Company: OTSA
Filing Date: 2025-01-28
Form Type: DRS
Source: 0001213900-25-007614
Chunk: 92

Company: OTSAW Ltd
Filing Date: 2025-01-28
Form: DRS
Chunk 92
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 home country practice in lieu of the above requirements, or we may choose to comply with the above requirement within one year of listing. The corporate governance practice in our home country, the Cayman Islands, does not require a majority of our board to consist of independent directors. Thus, although a director must act in the best interests of Otsaw Limited, it is possible that fewer board members will be exercising independent judgment and the level of board oversight on the management of Otsaw Limited may decrease as a result. In addition, the Nasdaq Listing Rules also require U.S. domestic issuers to have a compensation committee, a nominating/corporate governance committee composed entirely of independent directors, and an audit committee with a minimum of three members. We, as a foreign private issuer, are not subject to these requirements. The Nasdaq Listing Rules may require shareholder approval for certain corporate matters, such as requiring that shareholders be given the opportunity to vote prior to issuance (or potential issuance) of securities (i) equaling 20% or more of the Company’s Class A Ordinary Shares or voting power for less than the greater of market 50 or book value (ii) resulting in a change of control of the company; and (iii) which is being issued pursuant to a stock option or purchase plan to be established or materially amended or other equity compensation arrangement made or materially amended. We intend to comply with the requirements of Nasdaq Listing Rules to have a board with a majority of independent directors, to appoint a nominating and corporate governance committee, and in determining whether shareholder approval is required on such matters. However, we may consider following home country practice in lieu of the requirements under Nasdaq Listing Rules with respect to certain corporate governance standards which may afford less protection to investors. We may become a passive foreign investment company, or PFIC, for United States federal income tax purposes for any taxable year, which could subject United States investors in our Ordinary Shares to significant adverse United States income tax consequences. We will be classified as a passive foreign investment company, or PFIC, for any taxable year if either (i) 75% or more of our gross income for such year consists of certain types of “passive” income, or (ii) 50% or more of the value of our assets (determined on the basis of a quarterly average) during such year produce or are held for the production of passive income (the “asset test”). Based upon our current and expected income and assets, including goodwill and (taking into account the expected