United States
Securities and Exchange
Commission
Washington, DC 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to
Section 14(a) of the
Securities Exchange Act of 1934
Filed by
the Registrant x
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Filed
by a party other than the Registrant
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Check
the appropriate box:
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x
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Preliminary
Proxy Statement
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Confidential,
for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
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Definitive
Proxy Statement
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Definitive
Additional Materials
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Soliciting
Material Pursuant to §240.14a-12
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Senmiao
Technology Limited
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(Name
of Registrant as Specified in its Charter)
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N/A
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(Name
of Person(s) Filing Proxy Statement, if Other Than the Registrant)
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Payment of
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x
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computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
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number of securities to which transaction applies:
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Per
unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
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maximum aggregate value of transaction:
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SENMIAO TECHNOLOGY LIMITED
16F, Shihao Square, Middle Jiannan Blvd.,
High-Tech Zone
Chengdu, Sichuan, People’s Republic
of China 610000
Dear Stockholders:
On behalf of the Board
of Directors of Senmiao Technology Limited (the “Company”), I cordially invite you to the 2020 Annual Meeting of Stockholders
of the Company (the “Meeting”) to be held at 9 p.m., Eastern Time, on Thursday, October 29, 2020 at the Company’s
offices at 16F, Shihao Square, Middle Jiannan Blvd., High-Tech Zone, Chengdu, Sichuan, People’s Republic of China 610000.
Details about the Meeting,
nominees for election to the Board of Directors and other matters to be acted on at the Meeting are presented in the notice of
the Meeting and proxy statement that follow. We will begin distributing the notice and proxy statement for the Meeting and our
Annual Report on Form 10-K, and proxy card to stockholders on or about October 2, 2020.
Your vote is important
— please date, sign and return your proxy card in the enclosed envelope or vote online or by telephone as soon as possible
to ensure that your shares will be represented and voted at the Meeting even if you cannot attend. If you attend the Meeting, you
may vote your shares in person even though you have previously signed and returned your proxy.
If you have any questions
regarding this material, please do not hesitate to call me at +86 28 88678707.
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Sincerely yours,
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Xi Wen
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Chairman and Chief Executive Officer,
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President and Secretary
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SENMIAO TECHNOLOGY LIMITED
16F, Shihao Square, Middle
Jiannan Blvd., High-Tech Zone
Chengdu, Sichuan, People’s
Republic of China 610000
NOTICE OF ANNUAL MEETING
OF STOCKHOLDERS
TO BE HELD ON THURSDAY,
OCTOBER 29, 2020
The
2020 Annual Meeting of Stockholders (the “Meeting”) of Senmiao Technology Limited (the “Company”) will
be held at 9 p.m., Eastern Time, on Thursday, October 29, 2020, at 16F, Shihao Square, Middle Jiannan Blvd., High-Tech Zone, Chengdu,
Sichuan, People’s Republic of China 610000, for the following purposes:
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1.
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To elect five directors to serve until the 2021 annual meeting of stockholders, or until their successors are elected and qualified or until their earlier deaths, resignations or removals;
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2.
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To ratify the appointment of Friedman LLP as the Company’s registered public accounting firm for the fiscal year ending March 31, 2021;
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3.
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To authorize the Board of Directors to effect a reverse stock split of the Company’s outstanding shares of common stock in a ratio of between one-for-five and one-for-ten, in its sole discretion, without further stockholder approval, by amending the Company’s Articles of Incorporation, as amended, at any time prior to our 2021 annual meeting of stockholders; and
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To transact such other business as may properly come before the Meeting or any adjournment thereof.
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The
Board of Directors has fixed the close of business on September 21, 2020 as the record date for the Meeting and only holders of
shares of common stock of record at that time will be entitled to notice of and to vote at the Meeting or any adjournment or adjournments
thereof. Stockholders are cordially invited to attend the Meeting in person.
Whether
or not you expect to attend the meeting, please read the proxy materials for the Meeting and complete the enclosed proxy card
and promptly mail it in the enclosed envelope or vote online or by telephone in order to assure representation of your shares
at the Meeting. Whether you are a registered stockholder or you hold your shares through a brokerage firm, you may cast your vote
by visiting www.proxyvote.com with the voter control number included on your proxy card or a voting instruction card, as
applicable.
IMPORTANT
NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE MEETING TO BE HELD ON OCTOBER 29, 2020: The Company’s Proxy
Statement for the Meeting and the Annual Report on Form 10-K for the fiscal year ended March 31, 2020 are available at https://materials.proxyvote.com/817225.
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BY ORDER OF THE BOARD OF DIRECTORS,
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Xi Wen
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Chairman and Chief Executive Officer,
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President and Secretary
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, 2020
TABLE OF CONTENTS
SENMIAO TECHNOLOGY LIMITED
16F, Shihao Square, Middle
Jiannan Blvd., High-Tech Zone
Chengdu, Sichuan, China
610000
+86 28 88678707
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON THURSDAY,
OCTOBER 29, 2020
These
proxy materials are being made available to you electronically or, if you have requested, printed versions of these materials,
have been delivered to you by mail in connection with the solicitation of proxies by the Board of Directors (the “Board”)
of Senmiao Technology Limited (the “Company,” “we,” “us” or “our” or similar terminology),
a Nevada corporation, for our 2020 Annual Meeting of Stockholders (the “Meeting”) to be held at 9 p.m. Eastern Time,
on Thursday, October 29, 2020, at our offices located at 16F, Shihao Square, Middle Jiannan Blvd., High-Tech Zone, Chengdu, Sichuan,
People’s Republic of China 610000.
QUESTIONS AND ANSWERS
ABOUT THE PROXY MATERIALS AND THE MEETING
What are proxy materials?
A
proxy statement is a document which includes information that we are required to provide to you under the Securities and Exchange
Commission (“SEC”) rules and is designed to assist you in voting your shares (your “shares”) of the Company’s
common stock, par value $0.0001 per share (“Common Stock”), at the Meeting. The proxy materials include our proxy
statement for the Annual Meeting (this “Proxy Statement”), our Annual Report on Form 10-K for the fiscal year ended
March 31, 2020 (“Annual Report”), and the proxy card or a voting instruction card for the Meeting.
This
Proxy Statement contains information about the Meeting and was prepared by our management. We intend to mail this Proxy Statement,
proxy card and our Annual Report to stockholders of record entitled to receive notice of the Meeting on or about October 2, 2020.
Who can vote at the Meeting?
Stockholders
who owned shares of our Common Stock as of the close of business on September 21, 2020 (the “Record Date”) may
attend and vote at the Meeting. There were shares of Common Stock outstanding on the Record Date. All shares of Common Stock
shall have one vote per share and vote together as a single class. Information about the stock ownership of our directors and
executive officers is contained in the section of this Proxy Statement entitled “Beneficial Ownership of Principal
Stockholders, Officers and Directors” on page 15 of this Proxy Statement.
What is the proxy card?
The
proxy card enables you to appoint Xi Wen, our Chairman, Chief Executive Officer, President and Secretary, and Xiaoyuan Zhang, our
Chief Financial Officer, and each of them, as your representative at the Meeting. By completing and returning the proxy card or
voting online as described herein, you are authorizing him to vote your shares at the Meeting in accordance with your instructions
on the proxy card. This way, your shares will be voted whether or not you attend the Meeting. Even if you plan to attend the Meeting,
we think that it is a good idea to complete and return your proxy card before the Meeting date just in case your plans change.
If a proposal comes up for vote at the Meeting that is not on the proxy card, the proxies will vote your shares, under your proxy,
according to their best judgment.
What am I voting on?
You
are being asked to vote on:
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1.
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The election of five directors to serve until the 2021 annual meeting of stockholders, or until their successors are elected and qualified or until their earlier deaths, resignations or removals (“Proposal 1”);
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2.
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The ratification of Friedman LLP as our independent registered public accounting firm for the fiscal year ending March 31, 2021(“Proposal 2”); and
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3.
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The approval of the Board to effect a reverse stock split of the Company’s outstanding shares of common stock in a ratio of between one-for-five and one-for-ten, in its sole discretion, without further stockholder approval, by amending the Company’s Articles of Incorporation, as amended, at any time prior to our 2021 annual meeting of stockholders (“Proposal 3”).
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We
will also transact any other business that properly comes before the Meeting.
How does the Board recommend
That I vote?
Our
Board unanimously recommends that the stockholders vote “FOR” all proposals being put before our stockholders at the
Meeting.
What is the difference
between holding shares as a stockholder of record and as a beneficial owner?
Stockholder
of Record
If,
on the Record Date, your shares were registered directly in your name with our transfer agent, VStock Transfer, LLC, you are a
“stockholder of record” who may vote at the Meeting, and we are sending these proxy materials directly to you. As the
stockholder of record, you have the right to direct the voting of your shares by returning the enclosed proxy card to us or to
vote in person at the Meeting. Whether or not you plan to attend the Meeting, please complete, date and sign the enclosed proxy
card to ensure that your vote is counted.
Beneficial
Owner
If,
on the Record Date, your shares were held in an account at a brokerage firm or at a bank or other nominee holder, you are considered
the beneficial owner of shares held “in street name,” and these proxy materials are being forwarded to you by your
broker or nominee who is considered the stockholder of record for purposes of voting at the Meeting. As the beneficial owner, you
have the right to direct your broker on how to vote your shares and to attend the Meeting. However, since you are not the stockholder
of record, you may not vote these shares in person at the Meeting unless you receive a valid proxy from your brokerage firm, bank
or other nominee holder. To obtain a valid proxy, you must make a special request of your brokerage firm, bank or other nominee
holder. If you do not make this request, you can still vote by using the voting instruction card enclosed with this Proxy Statement;
however, you will not be able to vote in person at the Meeting.
How do I vote?
(1)
You may vote by mail. You may vote by mail by completing, signing and dating your proxy card and returning it in the enclosed,
postage-paid and addressed envelope. If we receive your proxy card prior to the Meeting and if you mark your voting instructions
on the proxy card, your shares will be voted:
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according to the best judgment of the proxies if a proposal comes up for a vote at the Meeting that is not on the proxy card.
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If
you return a signed card, but do not provide voting instructions, your shares will be voted:
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for the election of five directors of our Board;
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for the ratification of the appointment of Friedman LLP as our independent registered public accounting firm for the fiscal year ending March 31, 2021;
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for the approval to authorize the Board to effect a reverse stock split of the Company’s outstanding shares of Common Stock in a ratio of between one-for-five and one-for-ten, in its sole discretion, without further stockholder approval, by amending the Company’s Articles of Incorporation, as amended, at any time prior to our 2021 annual meeting of stockholders; and
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·
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according to the best judgment of the proxies, if a proposal comes up for a vote at the Meeting that is not on the proxy card.
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(2)
You may vote in person at the Meeting. We will pass out written ballots to anyone who wants to vote at the Meeting. However,
if you hold your shares in street name, you must bring to the Meeting a valid proxy from the broker, bank or other nominee holding
your shares that confirms your beneficial ownership of the shares and gives you the right to vote your shares. We encourage you
to examine your proxy card closely to make sure you are voting all of your shares in the Company.
(3)
You may vote online. You may also have access to the materials for the Meeting by visiting the website https://materials.proxyvote.com/817225.
You may also cast your vote by visiting www.proxyvote.com with
the voter control number included on your proxy card.
(4)
You may vote by telephone. Call 1-800-690-6903 to vote by telephone until 11:59 p.m. Eastern Time on October 28, 2020.
Have your proxy card in hand when you call and then follow the instructions.
What does it mean if
I receive more than one proxy card?
You
may have multiple accounts at the transfer agent and/or with brokerage firms. Please sign and return all proxy cards to ensure
that all of your shares are voted.
What if I change my
mind after I return my proxy?
You
may revoke your proxy and change your vote at any time before the polls close at the Meeting. You may do this by:
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sending a written notice to the Secretary of the Company stating that you would like to revoke your proxy of a particular date;
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signing another proxy card with a later date and returning it before the polls close at the Meeting; or
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attending the Meeting and voting in person.
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Please
note, however, that if your shares are held of record by a brokerage firm, bank or other nominee, you must instruct your broker,
bank or other nominee that you wish to change your vote by following the procedures on the voting form provided to you by the broker,
bank or other nominee. If your shares are held in street name, and you wish to attend and vote at the Meeting, you must bring to
the Meeting a legal proxy from the broker, bank or other nominee holding your shares, confirming your beneficial ownership of the
shares and giving you the right to vote your shares.
What happens if I do
not give specific voting instructions?
Stockholder
of Record
If
you are a registered stockholder of record and you indicate when voting on the Internet or by telephone that you wish to vote as
recommended by the Board, or you sign, date and return a proxy card without giving specific voting instructions, then the proxy
holders will vote your shares in the manner recommended by the Board on all matters presented in this Proxy Statement and as the
proxy holders may determine in their best judgment with respect to any other matters properly presented for a vote at the Meeting.
Beneficial
Owners
If
you are a beneficial owner of shares held in street name and do not provide the organization that holds your shares with specific
voting instructions, the organization that holds your shares may generally vote at its discretion on routine matters but cannot
vote on non-routine matters. If the organization that holds your shares does not receive instructions from you on how to vote your
shares on a non-routine matter, the organization will inform the inspector of elections that it does not have the authority to
vote on this matter with respect to your shares. This is generally referred to as a “broker non-vote.” In tabulating
the voting results for any particular proposal, shares that constitute broker non-votes are not considered entitled to vote on
that proposal. Thus, broker non-votes will not affect the outcome of any matter being voted on at the Meeting, assuming that a
quorum is obtained.
Which proposals are
considered “routine” or “non-routine”?
The
ratification of the appointment of Friedman LLP as our independent registered public accounting firm for the fiscal year ending
March 31, 2021 (Proposal 2) and the approval of the amendment to our Articles of Incorporation to affect a reverse stock
split (Proposal 3) are considered routine under applicable rules. A broker or other nominee may generally
vote on routine matters, and therefore no broker non-votes are expected to exist in connection with Proposal 2. The election of
directors (Proposal 1) is considered non-routine under applicable rules. A broker or other nominee cannot vote without instructions
on non-routine matters, and, therefore, there may be broker non-votes on Proposal 1.
How are votes counted?
You
may vote “for,” “against,” or “abstain” on each of the proposals being placed before our stockholders.
Abstentions and broker non-votes (i.e., shares held by brokers on behalf of their customers, which may not be voted on certain
matters because the brokers have not received specific voting instructions from their customers with respect to such matters) will
be counted solely for the purpose of determining whether a quorum is present at the Meeting.
How many votes are required
to elect the directors?
The
affirmative vote of a majority of the votes cast at the Meeting by the holders of shares of Common Stock entitled to vote is required
to elect each of five nominees as directors. Abstentions and broker non-votes will have no direct effect on the outcome of this
proposal.
How many votes are required
to ratify the Company’s independent public accountant?
The
affirmative vote of a majority of the votes cast at the Meeting by the holders of shares of Common Stock entitled to vote is required
to ratify Friedman LLP as our independent registered public accounting firm for the year ending March 31, 2021. Brokers will have
discretion to vote on this proposal but abstentions will have no direct effect on the outcome of this proposal.
How many votes are required
to amend our Articles of Incorporation to affect a reverse stock split?
The
affirmative vote of a majority of the votes cast at the Meeting by the holders of shares of Common Stock entitled to vote is required
to approve the amendment of our Articles of Incorporation to affect a reverse stock split. Brokers will have discretion to vote
on this proposal but abstentions will have no direct effect on the outcome of this proposal.
Is my vote kept confidential?
Yes.
Proxies, ballots and voting tabulations identifying stockholders are kept confidential and will not be disclosed except as may
be necessary to meet legal requirements.
Where do I find the
voting results of the Meeting?
We
will announce voting results at the Meeting and file a Current Report on Form 8-K announcing the voting results of the Meeting.
Who can help answer
my questions?
You
can contact our Chairman of the Board, Chief Executive Officer, President and Secretary, Mr. Xi Wen, at +86 28 88678707 or by sending
a letter to him at offices of the Company at 16F, Shihao Square, Middle Jiannan Blvd., High-Tech Zone, Chengdu, Sichuan, People’s
Republic of China 610000 with any questions about proposals described in this Proxy Statement or how to execute your vote.
PROXY STATEMENT
INTRODUCTION
2020 Annual Meeting of Stockholders
This
Proxy Statement is being furnished to the holders of our Common Stock in connection with the solicitation of proxies for use at
the Meeting. The Meeting is to be held at 9 p.m., Eastern Time, on Thursday, October 29, 2020 at our offices located at 16F, Shihao
Square, Middle Jiannan Blvd., High-Tech Zone, Chengdu, Sichuan, People’s Republic of China 610000 and at any adjournment
or adjournments thereof. The Company is soliciting proxies for use at the Meeting, including any postponements or adjournments.
Record Date; Mailing Date
The
Board has fixed the close of business on September 21, 2020 as the Record Date for the determination of stockholders entitled to
notice of, and to vote and act at, the Meeting. Only stockholders of record at the close of business on that date are entitled
to notice of, and to vote and act at, the Meeting. We will begin distributing the notice of the Meeting, the Proxy Statement, our
Annual Report and proxy card to stockholders on or about October 2, 2020.
Proposals to be submitted at the Meeting
At the Meeting,
stockholders will be acting upon the following proposals:
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1.
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To elect five directors to serve until the 2021 annual meeting of stockholders, or until their successors are elected and qualified or until their earlier deaths, resignations or removals;
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2.
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To ratify the appointment of Friedman LLP as the Company’s registered public accounting firm for the fiscal year ending March 31, 2021;
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3.
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To authorize the Board to effect a reverse stock split of the Company’s outstanding shares of Common Stock in a ratio of between one-for-five and one-for-ten, in its sole discretion, without further stockholder approval, by amending the Company’s Articles of Incorporation, as amended, at any time prior to our 2021 annual meeting of stockholders; and
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4.
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To transact such other business as may properly come before the Meeting or any adjournment thereof.
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Principal Offices
The
principal executive offices of the Company are located at 16F, Shihao Square, Middle Jiannan Blvd., High-Tech Zone, Chengdu, Sichuan,
China 610000. The Company’s telephone number at such address is +86 28 88678707.
Information Concerning Solicitation and Voting
As
of the Record Date, there were outstanding shares of Common Stock, each share entitled to one vote on each matter to be voted on
at the Meeting. Only holders of shares of Common Stock on the Record Date will be entitled to vote at the Meeting. The presence
in person or by proxy of holders of record of a majority of the shares outstanding and entitled to vote as of the Record Date shall
be required for a quorum to transact business at the Meeting. If a quorum should not be present, the Meeting may be adjourned until
a quorum is obtained. To be elected, the nominee named in Proposal 1 must receive a majority of the votes of the shares of Common
Stock cast in person or represented by proxy at the Meeting. For the purposes of election of such director, although abstentions
will count toward the presence of a quorum, they will not be counted as votes cast and will have no effect on the result of the
vote. “Broker non-votes,” which occur when brokers are prohibited from exercising discretionary voting authority for
beneficial owners who have not provided voting instructions, will not be counted for the purpose of determining the number of shares
present in person or by proxy on a voting matter and will have no effect on the outcome of the vote. Brokers who hold shares in
street name may vote on behalf of beneficial owners with respect to Proposals 2 and 3.
Expenses
The
expense of preparing, printing and mailing the proxy materials and the proxies solicited hereby will be borne by the Company. In
addition to the use of the mails, proxies may be solicited by officers, directors and regular employees of the Company, without
additional remuneration, by personal interviews, telephone, email or facsimile transmission. The Company will also request brokerage
firms, nominees, custodians and fiduciaries to forward proxy materials to the beneficial owners of shares of Common Stock held
of record and will provide reimbursements for the cost of forwarding the material in accordance with customary charges.
Revocability of Proxies
Proxies
given by stockholders of record for use at the Meeting may be revoked at any time prior to the exercise of the powers conferred.
In addition to revocation in any other manner permitted by law, stockholders of record giving a proxy may revoke the proxy by an
instrument in writing, executed by the stockholder or his attorney authorized in writing or, if the stockholder is a corporation,
under its corporate seal, by an officer or attorney thereof duly authorized, and deposited either at the corporate headquarters
of the Company at any time up to and including the last business day preceding the day of the Meeting, or any adjournments thereof,
at which the proxy is to be used, or with the chairman of such Meeting on the day of the Meeting or adjournments thereof, and upon
either of such deposits the proxy is revoked.
ALL PROXIES RECEIVED
WILL BE VOTED IN ACCORDANCE WITH THE CHOICES SPECIFIED ON SUCH PROXIES. PROXIES WILL BE VOTED IN FAVOR OF A PROPOSAL IF NO CONTRARY
SPECIFICATION IS MADE. ALL VALID PROXIES OBTAINED WILL BE VOTED AT THE DISCRETION OF THE PERSONS NAMED IN THE PROXY WITH RESPECT
TO ANY OTHER BUSINESS THAT MAY COME BEFORE THE MEETING.
THE BOARD UNANIMOUSLY
RECOMMENDS A VOTE “FOR” THE APPROVAL OF EACH OF THE PROPOSALS TO BE SUBMITTED AT THE MEETING.
PROPOSAL 1
ELECTION OF DIRECTORS
Nominees for Directors
Five
directors are to be elected at the Meeting to serve until the 2021 annual meeting of stockholders, or until their successors are
elected and qualified or until their earlier death, resignation or removal. The following table sets forth information concerning
each nominee as of the date of the Record Date.
Name
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Age
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Position(s) Held
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Director Since
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Xi Wen
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37
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Chairman, Chief Executive Officer, President and Secretary
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June 2017
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Trent D. Davis
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52
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Director
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March 2018
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Xiaojuan Lin
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55
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Director
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March 2018
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Sichun Wang
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32
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Director
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November 2018
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Jie Gao
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42
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Director
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November 2018
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Xi Wen has
been serving as President, Secretary and Director of the Company since June 2017, was appointed Chairman of the Board on July 20,
2017 and our Chief Executive Officer on August 1, 2018. Mr. Wen has over 10 years of experience in finance and investment
management. He has been serving as Executive Director of Sichuan Senmiao since February 2017, in charge of all aspects of
Senmiao's operations. Immediately prior to joining Senmiao, Mr. Wen served as a director of Chenghexin, where he was responsible
for overseeing the operations of the Aihongsen lending platform from May 2015 to February 2017. He also founded Chengdu Fubang
Zhuoyue Investment Co. in September 2013 and served as General Manager until May 2015. From January 2009 to August
2013, Mr. Wen was the General Manager of Chengdu Haiyuan Trading Co., Ltd., in charge of the company’s daily operations.
Mr. Wen holds a Bachelor’s degree in Business and Economics from Manchester Metropolitan University in Manchester, United
Kingdom. Mr. Wen is qualified to serve on our Board due to his knowledge of our businesses and expertise in business management,
finance and investment.
Trent
D. Davis has been a director of the Company since March 21, 2018. Mr. Davis is currently the Chief Executive Officer
of Paulson Investment Company, LLC, which is a boutique investment firm specializing in private equity offerings for small to mid-cap
markets. Formerly, from December 2014 to December 2018, Mr. Davis was President and Chief Operating Officer of Whitestone Investment
Network, Inc., which specializes in providing executive advisory services to small entrepreneurial companies, as well as restructuring,
recapitalizing, and making strategic investments in small to midsize companies. Currently, Mr. Davis is a Director for INVO
Bioscience (OTC: INVOD), which is a medical device company focused on creating simplified, lower cost treatments for patients diagnosed
with infertility. Formerly, from September 2016 to August 2019, Mr. Davis was Vice Chairman and Lead Director of Eastside Distilling
Inc. (Nasdaq: EAST), a manufacturer of high-quality, master-crafted spirits. As the Lead Independent Director Dataram Corporation
(Nasdaq: DRAM), which develops, manufactures, and markets memory products primarily used in enterprise servers and workstations
worldwide, from July 2015 to April 2017, Mr. Davis helped the company successfully complete the reverse merger with U.S. Gold Corp
(Nasdaq: USAU), a gold exploration and development company. Previously, from December 2014 to July 2015, Mr. Davis was Chairman
of the Board for Majesco Entertainment Company (Nasdaq: COOL), an innovative developer, marketer, publisher, and distributor of
interactive entertainment for consumers around the world. From November 2013 until July 2014, Mr. Davis served as the President
and Director of Paulson Capital Corp. (Nasdaq: PLCC) until he successfully completed the reverse merger of Paulson with VBI Vaccines
(Nasdaq: VBIV). He went on to serve as a member of its Board of Directors and Audit Committee until May 2016. Mr. Davis was also
the Chief Executive Officer of Paulson Investment Company, Inc., a subsidiary of Paulson Capital Corp, from July 2005 to October
2014, and is credited with overseeing the syndication of approximately $600 million for over 50 client companies in both public
and private transactions. In 2003, Mr. Davis served as Chairman of the Board of the National Investment Banking Association. Mr.
Davis holds a B.S. in Business and Economics from Linfield College and an M.B.A. from University of Portland. Mr. Davis is qualified
to serve on our Board because of his deep knowledge of finance and public company issues, capital market, advisory and entrepreneurial
experiences, and extensive expertise in operational and executive management.
Xiaojuan Lin has
been a director of the Company since July 20, 2017. Since March 2011, Ms. Lin has been the legal representative
and Executive General Manager of Hunan Dinchengtai Investment Co. Ltd. She previously served as Deputy General Manager and Finance
Manager of Hunan Xinhongxin Group from April 2004 to February 2010 where she was in charge of the group's finance, tax
and accounting matters. From August 2000 to March 2004, Ms. Lin served as Finance Manager for Northwest Region at
Tianjin Jiashijian Commercial Group, where she managed the group's finance, tax and accounting matters. She also acted as Budgeting
and Accounting Manager of Cygent Hotel from 1986 to 2000. Ms. Lin holds a Bachelor’s degree in Statistics from Hunan
Finance University in Hunan, China. She is a Certified Public Accountant in China. Ms. Lin is qualified to serve on our Board due
to her expertise in accounting and finance.
Sichun Wang has
been a director of the Company since November 8, 2018. Ms. Wang has served as the senior investment manager and financial controller
of SWHY SDH Equity Investment Management, an equity investment and management company, since October 2016, where she leads
the financial department of the company and participated in several pre-initial-public offering, mergers and acquisitions and secondary
offering projects. From February 2016 to April 2016, she served as the trust manager of JIC Trust Company Limited, a
trust and financial company. Prior to that, Ms. Wang served as the assistant manager of KPMG Huazhen from September 2011
to January 2016, where she participated in audits of multiple companies and achieved Bravo Award for outstanding performance.
Ms. Wang received her Bachelor of Arts degree in accounting with honors from Michigan State University in East Lansing, MI.
She is a Certified Public Accountant in China. Ms. Wang is qualified to serve on our Board due to her expertise in accounting
and auditing and her experience with capital market and corporate financing.
Jie Gao has
served as a director of the Company since November 8, 2018. She has been the general manager of Hunan Ruixi Financial Leasing Co.,
Ltd. (“Hunan Ruixi”), our majority owned subsidiary, since February 2018. She has also served as the executive
director of Hunan Ruixi Automobile Leasing Co., Ltd., a wholly owned subsidiary of Hunan Ruixi, since April 2018. Prior to that,
she was the executive director of Guangdong Hu Mao Sheng Tang Fund Management Co., Ltd., a fund management company, from May 2017
to January 2018, where she was responsible for the establishment and management of the finance and investment department.
She served as the project director of finance and investment department of Resgreen Biotechnology Group Co., Ltd., a biotechnology
company, from October 2003 to March 2017. Before that, she also served in administrative positions in electronic technology
companies in Changsha, Hunan, China. She received an associate’s degree in hotel secretary from Hunan University of Commerce
in Changsha, Hunan, China. Ms. Gao is qualified to serve on our Board due to her experience in business management, investment
and finance.
There are no arrangements
between our directors and any other person pursuant to which our directors were nominated or elected for their positions. There
are no family relationships between any of our directors or executive officers.
The enclosed proxy,
if returned, and unless indicated to the contrary, will be voted for the election of the above nominees. Proxies cannot be voted
for a greater number of persons than the number of nominees named.
We have been advised
by each of the five nominees that they are willing to be named as nominees and each are willing to serve as a director if elected.
If some unexpected occurrence should make necessary, in the discretion of the Board, the substitution of some other person for
the nominees, it is the intention of the persons named in the proxy to vote for the election of such other person as may be designated
by the Board.
Directors and Executive Officers
The table below sets
forth the name, age and position of our directors and executive officers, their ages as of the Record Date.
Name
|
|
Age
|
|
Position
|
Xi Wen
|
|
37
|
|
Chief Executive Officer, Chairman of the Board, President and Secretary, Executive Director of Sichuan Senmiao
|
Xiaoyuan Zhang
|
|
32
|
|
Chief Financial Officer and Treasurer
|
Chunhai Li
|
|
35
|
|
Chief Technology Officer
|
Haitao Liu
|
|
49
|
|
Chief Operating Officer
|
Xiaojuan Lin
|
|
55
|
|
Director
|
Trent D. Davis
|
|
52
|
|
Director
|
Sichun Wang
|
|
32
|
|
Director
|
Jie Gao
|
|
42
|
|
Director
|
Xiaoyuan Zhang has
been serving as our Chief Financial Officer since September 17, 2018. She has served as a director and the chairperson of the Audit
Committee of Color Star Technology Co., Ltd. (Nasdaq: HHT), a provider of online and offline education services in China, since
July 2019. Mr. Zhang previously served as Senior Auditor and Assurance Manager of Ernst & Young Hua Ming LLP, Chengdu Branch,
from October 2010 to September 2018 where she participated in audits of several public companies listed in China, Hong Kong and
Singapore, as well as large state-owned and foreign investment enterprises. Ms. Zhang received her dual bachelor’s degrees
in accounting and law from Southwestern University of Finance and Economics in Chengdu, China. Ms. Zhang is an intermediate accountant
and a Certified Public Accountant of the Chinese Institute of Certified Public Accountants.
Chunhai Li has been serving
as the Chief Technology Officer of the Company since July 20, 2017 and Chief Technology Officer of Sichuan Senmiao since September 2016.
Before joining Sichuan Senmiao, he was the Director of Research and Development of Beijing Huashengtiancheng Technology Co., Ltd.
from October 2014 to August 2016, where he was in charge of the development of bank data platform and team management.
Prior to that, he was the Director of Research and Development at Zhongkesanyang (Beijing) Technology Co., Ltd. from February 2013
to September 2014, primarily responsible for the organization of the company and technology team as well as management of
technology and operations. From October 2007 to February 2013, he was the project manager for online banking at Beijing
Yuxinyicheng Technology Co., Ltd., where he participated in and managed the online banking projects for many banks. Mr. Li
received his bachelor's degree in computer science from University of Electronic Science and Technology of China.
Haitao Liu has
been serving as the Chief Operating Officer since September 10, 2020. Prior to that, he was the Chief Executive Officer of Sichuan
Senmiao from August 2018 to September 2020. Mr. Liu served as the Chief Executive Officer of Sichuan Senmiao from August 1,
2018 to September 10, 2020. Mr. Liu previously served as Chief Executive Officer of Shenzhen Qianhai Tuteng Internet Financial
Services Co., Ltd., a peer-to-peer online lending company specialized in auto loans, from May 2015 to April 2018. Prior to that,
he served as the Deputy General Manager of Chengdu High-Tech Zone Xingrui Microfinance Co., Ltd., a company offering loans to small
businesses and individuals, from May 2012 to April 2015, as the Chief Financial Officer of Sichuan Information Industry Co., Ltd.,
an information technology company, from July 2006 to May 2012, and as the Deputy General Manager of Sichuan Zhongxin Hengde CPA
Co., Ltd. from June 2000 to July 2006. He also served as a civil servant in Chenghua District People’s Government of Chengdu
from June 1993 to June 2000. Mr. Liu received a master’s degree in EMBA (Finance) from Southwestern University of Finance
and Economics, a bachelor’s degree in Business Administration from Southwest Jiaotong University and an associate degree
in Commercial Economy from Southwestern University of Finance and Economics in China.
Information regarding
the principal occupations of Xi Wen, Trent Davis, Sichun Wang, Xiaojuan Lin and Jie Gao is set forth above under the heading “Nominees
for Directors.”
Certain Legal Proceedings
None of the Company’s
directors and executive officers have been involved, in the past ten years and in a manner material to an evaluation of such person’s
ability or integrity to serve in their respective position, in any of those “certain legal proceedings” more fully
detailed in Item 401(f) of Regulation S-K, which include but are not limited to, bankruptcies, criminal convictions and an adjudication
finding that an individual violated federal or state securities laws.
There are no material
proceedings in which any of the Company’s directors, officers or affiliates, stockholders owning more than 5% of the Common
Stock, or any associate of any such director, officer, affiliate, and stockholder of the Company, is a party adverse to the Company
or any of its subsidiaries and variable interest entities or has a material interest adverse to the Company or any of its subsidiaries
and variable interest entities.
Director Independence
Our Board is composed
of a majority of independent directors as required by the listing rules of the Nasdaq Stock Market (“Nasdaq”). Our
Board has determined that Mr. Davis, Ms. Lin and Ms. Wang qualify as independent directors under Nasdaq listing rules.
Meetings of the Board,
Committees and Stockholders
During the fiscal year
ended March 31, 2020, our Board held five meetings, our Audit Committee held four meetings, our Compensation Committee held one
meeting and our Nominating and Corporate Governance Committee didn't hold any meeting. These meetings include those that were held
in person and by means of a telephone call but do not include actions taken by unanimous written consent.
Each
member of the Board attended or participated in 75% or more of the aggregate of (i) the total number of meetings of the Board
held during the fiscal year 2020, and (ii) the total number of meetings held by each committee of the Board on which such
member served during the fiscal year 2020.
It is our policy that
all directors must attend all stockholder meetings, barring extenuating circumstances. We expect all of our directors to attend
the Meeting. All directors attended the 2019 annual meeting of stockholders.
Board Committees
Our Board has established
three standing committees — Audit, Compensation, and Nominating and Corporate Governance. Each committee operates under a
written charter adopted by the Board, which is available at http://senmiaotechir.com/corporate/governance.
Audit Committee
Our Audit Committee
consists of Ms. Lin, Mr. Davis and Ms. Wang, and is chaired by Ms. Wang. Each of our Audit Committee members satisfies
the “independence” requirements of the Nasdaq listing rules and meet the independence standards under Rule 10A-3 under
the Exchange Act of 1934, as amended (the “Exchange Act”). We have determined that Ms. Lin qualifies as an “audit
committee financial expert.” The Audit Committee oversees our accounting and financial reporting processes and the audits
of the financial statements of our company. The Audit Committee is responsible for, among other things:
|
●
|
selecting the independent registered public accounting firm and pre-screening all auditing and non-auditing services permitted to be performed by the independent registered public accounting firm;
|
|
|
|
|
●
|
reviewing with the independent registered public accounting firm any audit problems or difficulties and management's response;
|
|
●
|
reviewing and approving all proposed related party transactions, as defined in Item 404 of Regulation S-K under the Securities Act;
|
|
|
|
|
●
|
discussing the annual audited financial statements with management and the independent registered public accounting firm;
|
|
|
|
|
●
|
reviewing the adequacy of our internal controls and any special audit steps adopted in light of material control deficiencies;
|
|
|
|
|
●
|
annually reviewing and reassessing the adequacy of our Audit Committee charter;
|
|
|
|
|
●
|
meeting separately and periodically with management and the independent registered public accounting firm; and
|
|
|
|
|
●
|
reporting to the Board.
|
Compensation
Committee
Our Compensation Committee
consists of Ms. Lin, Ms. Wang and Mr. Davis and is chaired by Ms. Lin. Each of the Compensation Committee members satisfies
the “independence” requirements of the listing rules of Nasdaq. The Compensation Committee assists the Board in reviewing
and approving the compensation structure, including all forms of compensation, relating to our directors and executive officers.
Our executive officers may not be present at any committee meeting during which their compensation is deliberated upon. The Compensation
Committee is responsible for, among other things:
|
●
|
reviewing the total compensation package for our executive officers and making recommendations to the Board with respect to it;
|
|
|
|
|
●
|
approving and overseeing the total compensation package for our executives other than the three most senior executives;
|
|
|
|
|
●
|
reviewing the compensation of our directors and making recommendations to the Board with respect to it; and
|
|
|
|
|
●
|
periodically reviewing and approving any long-term incentive compensation or equity plans, programs or similar arrangements, annual bonuses, and employee pension and welfare benefit plans.
|
Nominating and
Corporate Governance Committee
Our Nominating and
Corporate Governance Committee consists of Ms. Lin, Ms. Wang and Mr. Davis, and is chaired by Ms. Lin. Each member of
our Nominating and Corporate Governance Committee satisfies the “independence” requirements of the Nasdaq listing rules.
The Nominating and Corporate Governance Committee assists the Board in selecting individuals qualified to become our directors
and in determining the composition of the Board and its committees. The Nominating and Corporate Governance Committee is responsible
for, among other things:
|
●
|
recommending nominees to the Board for election or re-election to the Board, or for appointment to fill any vacancy on the Board;
|
|
|
|
|
●
|
reviewing annually with the Board the current composition of the Board with regards to characteristics such as independence, age, skills, experience and availability of service to us;
|
|
●
|
selecting and recommending to the Board the names of directors to serve as members of the Audit Committee and the Compensation Committee, as well as of the nominating and corporate governance committee itself; and
|
|
|
|
|
●
|
monitoring compliance with our code of business conduct and ethics, including reviewing the adequacy and effectiveness of our procedures to ensure proper compliance.
|
Nomination Process
When seeking candidates
for director, the Nominating and Corporate Governance Committee may solicit suggestions from incumbent directors, management or
stockholders. The committee will consider director candidates proposed by stockholders, provided that the stockholder recommendation
complies with the Company’s By-law provisions requiring that stockholder submissions be submitted to the Company’s
Secretary at its principal executive offices in a timely manner and include the information called for in the Company’s By-laws
and the charter of the Nominating and Corporate Governance Committee concerning (a) the potential nominee and (b) the person proposing
the nomination.
The Nominating and
Corporate Governance Committee will apply the same standards in considering candidates submitted by stockholders as it uses for
any other potential nominee. In addition, the Nominating and Corporate Governance Committee has authority under its charter to
retain a search firm to assist the Company with identifying and evaluating Board candidates who have the backgrounds, skills and
experience that the Committee has identified as desired in director candidates. During the fiscal year 2020 the Nominating and
Corporate Governance Committee did not engage any third parties to assist in the identification of nominees. During the fiscal
year 2020, we did not receive any director nominee suggestions from stockholders.
After conducting an
initial evaluation of a potential candidate, the Nominating and Corporate Governance Committee will interview that candidate if
it believes such candidate might be suitable to be a director. The candidate may also meet with other members of the Board. At
the candidate’s request, they may also meet with management. If the Nominating and Corporate Governance Committee believes
a candidate would be a valuable addition to the Board, it will recommend that candidate’s election to the full Board.
The Nominating and
Corporate Governance Committee selects each nominee based on the nominee’s skills, achievements and experience. The Nominating
and Corporate Governance Committee considers a variety of factors in selecting candidates. The minimum characteristics that the
Committee believes must be met include: independence, wisdom, integrity, an understanding and general acceptance of the Company’s
corporate philosophy, valid business or professional knowledge and experience, a proven record of accomplishment with excellent
organizations, an inquiring mind, a willingness to speak one’s mind, an ability to challenge and stimulate management, and
a willingness to commit time and energy.
In making its selection
of candidates to recommend for election, the Nominating and Corporate Governance Committee will consider candidates from diverse
professional, racial, cultural, ethnic and gender backgrounds that combine a broad spectrum of experience and expertise with a
reputation for integrity.
Board Leadership Structure
and Role in Risk Oversight
Xi Wen is our Chairman
and Chief Executive Officer. We have three independent directors but do not have a lead independent director. Our Board has three
standing committees, each of which is comprised solely of independent directors with a committee chair. The Board believes that
the Company’s Chief Executive Officer is best situated to serve as the Chairman of the Board because he is the director most
familiar with our business and industry and the director most capable of identifying strategic priorities and executing our business
strategy. In addition, having a single leader eliminates the potential for confusion and provides clear leadership for the Company.
We believe that this leadership structure has served the Company well.
Our Board has overall
responsibility for risk oversight. Our Board administers this oversight function directly through our Board as a whole, as well
as through various standing committees of our Board that address risks inherent in their respective areas of oversight. In particular,
|
●
|
The Audit Committee oversees the Company’s risk policies and processes relating to the financial statements and financial reporting processes, as well as key credit risks, liquidity risks, market risks and compliance, and the guidelines, policies and processes for monitoring and mitigating those risks.
|
|
|
|
|
●
|
The Nominating and Corporate Governance Committee oversees risks related to the Company’s governance structure and processes.
|
Delinquent Section 16(a) Reports
Section 16(a) of the
Securities Exchange Act of 1934, as amended, requires our officers, directors and persons who beneficially own more than ten percent
of our Common Stock to file reports of ownership and changes in ownership with the SEC. These reporting persons are also required
to furnish us with copies of all Section 16(a) forms they file. Based solely upon a review of such forms, we believe that during
the year ended March 31, 2020 there were no delinquent filers.
Code of Ethics
We have adopted a written
code of ethics that applies to all of our directors, officers and employees in accordance with the rules of Nasdaq and the SEC.
The code is available at http://senmiaotechir.com/corporate/governance. We plan to disclose any changes in this code or waivers
from this code that apply to our executive officers by posting such information to our website or by filing with the SEC a Current
Report on Form 8-K, in each case if such disclosure is required by SEC or Nasdaq rules.
Audit Committee Report*
The Audit Committee
during the fiscal year ended March 31, 2020 was composed of the following three directors: Sichun Wang, Xiaojuan Lin and Trent
Davis, each of whom is independent as defined by the rules of the Nasdaq. Ms. Wang served as chairperson of the Audit Committee.
Management is responsible
for the Company’s financial statements, financial reporting process and systems of internal accounting and financial reporting
control. The Audit Committee’s responsibility is to oversee all aspects of the financial reporting process on behalf of the
Board. The responsibilities of the Audit Committee also include engaging and evaluating the performance of Friedman LLP (“Friedman”)
that serves as the Company’s independent auditor.
The Audit Committee
has reviewed and discussed the audited financial statements for the year ended March 31, 2020 with the Company’s management
and Friedman. The Audit Committee has also discussed with Friedman the matters required to be discussed by applicable requirements
of the Public Company Accounting Oversight Board (“PCAOB”) and the SEC.
The Audit Committee
also has received and reviewed the written disclosures and the letter from Friedman required by applicable requirements of the
PCAOB regarding Friedman’s communications with the Audit Committee concerning independence, and has discussed with Friedman
its independence.
In reliance on the
reviews and discussions referred to above, the Audit Committee recommended (and the Board approved) that the Company’s audited
financial statements referred to above be included in the Company’s Annual Report on Form 10-K for the year ended March 31,
2020 for filing with the SEC.
Audit Committee of the Board
Sichun Wang, Chairperson
Xiaojuan Lin
Trent Davis
* The
information contained in this Audit Committee Report shall not be deemed to be “soliciting material” or “filed”
or incorporated by reference in future filings with the SEC, or subject to the liabilities of Section 18 of the Exchange Act, except
to the extent that the Company specifically requests that the information be treated as soliciting material or specifically incorporates
it by reference into a document filed under the Securities Act or the Exchange Act.
Beneficial Ownership of Principal Stockholders,
Officers and Directors
As of September 17, 2020,
there were 43,358,818 shares of Common Stock outstanding. The following table sets forth certain information known to us with respect
to the beneficial ownership of Common Stock as of that date by (i) each of our directors and executive officers, (ii) all of our
directors and executive officers as a group, and (iv) each person, or group of affiliated persons, whom we know to beneficially
own more than 5% of our Common Stock.
Unless otherwise indicated,
we believe that all persons named in the table have sole voting and investment power with respect to all shares beneficially owned
by them.
|
|
Amount and
|
|
|
|
|
|
|
Nature of
|
|
|
Percentage of
|
|
|
|
Beneficial
|
|
|
Outstanding
|
|
Name and Address of Beneficial Owner (1)
|
|
Ownership
|
|
|
Shares
|
|
5% Stockholders
|
|
|
|
|
|
|
|
|
Senmiao International Investment Group Limited (2)
|
|
|
10,575,000
|
|
|
|
24.4
|
%
|
HSA Investment Group Limited (3)
|
|
|
2,475,000
|
|
|
|
5.7
|
%
|
Officers and Directors
|
|
|
|
|
|
|
|
|
Xi Wen (4)
|
|
|
1,158,053
|
|
|
|
2.7
|
%
|
Xiaoyuan Zhang
|
|
|
—
|
|
|
|
—
|
|
Chunhai Li
|
|
|
—
|
|
|
|
—
|
|
Haitao Liu
|
|
|
—
|
|
|
|
—
|
|
Xiaojuan Lin
|
|
|
35,303
|
|
|
|
*
|
|
Trent D. Davis
|
|
|
35,303
|
|
|
|
*
|
|
Jie Gao
|
|
|
30,303
|
|
|
|
*
|
|
Sichun Wang
|
|
|
30,303
|
|
|
|
*
|
|
All directors and executive officers as a group (eight individuals)
|
|
|
1,289,265
|
|
|
|
3.0
|
%
|
* less
than 1%
|
(1)
|
Unless otherwise indicated, the business address of each of the individuals is 16F, Building A, Shihao Square, Middle Jiannan Avenue, High-Tech Zone, Chengdu, Sichuan, China.
|
|
(2)
|
Xiang Hu, through Senmiao International Investment Group Limited, a British Virgin Islands company wholly owned by him, owns 10,575,000 shares of Common Stock.
|
|
(3)
|
The natural person who exercises voting and dispositive power over the shares of Common Stock held by HSA Investment Group Limited is Wuyong Luo.
|
|
(4)
|
Includes 1,122,750 shares of Common Stock held in the name of Mr. Wen’s spouse.
|
Executive Compensation
Summary Compensation Table
The following table
sets forth the cash and non-cash compensation awarded to or earned by: (i) each individual who served as the principal executive
officer and principal financial officer of our company during the years ended March 31, 2020 and 2019. For purposes of this document,
these individuals are collectively referred to as the “named executive officers” of the Company.
Name and
principal
position
|
|
Year
|
|
|
Salary
($)
|
|
|
Bonus
($)
|
|
|
Stock
awards
($)
|
|
|
Option
awards
($)
|
|
|
Non-equity
incentive plan
compensation
($)
|
|
|
Nonqualified
deferred
compensation
earnings
($)
|
|
|
All
other
compensation
($)
|
|
|
Total
($)
|
|
Xin Chen, Former Chief
|
|
|
2020
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Executive Officer (1)
|
|
|
2019
|
|
|
|
37,372
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
37,372
|
(2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Xi Wen
|
|
|
2020
|
|
|
|
156,319
|
|
|
|
—
|
|
|
|
31,050
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
187,369
|
(3)
|
Chief Executive Officer, Chairman, President and
Secretary
|
|
|
2019
|
|
|
|
20,000
|
|
|
|
—
|
|
|
|
5,525
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
25,525
|
(4)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rong Zhu, Former Chief Financial
|
|
|
2020
|
|
|
|
15,833
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
15,833
|
|
Officer and Treasurer, Current Chief Financial Officer
and Treasurer of Sichuan Senmiao (5)
|
|
|
2019
|
|
|
|
19,375
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
19,375
|
(6)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Xiaoyuan Zhang, Chief Financial
|
|
|
2020
|
|
|
|
71,280
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
71,280
|
|
Officer and Treasurer (7)
|
|
|
2019
|
|
|
|
44,027
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
44,027
|
(8)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Chunhai Li, Chief Technology
|
|
|
2020
|
|
|
|
45,616
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
45,616
|
|
Officer
|
|
|
2019
|
|
|
|
19,673
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
19,673
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Haitao Liu
|
|
|
2020
|
|
|
|
71,280
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
71,280
|
|
Chief Operating Officer, and former Chief Executive
Officer, Sichuan Senmiao (9)
|
|
|
2019
|
|
|
|
52,074
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
52,074
|
(10)
|
|
(1)
|
Ms. Chen resigned as Chief Executive Officer of the Company on July 31, 2018.
|
|
(2)
|
The amount represents the total compensation Ms. Chen received as Chief Executive Officer of the Company from April 1, 2018 through her resignation on July 31, 2018.
|
|
(3)
|
The amount represents the total compensation Mr. Wen received as the Company’s Chairman and executive officer. Mr. Wen did not receive any compensation for his services as President and Secretary until June 20, 2019.
|
|
(4)
|
The amount represents the total compensation Mr. Wen received as the Company’s Chairman.
|
|
(5)
|
Ms. Zhu resigned as the Chief Financial Officer and Treasurer effective September 17, 2018.
|
|
(6)
|
The amount represents the total compensation Ms. Zhu received as the Company’s Chief Financial Officer and Treasurer through September 17, 2018, the effective date of her resignation. Ms. Zhu is the Chief Financial Officer and Treasurer of Sichuan Senmiao after her resignation.
|
|
(7)
|
Ms. Xiaoyuan Zhang was appointed by the Board to serve as the Chief Financial Officer and Treasurer of the Company upon the resignation of Ms. Rong Zhu.
|
|
(8)
|
The amount represents the total compensation Ms. Zhang received as the Company’s Chief Financial officer and Treasurer from September 17, 2018 through March 31, 2019.
|
|
(9)
|
Mr. Liu was appointed by the Board to serve as the Chief Executive Officer of Sichuan Senmiao upon the resignation of Ms. Xin Chen, effective August 1, 2018. Mr. Liu resigned as Chief Executive Officer of Sichuan Senmiao, effective September 10, 2020.
|
|
(10)
|
The amount represents the total compensation Mr. Liu received as the Chief Executive Officer of Sichuan Senmiao from August 1, 2018 through March 31, 2019.
|
|
(11)
|
Except Mr. Wen’s salaries paid for his services as Chief Executive Officer of the Company, other executive officers received their salaries in Renminbi which were translated into U.S. dollars at the average exchange rate used to translate statement of operations items, which was RMB6.9472 to US$1.00 for the year ended March 31, 2020 and RMB6.7126 to US$1.00 for the year ended March 31, 2019.
|
Employment Agreements and Potential Payments Upon Termination
Xi Wen, Chief Executive Officer, Chairman of the Board,
President and Secretary
On May 27, 2019, the
Company and Mr. Wen entered into an employment agreement (the “Wen Agreement”) to memorialize the compensation arrangement
and the other terms of Mr. Wen’s continuing employment with the Company and Sichuan Senmiao. Under the Wen Agreement, Mr.
Wen is entitled to the following compensation: (i) an annual salary of US$100,000 for his service as Chief Executive Officer of
the Company, payable quarterly in arrears, starting upon the Company’s receipt of proceeds from a financing of at least $1,000,000;
(ii) an annual salary of RMB 600,000 (approximately US$87,354) for his service as the Executive Director for Sichuan Senmiao, payable
monthly in arrears starting upon the Company’s receipt of proceeds from a financing of at least $1 million; and (iii) a cash
bonus of up to US$50,000 for his services as Chief Executive Officer of the Company for the fiscal year ended March 31, 2020 upon
satisfaction of the performance targets as reviewed by the Compensation Committee.
Mr. Wen is also entitled
to participate in the Company’s equity incentive plans and other Company benefits (including health insurance, vacation and
expense reimbursement), each in accordance with the Company’s policies as determined by the Board from time to time. The
Wen Agreement has an initial term of three years and is subject to successive, automatic one-year extensions unless either party
gives notice of non-extension to the other party at least 30 days prior to the end of the applicable term.
Pursuant to the Wen
Agreement, the Company may terminate Mr. Wen’s employment for cause (as defined in the Wen Agreement), at any time, without
notice. Upon a termination for cause, Mr. Wen will not be entitled to receive payment of any severance benefits or other amounts
by reason of the termination, and his right to all other benefits will terminate, except as required by any applicable law.
The Company may also
terminate Mr. Wen’s employment without cause upon 30 days’ advance written notice. In the case of such a termination
by the Company, the Company is required to provide the following severance payments and benefits to Mr. Wen: (1) a lump sum cash
payment equal to three (3) months of the base salary as of the date of such termination; (2) a lump sum cash payment equal to a
pro-rated amount of his target annual bonus for the year immediately preceding the termination, if any; (3) payment of premiums
for continued health benefits under the Company’s health plans for three (3) months following the termination, if any; and
(4) immediate vesting of 100% of the then-unvested portion of any outstanding equity awards held by Mr. Wen.
In addition, if the
Company or its successor terminates the Wen Agreement upon a merger, consolidation, or transfer or sale of all or substantially
all of the assets of the Company with or to any other individual(s) or entity, Mr. Wen shall be entitled to the following severance
payments and benefits upon such termination: (1) a lump sum cash payment equal to three months of the base salary at a rate equal
to the greater of his annual salary in effect immediately prior to the termination, or his then current annual salary as of the
date of such termination; (2) a lump sum cash payment equal to a pro-rated amount of his target annual bonus for the year immediately
preceding the termination; (3) payment of premiums for continued health benefits under the Company’s health plans for three
months following the termination; and (4) immediate vesting of 100% of the then-unvested portion of any outstanding equity awards
held by Mr. Wen.
Pursuant to the Wen
Agreement, Mr. Wen may terminate his employment at any time with 30 days’ advance written notice without cause or if there
is any significant change in his authority, duties and responsibilities or a material reduction in his annual salary. In such case,
Mr. Wen will be entitled to receive compensation equivalent to three months of his base salary.
In order to receive
any severance benefits under the Wen Agreement, Mr. Wen will be required to execute and deliver to the Company a general release
of claims in a form reasonably satisfactory to the Board.
The Wen Agreement also
contains customary restrictive covenants relating to confidentiality, non-competition and non-solicitation.
Xiaoyuan Zhang, Chief Financial Officer and
Treasurer
On September 17, 2018,
the Company and Ms. Zhang entered into an employment agreement (the “Zhang Agreement”). Under the Zhang Agreement,
Ms. Zhang is entitled to an annual salary of RMB540,000 (approximately $78,620) for her services as Chief Financial Officer and
Treasurer of the Company. She is also entitled to participate in the Company’s equity incentive plans and other Company benefits,
each as determined by the Board from time to time. Her employment has an initial term of one year and is subject to successive,
automatic one-year extensions unless either party gives notice of non-extension to the other party at least 30 days prior to the
end of the applicable term.
Pursuant to the Zhang
Agreement, the Company may terminate Ms. Zhang’s employment for cause, at any time, without notice or remuneration, for certain
acts, such as conviction or plea of guilty to a felony or grossly negligent or dishonest acts to the detriment of the Company,
or misconduct or a failure to perform agreed duties. In such case, Ms. Zhang will not be entitled to receive payment of any severance
benefits or other amounts by reason of the termination, and her right to all other benefits will terminate, except as required
by any applicable law. The Company may also terminate Ms. Zhang’s employment without cause upon 30 days’ advance written
notice. In such case of termination by the Company, the Company is required to provide the following severance payments and benefits
to Ms. Zhang: a cash payment of one month of base salary as of the date of such termination for each year (which is any period
longer than six months but no more than one year) and a cash payment of half month of base salary as of the date of such termination
for any period of employment no more than six months, provided that the total severance payments shall not exceed twelve months
of base salary.
Pursuant to the Zhang
Agreement, Ms. Zhang may terminate her employment at any time with 30 days’ advance written notice if there is any significant
change in her duties and responsibilities or a material reduction in her annual salary. In such case, Ms. Zhang will be entitled
to receive compensation equivalent to 3 months of her base salary. In addition, if the Company or its successor terminates the
Zhang Agreement upon a merger, consolidation, or transfer or sale of all or substantially all of the assets of the Company
with or to any other individual(s) or entity, Ms. Zhang shall be entitled to the following severance payments and benefits upon
such termination: (1) a lump sum cash payment equal to 3 months of base salary at a rate equal to the greater of her
annual salary in effect immediately prior to the termination, or her then current annual salary as of the date of such termination;
(2) a lump sum cash payment equal to a pro-rated amount of target annual bonus for the year immediately preceding the termination;
(3) payment of premiums for continued health benefits under the Company’s health plans for 3 months following the termination;
and (4) immediate vesting of 100% of the then-unvested portion of any outstanding equity awards held by Ms. Zhang.
The Zhang Agreement
also contains customary restrictive covenants relating to confidentiality, non-competition and non-solicitation.
Chunhai Li, Chief Technology Officer
Mr. Li serves as Chief
Technology Officer of the Company pursuant to an employment agreement dated July 20, 2017. Under his employment agreement,
Mr. Li is entitled to an annual salary of $1.00 for his services Chief Technology Officer of the Company. His employment
has an initial term of one year and is subject to successive, automatic one-year extensions unless either party gives notice of
non-extension to the other party at least 30 days prior to the end of the applicable term.
We may terminate Mr.
Li's employment for cause, at any time, without notice or remuneration, for certain acts of the executive officer, such as conviction
or plea of guilty to a felony or grossly negligent or dishonest acts to our detriment, or misconduct or a failure to perform agreed
duties. In such case, Mr. Li will not be entitled to receive payment of any severance benefits or other amounts by reason of the
termination, and his right to all other benefits will terminate, except as required by any applicable law. We may also terminate
Mr. Li's employment without cause upon 30 days' advance written notice. In such case of termination by us, we are required to provide
the following severance payments and benefits to him: (1) a lump sum cash payment equal to 3 months of his base salary as of the
date of such termination; (2) a lump sum cash payment equal to a pro-rated amount of his target annual bonus for the year immediately
preceding the termination, if any; (3) payment of premiums for continued health benefits under the Company's health plans for 3
months following the termination, if any; and (4) immediate vesting of 100% of the then-unvested portion of any outstanding equity
awards held by him.
Mr. Li may terminate
his employment at any time with 30 days' advance written notice if there is any significant change in his duties and responsibilities
or a material reduction in his annual salary. In such case, Mr. Li will be entitled to receive compensation equivalent to three
months of his base salary.
Mr. Li has agreed to
hold, both during and after the termination of his employment agreement, in strict confidence and not to use, except as required
in the performance of his duties in connection with the employment, any of our confidential information or proprietary information
of any third party received by us and for which we have confidential obligations. In addition, he has agreed to be bound by non-competition
and non-solicitation restrictions during the term of his employment and for one year following termination of his employment.
Mr. Li also serves
as Chief Technology Officer of Sichuan Senmiao pursuant to an employment agreement with Sichuan Senmiao for a term of three years
ending September 11, 2022. Pursuant to the renewed employment agreement with Sichuan Senmiao in September 2019, Mr. Li receives
an annual salary of RMB374,004 (approximately US$53,835) for his services and is entitled to benefits under PRC government statutory
employee benefit plans.
Haitao Liu, Chief Operating Officer
Mr. Liu serves as the
Chief Executive Officer of the Company pursuant to an employment agreement, dated September 11, 2020 (the “Liu Agreement”).
Under the Liu Agreement, Mr. Liu is entitled to an annual salary of RMB540,000 (approximately $77,000) for his service as Chief
Operating Officer of the Company. He is also entitled to participate in the Company’s equity incentive plans and other Company
benefits, each as determined by the Board from time to time. His employment has an initial term of one year and is subject to successive,
automatic one-year extensions unless either party gives notice of non-extension to the other party at least 30 days prior to the
end of the applicable term.
Pursuant to the
Liu Agreement, the Company may terminate Mr. Liu’s employment for cause, at any time, without notice or remuneration,
for certain acts, such as conviction or plea of guilty to a felony or grossly negligent or dishonest acts to the detriment of
the Company, or misconduct or a failure to perform agreed duties. In such case, Mr. Liu will not be entitled to receive
payment of any severance benefits or other amounts by reason of the termination, and his right to all other benefits will
terminate, except as required by any applicable law. The Company may also terminate Mr. Liu’s employment without cause
upon 30 days’ advance written notice. In such case of termination by the Company, the Company is required to provide
the following severance payments and benefits to Mr. Liu: a cash payment of one month of base salary as of the date of such
termination for each year (which is any period longer than six months but no more than one year) and a cash payment of half
month of base salary as of the date of such termination for any period of employment no more than six months, provided that
the total severance payments shall not exceed twelve months of base salary.
Pursuant to the Liu
Agreement, Mr. Liu may terminate his employment at any time with 30 days’ advance written notice if there is any significant
change in his duties and responsibilities or a material reduction in his annual salary. In such case, Mr. Liu will be entitled
to receive compensation equivalent to 3 months of his base salary. In addition, if the Company or its successor terminates the
Liu Agreement upon a merger, consolidation, or transfer or sale of all or substantially all of the assets of the Company with
or to any other individual(s) or entity, Mr. Liu shall be entitled to the following severance payments and benefits upon such termination:
(1) a lump sum cash payment equal to 3 months of base salary at a rate equal to the greater of his annual salary in effect
immediate1y prior to the termination, or his then current annua1 salary as of the date of such termination; (2) a lump sum
cash payment equal to a pro-rated amount of target annual bonus for the year immediately preceding the termination; (3) payment
of premiums for continued health benefits under the Company’s health plans for 3 months fo1lowing the termination; and (4) immediate
vesting of 100% of the then-unvested portion of any outstanding equity awards held by Mr. Liu.
Outstanding Equity Awards at Fiscal Year-End
As of Mach 31, 2020, there was no outstanding
equity awards of executive officers.
Director Compensation
The following table
sets forth certain information concerning the compensation of our then serving non-executive directors for the fiscal year ended
March 31, 2020:
|
|
Fees
earned
or
paid in
cash
$
|
|
|
Stock
awards
$
|
|
|
Option
awards
$
|
|
|
Non-equity
incentive plan
compensation
$
|
|
|
Nonqualified
deferred
compensation
earnings
$
|
|
|
All
other
compensation
$
|
|
|
Total
$
|
|
Xiaojuan Lin
|
|
|
20,000
|
|
|
|
31,050
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
51,050
|
|
Trent Davis
|
|
|
40,000
|
|
|
|
31,050
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
71,050
|
|
Sichun Wang
|
|
|
20,000
|
|
|
|
20,000
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
40,000
|
|
Jie Gao
|
|
|
20,000
|
|
|
|
20,000
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
40,000
|
|
Each of our directors
receives an annual retainer of $20,000 except that Mr. Trent receives an annual retainer of $40,000. They will also be reimbursed
for reasonable, pre-approved expenses in connection with the performance of their services.
On August 3, 2018,
our Board approved the grant of 5,000 restricted stock units (“RSUs”) to each of our directors then in office
as part of their compensation for the fiscal year ended March 31, 2019. The RSUs vest in four equal quarterly installments on August
3, 2018, April 1, 2019, July 1, 2019 and October 1, 2019 or in full upon the occurrence of a change in control of the Company,
subject to the terms and conditions set forth in the RSU agreement, provided that the director remains in service as a director
through the applicable vesting date. RSUs will be settled by the Company's issuance of a share of Common Stock in certificated
or uncertificated form upon the earlier of a (i) change in control and (ii) the director’s cessation as a director of the
Company due to a "separation of service" within the meaning of Section 409A of the Internal Revenue Code of 1986, as
amended, or the director’s death or disability.
As of March 31,
2020, the first installment of RSUs vested and the Company accounted for the vested RSUs as expenses and charged to Common Stock.
The fair value of the vested RSUs is calculated at the grant date market price of the Company’s Common Stock multiplying
by the number of vested shares.
On December 11,
2019, our Board approved the issuance of 30,303 RSUs to each of our directors as stock compensation for their services for the
fiscal year ended March 31, 2020. The RSUs either vest on March 31, 2020 in full
or upon the occurrence of a change in control of the Company, subject to the terms and conditions set forth in the Agreement, provided
that the director receiving such RSUs remains in service as a director through March 31, 2020. RSUs shall be settled by the Company's
issuance of a share of Common Stock in certificated or uncertificated form upon the earlier of (i) March 31, 2020, (ii) change
in control and (ii) the director's cessation as a director of the Company due to a “separation of service” within the
meaning of Section 409A of the Internal Revenue Code of 1986, as amended, or the director's death or disability.
As of March 31,
2020, all of the RSUs vested and the Company accounted for the vested RSUs as expenses and charged to Common Stock. The fair value
of the vested RSUs is calculated at the grant date market price of the Company’s Common Stock multiplying by the number of
vested shares. Total compensation expense for the year ended March 31, 2020 was $133,150.
Compensation Committee Interlocks and Insider Participation
None of the members
of our compensation committee is or has been an officer or employee of our Company. None of our officers and directors currently
serves, or in the past year has served, as a member of the compensation committee or other board committee performing equivalent
functions of any entity that has one or more executive officers serving on our Board or Compensation Committee.
Certain Relationships and Related Transactions
Our Audit Committee
must review and approve any related person transaction we propose to enter into which would need to be disclosed under Item 404(a)
of Regulation S-K. Our Audit Committee charter details the policies and procedures relating to transactions that may present actual,
potential or perceived conflicts of interest and may raise questions as to whether such transactions are consistent with the best
interest of our company and our stockholders.
In December 2017,
Sichuan Senmiao entered into loan agreements with two stockholders, who agreed to grant lines of credit of approximating $955,000
and $159,000, respectively, to Sichuan Senmiao for five years. The lines of credit are non-interest bearing, effective from January 2017.
As of March 31, 2020, the outstanding balances in the discontinued operations were $108,711 and $73,384, respectively.
During the year end
March 31, 2017, we entered into two office lease agreements which were set to expire in January 2020 with Hong Li, a shareholder
of Sichuan Senmiao. On April 1, 2018, the two office leases were modified with the leasing term from April 1, 2018 to
March 31, 2021. For the years ended March 31, 2020 and 2019, the Company paid $109,896 and $113,742, respectively, to the
shareholder in rental expenses.
In September 2019,
Hunan Ruixi entered into an office lease agreement which was set to expire in October, 2023 with Hunan Dingchentai Investment Co.,
Ltd. ("Dingchentai"), a Company where one of our independent director serves as legal representative and general manager.
The rent was approximately $44,250 per year, payable on a quarterly basis. For the years ended March 31, 2020 and 2019, the Company
incurred expense of $41,661 and $13,597 in rent, respectively, to Dingchentai.
In June 2019 and January
2020, the Company entered into two automobile maintenance services contracts with Sichuan Qihuaxin Automobile Services Co., Ltd
and Sichuan Yousen Automobile Maintenance Service Co., Ltd, the companies which are controlled by one of the noncontrolling shareholder
of Sichuan Jinkailong. During the year ended March 31, 2020, the Company paid automobile maintenance service fees of an aggregate
of $36,088 and $21,759 to those companies, respectively.
Vote Required for Approval
Each director nominee
receiving a majority of the votes cast at the Meeting, in person or by proxy, and entitled to vote in the election of directors,
will be elected.
THE BOARD RECOMMENDS A VOTE “FOR”
THE ELECTION OF FIVE DIRECTORS.
PROPOSAL 2
RATIFICATION OF THE APPOINTMENT OF THE
COMPANY’S REGISTERED PUBLIC ACCOUNTING
FIRM
Overview
The Audit Committee
is directly responsible for the appointment, compensation, retention and oversight of the work of the Company’s independent
registered public accountants. The Audit Committee appointed the firm of Friedman to serve as our registered public accounting
firm for our fiscal year ending March 31, 2021. The report of Friedman on our consolidated financial statements for the fiscal
year ended March 31, 2020 contained no adverse opinion or disclaimer of opinion and was not qualified or modified as to uncertainty,
audit scope or accounting principles. We do not expect any representative of Friedman to attend the Meeting.
Changes in and Disagreements with Accountants on Accounting
and Financial Disclosure
On August 26, 2017,
we dismissed Anton & Chia, LLP (“A&C”) as our independent registered public accounting firm. The reports of
A&C, on our financial statements for each of the fiscal years ended March 31, 2017 and 2016 contained no adverse opinion or
a disclaimer of opinion and were not modified. The decision to change independent accountants was approved by our Board on September
27, 2017.
During the fiscal years
ended March 31, 2017 and 2016 and through the date of the dismissal of A&C, we had no disagreements with A&C, on any matter
of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if
not resolved to the satisfaction of A&C, would have caused it to make reference to the subject matter of such disagreements
in its report on our financial statements for such periods.
During the fiscal years
ended March 31, 2017 and 2016 and through the date of the dismissal of A&C, there had been no reportable events as defined
under Item 304(a)(1)(v) of Regulation S-K adopted by the SEC.
We provided A&C,
with a copy of this disclosure before the filing was made with the SEC. We requested that A&C provide us with a letter addressed
to the SEC stating whether or not it agrees with the above statements, and we received a letter from A&C, stating that it agrees
with the above statements.
We then engaged ZH
CPA LLP (“ZH CPA”) on August 26, 2017 and the auditors’ actual work started right thereafter. Our Board approved
and ratified the appointment of ZH CPA as our new independent registered public accounting firm, effective September 27, 2017.
During the fiscal years ended March 31, 2017 and 2016 and through the date of the engagement of ZH CPA, we did not consult with
ZH CPA regarding either (1) the application of accounting principles to a specified transaction, either completed or proposed,
or the type of audit opinion that might be rendered on our financial statements, or (2) any matter that was either the subject
of a disagreement or a reportable event (as defined in Item 304(a)(1)(v) of Regulation S-K). In approving the selection of ZH CPA
as our new independent registered public accounting firm, the Board considered all relevant factors.
On April 4, 2018, ZH
CPA resigned as our independent registered public accounting firm.
The reports of ZH CPA
on the Company’s financial statements for the fiscal years ended March 31, 2017 and 2016 did not contain an adverse opinion
or disclaimer of opinion and were not qualified or modified as to uncertainty, audit scope, or accounting principles.
During the fiscal years
ended March 31, 2017 and 2016 and through April 4, 2018, there were (i) no disagreements between the Company and ZH CPA on any
matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedures, which disagreement,
if not resolved to the satisfaction of ZH CPA, would have caused ZH CPA to make reference thereto in their reports on the consolidated
financial statements for such years, and (ii) no reportable events as that term is defined in Item 304(a)(1)(v) of Regulation S-K.
We provided ZH CPA
with a copy of the disclosure above and requested that ZH furnish us with a letter addressed to the Securities and Exchange Commission
stating whether or not ZH agrees with the above disclosure. We received a letter from ZH CPA stating that it agrees with the above
statements.
On April 4, 2018, our
Audit Committee appointed Friedman as our new independent registered public accounting firm.
Except as disclosed
herein, during the fiscal years ended March 31, 2017 and 2016 and in the subsequent interim period through April 4, 2018, the Company
had not consulted with Friedman regarding either (i) the application of accounting principles to a specified transaction, either
completed or proposed, or the type of audit opinion that might be rendered on the Company’s consolidated financial statements,
and neither a written report nor oral advice was provided to the Company that Friedman concluded was an important factor considered
by the Company in reaching a decision as to the accounting, auditing or financial reporting issue; or (ii) any matter that was
either the subject of a disagreement (as defined in Item 304(a)(1)(iv) of Regulation S-K and the related instructions) or a reportable
event (as described in Item 304(a)(1)(v) of Regulation S-K).
The following table
shows the fees that we paid or accrued for the audit and other services provided by our independent registered public accounting
firms for the fiscal years ended March 31, 2020 and 2019.
Fee Category
|
|
Fiscal Year
Ended March 31, 2020
|
|
|
Fiscal Year
Ended March 31, 2019
|
|
Audit Fees (1)
|
|
$
|
261,755
|
|
|
$
|
212,664
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Audit-Related Fees(2)
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|
$
|
50,000
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|
|
$
|
35,178
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Tax Fees(3)
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$
|
22,400
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|
$
|
-
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All Other Fees(4)
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$
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-
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$
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-
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(1)
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This category consists of fees for professional services rendered by our principal independent registered public accountants for the audit of our annual financial statements, review of financial statements included in our quarterly reports and services that are normally provided by the independent registered public accounting firms in connection with statutory and regulatory filings or engagements for those fiscal years.
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(2)
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This category consists of fees for assurance and related services by our independent registered public accountant that are reasonably related to the performance of the audit or review of our financial statements and are not reported above under “Audit Fees.” The services for the fees disclosed under this category include consultations concerning financial accounting and reporting standards.
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(3)
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This category consists of fees for professional services rendered by our independent registered public accountant for tax compliance, tax advice, and tax planning.
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(4)
|
This category consists of fees for services provided by our independent registered public accountants other than the services described above.
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Policy on Pre-Approval of Audit Services
Our Audit Committee
pre-approves all services, including both audit and non-audit services, provided by our independent registered public accounting
firm. During our fiscal year ended March 31, 2020, all the services provided by our auditor have been approved by our Audit Committee.
Vote Required for Approval
The affirmative vote
of a majority of the votes cast by the holders of Common Stock of the Company present in person or represented by proxy at the
Meeting and entitled to vote thereon is required to approve this proposal.
THE BOARD RECOMMENDS
A VOTE “FOR” THE RATIFICATION OF THE APPOINTMENT OF FRIEDMAN AS THE COMPANY’S REGISTERED PUBLIC ACCOUNTING FIRM
FOR THE FISCAL YEAR ENDING MARCH 31, 2021.
PROPOSAL 3
AMENDMENT TO
THE COMPANY’S ARTICLES OF INCORPORATION
TO AFFECT A
REVERSE STOCK SPLIT
General
On September 16, 2020,
the Board approved the proposal for a reverse split to amend Article 3 of our Articles of Incorporation, as amended, to enable
a potential reverse split (the “Reverse Split”) of our outstanding shares of Common Stock within a range of a ratio
of not less than 1-for-5 and not more than 1-for-10, to be selected at
the discretion of our Board. Stockholder approval of this proposal will authorize our Board, in its sole discretion, to determine
whether to effect the Reverse Split and to set the exact ratio within the range at which the Reverse Split will be effected, at
any time prior to our 2021 annual meeting of stockholders. Our Board believes that approval of this proposal to effect the Reverse
Split and to determine the ratio as opposed to approval of an immediate reverse stock split at a specific ratio, and to effect
such reverse stock split at any time prior to our 2021 annual meeting of stockholders, will provide our Board with maximum flexibility
to react to current market conditions and therefore to achieve the purposes of the Reverse Split, if implemented, and to act in
the best interests of our stockholders.
Effecting the Reverse
Split requires that Article 3 of our Articles of Incorporation, as amended, be amended to include a reference to the Reverse Split.
If approved, the Reverse Split will be effective upon the filing of a Certificate of Amendment to the Articles of Incorporation,
in the form attached to this proxy statement as Annex A (the “Certificate of Amendment”), with the
Secretary of State of Nevada, with such filing to occur, if at all, at the sole discretion of the Board.
The intention of the
Board in obtaining approval for the authority to effect a Reverse Split would be to increase the stock price of our Common Stock
sufficiently above the $1.00 minimum bid price requirement to regain its listing on the Nasdaq Capital Market (“Nasdaq”).
The Board, in its sole discretion, can elect to abandon the Reverse Split in its entirety at any time.
One principal effect
of the Reverse Split would be to decrease the number of outstanding shares of our Common Stock as described below. Except for de
minimus adjustments that may result from the treatment of fractional shares as described below, the Reverse Split will not have
any dilutive effect on our stockholders (whether such stockholders hold Common Stock) since each stockholder would hold the same
percentage of our Common Stock (in hand or on an as converted basis) outstanding immediately following the Reverse Split as such
stockholder held immediately prior to the Reverse Split. The relative voting and other rights that accompany the shares would not
be affected by the Reverse Split.
The table below sets
forth the number of shares of our Common Stock outstanding before and after the Reverse Split based on shares of Common Stock outstanding
as of the Record Date.
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Prior to the
Reverse Split
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Assuming a one-for-
seven Reverse Split
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Aggregate Number of Shares of Common Stock Outstanding
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Except for certain
possible de minimus adjustments, the Reverse Split will not have any dilutive effect on our stockholders as the proportion of shares
owned or convertible by our stockholders relative to the number of shares of Common Stock outstanding issuance will remain the
same.
Reasons for the Reverse Split; Nasdaq
Requirements for Continued Listing
The Board’s
primary objective in proposing a potential Reverse Split is to raise the per share trading price of our Common Stock. Our Common
Stock currently trades on Nasdaq under the symbol “AIHS.”
On September 30, 2019,
we received a deficiency notice from Nasdaq informing us that our Common Stock failed to comply with the $1 minimum bid price required
for continued listing on The Nasdaq Capital Market under Nasdaq Listing Rule 5550(a)(2) based upon the closing bid price of the
Common Stock for the 30 consecutive business days prior to the date of the notice from Nasdaq. On March 31, 2020, we received another
notice from Nasdaq indicating that we are eligible for an additional 180-day period, or until September 28, 2020, to regain compliance.
On April 20, 2020,
we received an additional notice from Nasdaq indicating that, due to extraordinary market conditions, Nasdaq has determined to
toll the compliance period for the minimum bid price requirement under Rule 5550(a)(2) through June 30, 2020. As a result, the
new date by which we have to gain compliance with the minimum bid price requirement is December 11, 2020. To regain compliance,
the minimum bid price of the Common Stock must meet or exceed $1.00 per share for a minimum of ten consecutive trading days at
any time prior to December 11, 2020.
Our Board believes
that the Reverse Split and any resulting increase in the per share price of our Common Stock will enhance the acceptability and
marketability of our Common Stock to the financial community and investing public. Many institutional investors have policies prohibiting
them from holding lower-priced stocks in their portfolios, which reduces the number of potential buyers of our Common Stock, although
we have not been told by them that is the reason for not investing in our Common Stock. Additionally, analysts at many brokerage
firms are reluctant to recommend lower-priced stocks to their clients or monitor the activity of lower-priced stocks. Brokerage
houses frequently have internal practices and policies that discourage individual brokers from dealing in lower-priced stocks.
Further, because brokers’ commissions on lower-priced stock generally represent a higher percentage of the stock price than
commissions on higher priced stock, investors in lower-priced stocks pay transaction costs which are a higher percentage of their
total share value, which may limit the willingness of individual investors and institutions to purchase our Common Stock.
We cannot assure you
that the Reverse Split will have any of the desired effects described above. More specifically, we cannot assure you that after
the Reverse Split the market price of our Common Stock will increase proportionately to reflect the ratio for the Reverse Split,
that the market price of our Common Stock will not decrease to its pre-split level, that our market capitalization will be equal
to the market capitalization before the Reverse Split, or that we will be able to maintain our listing on Nasdaq.
Potential Disadvantages of the Reverse
Split
As noted above, the
principal purpose of the Reverse Split would be to help increase the per share market price of our Common Stock by up to a factor
of at least five. We cannot assure you, however, that the Reverse Split will accomplish this objective for any meaningful period
of time. While we expect that the reduction in the number of outstanding shares of Common Stock will increase the market price
of our Common Stock, we cannot assure you that the Reverse Split will increase the market price of our Common Stock by a multiple
equal to the number of pre-split shares, or result in any permanent increase in the market price of our Common Stock, which is
dependent upon many factors, including our business and financial performance, general market conditions and prospects for future
success. If the per share market price does not increase proportionately as a result of the Reverse Split, then the value of our
Company as measured by our stock capitalization will be reduced, perhaps significantly.
The number of shares
held by each individual holder of Common Stock would be reduced if the Reverse Split is implemented. This will increase the number
of stockholders who hold less than a “round lot,” or 100 shares. Typically, the transaction costs to stockholders selling
“odd lots” are higher on a per share basis. Consequently, the Reverse Split could increase the transaction costs to
existing holders of Common Stock in the event they wish to sell all or a portion of their position.
Although our Board
believes that the decrease in the number of shares of our Common Stock outstanding as a consequence of the Reverse Split and the
anticipated increase in the market price of our Common Stock could encourage interest in our Common Stock and possibly promote
greater liquidity for our stockholders, such liquidity could also be adversely affected by the reduced number of shares outstanding
after the Reverse Split.
Effecting the Reverse Split
Upon receipt of stockholder
approval for the Reverse Split Proposal, if our Board concludes that it is in the best interests of our Company and our stockholders
to effect the Reverse Split, the Certificate of Amendment will be filed with the Secretary of State of Nevada. The actual timing
of the filing of the Certificate of Amendment with the Secretary of State of Nevada to effect the Reverse Split will be determined
by our Board. In addition, if for any reason our Board deems it advisable to do so, the Reverse Split may be abandoned at any time
prior to the filing of the Certificate of Amendment, without further action by our stockholders. In addition, our Board may deem
it advisable to effect the Reverse Split even if the price of our Common Stock is above $1.00 at the time the Reverse Split is
to be effected. The Reverse Split will be effective as of the date of filing of the Certificate of Amendment with the Secretary
of State of the State of Nevada (the “Effective Time”).
Upon the filing of
the Certificate of Amendment, without further action on our part or our stockholders, the outstanding shares of Common Stock held
by stockholders of record as of the Effective Time would be converted into a lesser number of shares of Common Stock based on a
Reverse Split ratio as determined by the Board.
Effect on Outstanding Shares, Options
and Certain Other Securities
If the Reverse Split
is implemented, the number of shares our Common Stock owned by each stockholder will be reduced in the same proportion as the reduction
in the total number of shares outstanding, such that the percentage of our Common Stock owned by each stockholder will remain unchanged
except for any de minimus change resulting from rounding up to the nearest number of whole shares so that we are not obligated
to issue cash in lieu of any fractional shares that such stockholder would have received as a result of the Reverse Split. The
number of shares of our Common Stock that may be purchased upon exercise of outstanding options or other securities convertible
into, or exercisable or exchangeable for, shares of our Common Stock, and the exercise or conversion prices for these securities,
will also be ratably adjusted in accordance with their terms as of the Effective Time.
Effect on Registration
Our Common Stock is
currently registered under the Securities Act of 1933, as amended, and we are subject to the periodic reporting and other requirements
of the Exchange Act. The proposed Reverse Split will not affect the registration of our Common Stock.
Fractional Shares; Exchange of Stock
Certificates
Our Board does not
currently intend to issue fractional shares in connection with the Reverse Split. Therefore, we do not expect to issue certificates
representing fractional shares. In lieu of any fractional shares, we will issue to stockholders of record who would otherwise hold
a fractional share because the number of shares of Common Stock they hold of record before the Reverse Split is not evenly divisible
by the Reverse Split ratio that number of shares of Common Stock as rounded up to the nearest whole share. No stockholders will
receive cash in lieu of fractional shares.
As of the Record Date,
we had holders of record of our Common Stock. We do not expect the Reverse Split and the rounding up of fractional shares to whole
shares to result in a significant reduction in the number of record holders. We presently do not intend to seek any change in our
status as a reporting company for federal securities law purposes, either before or after the Reverse Split.
On or after the Effective
Time, we will mail a letter of transmittal to each stockholder. Each stockholder will be able to obtain a certificate evidencing
his, her or its post-Reverse Split shares only by sending the exchange agent (who will be the Company’s transfer agent) the
stockholder’s old stock certificate(s), together with the properly executed and completed letter of transmittal and such
evidence of ownership of the shares as we may require. Stockholders will not receive certificates for post-Reverse Split shares
unless and until their old certificates are surrendered. Stockholders should not forward their certificates to the exchange agent
until they receive the letter of transmittal, and they should only send in their certificates with the letter of transmittal. The
exchange agent will send each stockholder, if elected in the letter of transmittal, a new stock certificate after receipt of that
stockholder’s properly completed letter of transmittal and old stock certificate(s). A stockholder that surrenders his, her
or its old stock certificate(s) but does not elect to receive a new stock certificate in the letter of transmittal will be deemed
to have requested to hold that stockholder’s shares electronically in book-entry form with our transfer agent.
Certain of our registered
holders of Common Stock hold some or all of their shares electronically in book-entry form with our transfer agent. These stockholders
do not have stock certificates evidencing their ownership of our Common Stock. They are, however, provided with a statement reflecting
the number of shares registered in their accounts. If a stockholder holds registered shares in book-entry form with our transfer
agent, the stockholder may return a properly executed and completed letter of transmittal.
Stockholders who hold
shares in street name through a nominee (such as a bank or broker) will be treated in the same manner as stockholders whose shares
are registered in their names, and nominees will be instructed to effect the Reverse Split for their beneficial holders. However,
nominees may have different procedures and stockholders holding shares in street name should contact their nominees.
Stockholders will
not have to pay any service charges in connection with the exchange of their certificates.
Authorized Shares
If and when our Board
elects to effect the Reverse Split, the Certificate of Amendment will not reduce the authorized number of shares of our capital
stock.
In accordance with
our Articles of Incorporation, as amended, and Nevada law, our stockholders do not have any preemptive rights to purchase or subscribe
for any of our unissued or treasury shares.
Anti-Takeover and Dilutive Effects
The authorized Common
Stock will not be diluted as a result of the Reverse Split. The Common Stock that is authorized but unissued provides the Board
with flexibility to effect among other transactions, public or private financings, acquisitions, stock dividends, stock splits
and the granting of equity incentive awards. However, these authorized but unissued shares may also be used by our Board, consistent
with and subject to its fiduciary duties, to deter future attempts to gain control of us or make such actions more expensive and
less desirable. The Certificate of Amendment would continue to give our Board authority to issue additional shares from time to
time without delay or further action by the stockholders except as may be required by applicable law or regulations. The Certificate
of Amendment is not being recommended in response to any specific effort of which we are aware to obtain control of us, nor does
our Board have any present intent to use the authorized but unissued Common Stock or preferred stock to impede a takeover attempt.
There are no plans or proposals to adopt other provisions or enter into any arrangements that have material anti-takeover effects.
Accounting Consequences
As of the Effective
Time, the stated capital attributable to Common Stock on our balance sheet will be reduced proportionately based on the Reverse
Split ratio that is determined by the Board (including a retroactive adjustment of prior periods), and the additional paid-in capital
account will be credited with the amount by which the stated capital is reduced. Reported per share net income or loss will be
higher because there will be fewer shares of our Common Stock outstanding.
Federal Income Tax Consequences
The following discussion
is a summary of the U.S. federal income tax consequences of the Reverse Split generally applicable to U.S. holders (as defined
below) of our Common Stock, and is based upon U.S. federal income tax law and relevant interpretations thereof in effect as of
the date of this proxy statement, all of which are subject to change, possibly with retroactive effect. This summary does not discuss
all aspects of U.S. federal income taxation that may be important to you in light of your individual circumstances, including if
you are subject to special tax rules that apply to certain types of investors (e.g., financial institutions, insurance companies,
broker-dealers, partnerships or other pass-through entities for U.S. federal income tax purposes, tax-exempt organizations (including
private foundations), taxpayers that have elected mark-to-market tax accounting, S corporations, regulated investment companies,
real estate investment trusts, investors that will hold our securities as part of a straddle, hedge, conversion, or other integrated
transaction for U.S. federal income tax purposes, or investors that have a functional currency other than the U.S. dollar), all
of whom may be subject to tax rules that differ materially from those summarized below. In addition, this summary does not discuss
other U.S. federal tax consequences (e.g., estate or gift tax), any state, local, or non-U.S. tax considerations, the Medicare
tax on certain investment income or the alternative minimum tax.
This summary is limited
to U.S. holders that hold our Common Stock as “capital assets” (generally, property held for investment) within the
meaning of Section 1221 of the Internal Revenue Code of 1986, as amended (the “Code”). We have not sought, and will
not seek, a ruling from the Internal Revenue Service (the “IRS”) regarding any matter discussed herein, and no assurance
can be given that the IRS would not assert, or that a court would not sustain, a position contrary to any of the tax aspects set
forth below.
For purposes of this
summary, a “U.S. holder” is a beneficial holder of Common Stock who or that, for U.S. federal income tax purposes,
is:
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•
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an individual who is a United States citizen or resident of the United States;
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•
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a corporation or other entity treated as a corporation for United States federal income tax purposes that is created or organized (or treated as created or organized) in or under the laws of the United States or any state or political subdivision thereof;
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•
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an estate the income of which is subject to United States federal income taxation regardless of its source; or
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•
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a trust if (A) the administration of which is subject to the primary supervision of a United States court and which has one or more United States persons (within the meaning of the Code) who have the authority to control all substantial decisions of the trust or (B) it has in effect a valid election under applicable Treasury regulations to be treated as a United States person.
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If a partnership (or
other entity classified as a partnership for U.S. federal income tax purposes) is the beneficial owner of our Common Stock, the
U.S. federal income tax treatment of a partner in the partnership will generally depend on the status of the partner and the activities
of the partnership. Partnerships that hold our Common Stock, and partners in such partnerships, should consult their own tax advisors
regarding the U.S. federal income tax consequences of the Reverse Split.
Each stockholder
should consult his, her or its own tax advisor regarding the U.S. federal, state, local and foreign income and other tax consequences
of the Reverse Split.
The Reverse Split
should be treated as a recapitalization for U.S. federal income tax purposes. Therefore, no gain or loss should be recognized by
a U.S. holder upon the Reverse Split. Accordingly, the aggregate tax basis in the Common Stock received pursuant to the Reverse
Split should equal the aggregate tax basis in the Common Stock surrendered and the holding period for the Common Stock received
should include the holding period for the Common Stock surrendered.
Vote Required
The
approval of this proposal requires the affirmative vote of the holders of a majority of the issued and outstanding shares of our
Common Stock. Abstentions, but not broker non-votes, are considered present for purposes of establishing a quorum. However, abstentions
will have the effect of a vote against this proposal.
THE BOARD RECOMMENDS
A VOTE “FOR” THE APPROVAL OF THE AMENDMENT TO OUR ARTICLES OF INCORPORATION TO EFFECT THE REVERSE STOCK SPLIT.
OTHER INFORMATION
Other Business
Our Board knows of
no other matter to be presented at the Meeting. If any additional matter should properly come before the Meeting, it is the intention
of the persons named in the enclosed proxy to vote such proxy in accordance with their judgment on any such matters.
Deadline for Submission of Stockholder
Proposals
Stockholder proposals
may be included in our proxy statement for an annual meeting so long as they are provided to us on a timely basis and satisfy the
other conditions set forth in SEC regulations under Rule 14a-8 regarding the inclusion of stockholder proposals in company-sponsored
proxy materials. For a stockholder proposal to be considered for inclusion in our proxy statement for the 2021 annual meeting of
stockholders, we must receive the proposal at our principal executive offices, addressed to the Corporate Secretary, no later than
July 1, 2021.
A stockholder nomination
of one or more director candidates for election to the Board to be included in our proxy statement for an annual meeting (a “proxy
access nomination”) may be included in such proxy statement and properly brought before the 2021 annual meeting of stockholders
as long as we receive information and notice of the proxy access nomination in compliance with the requirements set forth in Section
2.6 of our Bylaws, addressed to the Corporate Secretary at our principal executive offices no earlier than July 1, 2021, nor later
than July 31, 2021.
In addition, a stockholder
proposal that is not intended for inclusion in our proxy statement under Rule 14a-8 or a stockholder nomination of a director candidate
that is not a proxy access nomination may be brought before our 2021 annual meeting of stockholders so long as we receive information
and notice of the proposal in compliance with the requirements set forth in our Bylaws by September 14, 2021.
Stockholder Communications
Stockholders wishing
to communicate with the Board may direct such communications to the Board c/o the Company, Attn: Chief Executive Officer. Our Chief
Executive Officer will present a summary of all stockholder communications to the Board at subsequent Board meetings. The directors
will have the opportunity to review the actual communications at their discretion.
Householding of Proxy Materials
The SEC has adopted
rules that permit companies and intermediaries (such as banks and brokers) to satisfy the delivery requirements for notices of
annual meetings, proxy statements and annual reports with respect to two or more stockholders sharing the same address by delivering
a single proxy statement addressed to those stockholders. This process, which is commonly referred to as “householding,”
potentially means extra convenience for stockholders and cost savings for companies. This year, a single copy of the Notice, Proxy
Statement, Annual Report or proxy card, as applicable, will be delivered to multiple stockholders sharing an address unless contrary
instructions have been received from the affected stockholders. Once you have received notice from your bank or broker that it
will be householding communications to your address, householding will continue until you are notified otherwise or until you revoke
your consent. If, at any time, you no longer wish to participate in householding and would prefer to receive a separate copy of
the proxy materials, please notify your bank or broker, and direct your written request to Chief Executive Officer of the Company,
at 16F, Shihao Square, Middle Jiannan Blvd., High-Tech Zone, Chengdu, Sichuan, People’s Republic of China 610000, Telephone:
+86 28 88678707. Stockholders who currently receive multiple copies of the proxy materials at their address and would like to request
householding of their communications should contact their bank or broker.
Annual Report
Accompanying this Proxy
Statement is a copy of our Annual Report on Form 10-K for the year ended March 31, 2020. The Annual Report contains audited financial
statements covering our fiscal year ended March 31, 2020. Copies of our Annual Report, as filed with the SEC, are available free
of charge on our website at http://www.senmiaotech.com or you can request a copy free of charge by calling +86 28 88678707
or sending an email to julie@ihongsen.com. Please include your contact information with the request.
Annex A
BARBARA
K. CEGAVSKE Secretary of State 202 North Carson Street Carson City, Nevada 89701-4201 (775) 684-5708 Website: www.nvsos.gov*090204*Certificate
of Amendment (PURSUANT TO NRS 78.385 AND 78.390)USE BLACK INK ONLY - DO NOT HIGHLIGHT ABOVE SPACE IS FOR OFFICE USE ONLYCertificate
of Amendment to Articles of Incorporation For Nevada Profit Corporations (Pursuant to NRS 78.385 and 78.390 - After Issuance of
Stock)1. Name of corporation: Senmiao Technology Limited2. The articles have been amended as follows: (provide article numbers,
if available) Article 3 of the Articles of Incorporation of the Corporation is hereby amended by adding a new subsection at the
end of Article 3 as follows: (f) Upon the filing and effectiveness (the "Effective Time") of this Certificate of Amendment pursuant
to the Nevada Revised Statutes, all the issued and outstanding shares of Common Stock (the "Old Common Stock") shall be automatically
combined and reclassified such thatevery [( )] shares of Old Common Stock shall be combined and reclassified into one (1) validlyissued,
fully paid and non-assessable share of Common Stock (the "New Common Stock") without any action by the holders thereof. The Corporation
shall not issue fractional shares of New Common Stock in connection with the Reverse Stock Split. In lieu thereof, each fractional
share of New Common Stock shall be rounded up to the nearest whole share.3. The vote by which the stockholders holding shares
in the corporation entitling them to exercise at least a majority of the voting power, or such greater proportion of the voting
power as may be required in the case of a vote by classes or series, or as may be required by the provisions of the articles of
incorporation* have voted in favor of the amendment is:4. Effective date and time of filing: (optional) Date:Time:5. Signature:
(required)(must not be later than 90 days after the certificate is filed)X Signature of Officer*If any proposed amendment would
alter or change any preference or any relative or other right given to any class or series of outstanding shares, then the amendment
must be approved by the vote, in addition to the affirmative vote otherwise required, of the holders of shares representing a
majority of the voting power of each class or series affected by the amendment regardless to limitations or restrictions on the
voting power thereof.IMPORTANT: Failure to include any of the above information and submit with the proper fees may cause this
filing to be rejected.This form must be accompanied by appropriate fees.Nevada Secretary of State Amend Profit-After Revised:
1-5-15
Signature [PLEASE
SIGN WITHIN BOX] Date Signature (Joint Owners) Date TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: KEEP THIS PORTION
FOR YOUR RECORDS THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED. DETACH AND RETURN THIS PORTION ONLY D24489-P45025 01) Xi
Wen 02) Trent Davis 03) Xiaojuan Lin 04) Sichun Wang 05) Jie Gao Nominees: 2. To ratify the appointment of Friedman LLP as the
Company's registered public accounting firm for the fiscal year ending March 31, 2021; The Board of Directors recommends you vote
FOR the following proposals: 3. To authorize the Board of Directors to effect a reverse stock split of the Company's outstanding
shares of common stock in a ratio of between one-forfive and one-for-ten, in its sole discretion, without further stockholder
approval, by amending the Company's Articles of Incorporation, as amended, at any time prior to the 2021 annual meeting of stockholders;
and 4. To transact any other business which may properly come before the meeting or any adjournment thereof. ! ! ! 1. Election
of five directors, each to hold office until the 2021 annual meeting of stockholders or until their successors are elected and
qualified; For All Withhold All For All Except For Against Abstain ! ! ! ! ! ! SENMIAO TECHNOLOGY LIMITED To withhold authority
to vote for any individual nominee(s), mark "For All Except" and write the number(s) of the nominee(s) on the line below. The
Board of Directors recommends you vote FOR the following: SENMIAO TECHNOLOGY LIMITED 16 F, SHIHAO SQ, MIDDLE JIANNAN BLVD. HIGH-TECH
ZONE CHENGDU SICHUAN, CHINA 610000 Please sign exactly as the name appears below. When shares are held by joint tenants, both
should sign. When signing as attorney, executor, administrator, trustee or guardian, please give full title as such. If a corporation,
please sign the corporate name by the president or other authorized officer. VOTE BY INTERNET - www.proxyvote.com Use the Internet
to transmit your voting instructions and for electronic delivery of information. Vote by 11:59 p.m. Eastern Standard Time on October
28, 2020. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to
create an electronic voting instruction form. ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS If you would like to reduce the costs
incurred by our company in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and
annual reports electronically via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above
to vote using the Internet and, when prompted, indicate that you agree to receive or access proxy materials electronically in
future years. VOTE BY PHONE - 1-800-690-6903 Use any touch-tone telephone to transmit your voting instructions. Vote by 11:59
p.m. Eastern Standard Time on October 28, 2020. Have your proxy card in hand when you call and then follow the instructions. VOTE
BY MAIL Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing,
c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717. Important Notice Regarding the Availability of Proxy Materials for the Annual
Meeting: The Notice and Proxy Statement and Annual Report are available at www.proxyvote.com. D24490-P45025 PROXY Senmiao Technology
Limited 16F, Shihao Square, Middle Jiannan Blvd., High-Tech Zone Chengdu, Sichuan, People’s Republic of China 610000 THIS
PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS Properly executed proxies received by the day before the meeting date will
be voted as marked and, if not marked, will be voted FOR the election of the nominees listed, FOR proposals 2 and 3, and as determined
by the appointed attorney and proxy with respect to other matters that may properly come before the meeting. THE UNDERSIGNED HEREBY
APPOINTS XI WEN AND XIAOYUAN ZHANG, AND EACH OF THEM, AS ATTORNEY AND PROXY OF THE UNDERSIGNED, WITH FULL POWER OF SUBSTITUTION,
TO VOTE ALL THE SHARES OF COMMON STOCK OF SENMIAO TECHNOLOGY LIMITED HELD OF RECORD BY THE UNDERSIGNED ON SEPTEMBER 21, 2020,
AT THE ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON THURSDAY, OCTOBER 29, 2020 AT 9:00 P.M. EASTERN TIME, OR ANY ADJOURNMENT THEREOF.
Please date, sign and mail the proxy promptly in the self-addressed return envelope which requires no postage if mailed in the
United States. Alternatively, you may vote by phone or the internet, as described in the instructions on the reverse side. Continued
and to be signed on reverse side
Important
Notice Regarding the Availability of Proxy Materials for the Annual Meeting: The Notice and Proxy Statement and Annual Report
are available at www.proxyvote.com. D24490-P45025 PROXY Senmiao Technology Limited 16F, Shihao Square, Middle Jiannan Blvd., High-Tech
Zone Chengdu, Sichuan, People’s Republic of China 610000 THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS Properly
executed proxies received by the day before the meeting date will be voted as marked and, if not marked, will be voted FOR the
election of the nominees listed, FOR proposals 2 and 3, and as determined by the appointed attorney and proxy with respect to
other matters that may properly come before the meeting. THE UNDERSIGNED HEREBY APPOINTS XI WEN AND XIAOYUAN ZHANG, AND EACH OF
THEM, AS ATTORNEY AND PROXY OF THE UNDERSIGNED, WITH FULL POWER OF SUBSTITUTION, TO VOTE ALL THE SHARES OF COMMON STOCK OF SENMIAO
TECHNOLOGY LIMITED HELD OF RECORD BY THE UNDERSIGNED ON SEPTEMBER 21, 2020, AT THE ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON
THURSDAY, OCTOBER 29, 2020 AT 9:00 P.M. EASTERN TIME, OR ANY ADJOURNMENT THEREOF. Please date, sign and mail the proxy promptly
in the self-addressed return envelope which requires no postage if mailed in the United States. Alternatively, you may vote by
phone or the internet, as described in the instructions on the reverse side. Continued and to be signed on reverse side
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