Cause.
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8.3 Consideration for Restricted Shares. The Committee shall determine the amount, if any, that a Grantee shall pay for Restricted Shares.
8.4 Effect of Forfeiture. If Restricted Shares are forfeited, and if the Grantee was required to pay for such shares or acquired such Restricted Shares upon the exercise of an Option, the Grantee shall be deemed to have resold such Restricted Shares to the Company at a price equal to the lesser of (x) the amount paid by the Grantee for such Restricted Shares, or (y) the Fair Market Value of a Share on the date of such forfeiture. The Company shall pay to the Grantee the deemed sale price as soon as is administratively practical. Such Restricted Shares shall cease to be outstanding and shall no longer confer on the Grantee thereof any rights as a shareholder of the Company, from and after the date of the event causing the forfeiture, whether or not the Grantee accepts the Company’s tender of payment for such Restricted Shares.
8.5 Escrow; Legends. The Committee may provide that the certificates (if any) for any Restricted Shares (x) shall be held (together with a share transfer power executed in blank by the Grantee) in escrow by the Company until such Restricted Shares become non-forfeitable or are forfeited and/or (y) shall bear an appropriate legend restricting the transfer of such Restricted Shares under the Plan. If any Restricted Shares become non-forfeitable, the Company shall cause certificates (if any) for such shares to be delivered without such legend.
Article 9.
Performance Share Units and Performance Shares
9.1 Grant of Performance Share Units and Performance Shares. Subject to and consistent with the provisions of the Plan, Performance Share Units or Performance Shares may be granted to any Eligible Person in such amounts and upon such terms, and at any time and from time to time, as shall be determined by the Committee. The Committee shall have the authority, at the time of grant of any Award under this Plan, to designate such Award as an Award intended to qualify as “performance-based compensation” under Section 162(m) of the Code. The Committee shall also have the authority to make an award of a cash bonus to any Grantee and designate such Award as an Award intended to qualify as “performance-based compensation” under Section 162(m) of the Code.
9.2 Value/Performance Goals. The Committee shall set performance goals in its discretion which, depending on the extent to which they are met, will determine the number or value of Performance Units or Performance Shares that will be paid to the Grantee.
(a) Performance Unit. Each Performance Unit shall have an initial value that is established by the Committee at the time of grant.
(b) Performance Share. Each Performance Share shall have an initial value equal to the Fair Market Value of a Share on the date of grant.
9.3 Earning of Performance Share Units and Performance Shares.
(a) After the applicable Performance Period has ended, the holder of Performance Units or Performance Shares shall be entitled to payment based on the level of achievement of performance goals set by the Committee. In determining the actual amount of an individual Grantee’s performance compensation Award for a Performance Period, the Committee may reduce or eliminate the amount of the performance compensation Award earned during the Performance Period through the use of negative discretion (consistent with Section 162(m) of the Code) if, in its sole judgment, such reduction or elimination is appropriate. The Committee shall not have the discretion, except as is otherwise provided in this Plan, to (A) grant or provide payment in respect of performance compensation Awards for a Performance Period if the performance goals for such Performance Period have not been attained; or (B) increase a performance compensation Award above the applicable overall share issuance limitations set forth in this Plan.
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(b) The performance criteria that will be used to establish the performance goal(s) required to be achieved for the vesting of Performance Share Units or Performance Shares shall be based on the attainment of specific levels of performance of the Company and/or one or more Affiliates, divisions or operational units, or any combination of the foregoing, as determined by the Committee, which criteria will be based on one or more of the following business criteria or any combination thereof: (i) revenue; (ii) sales; (iii) profit (net profit, gross profit, operating profit, economic profit, profit margins or other corporate profit measures); (iv) earnings (EBIT, EBITDA, earnings per share, or other corporate earnings measures); (v) net income (before or after taxes, operating income or other income measures); (vi) cash (cash flow, cash generation or other cash measures); (vii) stock price or performance; (viii) total stockholder return (stock price appreciation plus reinvested dividends divided by beginning share price); (ix) economic value added; (x) return measures (including, but not limited to, return on assets, capital, equity, investments or sales, and cash flow return on assets, capital, equity, or sales); (xi) market share; (xii) improvements in capital structure; (xiii) expenses (expense management, expense ratio, expense efficiency ratios or other expense measures); (xiv) business expansion or consolidation (acquisitions and divestitures); (xv) internal rate of return or increase in net present value; (xvi) working capital targets relating to inventory and/or accounts receivable; (xvii) inventory management; (xviii) service or product delivery or quality; (xix) employee retention; (xx) safety standards; (xxi) productivity measures; (xxii) cost reduction measures; and/or (xxiii) strategic plan development and implementation.
(c) At the discretion of the Committee, the settlement of Performance Share Units or Performance Shares may be in cash, Shares of equivalent value, or in some combination thereof, as set forth in the Award Agreement.
(d) If a Grantee is promoted, demoted or transferred to a different business unit of the Company during a Performance Period, then, to the extent the Committee determines that the Award, the performance goals, or the Performance Period are no longer appropriate, the Committee may adjust, change, eliminate or cancel the Award, the performance goals, or the applicable Performance Period, as it deems appropriate in order to make them appropriate and comparable to the initial Award, the performance goals, or the Performance Period.
(e) At the discretion of the Committee, a Grantee may be entitled to receive any dividends or Dividend Equivalents declared with respect to Shares issuable in connection with vested Performance Shares which have been earned, but not yet issued to the Grantee.
Article 10.
Deferred Shares and Restricted Share Units
10.1 Grant of Deferred Shares and Restricted Share Units. Subject to and consistent with the provisions of the Plan, the Committee, at any time and from time to time, may grant Deferred Shares and/or Restricted Share Units to any Eligible Person, in such amount and upon such terms as the Committee shall determine.
10.2 Vesting and Delivery.
(a) Deferred Shares. Delivery of Shares subject to a Deferred Shares grant will occur upon expiration of the deferral period or upon the occurrence of one or more of the distribution events described in Section 409A(a)(2) of the Code as specified by the Committee in the Grantee’s Award Agreement for the Award of Deferred Shares. An Award of Deferred Shares may be subject to such substantial risk of forfeiture conditions as the Committee may impose, which conditions may lapse at such times or upon the achievement of such objectives as the Committee shall determine at the time of grant or thereafter. Unless otherwise determined by the Committee, to the extent that the Grantee has a Termination of Affiliation while the Deferred Shares remains subject to a substantial risk of forfeiture, such Deferred Shares shall be forfeited, unless the Committee determines that such substantial risk of forfeiture shall lapse in the event of the Grantee’s Termination of Affiliation due to death, Disability, or involuntary termination by the Company or a Subsidiary without “cause.”
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(b) Restricted Share Units. Delivery of Shares subject to a grant of Restricted Share Units will occur upon the expiration of the period during which the Restricted Share Units are subject to a substantial risk of forfeiture. Unless otherwise determined by the Committee, to the extent that the Grantee has a Termination of Affiliation while the Restricted Share Units remains subject to a substantial risk of forfeiture, such Restricted Share Units shall be forfeited, unless the Committee determines that such substantial risk of forfeiture shall lapse in the event of the Grantee’s Termination of Affiliation due to death, Disability, or involuntary termination by the Company or a Subsidiary without “cause.”
10.3 Voting and Dividend Equivalent Rights Attributable to Deferred Shares and Restricted Share Units. A Grantee awarded Deferred Shares or Restricted Share Units will have no voting rights with respect to such Deferred Shares or Restricted Share Units prior to the delivery of Shares in settlement of such Deferred Shares and/or Restricted Share Units. Unless otherwise determined by the Committee, a Grantee will have the rights to receive Dividend Equivalents in respect of Deferred Shares and/or Restricted Share Units, which Dividend Equivalents shall be deemed reinvested in additional Shares of Deferred Shares or Restricted Share Units, as applicable, which shall remain subject to the same forfeiture conditions applicable to the Deferred Shares or Restricted Share Units to which such Dividend Equivalents relate.
Article 11.
Dividend Equivalents
The Committee is authorized to grant Awards of Dividend Equivalents alone or in conjunction with other Awards. The Committee may provide that Dividend Equivalents shall be paid or distributed when accrued or shall be deemed to have been reinvested in additional Shares or additional Awards or otherwise reinvested subject to distribution at the same time and subject to the same conditions as the Award to which it relates; provided, however, that any Dividend Equivalents granted in conjunction with any Award that is subject to forfeiture conditions shall remain subject to the same forfeiture conditions applicable to the Award to which such Dividend Equivalents relate and any payments in respect of any Dividend Equivalents granted in conjunction with any Options or SARs may not be conditioned, directly or indirectly, on the Grantee’s exercise of the Options or SARs or paid at the same time that the Options or SARs are exercised.
Article 12.
Bonus Shares
Subject to the terms of the Plan, the Committee may grant Bonus Shares to any Eligible Person, in such amount and upon such terms and at any time and from time to time as shall be determined by the Committee.
Article 13.
Other Share-Based Awards
The Committee is authorized, subject to limitations under Applicable Law, to grant such other Awards that are denominated or payable in, valued in whole or in part by reference to, or otherwise based on, or related to, Shares, as deemed by the Committee to be consistent with the purposes of the Plan, including Shares awarded which are not subject to any restrictions or conditions, convertible or exchangeable debt securities or other rights convertible or exchangeable into Shares, and Awards valued by reference to the value of securities of or the performance of specified Subsidiaries. Subject to and consistent with the provisions of the Plan, the Committee shall determine the terms and conditions of such Awards. Except as provided by the Committee, Shares issued pursuant to a purchase right granted under this Article 13 shall be purchased for such consideration, paid for by such methods and in such forms, including cash, Shares, outstanding Awards or other property, as the Committee shall determine.
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Article 14.
Non-Employee Director Awards
Subject to the terms of the Plan, the Board may grant Awards to any Non-Employee Director, in such amount and upon such terms and at any time and from time to time as shall be determined by the full Board in its sole discretion. Except as otherwise provided in Section 5.6(b), a Non-Employee Director may not be granted Awards with respect to Shares that have a Fair Market Value (determined as of the date of grant) in excess of US$500,000 in a single calendar year.
Article 15.
Amendment, Modification, and Termination
15.1 Amendment, Modification, and Termination. Subject to Section 15.2, the Board may, at any time and from time to time, alter, amend, suspend, discontinue or terminate the Plan in whole or in part without the approval of the Company’s shareholders, except that (a) any amendment or alteration shall be subject to the approval of the Company’s shareholders if such shareholder approval is required by any federal or state law or regulation or the rules of any stock exchange or automated quotation system on which the Shares may then be listed or quoted, and (b) the Board may otherwise, in its discretion, determine to submit other such amendments or alterations to shareholders for approval.
15.2 Awards Previously Granted. Except as otherwise specifically permitted in the Plan or an Award Agreement, no termination, amendment, or modification of the Plan shall adversely affect in any material way any Award previously granted under the Plan, without the written consent of the Grantee of such Award.
Article 16.
Compliance with Code Section 409A
The Plan and all Awards granted hereunder are intended to comply with, or otherwise be exempt from, the requirements of Section 409A of the Code. The Plan and all Awards granted under this Plan shall be administered, interpreted, and construed in a manner consistent with Section 409A of the Code to the extent necessary to avoid the imposition of additional taxes under Section 409A(a)(1)(B) of the Code. To the extent that the Committee determines that any Award is subject to Section 409A of the Code, the Award Agreement evidencing such Award shall incorporate the terms and conditions required by Section 409A of the Code. To the extent applicable, the Plan and Award Agreements shall be interpreted in accordance with Section 409A of the Code and U.S. Department of Treasury regulations and other interpretive guidance issued thereunder. Notwithstanding any provision of the Plan or any Award Agreement to the contrary, if the Committee determines that any Award may be subject to Section 409A of the Code, the Committee may adopt such amendments to the Plan and each applicable Award Agreement as the Committee determines necessary or appropriate to (a) exempt the Award from Section 409A of the Code, or (b) comply with the requirements of Section 409A of the Code and related U.S. Department of Treasury guidance.
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Article 17.
Withholding
17.1 Required Withholding.
(a) The Committee in its sole discretion may provide that when taxes under any Applicable Law are to be withheld in connection with the exercise of an Option or SAR, or upon the lapse of restrictions on Restricted Shares, or upon the transfer of Shares, or upon payment of any other benefit or right under this Plan (the date on which such exercise occurs or such restrictions lapse or such payment of any other benefit or right occurs hereinafter referred to as the “Tax Date”), the Grantee may elect to make payment for the withholding of taxes under Applicable Law, including without limitation United States federal, state and local taxes, including Social Security and Medicare (“FICA”) taxes, by one or a combination of the following methods:
(i) payment of an amount in cash equal to the amount to be withheld (including cash obtained through the sale of the Shares acquired on exercise of an Option or SAR, upon the lapse of restrictions on Restricted Shares, or upon the transfer of Shares, through a broker-dealer to whom the Grantee has submitted an irrevocable instructions to deliver promptly to the Company, the amount to be withheld);
(ii) delivering part or all of the amount to be withheld in the form of Shares valued at its Fair Market Value on the Tax Date;
(iii) requesting the Company to withhold from those Shares that would otherwise be received upon exercise of the Option or SAR, upon the lapse of restrictions on Restricted Shares, or upon the transfer of Shares, a number of Shares having a Fair Market Value on the Tax Date equal to the amount to be withheld; or
(iv) withholding from any compensation otherwise due to the Grantee.
The Committee shall provide that the amount of tax withholding upon exercise of an Option or SARs, upon the lapse of restrictions on Restricted Shares, or upon the transfer of Shares, to be satisfied by withholding Shares upon exercise of such Option or SAR, upon the lapse of restrictions on Restricted Shares, or upon the transfer of Shares, pursuant to clause (iii) above shall not exceed the maximum amount of taxes, including FICA taxes, required to be withheld under federal, state and local law. An election by Grantee under this subsection is irrevocable. Any fractional share amount and any additional withholding not paid by the withholding or surrender of Shares must be paid in cash. If no timely election is made, the Grantee must deliver cash to satisfy all tax withholding requirements.
(b) Any Grantee who makes a Disqualifying Disposition (as defined in Section 6.4(f)) or an election under Section 83(b) of the Code shall remit to the Company an amount sufficient to satisfy all resulting tax withholding requirements in the same manner as set forth in subsection (a).
17.2 Notification under Code Section 83(b). If the Grantee, in connection with the exercise of any Option, or the grant of Restricted Shares, makes the election permitted under Section 83(b) of the Code to include in such Grantee’s gross income in the year of transfer the amounts specified in Section 83(b) of the Code, then such Grantee shall notify the Company of such election within 10 days of filing the notice of the election with the Internal Revenue Service, in addition to any filing and notification required pursuant to regulations issued under Section 83(b) of the Code. The Committee may, in connection with the grant of an Award or at any time thereafter, prohibit a Grantee from making the election described above.
Article 18.
Additional Provisions
18.1 Successors. Subject to Section 4.2(b), all obligations of the Company under the Plan with respect to Awards granted hereunder shall be binding on any successor to the Company, whether the existence of such successor is the result of a direct or indirect purchase, merger, consolidation, or otherwise of all or substantially all of the business and/or assets of the Company.
18.2 Severability. If any part of the Plan is declared by any court or governmental authority to be unlawful or invalid, such unlawfulness or invalidity shall not invalidate any other part of the Plan. Any Section or part of a Section so declared to be unlawful or invalid shall, if possible, be construed in a manner which will give effect to the terms of such Section or part of a Section to the fullest extent possible while remaining lawful and valid.
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18.3 Requirements of Law. The granting of Awards and the delivery of Shares under the Plan shall be subject to all Applicable Law, rules, and regulations, and to such approvals by any governmental agencies or national securities exchanges as may be required. Notwithstanding any provision of the Plan or any Award, Grantees shall not be entitled to exercise, or receive benefits under, any Award, and the Company (and any Subsidiary) shall not be obligated to deliver any Shares or deliver benefits to a Grantee, if such exercise or delivery would constitute a violation by the Grantee or the Company of any Applicable Law or regulation.
18.4 Securities Law Compliance.
(a) If the Committee deems it necessary to comply with any applicable securities law, or the requirements of any stock exchange upon which Shares may be listed, the Committee may impose any restriction on Awards or Shares acquired pursuant to Awards under the Plan as it may deem advisable. In addition, if requested by the Company and any underwriter engaged by the Company, Shares acquired pursuant to Awards may not be sold or otherwise transferred or disposed of for such period following the effective date of any registration statement of the Company filed under the Securities Act as the Company or such underwriter shall specify reasonably and in good faith, not to exceed 180 days in the case of the Company’s initial public offering or 90 days in the case of any other public offering. All certificates (if any) for Shares issued under the Plan pursuant to any Award or the exercise thereof shall be subject to such stop transfer orders and other restrictions as the Committee may deem advisable under the rules, regulations and other requirements of the SEC, any stock exchange upon which Shares are then listed, any applicable securities law, and the Committee may cause a legend or legends to be put on any such certificates (if any) to make appropriate reference to such restrictions. If so requested by the Company, the Grantee shall make a written representation to the Company that he or she will not sell or offer to sell any Shares unless a registration statement shall be in effect with respect to such Shares under the Securities Act of 1933, as amended, and any applicable state securities law or unless he or she shall have furnished to the Company, in form and substance satisfactory to the Company, that such registration is not required.
(b) If the Committee determines that the exercise or non-forfeitability of, or delivery of benefits pursuant to, any Award would violate any applicable provision of securities laws or the listing requirements of any national securities exchange or national market system on which are listed any of the Company’s equity securities, then the Committee may postpone any such exercise, non-forfeitability or delivery, as applicable, but the Company shall use all reasonable efforts to cause such exercise, non-forfeitability or delivery to comply with all such provisions at the earliest practicable date.
18.5 Forfeiture Events. Notwithstanding any provisions herein to the contrary, the Committee shall have the authority to provide in any Award Agreement that a Grantee’s (including his or her estate’s, beneficiary’s or transferee’s) rights (including the right to exercise any Option or SAR), payments and benefits with respect to any Award shall be subject to reduction, cancellation, forfeiture or recoupment (to the extent permitted by Applicable Law) in the event of the Participant’s termination for Cause; serious misconduct; violation of the Company’s or a Subsidiary’s policies; breach of fiduciary duty; unauthorized disclosure of any trade secret or confidential information of the Company or a Subsidiary; breach of applicable noncompetition, nonsolicitation, confidentiality or other restrictive covenants; or other conduct or activity that is in competition with the business of the Company or a Subsidiary, or otherwise detrimental to the business, reputation or interests of the Company and/or a Subsidiary; or upon the occurrence of certain events specified in the applicable Award Agreement (in any such case, whether or not the Grantee is then an Employee or Non-Employee Director). The determination of whether a Grantee’s conduct, activities or circumstances are described in the immediately preceding sentence shall be made by the Committee in its discretion, and pending any such determination, the Committee shall have the authority to suspend the exercise, payment, delivery or settlement of all or any portion of such Grantee’s outstanding Awards pending any investigation of the matter.
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18.6 No Rights as a Shareholder. No Grantee shall have any rights as a shareholder of the Company with respect to the Shares (other than Restricted Shares) which may be deliverable upon exercise or payment of such Award until such Shares have been delivered to him or her. Restricted Shares, whether held by a Grantee or in escrow by the Company, shall confer on the Grantee all rights of a shareholder of the Company, except as otherwise provided in the Plan or Award Agreement. At the time of a grant of Restricted Shares, the Committee may require the payment of cash dividends thereon to be deferred and, if the Committee so determines, reinvested in additional Restricted Shares. Share dividends and deferred cash dividends issued with respect to Restricted Shares shall be subject to the same restrictions and other terms as apply to the Restricted Shares with respect to which such dividends are issued. The Committee may in its discretion provide for payment of interest on deferred cash dividends.
18.7 Nature of Payments. Unless otherwise specified in the Award Agreement, Awards shall be special incentive payments to the Grantee and shall not be taken into account in computing the amount of salary or compensation of the Grantee for purposes of determining any pension, retirement, death or other benefit under (a) any pension, retirement, profit sharing, bonus, insurance or other employee benefit plan of the Company or any Subsidiary, except as such plan shall otherwise expressly provide, or (b) any agreement between (i) the Company or any Subsidiary and (ii) the Grantee, except as such agreement shall otherwise expressly provide.
18.8 Non-Exclusivity of Plan. Neither the adoption of the Plan by the Board nor its submission to the shareholders of the Company for approval shall be construed as creating any limitations on the power of the Board to adopt such other compensatory arrangements for employees or Non-Employee Directors as it may deem desirable.
18.9 Governing Law. The Plan is governed by and construed in accordance with, the laws of the British Virgin Islands. The courts of the British Virgin Islands and the courts of appeal from them shall have non-exclusive jurisdiction to determine any disputes which may arise out of or in connection with this Plan, accordingly, any legal action or proceedings arising out of or in connection with this Plan may be brought in those courts, but without prejudice to the right of the Company or any Grantee to bring proceedings in any other appropriate jurisdiction.
18.10 Unfunded Status of Awards; Creation of Trusts. The Plan is intended to constitute an “unfunded” plan for incentive and deferred compensation. With respect to any payments not yet made to a Grantee pursuant to an Award, nothing contained in the Plan or any Award Agreement shall give any such Grantee any rights that are greater than those of a general creditor of the Company; provided, however, that the Committee may authorize the creation of trusts or make other arrangements to meet the Company’s obligations under the Plan to deliver cash, Shares or other property pursuant to any Award which trusts or other arrangements shall be consistent with the “unfunded” status of the Plan unless the Committee otherwise determines.
18.11 Affiliation. Nothing in the Plan or an Award Agreement shall interfere with or limit in any way the right of the Company or any Subsidiary to terminate any Grantee’s employment or consulting contract at any time, nor confer upon any Grantee the right to continue in the employ of or as an officer of or as a consultant to or Non-Employee Director of the Company or any Subsidiary.
18.12 Participation. No employee or officer shall have the right to be selected to receive an Award under this Plan or, having been so selected, to be selected to receive a future Award.
18.13 Construction. The following rules of construction will apply to the Plan: (a) the word “or” is disjunctive but not necessarily exclusive, (b) “including” (and with correlative meaning “include”) means including without limiting the generality of any description preceding or succeeding such term and shall be deemed in each case to be followed by the words “without limitation”, and (c) words in the singular include the plural, words in the plural include the singular, and words in the neuter gender include the masculine and feminine genders and words in the masculine or feminine gender include the other neuter genders.
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18.14 Headings. The headings of articles and sections are included solely for convenience of reference, and if there is any conflict between such headings and the text of this Plan, the text shall control.
18.15 Obligations. Unless otherwise specified in the Award Agreement, the obligation to deliver, pay or transfer any amount of money or other property pursuant to Awards under this Plan shall be the sole obligation of a Grantee’s employer; provided that the obligation to deliver or transfer any Shares pursuant to Awards under this Plan shall be the sole obligation of the Company.
18.16 No Right to Continue as Director. Nothing in the Plan or any Award Agreement shall confer upon any Non-Employee Director the right to continue to serve as a director of the Company.
18.17 Shareholder Approval. All Incentive Share Options granted on or after the Effective Date and prior to the date the Company’s shareholders approve the Plan are expressly conditioned upon and subject to approval of the Plan by the Company’s shareholders.
18.18 Forfeiture of Shares. Any forfeiture of Shares described in this Plan will take effect as a surrender for no consideration of such Shares as a matter of Cayman Islands law.
18.19 Share Issuances. The allotment and issuance of Shares pursuant to the terms of this Plan following the exercise of an Option shall be subject to the Amended and Restated Memorandum and Articles of Association of the Company. Shares shall not in fact be allotted and issued (or repurchased or forfeited) until the time at which the Grantee’s name (and number of Shares to be allotted and issued) is entered on the Company’s Register of Members (or the existing entry is updated to reflect the repurchase or forfeiture) (the register being prima facie evidence of legal title to Shares).
18.20 No Dividends on Unvested Awards. Notwithstanding anything in this Plan to the contrary, in no event shall the Board or the Committee approve the payment of any dividend by the Company on unvested Awards.
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RegistrationName:
Numberof Shares:
ControlNumber:
MOXIAN(BVI) INC
ANNUALMEETING OF SHAREHOLDERS
August12, 2022
10:00AM, Beijing Time
(August11, 2022, 10:00 PM, Eastern Time)
THISPROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF MOXIAN (BVI) INC
The undersigned shareholder of Moxian (BVI) Inc (the “Company”) hereby appoints Conglin Deng or Tan Wanhong, and each of them, as proxies with full power of substitution, on behalf and in the name of the undersigned, to represent the undersigned at the annual meeting of shareholders of the Company to be held on August 12, 2022, at 10:00 AM Beijing Time, at Room A, Level 2, Carpenter Haus, 36 Carpenter Street, Singapore and to vote all ordinary shares which the undersigned would be entitled to vote if then and there personally present, on the matters set forth below (i) as specified by the undersigned below and (ii) in the discretion of the proxy upon such other business as may properly come before the meeting, all as set forth in the notice of annual meeting and in the proxy statement furnished herewith.
THISPROXY CARD, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY THE UNDERSIGNED. IF NO DIRECTION IS MADE BUT THE CARDIS SIGNED, THIS PROXY CARD WILL BE VOTED “FOR” THE ELECTION OF ALL NOMINEES UNDER PROPOSAL NO. 1, “FOR” PROPOSALSNO. 2, NO. 3, NO. 4, NO. 5, NO. 6 AND IN THE DISCRETION OF THE PROXY WITH RESPECT TO SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORETHE MEETING.
Item 1 Resolution THAT the following individuals be elected as our Directors:
| FOR | AGAINST | ABSTAIN | |
|---|---|---|---|
| Conglin Deng | ☐ | ☐ | ☐ |
| Lionel Choong Khuat Leok | ☐ | ☐ | ☐ |
| Tao Xu | ☐ | ☐ | ☐ |
| Chuan Zhan | ☐ | ☐ | ☐ |
| Panpan Wang | ☐ | ☐ | ☐ |
Item 2 Resolution THAT Audit Alliance LLP be appointed as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2022.
| ☐ For | ☐ Against | ☐ Abstain |
|---|
Item 3 Resolution THAT the 2022 Omnibus Equity Incentive Plan of the Company be approved.
| ☐ For | ☐ Against | ☐ Abstain |
|---|
Item 4 Resolution THAT the Memorandum and Articles of Association of the Company be amended to provide that the Preferred Shares be convertible into Ordinary Shares of the Company at any time by the holder thereof or upon the occurrence of an reorganization event.
| ☐ For | ☐ Against | ☐ Abstain |
|---|
Item 5 Resolution THAT the Memorandum and Articles of Association of the Company be amended to provide that each Preferred Share shall be entitled to six votes per share.
| ☐ For | ☐ Against | ☐ Abstain |
|---|
Item 6 Resolution THAT the Amended and Restated Memorandum and Articles of Association be approved.
| ☐ For | ☐ Against | ☐ Abstain |
|---|
Item 7 Such other business as may properly come before the meeting or any adjournment thereof.
| ☐ For | ☐ Against | ☐ Abstain |
|---|
In his or her discretion, the proxy is authorized to vote upon any other matters which may properly come before the Annual Meeting, or any adjournment or postponement thereof.
THISPROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
Dated: __________________________________, 2022
_______________________________________
Signature
_______________________________________
Signature (Joint Owners)
Please date and sign name exactly as it appears hereon. Executors, administrators, trustees, etc. should so indicate when signing. If the stockholder is a corporation, the full corporate name should be inserted and the proxy signed by an officer of the corporation indicating his/her title
[SEEVOTING INSTRUCTIONS ON NEXT PAGE]
VOTINGINSTRUCTIONS
Please sign, date and mail this Proxy Card promptly to the following address in the enclosed postage-paid envelope:
Securities Transfer Corporation
2901 N. Dallas Parkway, Suite 380
Plano, Texas 75093
Attention: Proxy Department
OR
You may sign, date and submit your Proxy Card by facsimile to +01 (469) 633-0088.
OR
You my sign, date, scan and email your scanned Proxy Card to proxyvote@stctransfer.com.
OR
You may vote online through the Internet:
1. Go to http://onlineproxyvote.com/MOXC/ at any time 24 hours a day.
2. Login using the control number located in the top left hand corner of this proxy card.
3. Access the proxy voting link within that website to vote your proxy.
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The Proxy Statement and the form of Proxy Card are available at http://onlineproxyvote.com/MOXC/