Document:

Exhibit 4.5

 

Execution Version

 

DIDI GLOBAL L.P.

 

Amended and Restated Exempted Limited Partnership Agreement

 

Among:

 

1                                         DiDi Global GP Ltd., which has its registered office in the Cayman Islands at PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands (the “General Partner”);

 

2                                         Mr. Will Wei Cheng of No. 1 Block B, Shangdong Digital Valley, No. 8 Dongbeiwang West Road, Haidian District, Beijing, People’s Republic of China;

 

3                                         Ms. Jean Qing Liu of No. 1 Block B, Shangdong Digital Valley, No. 8 Dongbeiwang West Road, Haidian District, Beijing, People’s Republic of China; and

 

4                                         Mr. Stephen Jingshi Zhu of No. 1 Block B, Shangdong Digital Valley, No. 8 Dongbeiwang West Road, Haidian District, Beijing, People’s Republic of China (together with Mr. Will Wei Cheng and Ms. Jean Qing Liu, the “Founding Partners”).

 

Dated:           23 June 2021

 

WHEREAS, the General Partner and the Founding Partners (as the initial limited partners of the Partnership) formed the Partnership as a Cayman Islands exempted limited partnership under the Act (as defined below) pursuant to the Initial Exempted Limited Partnership Agreement dated 10 June 2021 (the “Initial Agreement”) and the filing of a Section 9(1) Statement on the same date with the Registrar of Exempted Limited Partnerships in the Cayman Islands;

 

WHEREAS, the parties hereto wish to effect the following by this amended and restated exempted limited partnership agreement (this “Agreement”): (i) the amendment and restatement of the Initial Agreement; (ii) the continuation of the Partnership on the terms set forth herein; and

 

NOW THEREFORE, the undersigned parties agree as follows:

 

1                                         Definitions

 

1.1                               Unless otherwise defined in this Agreement,

 

“Act” means the the Exempted Limited Partnership Act (As Revised) of the Cayman Islands, as amended from time to time.

 

“Board” has the meaning set forth under clause 16.1.

 

“Company” means DiDi Global Inc., a company incorporated in the Cayman Islands.

 

“Core Management Position” has the meaning set forth under clause 16.2.

 

“DiDi MAA” has the meaning set forth under clause 8.

 

“Executive Director” has the meaning set forth under clause 16.1.

 

 

“Founding Partners” has the meaning set forth in the Introduction.

 

“General Partner” means DiDi Global GP Ltd.

 

“Limited Partners” means the parties listed as limited partners in the Partnership’s register of limited partners which include the Founding Partners and any other person who is admitted to the Partnership as a limited partner, in each case, for so long as such person remains a limited partner in accordance with this Agreement.

 

“Partner” means the General Partner and/or any of the Limited Partners, as the context requires.

 

“Partnership Committee” has the meaning set forth under clause 16.3.

 

“Partnership Conditions” has the meaning set forth under clause 16.1.

 

2                                         Name:  The name of the Partnership shall be DiDi Global L.P..  The Partnership’s name may be amended at any time by the General Partner giving notice of such change to the Limited Partners and making the appropriate filing pursuant to section 10 of the Act.

 

3                                         General Partner:  The Partnership’s sole general partner is the General Partner.

 

4                                         Registered Office:  The Partnership’s registered office is at the offices of Maples Corporate Services Limited, PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands.

 

5                                         Term:  The Partnership’s term shall commence on the date that it is registered as an exempted limited partnership under section 9 of the Act and shall continue for an indefinite period unless earlier wound up and dissolved by the General Partner.

 

6                                         Capital Contributions:  Each of the General Partner and the Founding Partners have contributed US$1.00 capital contribution to the Partnership upon the formation of the Partnership. Any person who is admitted as a limited partner to the Partnership after the date hereof shall make capital contribution as agreed with the General Partner at the time of such person’s admission.  No Partner shall be obligated to contribution additional amounts unless otherwise agreed by the Partners in writing from time to time.

 

7                                         Liability:  Subject to the Act, the Limited Partners’ liability for the Partnership’s debts and obligations shall be limited to their respective capital contributions and all undistributed profits and income thereon.  Save to that extent, the General Partner shall be liable for the Partnership’s debts and obligations.

 

8                                         Business:  The Partnership’s business is to exercise the decision-making discretion related to, or act on (or omit to act on),  matters that are authorized, permitted or required to be decided on, acted (or omitted), made or otherwise performed by the Partnership as set forth in the memorandum and articles of association of the Company (as amended from time to time, the “DiDi MAA”) in accordance with the provisions of this Agreement and to engage or participate in any other lawful activities in which exempted limited partnerships formed in the Cayman Islands may engage or participate as may in the sole discretion of the General Partner be necessary or advisable in order to carry out the foregoing purposes and objectives of the Partnership.

 

9                                         Conduct of Business:  The conduct of the business of the Partnership shall be undertaken by the General Partner and not by the Limited Partners.  The Limited Partners are prohibited from taking part in the conduct of the business of the Partnership, save to the extent permitted by the Act and otherwise set forth in this Agreement.

 

 

10                                  No Return of Capital Contributions:  Except as expressly provided in this Agreement, capital contributions shall not be repaid until the liquidation of the Partnership.  If the assets of the Partnership, after payment of or provision for all the liabilities of the Partnership, are insufficient to repay the capital contributions in full the General Partner shall not be liable for the repayment thereof from its own resources.

 

11                                  Allocations of Profits and Losses:  Profits and losses of the Partnership attributable to investments of the Partnership shall be allocated between the General Partner and the Limited Partners in proportion to their respective capital contributions or as the General Partner and the Limited Partners may otherwise agree.

 

12                                  Transfers:  No interest in the Partnership shall be transferred in whole or in part unless agreed in writing by the General Partner.

 

13                                  Admissions.

 

13.1. The General Partner, on an annual basis, may admit one or more additional persons to the Partnership as limited partners. No Person shall be admitted as a Limited Partner to the extent that such admission causes the Partnership to violate any applicable law or regulation.  Subject thereto and subject to the nomination procedure under clause 13.2, all persons shall become Limited Partners upon:

 

(a)                                 acceptance by the General Partner, in accordance with the remaining provisions of this Agreement, of a subscription for the limited partnership interests of the Partnership;

 

(b)                                 such persons having executed an effective deed of adherence to this Agreement or otherwise agreed in writing to be bound by its terms; and

 

(c)                                  all Limited Partners hereby consent to the admission of such persons as Limited Partners upon satisfaction of the foregoing and clause 13.2 without any further act of the then existing Limited Partners.

 

13.2. The admission of any additional Limited Partner shall be subject to the completion of the following nomination procedure: any existing Limited Partner may propose candidates to the Partnership Committee which shall review the nomination and propose the candidates for the election as new limited partners at the Partnership meeting. The election of any new limited partner shall require the affirmative vote of at least 75% of the Limited Partners.

 

Candidates for admission as limited partners must meet the following qualifying standards as determined by the Partnership Committee:

 

(a)                                 a high standard of personal character and integrity;

 

(b)                                 continued service as a director, officer or employee with the Company for a certain period of time;

 

(c)                                  a consistent commitment to the Company’s mission, vision and values as well as a track record of contribution to the business of the Company; and

 

 

(d)                                 such other standard as determined by the Partnership Committee from time to time.

 

14                                  Withdrawal:  Under no circumstances shall any Limited Partner be permitted to withdraw from the Partnership or to withdraw any part of its capital account without the consent of the General Partner.

 

14.1 (a) All Limited Partners except the Founding Partners shall be required to withdraw from the Partnership upon termination of their employment with the Company. Once such Limited Partner’s employment with the Company is terminated, such Limited Partner shall immediately cease to be a Limited Partner of the Partnership for all purposes as of the termination date of the employment and shall no longer be entitled to the rights of a Limited Partner under this Agreement.

 

(b) Any Limited Partner that elects to withdraw from the Partnership shall seek consent of the General Partner, which shall evaluate such Limited Partner’s application for withdrawal in its sole discretion. Upon the approval of the General Partner of such withdrawal, such Limited Partner shall immediately cease to be a Limited Partner of the Partnership for all purposes and shall no longer be entitled to the rights of a Limited Partner under this Agreement.

 

Under each case of the above sub-clause (a) and (b), as promptly as practicable following the withdrawal of such Limited Partner, the General Partner shall update the register of limited partners of the Partnership accordingly.

 

14.2 Any Limited Partner may be removed upon an affirmative vote of the majority of the Limited Partners, in the event that the Partnership Committee determines that such Limited Partner fails to meet any of the qualifying standards set out in clause 14.2 hereof and recommends to the General Partner to call for a meeting of the Partnership.

 

15                                  Partner Meetings: The General Partner shall hold annual meetings of the Partnership and may, whenever it thinks fit or based on the recommendation of the Partnership Committee, convene other meetings of the Partnership wherein the Partners shall have any opportunity to review and discuss the Partnership’s activities. Meetings of the Partnership shall be at such physical site, or through such teleconference or electronic means, as the General Partner shall select. The General Partner shall give written notice of such meeting to each Limited Partner at least ten (10) business days in advance.  The accidental omission to give notice of a meeting to, or the non-receipt of a notice of a meeting by, any Limited Partner shall not invalidate the proceedings at the meeting. Any action required to be, or which may be, taken at any meeting of the Partnership may be taken in writing without a meeting if consents thereto are given by certain numbers of the Limited Partners that would be necessary to take such action at a meeting. Each Limited Partner shall be entitled to one (1) vote with respect to any matter to be voted by the Limited Partners. The quorum for a Partner meeting shall be the General Partner and a majority of the Limited Partners. The General Partner may designate itself as the chairman of any Partner meeting. Any Limited Partner who is unable to attend a Partner meeting may (i) grant in writing to another Limited Partner or any other person such Limited Partner’s proxy to vote on any matter upon which action is taken at such meeting, and (ii) designate in writing to the General Partner an alternate to observe, but not vote on any matter acted upon at such meeting (unless such alternate is also granted a proxy pursuant to the preceding sub-clause (i)).

 

 

16                                  Exercise of the Partnership’s Powers

 

16.1 Appointment and Removal of Executive Directors of the Company

 

Subject to the relevant provisions of the DiDi MAA, upon the satisfaction of the Partnership Conditions, the Partnership should be entitled to appoint and/or remove any and all of the executive directors of the Company (collectively, the “Executive Directors” and each, an “Executive Director”) in the following manner:

 

(a)                                 the Partnership shall be entitled to nominate any and all of the Executive Directors by an affirmative vote of at least 75% of the Limited Partners. If any candidate nominated by the Partnership via the Partnership Committee is not appointed by the board of directors of the Company (“Board”) or is removed by the shareholders of the Company by ordinary resolution in accordance with the DiDi MAA, the Partnership shall have the right to appoint a different person to serve as an interim Executive Director until the next general meeting of the Company by an affirmative vote of at least 75% of the Limited Partners. Such appointment of Executive Directors shall become effective immediately upon the delivery by the General Partner of a written notice to the Company without the requirement for any further actions by the shareholders of the Company or the Board; and

 

(b)                                 an Executive Director may resign or be removed by the Partnership by an affirmative vote of at least 75% of the Limited Partners. In the event of removal or resignation of an Executive Director appointed by the Partnership, the Partnership is entitled to appoint a replacement of such Executive Director by an affirmative vote of at least 75% of the Limited Partners. The appointment of such Executive Director shall become effective immediately upon the delivery by the General Partner of a written notice to the Company without the requirement for any further actions by the shareholders of the Company or the Board.

 

For purposes of this Agreement, “Partnership Conditions” mean: (i) the Partnership consists of at least two Limited Partners, and (ii) the Partnership is operating under the Act and the terms of this Agreement, as amended from time to time, and  “Executive Director” refers to a director of the Company that is (i) neither a director who satisfies the “independence” requirements of Rule 5605(a)(2) of the Nasdaq Stock Market Rules or Section 303A of the Corporate Governance Rules of the New York Stock Exchange nor a director who is affiliated with or was appointed to the Board by a holder or a group of affiliated holders of preferred shares and/or Class A ordinary shares converted from preferred shares of the Company prior to the Company’s initial public offering of ADSs in the United States, and (ii) maintains an employment relationship with the Company.

 

16.2 Nomination and Removal of Executives of the Company

 

Subject to the relevant provisions of the DiDi MAA, upon the satisfaction of the Partnership Conditions, the Partnership shall be entitled to nominate and remove the executive members of the Company in the following manner:

 

(a)                                 any of Mr. Will Wei Cheng, Ms. Jean Qing Liu and Mr. Stephen Jingshi Zhu, each as a core management member of the Company, may be removed from his or her executive position in the Company with the unanimous approval by the Founding Partners, provided that if any such Founding Partner is no longer suitable to make such decision due to (i) severe mental illness or severe physical incapacity which results in such Founding Partner’s inability to make decisions, or (ii) convicted felony (being a crime punishable by a term of imprisonment of not less than one year), embezzlement, or similar offense, the removal of his or her executive position shall no longer be subject to approval by such Founding Partner;

 

 

(b)                                 subject to sub-clause (a) above, the Partnership shall have the right to nominate the CEO, President and CEO of International Business of the Company (each, a “Core Management Position”) to the Board for appointment by an affirmative vote of at least 75% of the Limited Partners. In the event that the Board fails to appoint any Core Management Position nominated by the Partnership for three (3) consecutive times, the Board may then appoint any person to serve as such Core Management Position after consultation with the Partnership.

 

16.3 Partnership Committee

 

The General Partner shall establish a partnership committee (“Partnership Committee”) for the Partnership, which will consist of no more than five (5) Limited Partners. The initial members of the Partnership Committee shall be the Founding Partners. Members of the Partnership Committee shall serve a term of three (3) years each and may serve multiple terms unless terminated upon his or her death, resignation, removal or termination of his or her membership in the partnership. Each member of the Partnership Committee shall be entitled to one (1) vote with respect to any matter or question to be decided by the Partnership Committee. Unless otherwise stated in this Agreement, all decisions of the Partnership Committee shall be made by a majority vote of the members of the Partnership Committee. The members of the Partnership Committee shall be determined by the General Partner in its sole discretion.  Any Limited Partner who is unable to attend a meeting of the Partnership Committee may (i) grant in writing to another Limited Partner or any other person such Limited Partner’s proxy to vote on any matter upon which action is taken at such meeting, and (ii) designate in writing to the Partnership Committee an alternate to observe, but not vote on any matter acted upon at such meeting (unless such alternate is also granted a proxy pursuant to the preceding sub-clause (i)).

 

The Partnership Committee’s authorities shall include (but not limited to) the following:

 

(a)                                 determine certain bonus allocation matters of the Company, subject to certain approval by the Board or the compensation committee of the Company;

 

(b)                                 assist the General Partner in managing, investing, distributing and disposing of the assets of the Partnership, including the aggregate deferred bonuses and any income thereof, or Partnership assets, for the benefit of the Partnership;

 

(c)                                  screen and initially approve the election of Limited Partners;

 

(d)                                 approve the proposed candidate for election as a Limited Partner; and

 

(e)                                  any other authorities designated to it by the General Partner or the Partnership from time to time.

 

17                                  Power of Attorney

 

Each Limited Partner hereby nominates, constitutes and appoints the General Partner, with full power of substitution, as such Limited Partner’s true and lawful attorney and agent with full power and authority, in such Limited Partner’s name, place and stead to do the following, namely:

 

(a)                                 to make, execute, swear to, acknowledge, deliver and record or file, as the case may be, as and where required any or all of:

 

 

(i)                                     all instruments that the General Partner determines to be appropriate to change the name of the Partnership;

 

(ii)                                  all documents and instruments required to qualify or continue the qualification of the Partnership as a valid and subsisting limited partnership in or otherwise to comply with the laws of any jurisdiction in which the Partnership may from time to time conduct its business or own or lease property;

 

(iii)                               all documents, certificates and instruments necessary to reflect any amendment to this Agreement; and

 

(iv)                              any such consents as may be required in connection with the withdrawal by any Limited Partner of any or all of his, her or its contribution to the Partnership;

 

(b)                                 to cure any ambiguity or defect, to correct or supplement any provision herein which may be inconsistent with any other provision herein or to add any other provision with respect to matters or questions arising under this Agreement that are not inconsistent with the provisions of this Agreement provided that such addition does not adversely affect any Limited Partner in any material respect;

 

(c)                                  to amend this Agreement and to reflect the admission or withdrawal of any Limited Partner and/or substitute any Limited Partner;

 

(d)                                 to execute and file with any governmental body or instrumentality thereof of the government of the Cayman Islands any documents necessary to be filed in connection with the Partnership business and the Partnership assets; and

 

(e)                                  to execute and deliver all such other documents or instruments on behalf of and in the name of the Partnership and each Limited Partner as may be deemed necessary by the General Partner to carry out fully the provisions of this Agreement in accordance with its terms.

 

The power of attorney granted hereby is intended to secure an interest in property and to secure a Limited Partner’s obligations under this Agreement and shall be irrevocable and shall survive the death or disability of the Limited Partner granting the same and shall survive the transfer by such Limited Partner, to the extent of the obligations of such Limited Partner under this Agreement, of the whole or any part of the interest of such Limited Partner in the Partnership, extends to the heirs, executors, administrators, other legal representatives and successors, transferees and assigns of such Limited Partner, and may be exercised by the General Partner on behalf of such Limited Partner in executing any instrument by an electronic signature or by listing all the Limited Partners and executing that instrument with a single signature as attorney and agent for all of them.

 

Each Limited Partner agrees to execute, deliver and provide any separate power of attorney which may be required by the General Partner from time to time for the purposes giving effect to any grant of power of attorney contemplated under this clause 17.

 

Each Limited Partner agrees to be bound by any representations or actions made or taken by the General Partner pursuant to the power of attorney contained herein and, to the maximum extent permitted under applicable law, hereby waives any and all defences which may be available to contest, negate or disaffirm the action of the General Partner taken in good faith under the power of attorney.  Each Limited Partner declares that, to the maximum extent permitted under applicable law, the power of attorney granted hereby may be exercised during any legal incapacity, mental incapacity or infirmity, or mental incompetence on the Limited Partner’s part.

 

 

18                                  The Exempted Limited Partnership Act:  The Limited Partners hereby irrevocably waive any and all right to demand or receive from the General Partner information regarding the state of business and financial condition of the Partnership as permitted by Section 22 of the Act. Sections 36(1)(b) and 36(9) of the Act shall not apply.

 

19                                  Notice:  All notices or other communications to be given under this Agreement to a Partner shall be sent by delivery in person, by courier service, by electronic mail transmission or facsimile or by registered or certified mail (postage prepaid, return receipt requested) addressed as follows or such other address as may be substituted by notice as herein provided:

 

(a)                                 if to the General Partner:

 

DiDi Global GP Ltd.

 

No. 1 Block B, Shangdong Digital Valley, No. 8 Dongbeiwang West Road, Haidian District, Beijing 100193, China

 

Attention to: *********

 

Email: *********

 

(b)                                 if to a Limited Partner, at the address set forth in the register of limited partners of the Partnership or the email address or facsimile number provided by the Limited Partner to the General Partner.

 

Any notice given to a Partner under this Agreement shall be deemed to have been given upon the earlier of (a) receipt or (b) three (3) calendar days after being sent by DHL or another recognized overnight delivery service, return receipt requested. In the case of notices sent by electronic mail transmission or facsimile, such notices shall be deemed to have been given when sent.

 

20                                  Execution/Amendment:  This Agreement may be executed in counterparts (each of which shall be deemed an original but all of which together shall constitute one and the same instrument), and except as expressly stated herein, may only be amended in whole or in part by written agreement of the General Partner and at least 75% of the Limited Partners. The General Partner may administer and modify the terms of this Agreement without the consent of the Limited Partners, but only to the extent (a) such modifications are administrative or technical in nature that are not inconsistent with other provisions of this Agreement as in effect at the time, or (b) for effecting the admission or withdrawal of any Limited Partner or the transfer of any interest of any Limited Partner each in accordance with the provisions of this Agreement.

 

Sections 8 and 19(3) of the Electronic Transactions Act (As Revised) of the Cayman Islands shall not apply, including in respect of any notice or communication under or in connection with this Agreement. This Agreement may be signed by any party under hand or by way of an electronic signature or by a signature or a representation of a signature affixed by mechanical means and may be reproduced as an electronic record and delivered to the General Partner by facsimile, by electronic mail or by delivery through a web or other electronic portal. The General Partner may take such steps as it deems appropriate to determine the reliability of any electronic signature.

 

 

21                                  De-registration:  The General Partner may, at any time, de-register the Partnership as an exempted limited partnership pursuant to section 41 of the Act and upon any such de-registration the Partnership will immediately dissolve.

 

22                                  Winding up and Dissolution:  The General Partner may, at any time, commence the winding up of the Partnership’s affairs and shall act as liquidator for the purposes of such winding up.  Upon completion of the Partnership’s winding up, the General Partner shall file a notice of dissolution in accordance with the Act and the Partnership will then dissolve.

 

23                                  Severance: If any provision of this Agreement shall be found by any court or administrative body of competent jurisdiction to be invalid or unenforceable, such invalidity or unenforceability shall not affect the other provisions of this Agreement which shall remain in full force and effect.

 

24                                  Transfer by Way of Continuation: Subject to the provisions of the Act, the General Partner may approve the Partnership to be registered by way of continuation as a partnership, body corporate or any other form of entity under the laws of any jurisdiction outside the Cayman Islands and to be deregistered in the Cayman Islands.

 

25                                  Governing Law:  This Agreement shall be governed by, and shall be construed in accordance with, the laws of the Cayman Islands.

 

[Intentionally left blank — signature page follows]

 

 

In witness whereof this Agreement has been executed by the parties as a deed on the date first set out above.

 

GENERAL PARTNER

 

	
EXECUTED as a   DEED by
    	
)
    	
 
    
	
DiDi Global GP Ltd.
    	
)
    	
 
    
	
 
    	
)
    	
/s/ Will Wei Cheng
    
	
By:
    	
)
    	
Name: Will Wei Cheng
    
	
 
    	
 
    	
Title: Director
    
	
 
    	
 
    	
 
    
	
in the presence of:
    	
)
    	
/s/ Xiaoxiao Wang
    
	
 
    	
)
    	
Name: Xiaoxiao Wang
    

 

 

FOUNDING PARTNERS

 

	
EXECUTED as a   DEED by
    	
)
    	
 
    
	
Will Wei Cheng
    	
)
    	
 
    
	
By:
    	
)
    	
/s/ Will Wei Cheng
    
	
 
    	
)
    	
Name: Will Wei Cheng
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
in the presence of:
    	
)
    	
/s/ Xiaoxiao Wang
    
	
 
    	
)
    	
Name: Xiaoxiao Wang
    
	
EXECUTED as a DEED by
    	
)
    	
 
    
	
Jean Qing Liu
    	
)
    	
 
    
	
By:
    	
)
    	
/s/ Jean Qing Liu
    
	
 
    	
)
    	
Name: Jean Qing Liu
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
in the presence of:
    	
)
    	
/s/ Xiaoxiao Wang
    
	
 
    	
)
    	
Name: Xiaoxiao Wang
    
	
EXECUTED as a DEED by
    	
)
    	
 
    
	
Stephen Jingshi Zhu
    	
)
    	
 
    
	
By:
    	
)
    	
/s/ Stephen Jingshi Zhu
    
	
 
    	
)
    	
Name: Stephen Jingshi   Zhu
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
in the presence of:
    	
)
    	
/s/ Xiaoxiao Wang
    
	
 
    	
)
    	
Name: Xiaoxiao WangExhibit 10.12

 

XIAOJU KUAIZHI INC.

 

2021 SHARE INCENTIVE PLAN

 

ARTICLE 1

 

PURPOSE

 

The purpose of this 2021 Share Incentive Plan is to promote the success and enhance the value of Xiaoju Kuaizhi Inc., an exempted company formed under the laws of the Cayman Islands (the “Company”), by linking the personal interests of the Directors, Employees, and Consultants to those of the Company’s shareholders and by providing such individuals with an incentive for outstanding performance to generate superior returns to the Company’s shareholders.

 

ARTICLE 2

 

DEFINITIONS AND CONSTRUCTION

 

Wherever the following terms are used in the Plan they shall have the meanings specified below, unless the context clearly indicates otherwise. The singular pronoun shall include the plural where the context so indicates.

 

2.1                               “Applicable Laws” means the legal requirements relating to the Plan and the Awards under applicable provisions of the corporate, securities, tax and other laws, rules, regulations and government orders, and the rules of any applicable stock exchange or national market system, of any jurisdiction applicable to Awards granted to residents therein

 

2.2                               “Award” means an Option, Restricted Share, Restricted Share Units or other types of awards approved by the Committee granted to a Participant pursuant to the Plan.

 

2.3                               “Award Agreement” means any written agreement, contract, or other instrument or document evidencing an Award, including through electronic medium.

 

2.4                               “Board” means the board of directors of the Company

 

2.5                               “Cause” with respect to a Participant means (unless otherwise expressly provided in the applicable Award Agreement, or another applicable contract with the Participant that defines such term for purposes of determining the effect that a “for cause” termination has on the Participant’s Awards) a termination of employment or service based upon a finding by the Service Recipient or the Committee, acting in good faith and based on its reasonable belief at the time, that the Participant:

 

(a)                                 has been negligent in the discharge of his or her duties to the Service Recipient or any Group Entity, has refused to perform stated or assigned duties or is incompetent in or (other than by reason of a disability or analogous condition) incapable of performing those duties;

 

 

(b)                                 has been dishonest or committed or engaged in an act of ethical breach, theft, embezzlement or fraud, a breach of confidentiality, an unauthorized disclosure or use of inside information, customer lists, trade secrets or other confidential information, or any act of criminal offense;

 

(c)                                  has breached a fiduciary duty, or violated any other duty, law, rule, regulation, corporate policy or guideline of the Service Recipient or any Group Entity; or has been convicted of, or plead guilty or nolo contendere to, a felony or misdemeanor (other than minor traffic violations or similar offenses);

 

(d)                                 has breached any of the provisions of any agreement with the Service Recipient or any Group Entity, including but not limited to, any intellectual property and/or invention assignment, employment, non-competition, non-solicitation, confidentiality or other similar agreement;

 

(e)                                  has engaged in unfair competition with, or otherwise acted in a manner injurious to the name, branding, reputation, business, assets or interests of, the Service Recipient or any Group  Entity; or

 

(f)                                   has improperly induced a vendor or customer to break or terminate any contract with the Service Recipient or any Group Entity or induced a principal for whom the Service Recipient or any Group Entity acts as agent to terminate such agency relationship.

 

A termination for Cause shall be deemed to occur (subject to reinstatement upon a contrary final determination by the Committee) on the date on which the Service Recipient first delivers written notice to the Participant of a finding of termination for Cause.

 

2.6                               “Code” means the Internal Revenue Code of 1986 of the United States, as amended

 

2.7                               “Committee” means a committee of the Board described in Article 10

 

2.8                               “Consultant” means any person, including a consultant or an advisor but not an Employee, who is engaged by a Service Recipient to render consulting or advisory services and is compensated for such services.

 

2.9                               “Corporate Transaction”, unless otherwise defined in an Award Agreement, means any of the following transactions, provided, however, that the Committee shall determine under (d) and (e) whether multiple transactions are related, and its determination shall be final, binding and conclusive:

 

(a)                                 an amalgamation, arrangement, merger or consolidation or scheme of arrangement (i) in which the Company is not the surviving entity, except for a transaction the principal purpose of which is to change the jurisdiction in which the Company is incorporated or (ii) following which the holders of the voting securities of the Company do not continue to hold more than 50% of the combined voting power of the voting securities of the surviving entity;

 

2

 

(b)                                 the sale, transfer or other disposition of all or substantially all of the assets of the Company;

 

(c)                                  the complete liquidation or dissolution of the Company;

 

(d)                                 any reverse takeover or series of related transactions culminating in a reverse takeover (including, but not limited to, a tender offer followed by a reverse takeover) in which the Company is the surviving entity but (A) the Company’s equity securities outstanding immediately prior to such takeover are converted or exchanged by virtue of the takeover into other property, whether in the form of securities, cash or otherwise, or (B) in which securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding securities are transferred to a person or persons different from those who held such securities immediately prior to such takeover or the initial transaction culminating in such takeover, but excluding any such transaction or series of related transactions that the Committee determines shall not be a Corporate Transaction; or

 

(e)                                  acquisition in a single or series of related transactions by any person or related group of persons (other than the Company or by a Company-sponsored employee benefit plan) of beneficial ownership (within the meaning of Rule 13d-3 of the Exchange Act) of securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding securities but excluding any such transaction or series of related transactions that the Committee determines shall not be a Corporate Transaction.

 

2.10                        “Director” means a member of the Board or a member of the board of directors of any Service Recipient.

 

2.11                        “Disability” means that a disability, whether temporary or permanent, partial or total, that causes the Participant to be unable to carry out the responsibilities and functions of the position held by the Participant. For the avoidance of doubt, a Participant will not be considered to have incurred a Disability unless he or she furnishes proof of such impairment sufficient to satisfy the Committee in its discretion.

 

2.12                        “Effective Date” shall have the meaning set forth in Section 11.1

 

2.13                        “Employee” means any person, including an officer or a Director, who is in the employment of a Service Recipient, subject to the control and direction of the Service Recipient as to both the work to be performed and the manner and method of performance. The payment of a director’s fee by a Service Recipient shall not be sufficient to constitute “employment” by the Service Recipient.

 

2.14                        “Exchange Act” means the Securities Exchange Act of 1934 of the United States, as amended

 

2.15                        “Fair Market Value” means, as of any date, the value of Shares determined as follows:

 

(a)                                 if the Shares are listed on one or more established stock exchanges or national market systems, including without limitation, the New York Stock Exchange or the Nasdaq Stock Market, its Fair Market Value shall be the closing sales price for such shares (or the closing bid, if no sales were reported) as quoted on the principal exchange or system on which the Shares are listed (as determined by the Committee) on the date of determination (or, if no closing sales price or closing bid was reported on that date, as applicable, on the last trading date such closing sales price or closing bid was reported), as reported on the website maintained by such exchange or market system or such other source as the Committee deems reliable;

 

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(b)                                 If the Shares are regularly quoted on an automated quotation system (including the OTC Bulletin Board) or by a recognized securities dealer, its Fair Market Value shall be the closing sales price for such Shares as quoted on such system or by such securities dealer on the date of determination, but if selling prices are not reported, the Fair Market Value of a Share shall be the mean between the high bid and low asked prices for the Shares on the date of determination (or, if no such prices were reported on that date, on the last date such prices were reported), as reported in The Wall Street Journal or such other source as the Committee deems reliable; or

 

(c)                                  in the absence of an established market for the Shares of the type described in (a) and (b) above, the Fair Market Value thereof shall be determined by the Committee in good faith and in its discretion by reference to (i) the placing price of the latest private placement of the Shares and the development of the Company’s business operations and the general economic and market conditions since such latest private placement, (ii) other third party transactions involving the Shares and the development of the Company’s business operation and the general economic and market conditions since such transaction, (iii) an independent valuation of the Shares, or (iv) such other methodologies or information as the Committee determines to be indicative of Fair Market Value.

 

2.16                        “Group Entity” means any of the Company, Subsidiaries or Related Entities of the Company

 

2.17                        “Incentive Share Option” means an Option that is intended to meet the requirements of Section 422 of the Code or any successor provision thereto

 

2.18                        “Independent Director” means (i) if the Shares or other securities representing the Shares are not listed on a stock exchange, a Director of the Company who is a Non-Employee Director; and (ii) if the Shares or other securities representing the Shares are listed on one or more stock exchange, a Director of the Company who meets the independence standards under the applicable corporate governance rules of the stock exchange(s)

 

2.19                        “Non-Employee Director” means a member of the Board who qualifies as a “Non-Employee Director” as defined in Rule 16b-3(b)(3) of the Exchange Act, or any successor definition adopted by the Board.

 

2.20                        “Non-Qualified Share Option” means an Option that is not intended to be an Incentive Share Option

 

2.21                        “Option” means a right granted to a Participant pursuant to Article 5 of the Plan and an Award Agreement to purchase a specified number of Shares at a specified price during  specified time periods. An Option may be either an Incentive Share Option or a Non-Qualified Share Option.

 

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2.22                        “Participant” means a person who, as a Director, Consultant or Employee, has been granted an Award pursuant to the Plan.

 

2.23                        “Parent” means a parent corporation under Section 424(e) of the Code

 

2.24                        “Plan” means this 2021 Share Incentive Plan of Xiaoju Kuaizhi Inc., as amended and/or restated from time to time

 

2.25                        “Related Entity” means any business, corporation, partnership, limited liability company or other entity in which the Company or a Parent or Subsidiary of the Company holds a substantial ownership interest, directly or indirectly, or controls through contractual arrangements and consolidates the financial results according to applicable accounting standards, but which is not a Subsidiary and which the Committee designates as a Related Entity for purposes of the Plan. For purposes of the Plan, any business, corporation, partnership, limited liability company or other entity in or of which the Company, a Parent or Subsidiary of the Company owns, directly or indirectly, securities or interests representing twenty percent (20%) or more of its total combined voting power of all classes of securities or interests shall be deemed as a “Related Entity.”

 

2.26                        “Restricted Share” means a Share awarded to a Participant pursuant to Article 6 that is subject to certain restrictions and may be subject to risk of forfeiture or repurchase.

 

2.27                        “Restricted Share Unit” means the right granted to a Participant pursuant to Article 7 to receive a Share at a future date

 

2.28                        “Securities Act” means the Securities Act of 1933 of the United States, as amended.

 

2.29                        “Service Recipient” means the Company, any Parent or Subsidiary of the Company or any Related Entity to which a Participant provides services as an Employee, a Consultant or a Director.

 

2.30                        “Share” means the ordinary shares of the Company, par value US$0.00002 per share, and such other securities of the Company that may be substituted for Shares pursuant to Article 9.

 

2.31                        “Subsidiary” means any corporation or other entity of which a majority of the outstanding voting shares or voting power is beneficially owned directly or indirectly by the Company.

 

2.32                        “Trading Date” means the closing of the first sale to the general public of the Shares pursuant to a registration statement filed with and declared effective by the U.S. Securities and Exchange Commission under the Securities Act.

 

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ARTICLE 3

 

SHARES SUBJECT TO THE PLAN

 

3.1                               Number of Shares

 

(a)                                 Subject to the provisions of Article 9 and Section 3.1(b), the maximum aggregate number of Shares which may be issued pursuant to all Awards (including Incentive Share Options) (the “Award Pool”) shall initially be 116,906,908, plus commencing no earlier than January 1, 2025 (the “Commencement Year”), if and when the Shares reserved for issuance pursuant to any Awards to be granted under the Award Pool (“Net Size of the Pool”) as of the last day of the immediately preceding fiscal year is less than four percent (4%) of the then total number of Shares issued and outstanding on an as-converted and fully-diluted basis, an increase on the first day of each fiscal year from the Commencement Year during the term of the Plan, by an amount decided by the Board or, if authorized by the Board, by the Committee, if and to the extent approved by the Board or, if authorized by the Board, by the Committee in such fiscal year, provided that such increase shall not result the Net Size of the Pool to exceed a percentage decided by the Board in the Commencement Year (which should not exceed four percent (4%)) of the then total number of Shares issued and outstanding on an as-converted and fully-diluted basis on the last day of the immediately preceding fiscal year.

 

(b)                                 To the extent that an Award terminates, expires, or lapses for any reason, any Shares subject to the Award shall again be available for the grant of an Award pursuant to the Plan. To the extent permitted by Applicable Laws, Shares issued in assumption of, or in substitution for, any outstanding awards of any entity acquired in any form or combination by a Group Entity shall not be counted against Shares available for grant pursuant to the Plan. Shares delivered by the Participant or withheld by the Company upon the exercise of any Award under the Plan, in payment of the exercise price thereof or tax withholding thereon, may again be optioned, granted or awarded hereunder, subject to the limitations of Section 3.1(a). If any Restricted Shares are forfeited or repurchased by the Company, such Shares may again be optioned, granted or awarded hereunder, subject to the limitations of Section 3.1(a). Notwithstanding the provisions of this Section 3.1(b), no Shares may again be optioned, granted or awarded if such action would cause an Incentive Share Option to fail to qualify as an incentive share option under Section 422 of the Code.

 

3.2                               Shares Distributed. Any Shares distributed pursuant to an Award may consist, in whole or in part, of authorized and unissued Shares, treasury Shares (subject to Applicable Laws) or Shares purchased on the open market. Additionally, at the discretion of the Committee, any Shares distributed pursuant to an Award may be represented by American Depository Shares. If the number of Shares represented by an American Depository Share is other than on a one-to-one basis, the limitations of Section 3.1 shall be adjusted to reflect the distribution of American Depository Shares in lieu of Shares.

 

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ARTICLE 4

 

ELIGIBILITY AND PARTICIPATION

 

4.1                               Eligibility. Persons eligible to participate in the Plan include Employees, Consultants, and Directors, as determined by the Committee.

 

4.2                               Participation. Subject to the provisions of the Plan, the Committee may, from time to time, select from among all eligible individuals, those to whom Awards shall be granted and shall determine the nature and amount of each Award. No individual shall have any right to be granted an Award pursuant to the Plan.

 

4.3                               Jurisdictions. In order to assure the viability of Awards granted to Participants employed in various jurisdictions, the Committee may provide for such special terms as it may consider necessary or appropriate to accommodate differences in local law, tax policy, or custom applicable in the jurisdiction in which the Participant resides, is employed, operates or is incorporated. Moreover, the Committee may approve such supplements to, or amendments, restatements, or alternative versions of, the Plan as it may consider necessary or appropriate for such purposes without thereby affecting the terms of the Plan as in effect for any other purpose; provided, however, that no such supplements, amendments, restatements, or alternative versions shall increase the share limitations contained in Section 3.1 of the Plan. Notwithstanding the foregoing, the Committee may not take any actions hereunder, and no Awards shall be granted, that would violate any Applicable Laws.

 

ARTICLE 5

 

OPTIONS

 

5.1                               General. The Committee is authorized to grant Options to Participants on the following terms and conditions:

 

(a)                                 Exercise Price. The exercise price per Share subject to an Option shall be determined by the Committee and set forth in the Award Agreement which may be a fixed price or a variable price related to the Fair Market Value of the Shares. The exercise price per Share subject to an Option may be amended or adjusted in the absolute discretion of the Committee, the determination of which shall be final, binding and conclusive. For the avoidance of doubt, to the extent not prohibited by Applicable Laws or any exchange rule, a downward adjustment of the exercise prices of Options mentioned in the preceding sentence shall be effective without the approval of the Company’s shareholders or the approval of the affected Participants. Notwithstanding anything in the foregoing, the exercise price shall in no circumstances be less than the par value of the Shares.

 

(b)                                 Time and Conditions of Exercise. The Committee shall determine the time or times at which an Option may be exercised in whole or in part, including exercise prior to vesting; provided that the term of any Option granted under the Plan shall not exceed ten years, except as provided in Section 12.1. The Committee shall also determine any conditions, if any, that must be satisfied before all or part of an Option may be exercised.

 

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(c)                                  Payment. The Committee shall determine the methods by which the exercise price of an Option may be paid, the form of payment, including, without limitation (i) cash or check denominated in U.S. Dollars, (ii) to the extent permissible under the Applicable Laws, cash or check in Chinese Renminbi, (iii) cash or check denominated in any other local currency as approved by the Committee, (iv) Shares held for such period of time as may be required by the Committee in order to avoid adverse financial accounting consequences and having a Fair Market Value on the date of delivery equal to the aggregate exercise price of the Option or exercised portion thereof, (v) after the Trading Date the delivery of a notice that the Participant has placed a market sell order with a broker with respect to Shares then issuable upon exercise of the Option, and that the broker has been directed to pay a sufficient portion of the net proceeds of the sale to the Company in satisfaction of the Option exercise price; provided that payment of such proceeds is then made to the Company upon settlement of such sale, (vi) other property acceptable to the Committee with a Fair Market Value equal to the exercise price, or (vii) any combination of the foregoing. Notwithstanding any other provision of the Plan to the contrary, no Participant who is a member of the Board or an “executive officer” of the Company within the meaning of Section 13(k) of the Exchange Act shall be permitted to pay the exercise price of an Option in any method which would violate Section 13(k) of the Exchange Act.

 

(d)                                 Evidence of Grant. All Options shall be evidenced by an Award Agreement between the Company and the Participant. The Award Agreement shall include such additional provisions as may be specified by the Committee.

 

(e)                                  Effects of Termination of Employment or Service on Options. Termination of employment or service shall have the following effects on Options granted to the Participants:

 

(i)                                     Dismissal for Cause. Unless otherwise provided in the Award Agreement or with prior written approval from the Committee, if a Participant’s employment by or service to the Service Recipient is terminated by the Service Recipient for Cause, the Participant’s Options will terminate upon such termination, whether or not the Option is then vested and/or exercisable;

 

(ii)                                  Death or Disability. Unless otherwise provided in the Award Agreement, if a Participant’s employment by or service to the Service Recipient terminates as a result of the Participant’s death or Disability:

 

(A)                               the Participant (or his or her legal representative or beneficiary, in the case of the Participant’s Disability or death, respectively) will have until the date that is 12 months after the Participant’s termination of Employment or service to exercise the Participant’s Options (or portion thereof) to the extent that such Options were vested and exercisable on the date of the Participant’s termination of Employment or service on account of death or Disability;

 

(B)                               the Options, to the extent not vested or exercisable on the date of the Participant’s termination of Employment or service, shall terminate upon the Participant’s termination of Employment or service on account of death or Disability; and

 

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(C)                               the Options, to the extent exercisable for the 12-month period following the Participant’s termination of Employment or service and not exercised during such period, shall terminate at the close of business on the last day of the 12-month period.

 

(iii)                               Other Terminations of Employment or Service. Unless otherwise provided in the Award Agreement, if a Participant’s employment by or service to the Service Recipient terminates for any reason other than a termination by the Service Recipient for Cause or because of the Participant’s death or Disability:

 

(A)                               the Participant will have until the date that is 90 days after the Participant’s termination of Employment or service to exercise his or her Options (or portion thereof) to the extent that such Options were vested and exercisable on the date of the Participant’s termination of Employment or service;

 

(B)                               the Options, to the extent not vested or exercisable on the date of the Participant’s termination of Employment or service, shall terminate upon the Participant’s termination of Employment or service; and

 

(C)                               the Options, to the extent exercisable for the 90-day period following the Participant’s termination of Employment or service and not exercised during such period, shall terminate at the close of business on the last day of the 90-day period.

 

5.2                               Incentive Share Options Incentive Share Options may be granted to Employees of the Company or a Subsidiary of the Company. Incentive Share Options may not be granted to employees of a Related Entity or to Independent Directors or Consultants. The terms of any Incentive Share Options granted pursuant to the Plan, in addition to the requirements of Section 5.1, must comply with the following additional provisions of this Section 5.2:

 

(a)                                 Individual Dollar Limitation. The aggregate Fair Market Value (determined as of the time the Option is granted) of all Shares with respect to which Incentive Share Options are first exercisable by a Participant in any calendar year may not exceed US$100,000 or such other limitation as imposed by Section 422(d) of the Code, or any successor provision. To the extent that Incentive Share Options are first exercisable by a Participant in excess of such limitation, the excess shall be considered Non-Qualified Share Options.

 

(b)                                 Exercise Price. The exercise price of an Incentive Share Option shall be equal to the Fair Market Value on the date of grant. However, the exercise price of any Incentive Share Option granted to any individual who, at the date of grant, owns Shares possessing more than ten percent of the total combined voting power of all classes of shares of the Company or any Parent or Subsidiary of the Company may not be less than 110% of Fair Market Value on the date of grant and such Option may not be exercisable for more than five years from the date of grant. Notwithstanding anything in the foregoing, the exercise price shall in no circumstances be less than the par value of the Shares.

 

(c)                                  Transfer Restriction. The Participant shall give the Company prompt notice of any disposition of Shares acquired by exercise of an Incentive Share Option within (i) two years from the date of grant of such Incentive Share Option or (ii) one year after the transfer of such Shares to the Participant.

 

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(d)                                 Expiration of Incentive Share Options. No Award of an Incentive Share Option may be made pursuant to the Plan after the tenth anniversary of the Effective Date.

 

(e)                                  Right to Exercise. During a Participant’s lifetime, an Incentive Share Option may be exercised only by the Participant.

 

ARTICLE 6

 

RESTRICTED SHARES

 

6.1                               Grant of Restricted Shares The Committee, at any time and from time to time, may grant Restricted Shares to Participants as the Committee, in its sole discretion, shall determine. The Committee, in its sole discretion, shall determine the number of Restricted Shares to be granted to each Participant.

 

6.2                               Restricted Shares Award Agreement Each Award of Restricted Shares shall be evidenced by an Award Agreement that shall specify the period of restriction, the number of Restricted Shares granted, and such other terms and conditions as the Committee, in its sole discretion, shall determine. Unless the Committee determines otherwise, Restricted Shares shall be held by the Company as escrow agent until the restrictions on such Restricted Shares have lapsed.

 

6.3                               Issuance and Restrictions Restricted Shares shall be subject to such restrictions on transferability and other restrictions as the Committee may impose (including, without limitation, limitations on the right to vote Restricted Shares or the right to receive dividends on the Restricted Shares). These restrictions may lapse separately or in combination at such times, pursuant to such circumstances, in such installments, or otherwise, as the Committee determines at the time of the grant of the Award or thereafter.

 

6.4                               Forfeiture/Repurchase Except as otherwise determined by the Committee at the time of the grant of the Award or thereafter, upon termination of employment or service during the applicable restriction period, Restricted Shares that are at that time subject to restrictions shall be forfeited or repurchased in accordance with the Award Agreement; provided, however, the Committee may (a) provide in any Restricted Share Award Agreement that restrictions or forfeiture or repurchase conditions relating to Restricted Shares will be waived in whole or in part in the event of terminations resulting from specified causes, and (b) in other cases waive in whole or in part restrictions or forfeiture or repurchase conditions relating to Restricted Shares.

 

6.5                               Certificates for Restricted Shares Restricted Shares granted pursuant to the Plan may be evidenced in such manner as the Committee shall determine. If certificates representing Restricted Shares are registered in the name of the Participant, certificates must bear an appropriate legend referring to the terms, conditions, and restrictions applicable to such Restricted Shares, and the Company may, at its discretion, retain physical possession of the certificate until such time as all applicable restrictions lapse.

 

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6.6                               Removal of Restrictions Except as otherwise provided in this Article 6, Restricted Shares granted under the Plan shall be released from escrow as soon as practicable after the last day of the period of restriction. The Committee, in its discretion, may accelerate the time at which any restrictions shall lapse or be removed. After the restrictions have lapsed, the Participant shall be entitled to have any legend or legends under Section 6.5 removed from his or her Share certificate, and the Shares shall be freely transferable by the Participant, subject to applicable legal restrictions. The Committee (in its discretion) may establish procedures regarding the release of Shares from escrow and the removal of legends, as necessary or appropriate to minimize administrative burdens on the Company.

 

ARTICLE 7

 

RESTRICTED SHARE UNITS

 

7.1                               Grant of Restricted Share Units. The Committee, at any time and from time to time, may grant Restricted Share Units to Participants as the Committee, in its sole discretion, shall determine. The Committee, in its sole discretion, shall determine the number of Restricted Share Units to be granted to each Participant.

 

7.2                               Restricted Share Units Award Agreement. Each Award of Restricted Share Units shall be evidenced by an Award Agreement that shall specify any vesting conditions, the number of Restricted Share Units granted, and such other terms and conditions as the Committee, in its sole discretion, shall determine.

 

7.3                               Form and Timing of Payment of Restricted Share Units. At the time of grant, the Committee shall specify the date or dates on which the Restricted Share Units shall become fully vested and nonforfeitable. Upon vesting, the Committee, in its sole discretion, may pay Restricted Share Units in the form of cash, Shares or a combination thereof. The Committee shall also determine any conditions, if any, that must be satisfied before the Restricted Share Units are vested.

 

7.4                               Forfeiture/Repurchase. Except as otherwise determined by the Committee at the time of the grant of the Award or thereafter, upon termination of employment or service during the applicable restriction period, Restricted Share Units that are at that time unvested shall be forfeited or repurchased in accordance with the Award Agreement; provided, however, the Committee may (a) provide in any Restricted Share Unit Award Agreement that restrictions or forfeiture and repurchase conditions relating to Restricted Share Units will be waived in whole or in part in the event of terminations resulting from specified causes, and (b) in other cases waive in whole or in part restrictions or forfeiture and repurchase conditions relating to Restricted Share Units.

 

ARTICLE 8

 

PROVISIONS APPLICABLE TO AWARDS

 

8.1                               Award Agreement. Awards under the Plan shall be evidenced by Award Agreements that set forth the terms, conditions and limitations for each Award which may include the term of an Award, the provisions applicable in the event the Participant’s employment or service terminates, and the Company’s authority to unilaterally or bilaterally amend, modify, suspend, cancel or rescind an Award.

 

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8.2                               No Transferability; Limited Exception to Transfer Restrictions.

 

8.2.1                     Limits on Transfer. Unless otherwise expressly provided in (or pursuant to) this Section 8.2, by applicable law and by the Award Agreement, as the same may be amended:

 

(a)                                 all Awards are non-transferable and will not be subject in any manner to sale, transfer, anticipation, alienation, assignment, pledge, encumbrance or charge;

 

(b)                                 Awards will be exercised only by the Participant; and

 

(c)                                  amounts payable or shares issuable pursuant to an Award will be delivered only to (or for the account of), and, in the case of Shares, registered in the name of, the Participant.

 

In addition, the shares shall be subject to the restrictions set forth in the applicable Award Agreement.

 

8.2.2                     Further Exceptions to Limits on Transfer. The exercise and transfer restrictions in Section 8.2.1 will not apply to:

 

(a)                                 transfers to the Company or a Subsidiary;

 

(b)                                 the designation of a beneficiary to receive benefits if the Participant dies or, if the Participant has died, transfers to or exercises by the Participant’s beneficiary, or, in the absence of a validly designated beneficiary, transfers by will or the laws of descent and distribution; or

 

(c)                                  if the Participant has suffered a Disability, permitted transfers or exercises on behalf of the Participant by the Participant’s duly authorized legal representative; or

 

(d)                                 subject to the prior approval of the Committee or an executive officer or director of the Company authorized by the Committee, transfer to one or more natural persons who are the Participant’s family members or entities owned and controlled by the Participant and/or the Participant’s family members, including but not limited to special purpose vehicles, trusts or other entities whose beneficiaries or beneficial owners are the Participant and/or the Participant’s family members, or to such other persons or entities as may be expressly approved by the Committee, pursuant to such conditions and procedures as the Committee may establish. Any permitted transfer shall be subject to the condition that the Committee receives evidence satisfactory to it that the transfer is being made for estate and/or tax planning purposes and on a basis consistent with the Company’s lawful issue of securities.

 

Notwithstanding anything else in this Section 8.2.2 to the contrary, but subject to compliance with all Applicable Laws, Incentive Share Options, Restricted Shares and Restricted Share Units will be subject to any and all transfer restrictions under the Code applicable to such Awards or necessary to maintain the intended tax consequences of such Awards.

 

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8.3                               Beneficiaries Notwithstanding Section 8.2, a Participant may, in the manner determined by the Committee, designate a beneficiary to exercise the rights of the Participant and to receive any distribution with respect to any Award upon the Participant’s death. A beneficiary, legal guardian, legal representative, or other person claiming any rights pursuant to the Plan is subject to all terms and conditions of the Plan and any Award Agreement applicable to the Participant, except to the extent the Plan and Award Agreement otherwise provide, and to any additional restrictions deemed necessary or appropriate by the Committee. If the Participant is married and resides in a community property state, a designation of a person other than the Participant’s spouse as his or her beneficiary with respect to more than 50% of the Participant’s interest in the Award shall not be effective without the prior written consent of the Participant’s spouse. If no beneficiary has been designated or survives the Participant, payment shall be made to the person entitled thereto pursuant to the Participant’s will or the laws of descent and distribution. Subject to the foregoing, a beneficiary designation may be changed or revoked by a Participant at any time provided the change or revocation is filed with the Committee.

 

8.4                               Performance Objectives and Other Terms The Committee, in its discretion, may set performance objectives or other vesting criteria which, depending on the extent to which they are met, will determine the number or value of the Awards that will be granted or paid out to the Participants.

 

8.5                               Share Certificates. Notwithstanding anything herein to the contrary, the Company shall not be required to issue or deliver any certificates evidencing the Shares pursuant to the exercise of any Award, unless and until the Committee has determined, with advice of counsel, that the issuance and delivery of such certificates is in compliance with all Applicable Laws, regulations of governmental authorities and, if applicable, the requirements of any exchange on which the Shares are listed or traded. All Share certificates delivered pursuant to the Plan are subject to any stop-transfer orders and other restrictions as the Committee deems necessary or advisable to comply with all Applicable Laws, and the rules of any national securities exchange or automated quotation system on which the Shares are listed, quoted, or traded. The Committee may place legends on any Share certificate to reference restrictions applicable to the Shares. In addition to the terms and conditions provided herein, the Committee may require that a Participant make such reasonable covenants, agreements, and representations as the Committee, in its discretion, deems advisable in order to comply with any such Applicable Laws. The Committee shall have the right to require any Participant to comply with any timing or other restrictions with respect to the settlement or exercise of any Award, including a window-period limitation, as may be imposed in the discretion of the Committee.

 

8.6                               Paperless Administration. Subject to Applicable Laws, the Committee may make Awards and provide applicable disclosure and procedures for exercise of Awards by an internet website or interactive voice response system for the paperless administration of Awards.

 

8.7                               Foreign Currency. A Participant may be required to provide evidence that any currency used to pay the exercise price of any Award was acquired and taken out of the jurisdiction in which the Participant resides in accordance with Applicable Laws, including foreign exchange control laws and regulations. In the event the exercise price for an Award is paid in Chinese Renminbi or other foreign currency, as permitted by the Committee, the amount payable will be determined by conversion from U.S. dollars at the official rate promulgated by the People’s Bank of China for Chinese Renminbi, or for jurisdictions other than the People’s Republic of China, the exchange rate as selected by the Committee on the date of exercise.

 

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ARTICLE 9

 

CHANGES IN CAPITAL STRUCTURE

 

9.1                               Adjustments In the event of any dividend, share split, combination or exchange of Shares, amalgamation, arrangement or consolidation, spin-off, recapitalization or other distribution (other than normal cash dividends) of Company assets to its shareholders, or any other change affecting the number of Shares or the price of a Share, the Committee shall make such proportionate adjustments, if any, as the Committee in its discretion may deem appropriate to reflect such change with respect to (a) the aggregate number and type of shares that may be issued under the Plan (including, but not limited to, adjustments of the limitations in Section 3.1); (b) the terms and conditions of any outstanding Awards (including, without limitation, any applicable performance targets or criteria with respect thereto); and (c) the grant or exercise price per share for any outstanding Awards under the Plan, provided that the exercise price per Share shall in no circumstances fall below the par value of such Share.

 

9.2                               Corporate Transactions. Except as may otherwise be provided in any Award Agreement or any other written agreement entered into by and between the Company and a Participant, if the Committee anticipates the occurrence, or upon the occurrence, of a Corporate Transaction, the Committee may, in its sole discretion, provide for (i) any and all Awards outstanding hereunder to terminate at a specific time in the future and shall give each Participant the right to exercise the vested portion of such Awards during a period of time as the Committee shall determine, or (ii) the purchase of any Award for an amount of cash equal to the amount that could have been attained upon the exercise of such Award (and, for the avoidance of doubt, if as of such date the Committee determines in good faith that no amount would have been attained upon the exercise of such Award, then such Award may be terminated by the Company without payment), or (iii) the replacement of such Award with other rights or property selected by the Committee in its sole discretion or the assumption of or substitution of such Award by the successor or surviving corporation, or a Parent or Subsidiary thereof, with appropriate adjustments as to the number and kind of Shares and prices, or (iv) payment of such Award in cash based on the value of Shares on the date of the Corporate Transaction plus reasonable interest on the Award through the date as determined by the Committee when such Award would otherwise be vested or have been paid in accordance with its original terms, if necessary to comply with Section 409A of the Code.

 

9.3                               Outstanding Awards — Other Changes. In the event of any other change in the capitalization of the Company or corporate change other than those specifically referred to in this Article 9, the Committee may, in its absolute discretion, make such adjustments in the number and class of shares subject to Awards outstanding on the date on which such change occurs and in the per share grant or exercise price of each Award as the Committee may consider appropriate to prevent dilution or enlargement of rights (provided that the exercise price per Share shall in no circumstances fall below the par value of such Share).

 

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9.4                               No Other Rights. Except as expressly provided in the Plan, no Participant shall have any rights by reason of any subdivision or consolidation of Shares of any class, the payment of any dividend, any increase or decrease in the number of shares of any class or any dissolution, liquidation, merger, or consolidation of the Company or any other corporation. Except as expressly provided in the Plan or pursuant to action of the Committee under the Plan, and no issuance by the Company of shares of any class, or securities convertible into shares of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number of Shares subject to an Award or the grant or exercise price of any Award.

 

ARTICLE 10

 

ADMINISTRATION

 

10.1                        Committee. The Plan shall be administered by the Board or the Compensation Committee of the Board (the “Committee”) to whom the Board shall delegate the authority to grant or amend Awards to Participants other than any of the Committee members. Reference to the Committee shall refer to the Board in absence of the Committee. Notwithstanding the foregoing, the full Board, acting by majority of its members in office, shall conduct the general administration of the Plan if required by Applicable Laws, and with respect to Awards granted to the Committee members and for purposes of such Awards the term “Committee” as used in the Plan shall be deemed to refer to the Board.

 

10.2                        Action by the Committee. A majority of the Committee shall constitute a quorum. The acts of a majority of the members of the Committee present at any meeting at which a quorum is present, and acts approved unanimously in writing by all members of the Committee in lieu of a meeting, shall be deemed the acts of the Committee. Each member of the Committee is entitled to, in good faith, rely or act upon any report or other information furnished to that member by any officer or other employee of a Group Entity, the Company’s independent certified public accountants, or any executive compensation consultant or other professional retained by the Company to assist in the administration of the Plan.

 

10.3                        Authority of the Committee. Subject to any specific designation in the Plan, the Committee has the exclusive power, authority and discretion to:

 

(a)                                 designate Participants to receive Awards;

 

(b)                                 determine the type or types of Awards to be granted to each Participant;

 

(c)                                  determine the number of Awards to be granted and the number of Shares to which an Award will relate;

 

(d)                                 designate an administrator to administer the Awards to Participants other than Committee members and executive officers of the Company, including designating Participants to receive Awards, determining the type or types of Awards to be granted to each Participant, determining the number of Awards to be granted and the number of Shares to which an Award will relate, determining the vesting terms, payment of the Award, and granting waiver of any conditions for the Award, or imposing any restriction or limitation regarding the Award or the Shares relating thereto, based in each case on such factors as the administrator, in its sole discretion, shall determine;

 

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(e)                                  determine the terms and conditions (including modifications thereto) of any Award granted pursuant to the Plan, including, but not limited to, the vesting terms or schedule, exercise price, grant price, purchase price, payment, or any restrictions or limitations on the Award, any schedule for lapse of forfeiture restrictions or restrictions on the exercisability of an Award, and accelerations or waivers of conditions, and any provisions related to non-competition and recapture of gain on an Award, based in each case on such considerations as the Committee in its sole discretion determines;

 

(f)                                   determine whether, to what extent, and pursuant to what circumstances an Award may be settled in, or the exercise price of an Award may be paid in, cash, Shares, other Awards, or other property, or an Award may be canceled, forfeited, or surrendered;

 

(g)                                  prescribe the form of each Award Agreement, which need not be identical for each Participant;

 

(h)                                 decide all other matters that must be determined in connection with an Award;

 

(i)                                     establish, adopt, or revise any rules and regulations as it may deem necessary or advisable to administer the Plan;

 

(j)                                    interpret the terms of, and any matter arising pursuant to, the Plan or any Award Agreement;

 

(k)                                 amend terms and conditions of Award Agreements; and

 

(l)                                     make all other decisions and determinations that may be required pursuant to the Plan or as the Committee deems necessary or advisable to administer the Plan, including design and adopt from time to time new types of Awards that are in compliance with Applicable Laws.

 

10.4                        Decisions Binding. The Committee’s interpretation of the Plan, any Awards granted pursuant to the Plan, any Award Agreement and all decisions and determinations by the Committee with respect to the Plan are final, binding, and conclusive on all Participants.

 

ARTICLE 11

 

EFFECTIVE AND EXPIRATION DATE

 

11.1                        Effective Date. The Plan shall become effective as of the date on which the Board adopts the Plan or as otherwise specified by the Board when adopting the Plan (the “Effective Date”).

 

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11.2                        Expiration Date. The Plan will expire on, and no Award may be granted pursuant to the Plan after, the tenth anniversary of the Effective Date. Any Awards that are outstanding on the tenth anniversary of the Effective Date shall remain in force according to the terms of the Plan and the applicable Award Agreement.

 

ARTICLE 12

 

AMENDMENT, MODIFICATION, AND TERMINATION

 

12.1                        Amendment, Modification, and Termination. At any time and from time to time, the Board may terminate, amend or modify the Plan; provided, however, that (a) to the extent necessary and desirable to comply with Applicable Laws or stock exchange rules, the Company shall obtain shareholder approval of any Plan amendment in such a manner and to such a degree as required, unless the Company decides to follow home country practice, and (b) unless the Company decides to follow home country practice, shareholder approval is required for any amendment to the Plan that (i) increases the number of Shares available under the Plan (other than any adjustment as provided by Article 9 or Section 3.1(a)), or (ii) permits the Committee to extend the term of the Plan or the exercise period for an Option beyond ten years from the date of grant.

 

12.2                        Awards Previously Granted. Except with respect to amendments made pursuant to Section 12.1, no termination, amendment, or modification of the Plan shall adversely affect in any material way any Award previously granted pursuant to the Plan without the prior written consent of the Participant.

 

ARTICLE 13

 

GENERAL PROVISIONS

 

13.1                        No Rights to Awards. No Participant, employee, or other person shall have any claim to be granted any Award pursuant to the Plan, and neither the Company nor the Committee is obligated to treat Participants, employees, and other persons uniformly.

 

13.2                        No Shareholders Rights. No Award gives the Participant any of the rights of a shareholder of the Company unless and until Shares are in fact issued to such person in connection with such Award.

 

13.3                        Taxes. No Shares shall be delivered under the Plan to any Participant until such Participant has made arrangements acceptable to the Committee for the satisfaction of any income and employment tax withholding obligations under Applicable Laws. The Company or any Subsidiary shall have the authority and the right to deduct or withhold, or require a Participant to remit to the Company, an amount sufficient to satisfy all applicable taxes (including the Participant’s payroll tax obligations) required or permitted by Applicable Laws to be withheld with respect to any taxable event concerning a Participant arising as a result of the Plan. The Committee may in its discretion and in satisfaction of the foregoing requirement allow a Participant to elect to have the Company withhold Shares otherwise issuable under an Award (or allow the return of Shares) having a Fair Market Value equal to the sums required to be withheld. Notwithstanding any other provision of the Plan, the number of Shares which may be withheld with respect to the issuance, vesting, exercise or payment of any Award (or which may be repurchased from the Participant of such Award after such Shares were acquired by the Participant from the Company) in order to satisfy any income and payroll tax liabilities applicable to the Participant with respect to the issuance, vesting, exercise or payment of the Award shall, unless specifically approved by the Committee, be limited to the number of Shares which have a Fair Market Value on the date of withholding or repurchase equal to the aggregate amount of such liabilities based on the minimum statutory withholding rates for the applicable income and payroll tax purposes that are applicable to such supplemental taxable income.

 

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13.4                        No Right to Employment or Services. Nothing in the Plan or any Award Agreement shall interfere with or limit in any way the right of the Service Recipient to terminate any Participant’s employment or services at any time, nor confer upon any Participant any right to continue in the employment or services of any Service Recipient.

 

13.5                        Unfunded Status of Awards. The Plan is intended to be an “unfunded” plan for incentive compensation. With respect to any payments not yet made to a Participant pursuant to an Award, nothing contained in the Plan or any Award Agreement shall give the Participant any rights that are greater than those of a general creditor of the relevant Group Entity.

 

13.6                        Indemnification. To the extent allowable pursuant to Applicable Laws, each member of the Committee or of the Board shall be indemnified and held harmless by the Company from any loss, cost, liability, or expense that may be imposed upon or reasonably incurred by such member in connection with or resulting from any claim, action, suit, or proceeding to which he or she may be a party or in which he or she may be involved by reason of any action or failure to act pursuant to the Plan and against and from any and all amounts paid by him or her in satisfaction of judgment in such action, suit, or proceeding against him or her; provided he or she gives the Company an opportunity, at its own expense, to handle and defend the same before he or she undertakes to handle and defend it on his or her own behalf. The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such persons may be entitled pursuant to the Company’s Memorandum of Association and Articles of Association, as a matter of law, or otherwise, or any power that the Company may have to indemnify them or hold them harmless.

 

13.7                        Relationship to Other Benefits. No payment pursuant to the Plan shall be taken into account in determining any benefits pursuant to any pension, retirement, savings, profit sharing, group insurance, welfare or other benefit plan of the any Group Entity except to the extent otherwise expressly provided in writing in such other plan or an agreement thereunder.

 

13.8                        Expenses. The expenses of administering the Plan shall be borne by the Group Entities.

 

13.9                        Titles and Headings. The titles and headings of the Sections in the Plan are for convenience of reference only and, in the event of any conflict, the text of the Plan, rather than such titles or headings, shall control.

 

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13.10                 Fractional Shares. No fractional Shares shall be issued and the Committee shall determine, in its discretion, whether cash shall be given in lieu of fractional Shares or whether such fractional Shares shall be eliminated by rounding up or down as appropriate.

 

13.11                 Government and Other Regulations. The obligation of the Company to make payment of awards in Shares or otherwise shall be subject to all Applicable Laws, and to such approvals by government agencies as may be required. The Company shall be under no obligation to register any of the Shares paid pursuant to the Plan under the Securities Act or any other similar law in any applicable jurisdiction. If the Shares paid pursuant to the Plan may in certain circumstances be exempt from registration pursuant to the Securities Act or other Applicable Laws, the Company may restrict the transfer of such Shares in such manner as it deems advisable to ensure the availability of any such exemption.

 

13.12                 Governing Law. The Plan and all Award Agreements shall be construed in accordance with and governed by the laws of the Cayman Islands.

 

13.13                 Section 409A. To the extent that the Committee determines that any Award granted under the Plan is or may become subject to Section 409A of the Code, the Award Agreement evidencing such Award shall incorporate the terms and conditions required by Section 409A of the Code. To the extent applicable, the Plan and the Award Agreements shall be interpreted in accordance with Section 409A of the Code and the U.S. Department of Treasury regulations and other interpretative guidance issued thereunder, including without limitation any such regulation or other guidance that may be issued after the Effective Date. Notwithstanding any provision of the Plan to the contrary, in the event that following the Effective Date the Committee determines that any Award may be subject to Section 409A of the Code and related Department of Treasury guidance (including such Department of Treasury guidance as may be issued after the Effective Date), the Committee may adopt such amendments to the Plan and the applicable Award agreement or adopt other policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, that the Committee determines are necessary or appropriate to (a) exempt the Award from Section 409A of the Code and/or preserve the intended tax treatment of the benefits provided with respect to the Award, or (b) comply with the requirements of Section 409A of the Code and related U.S. Department of Treasury guidance.

 

13.14                 Appendices. Subject to Section 12.1, the Committee may approve such supplements, amendments or appendices to the Plan as it may consider necessary or appropriate for purposes of compliance with Applicable Laws or otherwise and such supplements, amendments or appendices shall be considered a part of the Plan; provided, however, that no such supplements shall increase the share limitation contained in Section 3.1 of the Plan without the approval of the Board.

 

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