Washington, D.C. 20549
You are cordially invited to attend the
2018-2019 annual stockholders meeting of ChineseInvestors.com Inc., an Indiana corporation, to be held on Saturday, November 16,
2019 at 1:00 p.m.., Pacific Time, in the conference room on the 2nd floor of the office building located at 227 W Valley Blvd.
#208 A, San Gabriel, CA 91776, USA.
The Notice of Annual Meeting of Stockholders
and Proxy Statement describe the formal business to be transacted at the annual meeting. Our directors and officers will be present
to respond to appropriate questions from stockholders.
Please note
that whether or not you plan to attend the meeting, your vote is very important. Therefore, we encourage you to vote your shares
by proxy even if you do not plan to attend. Our Board of Directors recommends the approval of the proposals being presented at
the meeting as being in the best interest of our Company and our shareholders. Shareholders may complete, date and sign the accompanying
Proxy Card and return it by mail using the postage-paid envelope provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes
Way, Edgewood, NY 11717; via telephone at 1-800-690-6903 by using any touch-tone telephone to transmit your voting instructions;
or over the Internet at www.proxyvote.com, as more specifically
described in the accompanying Proxy Statement. This will ensure that your shares will be represented and voted at the meeting,
even if you do not attend. If you attend the meeting, you may revoke your proxy and personally cast your vote. Attendance at the
meeting does not of itself revoke your proxy.
The
Company’s 2019 Proxy Statement and 2018 Annual Report to Shareholders are available free of charge at https://materials.proxyvote.com/16947Q.
ITEM 3 – TO APPROVE AN AMENDMENT TO OUR CERTIFICATE
OF INCORPORATION TO INCREASE THE COMPANY'S AUTHORIZED SHARES OF COMMON STOCK TO 700,000,000 SHARES AND TO INCREASE ITS SHARES OF
PREFERRED STOCK TO 300,000,000
On July 22, 2019, our Board of Directors unanimously approved,
subject to stockholder approval, an amendment to our certificate of incorporation to increase the number of shares of common stock
authorized for issuance by 620,000,000 shares of common stock, bringing the total number of shares of common stock authorized to
700,000,000 shares and to increase the number of shares of preferred stock authorized for issuance by 280,000,000 to 300,000,000.
The text of the proposed amendment to the Certificate of Incorporation is attached hereto as Appendix A. This proposal to
increase the number of shares of common stock authorized for issuance, if approved at the Annual Meeting, will become effective
and the Company's number of shares of authorized common stock will be increased to 700,000,000 and the Company’s number of
authorized shares of preferred stock will be increased to 300,000,000 shares upon the filing of the certificate of amendment with
the Secretary of State of Indiana. The following discussion is qualified in its entirety by the full text of the certificate of
amendment, which is incorporated herein by reference.
Reasons for the Increase
The Board believes that it is desirable to have additional authorized
shares of preferred and common stock available for possible future financings, to fund the Company’s proposed Amended 2019
Equity Incentive Plan described and other general corporate purposes. The Board believes that having such additional authorized
shares of common and preferred stock available for issuance in the future will give the Company greater flexibility and may allow
such shares to be issued without the expense and delay of a special stockholders' meeting unless such approval is expressly required
by applicable law. Although such issuance of additional shares with respect to future financings and acquisitions would dilute
existing stockholders, management believes that such transactions would increase the overall value of the Company to its stockholders.
There are certain advantages and disadvantages of an increase in authorized common stock. The advantages include:
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The ability to raise capital by issuing capital stock under
financing transactions.
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To have shares of common stock available to pursue business
expansion opportunities, if any.
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To have sufficient authorized but unissued shares of common stock available for the issuance the Company’s 2019 Equity
Incentive Plan is approved.
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The disadvantages include:
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The issuance of authorized but unissued stock could be used to deter a potential takeover of the Company that may otherwise
be beneficial to stockholders by diluting the shares held by a potential suitor or issuing shares to a stockholder that will vote
in accordance with the Board's desires. A takeover may be beneficial to independent stockholders because, among other reasons,
a potential suitor may offer such stockholders a premium for their shares of stock compared to the then-existing market price.
The Company does not have any plans or proposals to adopt provisions or enter into agreements that may have material anti-takeover
consequences.
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Most of our stockholders do not have any preemptive or similar rights to subscribe for or purchase any additional shares of
common stock that may be issued in the future, and therefore, future issuances of common stock may, depending on the circumstances,
have a dilutive effect on the earnings per share, voting power and other interests of existing stockholders of the Company.
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The additional shares of common stock for which authorization is sought in this proposal would be part of the existing class
of common stock and, if and when issued, would have the same rights and privileges as the shares of common stock presently outstanding.
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Although an increase in the authorized shares of common stock
could, under certain circumstances, have an anti-takeover effect, this proposal to adopt the amendment is not in response to any
effort of which the Company is aware to accumulate common stock or obtain control of the Company. Nor is it part of a plan by management
to recommend a series of similar amendments to the Board and stockholders.
At present, apart granting equity incentives for our employees
pursuant to the Company’s proposed 2019 Equity Incentive Plan, our board of directors has no immediate plans, arrangements
or understandings to issue the additional shares of common stock. However, we desire to have the shares available to provide additional
flexibility to use our common stock for business and financial purposes in the future as well to have sufficient shares available
to provide appropriate equity incentives for our employees.
If the Company's stockholders do not approve the increase in
authorized shares of common and preferred stock, then the Company will not be able to increase the total number of authorized shares
of common stock from 80,000,000 to 700,000,000 and will not be able to increase the total number of authorized shared of preferred
stock from 20,000,000 to 300,000,000, and therefore, the Company could be limited in its ability to use shares of common and preferred
stock for financing, issuing stock options, or other general corporate purposes.
Our directors and executive officers have no substantial interests,
directly or indirectly, in the matters set forth in this proposed amendment, except to the extent of their ownership in shares
of our common stock and securities convertible or exercisable for common stock.
THE BOARD RECOMMENDS THAT THE STOCKHOLDERS VOTE “FOR”
THE PROPOSAL TO AMEND THE COMPANY’S ARTICLES OF INCORPORATION TO INCREASE THE AUTHORIZED SHARES OF COMMON STOCK FROM 80,000,000
TO 700,000,000 AND PREFERRED SHARES FROM 20,000,000 TO 300,000,000.
ITEM 4 – APPROVAL OF THE COMPANY’S 2019
AMENDED EQUITY INCENTIVE PLAN
The Company’s Amended 2019 Equity Incentive Plan (the
“Plan”) was approved by the Board on July 17, 2019. The Company believes that the Plan will help to (i) assist the
Company and its affiliates in the recruitment and retention of persons with ability and initiative, (ii) provide an incentive to
such persons to contribute to the growth and success of the Company’s businesses by affording such persons equity participation
in the Company, (iii) associate the interests of such persons with those of the Company and its affiliates and shareholders, (iv)
to provide incentives to individuals who perform services for the Company, and (v) to promote the success of the Company’s
business. The following is a summary of the material features of the Plan and is qualified in its entirety by reference to the
Plan, which is attached hereto as Appendix B.
General Details and Provisions of the Plan
The Board has the sole authority to implement, interpret, and/or
administer the Plan unless the Board delegates (i) all or any portion of its authority to implement, interpret, and/or administer
the Plan to a committee of the Board consisting of non-employee directors (the “Committee”), or (ii) the authority
to grant and administer awards to non-executive employees of the Company under the Plan to an officer of the Company.
The Plan relates to the issuance of up to 7,000,000 shares of
Common Stock (including shares that may be issued related to the exercise of options awarded under the Plan), subject to adjustment
as described below, and shall be effective for ten (10) years, unless earlier terminated.
Any employee of the Company or an affiliate, a director, or
a consultant to the Company or an affiliate (collectively “Service Providers”) may be eligible under the Plan. The
Plan provides Service Providers the opportunity to participate in the enhancement of shareholder value by the award of Non-statutory
Stock Options, Restricted Stock, Restricted Stock Units, Stock Appreciation Rights, Performance Units, Performance Shares, and
such other cash or stock awards as the Administrator determines may be granted to Service Providers under the Plan. Incentive
Stock Options may be granted only to Employees. As of the date hereof, the Company has approximately 68 employees and 2 non-employee
directors who may be eligible Service Providers under the Plan; however, this does not include potential consultants who may be
an eligible Service Provider under the terms of the Plan or those who may become an eligible Service Provider in the future. While
our directors and our executive officers may participate in the Plan, the amounts and benefits that they may receive from the
Plan (if any) has not been determined and is not currently determinable.
Stock Options
The Administrator will have complete discretion to determine
the number of Shares subject to an Option granted to any Participant. Each Option will be designated in the Award Agreement as
either an Incentive Stock Option or a Non-statutory Stock Option. However, notwithstanding such designation, to the extent that
the aggregate Fair Market Value of the Shares with respect to which Incentive Stock Options are exercisable for the first time
by the Participant during any calendar year (under all plans of the Company and any Parent or Subsidiary) exceeds $100,000 (U.S.),
such Options will be treated as Non-statutory Stock Options. The Fair Market Value of the Shares will be determined as of the time
the Option with respect to such Shares is granted.
The Administrator will determine the term of each Option in
its sole discretion; provided, however, that the term will be no more than ten (10) years from the date of grant thereof in the
case of Incentive Stock Options. Moreover, in the case of an Incentive Stock Option granted to a Participant who, at the time the
Incentive Stock Option is granted, owns stock representing more than 10% of the total combined voting power of all classes of stock
of the Company or any Parent or Subsidiary, the term of the Incentive Stock Option will be five (5) years from the date of grant
or such shorter term as may be provided in the Award Agreement.
The per share exercise price for the Shares to be issued pursuant
to exercise of an Option will be determined by the Administrator, but will be no less than 100% of the Fair Market Value per Share
on the date of grant. In addition, in the case of an Incentive Stock Option granted to an Employee who, at the time the Incentive
Stock Option is granted, owns stock representing more than 10% of the voting power of all classes of stock of the Company or any
Parent or Subsidiary, the per Share exercise price will be no less than 110% of the Fair Market Value per Share on the date of
grant. Notwithstanding the foregoing, Options may be granted with a per Share exercise price of less than 100% of the Fair Market
Value per Share on the date of grant pursuant to the issuance or assumption of an Option in a transaction to which Section 424(a)
of the Code applies in a manner consistent with said Section 424(a).
Stock Appreciation Rights
The Administrator will have complete discretion to determine
the number of Stock Appreciation Rights granted to any Participant which may be granted to Service Providers at any time and from
time to time as will be determined by the Administrator, in its sole discretion. The Administrator will have complete discretion
to determine the terms and conditions of Stock Appreciation Rights granted under the Plan; provided, however, that the exercise
price will be not less than 100% of the Fair Market Value of a Share on the date of grant. Each Stock Appreciation Right grant
will be evidenced by an Award Agreement that will specify the exercise price, the number of Shares with respect to which the Award
is granted, the term of the Stock Appreciation Right, the conditions of exercise, and such other terms and conditions as the Administrator,
in its sole discretion, will determine. A Stock Appreciation Right granted under the Plan will expire upon the date determined
by the Administrator, in its sole discretion, and set forth in the Award Agreement; provided, however, that the term will be no
more than ten (10) years from the date of grant thereof. Upon exercise of a Stock Appreciation Right, a Participant will be entitled
to receive payment from the Company in an amount determined by multiplying: (i) The difference between the Fair Market Value of
a Share on the date of exercise over the “stock appreciation right exercise price,” as defined under Treasury Regulation
Section 1.409A-1(b)(i)(B)(2), i.e., the Fair Market Value of a Share on the date of grant of the Stock Appreciation Right; times
(ii) The number of Shares with respect to which the Stock Appreciation Right is exercised. At the discretion of the Administrator,
the payment upon Stock Appreciation Right exercise may be in cash, in Shares of equivalent value, or in some combination thereof.
Bonus, Deferred, and Restricted Stock Award
The Administrator may, in its sole discretion, grant awards
of Common Stock in the form of bonus awards, deferred awards, and restricted stock awards. Each stock award agreement shall be
in such form and shall contain such terms and conditions as the Board, or the committee, deems appropriate. The terms and conditions
of each stock award agreement may change from time to time and need not be uniform with respect to Eligible Persons, and the terms
and conditions of separate stock award agreements need not be identical.
Performance Share Awards
The Administrator may authorize grants of shares of Common Stock
to be awarded upon the achievement of specified performance objectives, upon such terms and conditions as the Administrator may
determine. Such awards shall be conferred upon the Service Provider upon the achievement of specified performance objectives during
a specified performance period, such objectives being set forth in the grant and including a minimum acceptable level of achievement
and, optionally, a formula for measuring and determining the number of performance shares to be issued. Each performance share
award agreement shall be in such form and shall contain such terms and conditions as the Administrator deems appropriate. The terms
and conditions of each performance share award may change from time to time and need not be uniform with respect to Service Providers,
and the terms and conditions of separate performance share award agreements need not be identical.
Adjustments; Dissolution or Liquidation; Merger or Change
in Control
In the event that any dividend or other distribution (whether
in the form of cash, Shares, other securities, or other property), recapitalization, stock split, reverse stock split, reorganization,
merger, consolidation, split-up, spin-off, combination, repurchase, or exchange of Shares or other securities of the Company, or
other change in the corporate structure of the Company affecting the Shares occurs, the Administrator, in order to prevent diminution
or enlargement of the benefits or potential benefits intended to be made available under the Plan, will adjust the number and class
of Shares that may be delivered under the Plan and/or the number, class, and price of Shares covered by each outstanding Award.
In the event of the proposed dissolution or liquidation of the
Company, any corporate separation or division, including, but not limited to, a split-up, a split-off or a spin-off; a reverse
merger in which the Company is the surviving entity, but the shares of Company stock outstanding immediately preceding the merger
are converted by virtue of the merger into other property, whether in the form of securities, cash or otherwise; or the transfer
of more than fifty percent (50%) of the then outstanding voting stock of the Company to another person or entity. the Administrator
will notify each Participant as soon as practicable prior to the effective date of such proposed transaction. The Company, to the
extent permitted by applicable law but otherwise in its sole discretion may provide for: (i) the continuation Awards by the Company
(if the Company is surviving entity or its parent; (ii) the assumption of the Plan and such outstanding Awards by the surviving
entity or its parent; (iii) the substitution by the surviving entity or its parent of rights with substantially the same terms
for such outstanding Awards; or (iv) the cancellation of such outstanding Rights without payment of any consideration provided
that in the case of this clause (iv), the Administrator will provide notice of its intention to cancel Award and offer a reasonable
opportunity to exercise vested Awards.
In the event of a merger or Change in Control, each outstanding
Award will be treated as the Administrator determines, including, without limitation, that each Award will be assumed or an equivalent
option or right substituted by the successor corporation or a Parent or Subsidiary of the successor corporation (the “Successor
Corporation”). The Administrator will not be required to treat all Awards similarly in the transaction.
In the event that the Successor Corporation does not assume
or substitute for the Award, the Participant will fully vest in and have the right to exercise all of his or her outstanding Options
and Stock Appreciation Rights, including Shares as to which such Awards would not otherwise be vested or exercisable, all restrictions
on Restricted Stock will lapse, and, with respect to Restricted Stock Units, Performance Shares and Performance Units, all Performance
Goals or other vesting criteria will be deemed achieved at target levels and all other terms and conditions met. In addition, if
an Option or Stock Appreciation Right is not assumed or substituted for in the event of a Change in Control, the Administrator
will notify the Participant in writing or electronically that the Option or Stock Appreciation Right will be fully vested and exercisable
for a period of time determined by the Administrator in its sole discretion, and the Option or Stock Appreciation Right will terminate
upon the expiration of such period.
Plan Amendment or Termination
The Administrator may at any time amend, alter, suspend or terminate
the Plan, provided that such action does not materially impair the existing rights of any participant without such participant's
written consent. The Plans will terminate ten (10) years after the earlier of (i) the date the Plan is adopted by the Board, and
(ii) the date a Plan is approved by the shareholders, except that awards that are granted under the Plan prior to its termination
will continue to be administered under the terms of the that Plan until the awards terminate, expire or are exercised.
Federal Income Tax Consequences
Individual who receives a grant of options (an “Optionee”)
will generally not recognize any taxable income on the date Nonqualified Options are granted pursuant to the Plan. Upon exercise
of the option, however, the Optionee must recognize, in the year of exercise, compensation taxable as ordinary income in an amount
equal to the difference between the option price and the fair market value of Company common stock on the date of exercise. Upon
the sale of the shares, any resulting gain or loss will be treated as capital gain or loss. The Company will receive an income
tax deduction in its fiscal year in which NSOs are exercised equal to the amount of ordinary income recognized by those Optionees
exercising options, and must comply with applicable tax withholding requirements. ISOs granted under the Plan are intended to qualify
for favorable tax treatment under Section 422 of the Internal Revenue Code. Under Section 422, an Optionee recognizes no taxable
income when the option is granted. Further, the Optionee generally will not recognize any taxable income when the option is exercised
if he or she has at all times from the date of the option’s grant until three months before the date of exercise been an
employee of the Company. The Company ordinarily is not entitled to any income tax deduction upon the grant or exercise of an incentive
stock option. This favorable tax treatment for the Optionee, and the denial of a deduction for the Company, will not, however,
apply if the Optionee disposes of the shares acquired upon the exercise of an incentive stock option within two years from the
granting of the option or one year from the receipt of the shares.
ITEM 5 – ADVISORY VOTE ON EXECUTIVE COMPENSATION
The recently enacted Dodd-Frank Wall Street
Reform and Consumer Protection Act (the “Dodd-Frank Act”) requires that we provide our stockholders a non-binding,
advisory vote to approve the compensation of our named executive officers. This vote is sometimes referred to as a “say-on-pay
vote.” Although this advisory vote is nonbinding, the Compensation Committee of our Board will review and consider the voting
results when making future decisions regarding our named executive officer compensation and related executive compensation programs.
In our Annual Report on Form 10-K, our
executive compensation program is comprised principally of salary, equity and performance-based cash compensation, designed to:
(i) attract, motivate and retain key executives who are critical to our success, (ii) align the interests of our executives with
stockholder value and our financial performance and (iii) achieve a balanced package that would attract and retain highly qualified
senior officers and appropriately reflect each such officer’s individual performance and contributions. In addition, the
Company regularly reviews its compensation program and the overall compensation package paid to each of its senior executives to
assess risk and to confirm that the structure is still aligned with the Company's long-term strategic goals.
Before you vote on the resolution below,
please read the entire “Executive Compensation” section, including the tables, together with the related narrative
disclosure and footnotes, as well as the disclosures located in our Annual Report on Form 10-K. Note, as a “smaller reporting
company,” we are obligated to provide compensation disclosures pursuant to Item 402 (m) through (q) of Regulation S-K promulgated
under the Securities Exchange Act of 1934 (“Regulation S-K”). Even though, as a smaller reporting company, we are exempt
from compensation discussion and analysis by the executive compensation requirements of Item 402(b) of Regulation S-K, we continue
to elect to provide information regarding our objectives and practices regarding executive compensation in order to give our stockholders
transparency into our compensation philosophy and practices.
For the reasons provided, the Board is
asking stockholders to cast a non-binding, advisory vote FOR the following resolution:
“RESOLVED, that stockholders approve
the compensation paid to our named executive officers as disclosed in this Proxy Statement pursuant to Item 402 (m) through (q)
of Regulation S-K (which includes the compensation tables and related narrative discussion).”
THE BOARD RECOMMENDS THAT THE STOCKHOLDERS
VOTE “FOR” THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS AS DESCRIBED IN THIS PROXY STATEMENT.
ITEM 6 – ADVISORY VOTE ON THE
FREQUENCY OF FUTURE ADVISORY VOTES TO APPROVE THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS
We are providing our stockholders with
the opportunity to vote, on a non-binding, advisory basis, for their preference on the frequency of future advisory votes to approve
the compensation of our named executive officers as reflected in Item 4 above. Stockholders may indicate whether they prefer that
we conduct future advisory votes to approve the compensation of our named executive officers every one, two or three years. Shareholders
also may abstain from casting a vote on this proposal.
The Board has determined that holding an
advisory vote on the compensation of our named executive officers every year is the most appropriate policy at this time, and recommends
that future advisory votes to approve the compensation of our named executive officers occur once every year. We believe that holding
this advisory vote annually will provide us with timely and appropriate feedback on compensation decisions for our named executive
officers.
Stockholders will be able to specify one
of four choices for this proposal on the proxy card: one year, two years, three years, or abstain. Although this advisory vote
on the frequency of future advisory votes on the compensation of our named executive officers is non-binding, the Board and the
Compensation Committee will carefully review the voting results when determining the frequency of future advisory votes on the
compensation of our named executive officers.
The Board is asking stockholders to cast
a non-binding, advisory vote for the ONE-YEAR option on the following resolution:
“RESOLVED, that the stockholders
of the Company recommend, in a non-binding vote, whether an advisory vote to approve the compensation of our named executive officers
should occur every one, two or three years.”
The Board believes that say-on-pay votes
should be conducted every year so that stockholders may annually express their views on our executive compensation program. This
vote, like the say-on-pay vote itself, is non-binding.
THE BOARD RECOMMENDS THAT THE STOCKHOLDERS
VOTE FOR THE “ONE-YEAR” OPTION AS TO THE FREQUENCY OF THE ADVISORY VOTE ON THE COMPENSATION OF OUR NAMED EXECUTIVE
OFFICERS.
THE BOARD RECOMMENDS THAT THE STOCKHOLDERS
VOTE “FOR” THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS AS DESCRIBED IN THIS PROXY STATEMENT.
SHAREHOLDER PROPOSALS
FOR 2020 ANNUAL MEETING
In order
to be included in the Company’s proxy statement for the 2020 Annual Meeting of Shareholders, a shareholder proposal submitted
pursuant to Rule 14a-8 under the Securities Exchange Act of 1934 must be received in writing by our Secretary at 227 W. Valley
Blvd, #208 A, San Gabriel, CA 91776, no later than May 27, 2020, assuming the 2020 Annual Meeting is not advanced more than 30
calendar days and not delayed by more than 60 calendar days of the date of the anniversary of the 2019 Annual Meeting, and otherwise
comply with all requirements of the SEC for shareholder proposals.
HOUSEHOLDING
Under
the rules adopted by the SEC, we may deliver a single set of proxy materials to one address shared by two or more of our stockholders.
This delivery method is referred to as “householding” and can result in significant cost savings. To take advantage
of this opportunity, we have delivered only one set of proxy materials to multiple stockholders who share an address, unless we
received contrary instructions from the impacted stockholders prior to the mailing date. We agree to deliver promptly, upon written
or oral request, a separate copy of the proxy materials, as requested, to any stockholder at the shared address to which a single
copy of these documents was delivered. If you prefer to receive separate copies of the proxy statement or annual report, contact
Broadridge Financial Solutions, Inc. by calling 1-866-540-7095 or in writing at 51 Mercedes Way, Edgewood, New York 11717, Attention:
Householding Department.
In
addition, if you currently are a stockholder who shares an address with another stockholder and would like to receive only one
copy of future notices and proxy materials for your household, you may notify your broker if your shares are held in a brokerage
account or you may notify us if you hold registered shares. Registered stockholders may notify us by contacting Broadridge Financial
Solutions, Inc. at the above telephone number or address.
OTHER BUSINESS
Shareholders
and other interested parties may send written communications to our Board or the non-management Directors as a group by
mailing them to our Board, c/o Melissa N. Armstrong, Esq. Secretary, ChineseInvestors.com, Inc., 227 W. Valley Blvd, #208 A,
San Gabriel, CA 91776. All communications will be forwarded to our Board or the non-management Directors as a group, as
applicable.
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BY ORDER OF THE BOARD OF DIRECTORS
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/s/ Melissa N. Armstrong
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Secretary of the Board
September 24, 2019
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FORM OF PROXY
APPENDIX A
AMENDED AND RESTATED ARTICLES
OF
CHINESEINVESTORS.COM.
Article
I
Name
The name of the Corporation is Chineseinvestors.com,
Inc. (the “Corporation”).
Article
II
Purpose and Powers
The purpose of the Corporation is to engage
in any lawful act or activity for which corporations may be organized under the Business Corporation Law of the State of Indiana
(the “IBCL”). The Corporation shall have and may exercise any and all power which a corporation incorporated
under the IBCL may have, including, without limitation, any and all power necessary or helpful to engage in such acts and activities.
Article
III
Registered Office
The address of the registered office of
the Corporation in the State of Indiana shall be located at 150 West Market Street, Suite 800, Indianapolis, IN 46204. The registered
agent of the Corporation at such address shall be National Registered Agents, Inc.
Article
IV
Authorized Shares
The total number of shares of all classes
of stock which the Corporation shall have the authority to issue shall consist of:
A.
700,000,000 shares of Common Stock, par value $0.001 per share (the “Common Stock”); and
B.
300,000,000 shares of Preferred Stock, par value $0.001 per share (the “Preferred Stock”).
The number of authorized shares of the Corporation’s
Common Stock may be increased or decreased (but not below the number of shares thereof then outstanding) by (in addition to any
vote of the holders of one or more series of Preferred Stock that may be required by the terms of this Certificate of Incorporation,
as the same may be amended) the affirmative vote of the holders of shares of capital stock of the Corporation representing a majority
of the votes represented by all outstanding shares of capital stock of the Corporation entitled to vote, voting on an as-converted
to Common Stock basis, irrespective of the provisions of Section 23-1-26-5 of the IBCL.
Article
V
Rights and Preferences of Capital Stock
The following is a statement of the designations
and the powers, preferences, rights, privileges and restrictions, qualifications and limitations thereof in respect of each class
of capital stock of the Corporation.
A.
Common Stock. The powers, rights, preferences, privileges and restrictions, qualifications and limitations
of the Common Stock are set forth below.
Section
1. General. The voting,
dividend and liquidation rights of the holders of the Common Stock (each a “Common Holder” and, collectively,
the “Common Holders”), with respect to the shares of Common Stock held by them, are subject to and qualified
by the rights, powers and preferences of the holders of Preferred Stock set forth herein and any Preferred Stock Designation (as
defined below) that may be adopted hereafter.
Section
2. Dividends. Subject to
the senior dividend rights of the Preferred Stock as hereinafter provided, and any Preferred Stock Designation that may be adopted
hereafter, dividends may be paid on the Common Stock, as and when declared by the Corporation’s Board of Directors (the “Board”),
out of funds of the Corporation legally available for the payment of such dividends.
Section
3. Liquidation. After the
preferential payments to the holders of Preferred Stock that may be required to be made to the holders of Preferred Stock pursuant
to a Preferred Stock Designation, the Common Holders shall be entitled to liquidation distributions, if any, pro rata.
Section
4. Voting.
(a)
Except as otherwise set forth herein, the Common Holders are entitled to one vote for each share of Common Stock (each a
“Common Share” and collectively, the “Common Shares”) held at all meetings
of stockholders (and written actions in lieu of meetings).
(b)
Except as otherwise required by the IBCL, holders of issued and outstanding shares of Common Stock shall not be entitled
to vote with respect to such shares on any amendment to this Certificate of Incorporation (as the same may be amended) that relates
solely to the terms of one or more outstanding series of Preferred Stock if the holders of such affected series are entitled, either
separately or together with the holders of one or more other such series, to vote thereon pursuant to these Amended and Restated
Articles of Incorporation (as the same may be amended) or pursuant to the IBCL.
B.
Preferred Stock. Preferred Stock may be issued from time to time in one or more series, each of such series
to have such terms as stated or expressed herein and in the resolution or resolutions providing for the issue of such series adopted
by the Board as hereinafter provided. Authority is hereby vested in the Board from time to time to authorize the issuance of shares
of Preferred Stock in one or more series, and by filing a certificate pursuant to the applicable law of the State of Indiana, to
establish from time to time the number of shares to be included in each such series and to fix by resolution or resolutions of
the Board, the designation, powers, preferences and rights of the shares of each such series and any qualifications, limitations
or restrictions thereof.
Without limiting the generality of the foregoing,
the resolutions providing for issuance of any series of Preferred Stock (a “Preferred Stock Designation”)
may provide, without limitation, the following: (i) the maximum number of shares to constitute such series, which may subsequently
be increased or decreased (but not below the number of shares of that series then outstanding) by resolution of the Board, the
distinctive designation thereof and the stated value thereof if different than the par value thereof; (ii) whether the shares of
such series shall have voting powers, full or limited, or no voting powers, and if any, the terms of such voting powers; (iii)
the dividend rate, if any, on the shares of such series, the conditions and dates upon which such dividends shall be payable, the
preference or relation which such dividends shall bear to the dividends payable on any other class or classes or on any other series
of capital stock and whether such dividend shall be cumulative or noncumulative; (iv) whether the shares of such series shall be
subject to redemption by the Corporation, and, if made subject to redemption, the times, prices and other terms, limitations, restrictions
or conditions of such redemption; (v) the relative amounts, and the relative rights or preference, if any, of payment in respect
of shares of such series, which the holders of shares of such series shall be entitled to receive upon the liquidation, dissolution
or winding up of the Corporation; (vi) whether or not the shares of such series shall be subject to the operation of a retirement
or sinking fund and, if so, the extent to and manner in which any such retirement or sinking fund shall be applied to the purchase
or redemption of the shares of such series for retirement or to other corporate purposes and the terms and provisions relative
to the operation thereof; (vii) whether or not the shares of such series shall be convertible into, or exchangeable for, shares
of any other class, classes or series, or other securities, whether or not issued by the Corporation, and if so convertible or
exchangeable, the price or prices or the rate or rates of conversion or exchange and the method, if any, of adjusting same; (viii)
the limitations and restrictions, if any, to be effective while any shares of such series are outstanding upon the payment of dividends
or the making of other distributions on, and upon the purchase, redemption or other acquisition by the Corporation of, the Common
Stock or any other class or classes of capital stock of the Corporation ranking junior to the shares of such series either as to
dividends or upon liquidation, dissolution or winding up; (ix) the conditions or restrictions, if any, upon the creation of indebtedness
of the Corporation or upon the issuance of any additional shares of capital stock (including additional shares of such series or
of any other series or of any other class) ranking on a parity with or prior to the shares of such series as to dividends or distributions
of assets upon liquidation, dissolution or winding up; and (x) any other preference and relative, participating, optional or other
special rights, and the qualifications, limitations or restrictions thereof, as shall not be inconsistent with law, this Article
V or any resolution of the Board pursuant hereto.
Article
VI
Board of Directors
A.
Number; Election. The initial number of directors shall be five (5); provided, however,
that such number may be changed in accordance with Article V, Part B, and the bylaws of the Corporation. Unless and except
to the extent that the bylaws of the Corporation shall otherwise require, the election of directors of the Corporation need not
be by written ballot.
B.
Limitation of Liability. To the fullest extent permitted by law, no director of the Corporation shall
be personally liable to the Corporation or its stockholders for monetary damages for breach of its fiduciary duty as a director.
If the IBCL or any other law of the State of Indiana is amended after approval by the stockholders of this Article VI to authorize
corporate action further eliminating or limiting the personal liability of directors, then the liability of a director of the Corporation
shall be eliminated or limited to the fullest extent permitted by the IBCL as so amended. Any repeal or modification of the foregoing
provisions of this Article VI by the stockholders of the Corporation shall not adversely affect any right or protection of a director
of the Corporation existing at the time of, or increase the liability of any director of the Corporation with respect to any acts
or omissions of such director occurring prior to, such repeal or modification.
Article
VII
Indemnification
A.
Availability of Indemnification. Each person who was or is a party or is threatened to be made a party
to or is involved in any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or
investigative and whether by or in the right of the Corporation or otherwise (a “Proceeding”), by reason
of the fact that he or she, or a person of whom he or she is the legal representative, is or was a director or officer of the Corporation
or is or was serving at the request of the Corporation as a director, officer, employee, partner (limited or general) or agent
of another corporation or of a partnership, joint venture, limited liability company, trust or other enterprise, including service
with respect to an employee benefit plan, shall be (and shall be deemed to have a contractual right to be) indemnified and held
harmless by the Corporation (and any successor to the Corporation by merger or otherwise) to the fullest extent authorized by,
and subject to the conditions and (except as provided herein) procedures set forth in the IBCL, as the same exists or may hereafter
be amended (but any such amendment shall not be deemed to limit or prohibit the rights of indemnification hereunder for past acts
or omissions of any such person insofar as such amendment limits or prohibits the indemnification rights that said law permitted
the Corporation to provide prior to such amendment), against all expenses, liabilities and losses (including attorneys’ fees,
judgments, fines, ERISA taxes or penalties and amounts paid or to be paid in settlement) reasonably incurred or suffered by such
person in connection therewith; provided, however, that the Corporation shall indemnify any such person seeking indemnification
in connection with a Proceeding (or part thereof) initiated by such person only if such Proceeding (or part thereof) was authorized
by the Board. Persons who are not directors or officers of the Corporation and are not so serving at the request of the Corporation
may but need not be similarly indemnified in respect of such service to the extent authorized at any time by the Board. The indemnification
conferred in this Article also shall include the right to be paid by the Corporation (and such successor) the expenses (including
attorneys’ fees) incurred in the defense of or other involvement in any such Proceeding in advance of its final disposition;
provided, however, that, if and to the extent the IBCL requires, the payment of such expenses (including attorneys’
fees) incurred by a director or officer in advance of the final disposition of a Proceeding shall be made only upon delivery to
the Corporation of an undertaking by or on behalf of such director or officer to repay all amounts so paid in advance if it shall
ultimately be determined that such director or officer is not entitled to be indemnified under this Article or otherwise; and provided
further that such expenses incurred by other employees and agents may be so paid in advance upon such terms and conditions,
if any, as the Board deems appropriate. The ultimate determination of entitlement to indemnification of persons who are non-director
or officer employees or agents shall be made in such manner as is determined by the Board in its sole discretion. Notwithstanding
the foregoing sentence, the Corporation shall not be required to indemnify a person in connection with a Proceeding initiated by
such person if the Proceeding was not authorized in advance by the Board.
B.
Non-exclusivity. The rights to indemnification and advance payment of expenses provided by Part A of this
Article VII shall not be deemed exclusive of any other rights to which those seeking indemnification and advance payment of expenses
may be entitled under any by-law, agreement, vote of stockholders or disinterested directors or otherwise, both as to action in
his or her official capacity and as to action in another capacity while holding such office.
C.
Survival of Indemnification. The indemnification and advance payment of expenses and rights thereto provided
by, or granted pursuant to, Part A of this Article VII shall, unless otherwise provided when authorized or ratified, continue as
to a person who has ceased to be a director, officer, employee, partner or agent and shall inure to the benefit of the personal
representatives, heirs, executors and administrators of such person.
D.
Insurance. The Board may, to the full extent permitted by applicable law as it presently exists, or may
hereafter be amended from time to time, authorize an appropriate officer or officers to purchase and maintain at the Corporation's
expense insurance: (a) to indemnify the Corporation for any obligation which it incurs as a result of the indemnification of directors,
officers and employees under the provisions of this Article VII; and (b) to indemnify or insure directors, officers and employees
against liability in instances in which they may not otherwise be indemnified by the Corporation under the provisions of this Article
VII.
E.
Amendment or Repeal. Any repeal or modification of the foregoing provisions of this Article VII shall
not adversely affect any right or protection hereunder of any person in respect of any act or omission occurring prior to the time
of such repeal or modification. The rights provided hereunder shall inure to the benefit of any indemnified person and such person's
heirs, executors and administrators.
Article
VIII
Amendment of Bylaws
In furtherance and not in limitation of
the powers conferred by the IBCL, the Board is expressly authorized and empowered to adopt, amend and repeal the bylaws of the
Corporation including but not limited to any bylaws adopted by the stockholders.
Article
IX
Negation of Preemptive Rights
Except as otherwise provided in this Certificate
of Incorporation (as the same may be amended) or in a written agreement between the stockholder and the Corporation, no stockholder
shall have any preemptive right to subscribe to any additional issue of stock or to any security convertible into stock solely
by virtue of being a stockholder of the Corporation.
Article
X
Stockholder Meetings
The holders of ten percent (10%) or more
of the Corporation’s outstanding shares of capital stock may call a special meeting of the Corporation’s stockholders
by providing written notice thereof to each stockholder who has not waived notice, either before or after such meeting, in accordance
with the bylaws.
Article
XI
Existence
The Corporation is to have perpetual existence.
APPENDIX B
CHINESEINVESTORS.COM, INC. AMENDED
2019 EQUITY INCENTIVE PLAN
1.
Purposes of the Plan. The purposes of this Plan are:
·
to assist the Company and its affiliates in the recruitment and retention of persons with ability and initiative;
·
to provide an incentive to such persons to contribute to the growth and success of the Company’s businesses by affording
such persons equity participation in the Company;
·
to associate the interests of such persons with those of the Company and its affiliates and shareholders;
· to
provide incentives to individuals who perform services for the Company, and
· to promote the success of the Company’s business.
The Plan permits the
grant of Incentive Stock Options, Non-statutory Stock Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units,
Performance Units, Performance Shares and other stock or cash awards as the Administrator may determine.
2.
Definitions. As used herein, the following definitions will apply:
(a)
“Administrator” means the Board or any of its Committees as will be administering the Plan, in accordance
with Section 4 hereof.
(b)
“Affiliate” means any corporation or any other entity (including, but not limited to, partnerships and
joint ventures) controlling, controlled by, or under common control with the Company.
(c)
“Applicable Laws” means the requirements relating to the administration of equity-based awards under
U.S. federal and state corporate laws, U.S. federal and state securities laws, the Code, any stock exchange or quotation system
on which the Common Stock is listed or quoted and the applicable laws of any foreign country or jurisdiction where Awards are,
or will be, granted under the Plans.
(d)
“Award” means, individually or collectively, a grant under the Plan of Options, Stock Appreciation Rights,
Restricted Stock, Restricted Stock Units, Performance Units, Performance Shares and other stock or cash awards as the Administrator
may determine.
(e)
“Award Agreement” means the written agreement setting forth the terms and provisions applicable to each
Award granted under the Plan. The Award Agreement is subject to the terms and conditions of the Plan.
(f)
“Board” means the Board of Directors of the Company.
(g)
“Change in Control” means the occurrence of any of the following events after the Effective Date:
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(i)
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A change in the ownership of the Company which occurs on the date that any one person, or more
than one person acting as a group (“Person”), acquires ownership of stock in the Company that, together with
the stock already held by such Person, constitutes more than 50% of the total voting power of the stock of the Company; provided,
however, that for purposes of this subsection (i), the acquisition of additional stock by any Person who is considered to own more
than 50% of the total voting power of the stock of the Company before the acquisition will not be considered a Change in Control;
or
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(ii)
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The consummation of any of the following events: (A) a change in the ownership of a substantial
portion of the Company’s assets, which occurs on the date that any Person acquires (or has acquired during the twelve (12)
month period ending on the date of the most recent acquisition by such Person) assets from the Company that have a total gross
fair market value equal to or more than 50% of the total gross fair market value of all of the assets of the Company immediately
prior to such acquisition or acquisitions, or (B) a merger, consolidation or reorganization involving the Company, where either
or both of the events described in clauses (i) or (ii) above would be the result. For purposes of this subsection (iii), the following
will not constitute a change in the ownership of a substantial portion of the Company’s assets or a Change in Control: (A)
a transfer to an entity that is controlled by the Company’s stockholders immediately after the transfer, or (B) a transfer
of assets by the Company to: (1) a stockholder of the Company (immediately before the asset transfer) in exchange for or with respect
to the Company’s stock, (2) an entity, 50% or more of the total value or voting power of which is owned, directly or indirectly,
by the Company, (3) a Person that owns, directly or indirectly, 50% or more of the total value or voting power of all the outstanding
stock of the Company, or (4) an entity, at least 50% of the total equity or voting power of which is owned, directly or indirectly,
by a Person described in subsection (iii)(B)(3) above. For purposes of this subsection (iii), gross fair market value means the
value of the assets of the Company, or the value of the assets being disposed of, determined without regard to any liabilities
associated with such assets.
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For purposes of this Section 2(g), persons
will be considered to be acting as a group if they are owners of a corporation or other entity that enters into a merger, consolidation,
purchase or acquisition of stock, or similar business transaction with the Company.
(h)
“Code” means the Internal Revenue Code of 1986, as amended. Any reference to a section of the Code herein
will be a reference to any successor or amended section of the Code.
(i)
“Committee” means a committee of Directors or of other individuals satisfying Applicable Laws appointed
by the Board in accordance with Section 4 hereof.
(j)
“Common Stock” means the common stock, par value $0.001 per share, of the Company.
(k)
“Company” means Chineseinvestors.com, Inc., an Indiana corporation, or any successor thereto.
(l)
“Consultant” means any person, including an advisor, other than an Employee engaged by the Company or
a Parent, Subsidiary or Affiliate to render services to such entity.
(m)
“Determination Date” means the latest possible date that will not jeopardize the qualification of an
Award granted under the Plan as “performance-based compensation” under Section 162(m) of the Code.
(n)
“Director” means a member of the Board.
(o) “Disability”
means permanent and total disability as defined in Section 22(e)(3) of the Code, provided that in the case of Awards other
than Incentive Stock Options, the Administrator in its discretion may determine whether a permanent and total disability
exists in accordance with uniform and non-discriminatory standards adopted by the Administrator from time to time.
(p)
“Effective Date” shall have the meaning set forth in Section 18 hereof.
(q)
“Employee” means any person, including Officers and Directors, other than a Consultant employed by the
Company or any Parent, Subsidiary or Affiliate of the Company. Neither service as a Director nor payment of a director’s
fee by the Company will be sufficient to constitute “employment” by the Company.
(r)
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
(s)
“Exchange Program” means a program under which (i) outstanding Awards are surrendered or cancelled in
exchange for Awards of the same type (which may have lower exercise prices and different terms), Awards of a different type, and/or
cash, and/or (ii) the exercise price of an outstanding Award is reduced. The Administrator will determine the terms and conditions
of any Exchange Program in its sole discretion.
(t)
“Fair Market Value” means, as of any date, the value of the Common Stock as the Administrator may determine
in good faith, by reference to the closing price of such stock on any established stock exchange or on a national market system
on the day of determination, if the Common Stock is so listed on any established stock exchange or on a national market system.
If the Common Stock is not listed on any established stock exchange or on a national market system, the value of the Common Stock
will be determined as the Administrator may determine in good faith using (i) a valuation methodology set forth in Treasury Regulation
1.409A-1(b)(5)(iv)(B) or (ii) with respect to valuations applicable to Awards that are not subject to Code Section 409A, such other
valuation methods as the Administrator may select.
(u)
“Fiscal Year” means the fiscal year of the Company.
(v)
“Incentive Stock Option” means an Option that by its terms qualifies and is otherwise intended to qualify
as an incentive stock option within the meaning of Section 422 of the Code and the regulations promulgated thereunder.
(w)
“Non-statutory Stock Option” means an Option that by its terms does not qualify or expressly provides
that it is not intended to qualify as an Incentive Stock Option.
(x)
“Officer” means a person who is an officer of the Company within the meaning of Section 16 of the
Exchange Act and the rules and regulations promulgated thereunder.
(y)
“Option” means a stock option granted pursuant to Section 6 hereof.
(z)
“Parent” means a “parent corporation,” whether now or hereafter existing, as defined in Section 424(e)
of the Code.
(aa)
“Participant” means the holder of an outstanding Award.
(bb)
“Performance Goals” will have the meaning set forth in Section 11 hereof.
(cc)
“Performance Period” means any Fiscal Year of the Company or such other period as determined by the Administrator
in its sole discretion.
(dd)
“Performance Share” means an Award denominated in Shares which may be earned in whole or in part upon
attainment of Performance Goals or other vesting criteria as the Administrator may determine pursuant to Section 10 hereof.
(ee)
“Performance Unit” means an Award which may be earned in whole or in part upon attainment of Performance
Goals or other vesting criteria as the Administrator may determine and which may be settled for cash, Shares or other securities
or a combination of the foregoing pursuant to Section 10 hereof.
(ff)
“Period of Restriction” means the period during which transfers of Shares of Restricted Stock are subject
to restrictions and, therefore, the Shares are subject to a substantial risk of forfeiture. Such restrictions may be based on the
passage of time, the achievement of target levels of performance, or the occurrence of other events specified in the applicable
Award, as interpreted and construed by the Administrator.
(gg)
“Plan” means this 2019 Equity Incentive Plan.
(hh) “Restricted Stock” means Shares issued pursuant to an Award of Restricted
Stock under Section 8 hereof, or issued pursuant to the early exercise of an Option.
(ii)
“Restricted Stock Unit” means a bookkeeping entry representing an amount equal to the Fair Market Value
of one Share, granted pursuant to Section 9 hereof. Each Restricted Stock Unit represents an unfunded and unsecured obligation
of the Company.
(jj)
“Rule 16b-3” means Rule 16b-3 of the Exchange Act or any
successor to Rule 16b-3, as in effect when discretion is being exercised with respect to the Plan.
(kk) “Section 16(b)” means Section 16(b) of the Exchange
Act.
(ll)
“Service Provider” means an Employee, Director, or Consultant.
(mm)
“Share” means a share of the Common Stock, as adjusted in accordance with Section 14 hereof.
(nn)
“Stock Appreciation Right” means an Award, granted alone or in connection with an Option, that pursuant
to Section 7 is designated as a Stock Appreciation Right.
(oo)
“Subsidiary” means a “subsidiary corporation,” whether now or hereafter existing, as defined
in Section 424(f) of the Code.
3.
Stock Subject to the Plan.
(a)
Subject to the provisions of Section 14 hereof, the maximum aggregate number of Shares that may be awarded and sold
under the Plan is seven million (7,000,000) Shares. The Shares may be authorized, but unissued, or reacquired Common Stock.
(b)
Lapsed Awards. If an Award expires or becomes unexercisable without having been exercised in full, or, with respect
to Restricted Stock, Restricted Stock Units, Performance Shares or Performance Units, is forfeited to or repurchased by the Company,
the unpurchased Shares (or for Awards other than Options and Stock Appreciation Rights, the forfeited or repurchased Shares) which
were subject thereto will become available for future grant or sale under the Plan (unless the Plan has terminated). Upon exercise
of a Stock Appreciation Right settled in Shares, the gross number of Shares covered by the portion of the Award so settled will
cease to be available under the Plan. Shares that have actually been issued under the Plan under any Award will not be returned
to the Plan and will not become available for future distribution under the Plan; provided, however, that if unvested Shares of
Restricted Stock, Restricted Stock Units, Performance Shares or Performance Units are repurchased by the Company or are forfeited
to the Company, such Shares will become available for future grant under the Plan. Shares subject to an Award that are transferred
to or retained by the Company to pay the tax and/or exercise price of an Award will become available for future grant or sale under
the Plan. To the extent an Award under the Plan is paid out in cash rather than Shares, such cash payment will not result in reducing
the number of Shares available for issuance under the Plan and, for the elimination of doubt, the number of Shares of equal value
to such cash payment shall become available for future grant or sale under the Plan. Notwithstanding the foregoing provisions of
this Section 3(b), subject to adjustment provided in Section 14 hereof, the maximum number of Shares that may be issued upon
the exercise of Incentive Stock Options will equal the aggregate Share number stated in Section 3(a) above, plus, to the extent
allowable under Section 422 of the Code, any Shares that become available for issuance under the Plan under this Section 3(b).
(c)
Share Reserve. The Company, during the term of this Plan, will at all times reserve and keep available such number
of Shares as will be sufficient to satisfy the requirements of the Plan.
4.
Administration of the Plan.
(a)
Procedure.
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(i)
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Multiple Administrative Bodies. Different Committees may be established with respect to
different groups of Service Providers; in that event, the Committee established with respect to a group of Service Providers shall
administer the Plan with respect to Awards granted to members of such group.
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(ii)
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Section 162(m). To the extent that the Administrator determines it to be desirable
to qualify Awards granted hereunder as “performance-based compensation” within the meaning of Section 162(m) of
the Code, and if the Company is then a “publicly held corporation” as defined therein, the Plan will be administered
by a Committee of two (2) or more “outside directors” within the meaning of Section 162(m) of the Code.
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(iii)
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Rule 16b-3. To the extent desirable to qualify transactions hereunder as exempt under Rule
16b-3, the transactions contemplated hereunder will be structured to satisfy the requirements for exemption under Rule 16b-3.
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(iv)
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Other Administration. Other than as provided above, the Plan will be administered by (A) the
Board or (B) a Committee, which committee will be constituted to satisfy Applicable Laws.
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(b)
Powers of the Administrator. Subject to the provisions of the Plan, and in the case of a Committee, subject to the
specific duties delegated by the Board to such Committee, the Administrator will have the authority, in its discretion:
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(i)
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to determine Fair Market Value;
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(ii)
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to select the Service Providers to whom Awards may be granted hereunder;
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(iii)
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to determine the terms and condition, not inconsistent with the terms of the Plan, of any Award
granted hereunder;
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(iv)
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to institute an Exchange Program and to determine the terms and conditions, not inconsistent with
the terms of the Plan, for (1) the surrender or cancellation of outstanding Awards in exchange for Awards of the same type, Awards
of a different type, and/or cash, or (2) the reduction of the exercise price of outstanding Awards;
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(v)
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to construe and interpret the terms of the Plan and Awards granted pursuant to the Plan;
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(vi)
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to prescribe, amend and rescind rules and regulations relating to the Plan, including rules and
regulations relating to sub-plans established for the purpose of satisfying applicable foreign laws;
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(vii)
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to modify or amend each Award (subject to Section 19(c) hereof);
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(viii)
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to authorize any person to execute on behalf of the Company any instrument required to reflect
or implement the grant of an Award previously granted by the Administrator;
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(ix)
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to allow a Participant to defer the receipt of the payment of cash or the delivery of Shares that
would otherwise be due to such Participant under an Award pursuant to such procedures as the Administrator may determine consistent
with the requirements for compliance with or exemption from the provisions of Code Section 409A; and
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(x)
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to make all other determinations deemed necessary or advisable for administering the Plan.
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(c) Effect
of Administrator’s Decision. The Administrator’s decisions, determinations, and interpretations will be final
and binding on all Participants and any other holders of Awards.
5.
Eligibility. Non-statutory Stock Options, Restricted Stock, Restricted Stock Units, Stock Appreciation Rights, Performance
Units, Performance Shares, and such other cash or stock awards as the Administrator determines may be granted to Service Providers.
Incentive Stock Options may be granted only to Employees.
6.
Stock Options.
(a)
Limitations.
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(i)
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Each Option will be designated in the Award Agreement as either an Incentive Stock Option or a
Non-statutory Stock Option. However, notwithstanding such designation, to the extent that the aggregate Fair Market Value of the
Shares with respect to which Incentive Stock Options are exercisable for the first time by the Participant during any calendar
year (under all plans of the Company and any Parent or Subsidiary) exceeds $100,000 (U.S.), such Options will be treated as Non-statutory
Stock Options. For purposes of this Section 6(a), Incentive Stock Options will be taken into account in the order in which
they were granted. The Fair Market Value of the Shares will be determined as of the time the Option with respect to such Shares
is granted.
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(ii)
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Subject to the limits set forth in Section 3, the Administrator will have complete discretion to
determine the number of Shares subject to an Option granted to any Participant.
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(b)
Term of Option. The Administrator will determine the term of each Option in its sole discretion; provided, however,
that the term will be no more than ten (10) years from the date of grant thereof in the case of Incentive Stock Options Moreover,
in the case of an Incentive Stock Option granted to a Participant who, at the time the Incentive Stock Option is granted, owns
stock representing more than 10% of the total combined voting power of all classes of stock of the Company or any Parent or Subsidiary,
the term of the Incentive Stock Option will be five (5) years from the date of grant or such shorter term as may be provided in
the Award Agreement.
(c)
Option Exercise Price and Consideration.
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(i)
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Exercise Price. The per share exercise price for the Shares to be issued pursuant to exercise
of an Option will be determined by the Administrator, but will be no less than 100% of the Fair Market Value per Share on the date
of grant. In addition, in the case of an Incentive Stock Option granted to an Employee who, at the time the Incentive Stock Option
is granted, owns stock representing more than 10% of the voting power of all classes of stock of the Company or any Parent or Subsidiary,
the per Share exercise price will be no less than 110% of the Fair Market Value per Share on the date of grant. Notwithstanding
the foregoing provisions of this Section 6(c), Options may be granted with a per Share exercise price of less than 100% of the
Fair Market Value per Share on the date of grant pursuant to the issuance or assumption of an Option in a transaction to which
Section 424(a) of the Code applies in a manner consistent with said Section 424(a).
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(ii)
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Waiting Period and Exercise Dates. At the time an Option is granted, the Administrator will
fix the period within which the Option may be exercised and will determine any conditions that must be satisfied before the Option
may be exercised.
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(iii)
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Form of Consideration. The Administrator will determine the acceptable form(s) of consideration
for exercising an Option, including the method of payment, to the extent permitted by Applicable Laws including but not limited
to tendering capital stock of the Company owned by a Participant, duly endorsed for transfer to the Company.
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(d)
Exercise of Option.
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(i)
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Procedure for Exercise; Rights as a Stockholder. Any Option granted hereunder will be exercisable
according to the terms of the Plan and at such times and under such conditions as determined by the Administrator and set forth
in the Award Agreement. An Option may not be exercised for a fraction of a Share.
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An Option will be deemed exercised when the Company receives: (i) notice of exercise (in
such form as the Administrator specifies from time to time) from the person entitled to exercise the Option, and
(ii) full payment for the Shares with respect to which the Option is exercised (together with any applicable withholding
taxes). No adjustment will be made for a dividend or other right for which the record date is prior to the date the Shares
are issued, except as provided in Section 14 hereof.
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(ii)
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Termination of Relationship as a Service Provider. If a Participant ceases to be a Service
Provider, other than upon the Participant’s termination as the result of the Participant’s death or Disability, the
Participant may exercise his or her Option within such period of time as is specified in the Award Agreement to the extent that
the Option is vested on the date of termination (but in no event later than the expiration of the term of such Option as set forth
in the Award Agreement). In the absence of a specified time in the Award Agreement, the Option will remain exercisable for three
(3) months following the Participant’s termination. Unless otherwise provided by the Administrator, if on the date of termination
the Participant is not vested as to his or her entire Option, the Shares covered by the unvested portion of the Option will revert
to the Plan. If after termination the Participant does not exercise his or her Option within the time specified by Award Agreement
or by operation of this Section 6(d)(3), the Option will terminate, and the Shares covered by such Option will revert to the Plan.
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(iii)
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Disability of Participant. If a Participant ceases to be a Service Provider as a result of the Participant’s Disability,
the Participant may exercise his or her Option within such period of time as is specified in the Award Agreement to the extent
the Option is vested on the date of cessation (but in no event later than the expiration of the term of such Option as set forth
in the Award Agreement). In the absence of a specified time in the Award Agreement, the Option will remain exercisable for six
(6) months following the date the Participant ceases to be a Service Provider unless the Option is an Incentive Stock Option, in
which case the Option will remain exercisable for one year unless a shorter time is provided in the Award Agreement. Unless otherwise
provided by the Administrator, if on the date of cessation the Participant is not vested as to his or her entire Option, the Shares
covered by the unvested portion of the Option will revert to the Plan. If after cessation the Participant does not exercise his
or her Option within the time specified herein, the Option will terminate, and the Shares covered by such Option will revert to
the Plan.
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(iv)
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Death of Participant. If a Participant dies while a Service Provider, the Option may be
exercised within such period of time as is specified in the Award Agreement to the extent that the Option is vested on the date
of death (but in no event may the option be exercised later than the expiration of the term of such Option as set forth in the
Award Agreement), by the Participant’s beneficiary, provided such beneficiary has been designated prior to Participant’s
death in a form acceptable to the Administrator. If no such beneficiary has been designated by the Participant, then such Option
may be exercised by the personal representative of the Participant’s estate or by the person(s) to whom the Option is transferred
pursuant to the Participant’s will or in accordance with the laws of descent and distribution. In the absence of a specified
time in the Award Agreement, the Option will remain exercisable for six (6) months following Participant’s death. Unless
otherwise provided by the Administrator, if at the time of death Participant is not vested as to his or her entire Option, the
Shares covered by the unvested portion of the Option will continue to vest in accordance with the Award Agreement. If the Option
is not so exercised within the time specified herein, the Option will terminate, and the Shares covered by such Option will revert
to the Plan.
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7.
Stock Appreciation Rights.
(a)
Grant of Stock Appreciation Rights. Subject to the terms and conditions of the Plan, a Stock Appreciation Right may
be granted to Service Providers at any time and from time to time as will be determined by the Administrator, in its sole discretion.
(b)
Number of Shares. The Administrator will have complete discretion to determine the number of Stock Appreciation Rights
granted to any Participant.
(c)
Exercise Price and Other Terms. The Administrator, subject to the provisions of the Plan, will have complete discretion
to determine the terms and conditions of Stock Appreciation Rights granted under the Plan; provided, however, that the exercise
price will be not less than 100% of the Fair Market Value of a Share on the date of grant.
(d)
Stock Appreciation Rights Agreement. Each Stock Appreciation Right grant will be evidenced by an Award Agreement
that will specify the exercise price, the number of Shares with respect to which the Award is granted, the term of the Stock Appreciation
Right, the conditions of exercise, and such other terms and conditions as the Administrator, in its sole discretion, will determine.
(e)
Expiration of Stock Appreciation Rights. A Stock Appreciation Right granted under the Plan will expire upon the date
determined by the Administrator, in its sole discretion, and set forth in the Award Agreement; provided, however, that the term
will be no more than ten (10) years from the date of grant thereof. Notwithstanding the foregoing, the rules of Section 6(d)
above also will apply to Stock Appreciation Rights.
(f)
Payment of Stock Appreciation Right Amount. Upon exercise of a Stock Appreciation Right, a Participant will be entitled
to receive payment from the Company in an amount determined by multiplying:
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(i)
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The difference between the Fair Market Value of a Share on the date of exercise over the “stock
appreciation right exercise price,” as defined under Treasury Regulation Section 1.409A-1(b)(i)(B)(2), i.e., the Fair
Market Value of a Share on the date of grant of the Stock Appreciation Right; times
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(ii)
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The number of Shares or the amount of cash with respect to which the Stock Appreciation Right is
exercised as prescribed in the applicable Award Agreement or as determined by the Administrator.
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At the discretion of the Administrator,
the payment upon Stock Appreciation Right exercise may be in cash, in Shares of equivalent value, or in some combination thereof.
8.
Restricted Stock.
(a)
Grant of Restricted Stock. Subject to the terms and provisions of the Plan, the Administrator, at any time and from
time to time, may grant Shares of Restricted Stock to Service Providers in such amounts as the Administrator, in its sole discretion,
will determine.
(b)
Restricted Stock Agreement. Each Award of Restricted Stock will be evidenced by an Award Agreement that will specify
the Period of Restriction, the number of Shares granted, and such other terms and conditions as the Administrator, in its sole
discretion, will determine.
(c)
Transferability. Except as provided in this Section 8, Shares of Restricted Stock may not be sold, transferred, pledged,
assigned, or otherwise alienated or hypothecated until such Shares become non-forfeitable at the end of the applicable Period of
Restriction.
(d)
Other Restrictions. The Administrator, in its sole discretion, may impose such other restrictions on Shares of Restricted
Stock as it may deem advisable or appropriate.
(e)
Removal of Restrictions. Except as otherwise provided in this Section 8, Shares of Restricted Stock covered by each
Restricted Stock grant made under the Plan will be released from escrow as soon as practicable after the last day of the Period
of Restriction. The Administrator, in its discretion, may accelerate the time at which any restrictions will lapse or be removed.
(f)
Voting Rights. During the Period of Restriction, Service Providers holding Shares of Restricted Stock granted hereunder
may exercise full voting rights with respect to those Shares, unless the Administrator determines otherwise in a manner not prohibited
by the Award Agreement.
(g)
Dividends and Other Distributions. During the Period of Restriction, Service Providers holding Shares of Restricted
Stock will be entitled to receive all dividends and other distributions paid with respect to such Shares unless otherwise provided
in the Award Agreement. If any such dividends or distributions are paid in Shares, the Shares will be subject to the same restrictions
on transferability and provisions for forfeiture as the Shares of Restricted Stock with respect to which they were paid.
(h)
Return of Restricted Stock to Company. On the date set forth in the Award Agreement, the Restricted Stock for which
restrictions have not lapsed will revert to the Company and again will become available for grant under the Plan.
(i) Section
162(m) Performance Restrictions. For purposes of qualifying grants of Restricted Stock as
“performance-based compensation” under Section 162(m) of the Code, the Administrator, in its discretion, may
condition the lapse of restrictions based upon the achievement of Performance Goals. The Performance Goals will be set by the
Administrator on or before the Determination Date. In granting Restricted Stock which is intended to qualify under
Section 162(m) of the Code, the Administrator will follow any procedures determined by it from time to time to be
necessary or appropriate to ensure qualification of the Award under Section 162(m) of the Code (e.g., in determining the
Performance Goals).
9.
Restricted Stock Units.
(a)
Grant. Restricted Stock Units may be granted at any time and from time to time as determined by the Administrator.
Each Restricted Stock Unit grant will be evidenced by an Award Agreement that will specify such other terms and conditions as the
Administrator, in its sole discretion, will determine in accordance with the terms and conditions of the Plan, including all terms,
conditions, and restrictions related to the grant, the number of Restricted Stock Units and the form of payout, which, subject
to Section 9(d) hereof, may be left to the discretion of the Administrator.
(b)
Vesting Criteria and Other Terms. The Administrator will set vesting criteria in its discretion, which, depending
on the extent to which the criteria are met, will determine the number of Restricted Stock Units that will be paid out to the Participant.
After the grant of Restricted Stock Units, the Administrator, in its sole discretion, may reduce or waive any restrictions for
such Restricted Stock Units. Each Award of Restricted Stock Units will be evidenced by an Award Agreement that will specify the
vesting criteria, and such other terms and conditions as the Administrator, in its sole discretion will determine. The Administrator,
in its discretion, may accelerate the time at which any restrictions will lapse or be removed, subject to the prohibition on acceleration
of the timing of distribution of deferred compensation subject to Section 409A of the Code, to the extent applicable to the Award.
(c)
Earning Restricted Stock Units. Upon meeting the applicable vesting criteria, the Participant will be entitled to
receive a payout as specified in the Award Agreement.
(d)
Form and Timing of Payment. Payment of earned Restricted Stock Units will be made as soon as practicable after the
date(s) set forth in the Award Agreement, which shall satisfy the requirements of Section 409A of the Code, to the extent applicable
to such Award. The Administrator, in its sole discretion, may pay earned Restricted Stock Units in cash, Shares, or a combination
thereof. Shares represented by Restricted Stock Units that are fully paid in cash again will be available for grant under the Plan.
(e)
Cancellation. On the date set forth in the Award Agreement, all unearned Restricted Stock Units will be forfeited
to the Company.
(f) Section
162(m) Performance Restrictions. For purposes of qualifying grants of Restricted Stock Units as “performance-based compensation”
under Section 162(m) of the Code, the Administrator, in its discretion, may set restrictions based upon the achievement of
Performance Goals. The Performance Goals will be set by the Administrator on or before the Determination Date. In granting Restricted
Stock Units which are intended to qualify under Section 162(m) of the Code, the Administrator will follow any procedures
determined by it from time to time to be necessary or appropriate to ensure qualification of the Award under Section 162(m)
of the Code (e.g., in determining the Performance Goals).
10.
Performance Units and Performance Shares.
(a)
Grant of Performance Units/Shares. Performance Units and Performance Shares may be granted to Service Providers at
any time and from time to time, as will be determined by the Administrator, in its sole discretion. The Administrator will have
complete discretion in determining the number of Performance Units/Shares granted to each Participant.
(b)
Value of Performance Units/Shares. Each Performance Unit will have an initial value that is established by the Administrator
on or before the date of grant. Each Performance Share will have an initial value equal to the Fair Market Value of a Share on
the date of grant.
(c) Performance
Objectives and Other Terms. The Administrator will set performance objectives or other vesting provisions. The Administrator
may set vesting criteria based upon the achievement of Company-wide, business unit, or individual goals (including, but not limited
to, continued employment), or any other basis determined by the Administrator in its discretion. Each Award of Performance Units/Shares
will be evidenced by an Award Agreement that will specify the Performance Period, and such other terms and conditions as the Administrator,
in its sole discretion, will determine.
(d)
Earning of Performance Units/Shares. After the applicable Performance Period has ended, the holder of Performance
Units/Shares will be entitled to receive a payout of the number of Performance Units/Shares earned by the Participant over the
Performance Period, to be determined as a function of the extent to which the corresponding performance objectives or other vesting
provisions have been achieved. After the grant of a Performance Unit/Share, the Administrator, in its sole discretion, may reduce
or waive any performance objectives or other vesting provisions for such Performance Unit/Share.
(e)
Form and Timing of Payment of Performance Units/Shares. Payment of earned Performance Units/Shares will be made as
soon as practicable after the expiration of the applicable Performance Period or, if earlier, after the date on which a Participant’s
interest in such Performance Units/Shares is no longer subject to a substantial risk of forfeiture, provided however, that in no
event shall such payment be made after the later to occur of (i) December 31 of the year in which such risk of forfeiture lapses
or (ii) two and one-half months after such risk of forfeiture lapses. The Administrator, in its sole discretion, may pay earned
Performance Units/Shares in the form of cash, in Shares (which have an aggregate Fair Market Value equal to the value of the earned
Performance Units/Shares at the close of the applicable Performance Period) or in a combination thereof.
(f)
Cancellation of Performance Units/Shares. On the date set forth in the Award Agreement, all unearned or unvested
Performance Units/Shares will be forfeited to the Company, and again will be available for grant under the Plan.
(g)
Section 162(m) Performance Restrictions. For purposes of qualifying grants of Performance Units/Shares as “performance-based
compensation” under Section 162(m) of the Code, the Administrator, in its discretion, may set restrictions based upon
the achievement of Performance Goals. The Performance Goals will be set by the Administrator on or before the Determination Date.
In granting Performance Units/Shares which are intended to qualify under Section 162(m) of the Code, the Administrator will
follow any procedures determined by it from time to time to be necessary or appropriate to ensure qualification of the Award under
Section 162(m) of the Code (e.g., in determining the Performance Goals).
11.
Performance-Based Compensation Under Code Section 162(m).
(a)
General. If the Administrator, in its discretion, decides to grant an Award intended to qualify as “performance-based
compensation” under Code Section 162(m), the provisions of this Section 11 will control over any contrary provision in the
Plan; provided, however, that the Administrator may in its discretion grant Awards that are not intended to qualify as “performance-based
compensation” under Section 162(m) of the Code to such Participants that are based on Performance Goals or other specific
criteria or goals but that do not satisfy the requirements of this Section 11.
(b)
Performance Goals. The granting and/or vesting of Awards of Restricted Stock, Restricted Stock Units, Performance
Shares and Performance Units and other incentives under the Plan may be made subject to the attainment of performance goals relating
to one or more business criteria within the meaning of Code Section 162(m) and may provide for a targeted level or levels of achievement
(“Performance Goals”) including (i) earnings per Share, (ii) operating cash flow, (iii) operating
income, (iv) profit after-tax, (v) profit before-tax, (vi) return on assets, (vii) return on equity, (viii) return
on sales, (ix) revenue, and (x) total shareholder return. Any Performance Goals may be used to measure the performance
of the Company as a whole or a business unit of the Company and may be measured relative to a peer group or index. The Performance
Goals may differ from Participant to Participant and from Award to Award. Prior to the Determination Date, the Administrator will
determine whether any significant element(s) will be included in or excluded from the calculation of any Performance Goal with
respect to any Participant.
(c)
Procedures. To the extent necessary to comply with the performance-based compensation provisions of Code Section
162(m), with respect to any Award granted subject to Performance Goals, within the first twenty-five percent (25%) of the Performance
Period, but in no event more than ninety (90) days following the commencement of any Performance Period (or such other time as
may be required or permitted by Code Section 162(m)), the Administrator will, in writing, (i) designate one or more Participants
to whom an Award will be made, (ii) select the Performance Goals applicable to the Performance Period, (iii) establish the amounts
of such Awards, as applicable, which may be earned for such Performance Period, and (iv) specify the relationship between
Performance Goals and the amounts of such Awards, as applicable, to be earned by each Participant for such Performance Period.
Following the completion of each Performance Period but in no event later than December 31 of the year in which such Performance
Period ends or, if later, the date that is two and one-half months after the end of such Performance Period, the Administrator
will certify in writing whether the applicable Performance Goals have been achieved for such Performance Period and pay any amount
to which a Participant is entitled under an Award with respect to such Performance Period. In determining the amounts earned by
a Participant, the Administrator will have the right to reduce or eliminate (but not to increase) the amount payable at a given
level of performance to take into account additional factors that the Administrator may deem relevant to the assessment of individual
or corporate performance for the Performance Period. A Participant will be eligible to receive payment pursuant to an Award for
a Performance Period only if the Performance Goals for such period are achieved.
(d)
Additional Limitations. Notwithstanding any other provision of the Plan, any Award which is granted to a Participant
and is intended to constitute qualified performance based compensation under Code Section 162(m) will be subject to any additional
limitations set forth in the Code (including any amendment to Section 162(m)) or any regulations and ruling issued thereunder that
are requirements for qualification as qualified performance-based compensation as described in Section 162(m) of the Code, and
the Plan will be deemed amended to the extent necessary to conform to such requirements.
12.
Leaves of Absence. Unless the Administrator provides otherwise, vesting of Awards granted hereunder will be suspended
during any unpaid leave of absence. A Service Provider will not cease to be an Employee in the case of (i) any leave of absence
approved by the Company, or (ii) transfers between locations of the Company or between the Company, its Parent, or any Subsidiary.
For purposes of Incentive Stock Options, no such leave may exceed three (3) months, unless reemployment upon expiration of such
leave is guaranteed by statute or contract. If reemployment upon expiration of a leave of absence approved by the Company is not
so guaranteed, then six (6) months and one day following the commencement of such leave any Incentive Stock Option held by the
Participant will cease to be treated as an Incentive Stock Option and will be treated for tax purposes as a Non-statutory Stock
Option.
13.
Transferability of Awards. Unless determined otherwise by the Administrator, an Award may not be sold, pledged, assigned,
hypothecated, transferred, or disposed of in any manner other than by will or by the laws of descent or distribution and may be
exercised, during the lifetime of the Participant, only by the Participant. If the Administrator makes an Award transferable, such
Award may only be transferred (i) by will, (ii) by the laws of descent and distribution, (iii) to a revocable trust, or (iv) as
permitted by Rule 701 of the Securities Act of 1933, as amended.
14.
Adjustments; Dissolution or Liquidation; Merger or Change in Control.
(a)
Adjustments. In the event that any dividend or other distribution (whether in the form of cash, Shares, other securities,
or other property), recapitalization, stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off,
combination, repurchase, or exchange of Shares or other securities of the Company, or other change in the corporate structure of
the Company affecting the Shares occurs, the Administrator, in order to prevent diminution or enlargement of the benefits or potential
benefits intended to be made available under the Plan, will adjust the number and class of Shares that may be delivered under the
Plan and/or the number, class, and price of Shares covered by each outstanding Award, and the numerical Share limits set forth
in Sections 3, 6, 7, 8, 9 and 10 hereof.
(b)
Dissolution or Liquidation. In the event of the proposed dissolution or liquidation of the Company, any corporate
separation or division, including, but not limited to, a split-up, a split-off or a spin-off; a reverse merger in which the Company
is the surviving entity, but the shares of Company stock outstanding immediately preceding the merger are converted by virtue of
the merger into other property, whether in the form of securities, cash or otherwise; or the transfer of more than fifty percent
(50%) of the then outstanding voting stock of the Company to another person or entity. the Administrator will notify each Participant
as soon as practicable prior to the effective date of such proposed transaction. The Company, to the extent permitted by applicable
law but otherwise in its sole discretion may provide for: (i) the continuation Awards by the Company (if the Company is surviving
entity or its parent; (ii) the assumption of the Plan and such outstanding Awards by the surviving entity or its parent; (iii)
the substitution by the surviving entity or its parent of rights with substantially the same terms for such outstanding Awards;
or (iv) the cancellation of such outstanding Rights without payment of any consideration provided that in the case of this clause
(iv), the Administrator will provide notice of its intention to cancel Award and offer a reasonable opportunity to exercise vested
Awards.
(c) Change in Control.
(i) In the
event of a merger or Change in Control, each outstanding Award will be treated as the Administrator determines, including, without
limitation, that each Award will be assumed or an equivalent option or right substituted by the successor corporation or a Parent
or Subsidiary of the successor corporation (the “Successor Corporation”). The Administrator will not be required
to treat all Awards similarly in the transaction.
(ii) In the event that the Successor
Corporation does not assume or substitute for the Award, the Participant will fully vest in and have the right to exercise all
of his or her outstanding Options and Stock Appreciation Rights, including Shares as to which such Awards would not otherwise be
vested or exercisable, all restrictions on Restricted Stock will lapse, and, with respect to Restricted Stock Units, Performance
Shares and Performance Units, all Performance Goals or other vesting criteria will be deemed achieved at target levels and all
other terms and conditions met. In addition, if an Option or Stock Appreciation Right is not assumed or substituted for in the
event of a Change in Control, the Administrator will notify the Participant in writing or electronically that the Option or Stock
Appreciation Right will be fully vested and exercisable for a period of time determined by the Administrator in its sole discretion,
and the Option or Stock Appreciation Right will terminate upon the expiration of such period.
(iii) For the purposes of this
subsection (c), an Award will be considered assumed if, following the Change in Control, the Award confers the right to purchase
or receive, for each Share subject to the Award immediately prior to the Change in Control, the consideration (whether stock, cash,
or other securities or property) or, in the case of a Stock Appreciation Right upon the exercise of which the Administrator determines
to settle in cash or a Performance Share or Performance Unit which the Administrator can determine to settle in cash, the fair
market value of the consideration received in the merger or Change in Control by holders of Common Stock for each Share held on
the effective date of the transaction (and if holders were offered a choice of consideration, the type of consideration chosen
by the holders of a majority of the outstanding Shares); provided, however, that if such consideration received in the Change in
Control is not solely common stock of the Successor Corporation, the Administrator may, with the consent of the Successor Corporation,
provide for the consideration to be received upon the exercise of an Option or Stock Appreciation Right or upon the payout of a
Performance Share or Performance Unit, for each Share subject to such Award (or in the case of Performance Units, the number of
implied shares determined by dividing the value of the Performance Units by the per share consideration received by holders of
Common Stock in the Change in Control), to be solely common stock of the Successor Corporation equal in fair market value to the
per share consideration received by holders of Common Stock in the Change in Control.
(iv) Notwithstanding
anything in this Section 14(c) to the contrary, an Award that vests, is earned or paid-out upon the satisfaction of one or more
Performance Goals will not be considered assumed if the Company or its successor modifies any of such Performance Goals without
the Participant’s consent; provided, however, a modification to such Performance Goals only to reflect the Successor Corporation’s
post-Change in Control corporate structure will not be deemed to invalidate an otherwise valid Award assumption.
15.
Tax Withholding
(a)
Withholding Requirements. Prior to the delivery of any Shares or cash pursuant to an Award (or exercise thereof),
the Company will have the power and the right to deduct or withhold, or require a Participant to remit to the Company, an amount
sufficient to satisfy federal, state, local, foreign or other taxes (including the Participant’s FICA obligation) required
to be withheld with respect to such Award (or exercise thereof).
(b)
Withholding Arrangements. The Administrator, in its sole discretion and pursuant to such procedures as it may specify
from time to time, may permit a Participant to satisfy such tax withholding obligation, in whole or in part by (without limitation)
(i) paying cash, (ii) electing to have the Company withhold otherwise deliverable cash or Shares having a Fair Market Value
equal to the minimum amount required to be withheld, (iii) delivering to the Company already-owned Shares having a Fair Market
Value equal to the amount required to be withheld, or (iv) selling a sufficient number of Shares otherwise deliverable to
the Participant through such means as the Administrator may determine in its sole discretion (whether through a broker or otherwise)
equal to the amount required to be withheld. The amount of the withholding requirement will be deemed to include any amount which
the Administrator agrees may be withheld at the time the election is made, not to exceed the amount determined by using the maximum
federal, state or local marginal income tax rates applicable to the Participant with respect to the Award on the date that the
amount of tax to be withheld is to be determined. The Fair Market Value of the Shares to be withheld or delivered will be determined
as of the date that the taxes are required to be withheld.
16.
No Effect on Employment or Service. Neither the Plan nor any Award will confer upon a Participant any right with
respect to continuing the Participant’s relationship as a Service Provider with the Company, nor will they interfere in any
way with the Participant’s right or the Company’s right to terminate such relationship at any time, with or without
cause, to the extent permitted by Applicable Laws.
17.
Date of Grant. The date of grant of an Award will be, for all purposes, the date on which the Administrator makes
the determination granting such Award, or such other later date as is determined by the Administrator. Notice of the determination
will be provided to each Participant within a reasonable time after the date of such grant.
18.
Term of Plan. Subject to Section 22 hereof, the Plan will become effective upon its adoption by the Board (the
“Effective Date”). It will continue in effect for a term of ten (10) years unless terminated earlier under Section 19
hereof; provided, however, that such expiration shall not affect Awards then outstanding, and the terms and conditions of this
Plan shall continue to apply to such Awards.
19.
Amendment and Termination of the Plan.
(a)
Amendment and Termination. The Administrator may at any time amend, alter, suspend or terminate the Plan.
(b)
Stockholder Approval. Subject to Section 22, the Company will obtain stockholder approval of the Plan and any Plan
amendment to the extent necessary or desirable to comply with Applicable Laws.
(c)
Effect of Amendment or Termination. No amendment, alteration, suspension, or termination of the Plan will impair
the rights of any Participant, unless mutually agreed otherwise between the Participant and the Administrator, which agreement
must be in writing and signed by the Participant and the Company. Termination of the Plan will not affect the Administrator’s
ability to exercise the powers granted to it hereunder with respect to Awards granted under the Plan prior to the date of such
termination.
20.
Conditions Upon Issuance of Shares.
(a)
Legal Compliance. Shares will not be issued pursuant to the exercise of an Award unless the exercise of such Award
and the issuance and delivery of such Shares will comply with Applicable Laws and will be further subject to the approval of counsel
for the Company with respect to such compliance.
(b)
Investment Representations. As a condition to the exercise of an Award, the Company may require the person exercising
such Award to represent and warrant at the time of any such exercise that the Shares are being purchased only for investment and
without any present intention to sell or distribute such Shares if, in the opinion of counsel for the Company, such a representation
is required.
(c)
Restrictive Legends. All Award Agreements and all securities of the Company issued pursuant thereto shall bear such
legends regarding restrictions on transfer and such other legends as the appropriate officer of the Company shall determine to
be necessary or advisable to comply with applicable securities and other laws.
21.
Inability to Obtain Authority. The inability of the Company to obtain authority from any regulatory body having jurisdiction,
which authority is deemed by the Company’s counsel to be necessary to the lawful issuance and sale of any Shares hereunder,
will relieve the Company of any liability in respect of the failure to issue or sell such Shares as to which such requisite authority
will not have been obtained.
22.
Stockholder Approval. The Plan will be subject to approval by the stockholders of the Company within twelve (12)
months after the date the Plan is adopted by the Board. Such stockholder approval will be obtained in the manner and to the degree
required under Applicable Laws, including without limitation Section 422 of the Code. In the event that stockholder approval is
not obtained within twelve (12) months after the date the Plan is adopted by the Board, all Incentive Stock Options granted hereunder
shall be void ab initio and of no effect. Notwithstanding any other provisions of the Plan, no Awards shall be exercisable
until the date of such stockholder approval.
23.
Notification of Election Under Section 83(b) of the Code. If any Service Provider shall, in connection with the acquisition
of Shares under the Plan, make the election permitted under Section 83(b) of the Code, such Service Provider shall notify the Company
of such election within ten (10) days of filing notice of the election with the Internal Revenue Service and provide the Company
with a copy thereof, in addition to any filing and a notification required pursuant to regulations issued under the authority of
Section 83(b) of the Code. A Service Provider shall not be permitted to make a Section 83(b) election with respect to an Award
of a Restricted Stock Unit.
24.
Notification Upon Disqualifying Disposition Under Section 421(b) of the Code. Each Service Provider shall notify
the Company of any disposition of Shares issued pursuant to the exercise of an Incentive Stock Option under the circumstances described
in Section 421(b) of the Code (relating to certain disqualifying dispositions), within ten (10) days of such disposition.
25.
409A Timing Rule for Specified Employees. If at the time of a Service Provider’s separation from service, such
individual is considered a “specified employee” within the meaning of Section 409A(a)(2)(B)(i) of the Code, and if
any payment that such Service Provider becomes entitled to under the Plan or any Award is deemed payable on account of such individual’s
separation from service, then no such payment shall be made prior to the date that is the earlier of (i) six months and one day
after the individual’s separation from service, (ii) the individual’s death or (iii) within the period that would be
treated as a short term deferral under Section 409A of the Code.
26.
Governing Law. The law of the State of Indiana shall govern all questions concerning the construction, validity and
interpretation of this Plan, without regard to such state’s conflict of laws rules, subject to the Company’s intention
that the Plan satisfy the requirements of jurisdictions outside of the United States of America with respect to Awards subject
to such jurisdictions.
27.
General Provisions.
(a)
No Rights as Stockholder. Except as specifically provided in this plan, a Participant or a transferee of an Award
shall have no rights as a stockholder with respect to any shares covered by the Award until the date of the issuance of such shares
to the Participant, and no adjustment shall be made for dividends (ordinary or extraordinary, whether in cash, securities or other
property) or distributions of other rights for which the record date is prior to the date such Stock is issued.
(b) Other Compensation Arrangements. Nothing contained in this Plan shall prevent the Board from adopting other or additional
compensation arrangements, subject to stockholder approval is required; and such arrangements may be either generally applicable
or applicable only in specific cases.
(c)
Disqualifying Dispositions. Any participant who shall make a “disposition” (as defined in Section 424
of the Code) of all or any portion of an Incentive Stock Option within two (2) years from the date of grant of such Incentive Stock
Option or within (1) year after the issuance of the shares of Stock acquired upon exercise of such Incentive Stock Option shall
be required to immediately advise the Company in writing as to the occurrence of the sale and the price realized upon the sale
of such shares of Stock.
(d)
Regulatory Matters. Each Stock Option Agreement and Stock Purchase Agreement shall provide that no shares shall be
purchased or sold thereunder unless and until (i) any then applicable requirements of state or federal laws and regulatory agencies
shall have been fully complied with to the satisfaction of the Company and its counsel and (ii) if required to do so by the Company,
the Optionee or Offeree shall have executed and delivered to the Company a letter of investment intent in such form and containing
such provisions as the Board or Committee may require.
(e)
Delivery. Upon exercise of an Award granted under this Plan, the Company shall issue Stock or pay any amounts due
within a reasonable period of time thereafter. Subject to any statutory obligations the Company may otherwise have, for purposes
of this Plan, thirty days shall be considered a reasonable period of time.
(f) Other
Provisions. The Stock Option Agreements and Stock Purchase Agreements authorized under the Plan may contain such other
provisions not inconsistent with this Plan, including, without limitation, restrictions upon the exercise of the Rights, as
the Administrator may deem advisable.
(g)
Section 409A. Awards under the Plan are intended either to be exempt from the rules of Section 409A of the Code or
to satisfy those rules, and the Plan and such awards shall be construed accordingly. Granted rights may be modified at any time,
in the Administrator’s direction, so as to increase the likelihood of exemption from or compliance with the rules of Section
409A of the Code.
As adopted by the Board of Directors of
CHINESEINVESTOR.COM INC. on July 17, 2019.
As approved by the shareholders of CHINESEINVESTORS.COM
INC. on November ___ 2019.