Document:

Exhibit 4.2

 

DESCRIPTION OF THE REGISTRANT’S
SECURITIES

REGISTERED PURSUANT TO SECTION 12 OF
THE

SECURITIES EXCHANGE ACT OF 1934

 

As of December 31, 2019, Pingtan Marine
Enterprise Ltd. Inc. (“Company,” “PME,” “we,” “our” and “us”) has one
class of securities registered under Section 12 of the Securities Exchange Act of 1934, as amended, ordinary shares, par value
of $0.001 per share (“ordinary shares”). Our ordinary shares are currently listed for trading on the Nasdaq Capital
Market under the symbol “PME.”

 

The following description summarizes the
most important terms of our share capital. Because it is only a summary, it does not contain all the information that may be important
to you. For a complete description, you should refer to our amended and restated memorandum and articles of association, a copy
of which has been filed with the SEC, and the applicable provisions of the Companies Law (2016 Revision), as amended (the “Companies
Law”).

 

 

General

 

The Company’s authorized share capital
consists of 125,000,000 ordinary shares of par value $0.001 each, of which 79,055,053 shares were issued and outstanding as of
March 13, 2020 and 5,000,000 preferred shares of par value of US$0.001 each, of which no shares are issued and outstanding.

 

Dividends

 

The holders of our shares are entitled to
such dividends as may be declared by our board of directors. If any share is issued on terms providing that it shall rank for dividend
as from a particular date, that share shall rank for dividend accordingly. Under Cayman Islands law, a Cayman Islands company may
pay a dividend only out of either profit or share premium account, provided that in no circumstances may a dividend be paid if
this would result in the company being unable to pay its debts as they fall due in the ordinary course of business.

 

Voting Rights

 

Each ordinary share is entitled to one vote
on all matters upon which the shares are entitled to vote. Voting at any meeting of shareholders is by show of hands unless a poll
is demanded. Our amended and restated memorandum and articles of association do not provide for cumulative voting.

 

Liquidation

 

On the winding up of our company, if the
assets available for distribution amongst our shareholders shall be more than sufficient to repay the whole of the share capital
at the commencement of the winding up, the surplus shall be distributed amongst our shareholders in proportion to the par value
of the shares held by them at the commencement of the winding up, subject to a deduction from those shares in respect of which
there are monies due, of all monies payable to our company for unpaid calls or otherwise. If our assets available for distribution
are insufficient to repay all of the paid-up capital, the assets will be distributed so that the losses are borne by our shareholders
in proportion to the par value of the shares held by them.

 

Variations of Rights of Shares

 

If at any time, our share capital is divided
into different classes of shares, all or any of the special rights attached to any class of shares may be varied with the consent
in writing of the holders of not less than three-fourths of the issued shares of that class or with the sanction of a special resolution
passed at a general meeting of the holders of the shares of that class. The rights conferred upon the holders of the shares of
any class issued with preferred or other rights will not, unless otherwise expressly provided by the terms of issue of the shares
of that class, be deemed to be varied by the creation or issue of further shares ranking paripassu with such existing class of
shares.

 

     

     

    

 

General Meetings of Shareholders and Shareholder Proposals

 

As a Cayman Islands exempted company, we
are not obliged by the Companies Law to call shareholders’ annual general meetings. Our amended and restated memorandum and
articles of association provide that we shall hold a general meeting as our annual general meeting each year and shall specify
the meeting as such in the notices calling it. The annual general meeting shall be held at such time and place as may be determined
by our directors and if no other time and place prescribed by them, it shall be held at the registered office of the Company on
the second Wednesday in December of each year at 10 o'clock in the morning.

 

Shareholders’ annual general meetings
and any other general meetings of our shareholders may be convened by a majority of our board of directors, chief executive officer
or the chairman of our board of directors. Advance notice of at least seven days is required for the convening of our annual general
shareholders’ meeting and any other general meeting of our shareholders.

 

Cayman Islands law provides shareholders
with only limited rights to requisition a general meeting, and does not provide shareholders with any right to put any proposal
before a general meeting. However, these rights may be provided in a company’s articles of association. Our amended and restated
memorandum and articles or association allow our shareholders holding shares representing in aggregate, not less than ten percent
of the votes attaching to the issued and outstanding shares of our company entitled to vote at general meetings, to requisition
an extraordinary general meeting of our shareholders, in which case our directors are obliged to call such meeting and to put the
resolutions so requisitioned to a vote at such meeting; however, our amended and restated memorandum and articles of association
do not provide our shareholders with any right to put any proposals before annual general meetings or extraordinary general meetings
not called by such shareholders.

 

The quorum at any general meeting is two
members being individuals present in person or by proxy or if a corporation or other non-natural person by its duly authorized
representative shall be a quorum unless the Company has only one member entitled to vote at such general meeting in which case
the quorum shall be that one member present in person or by proxy.

 

Election and Removal of Directors

 

The board is divided into three classes:
Class A, Class B and Class C and the number of directors in each class shall be as nearly equal as possible. At each annual general
meeting, Directors are elected for a term of office to expire at the third succeeding annual general meeting.

 

Our shareholders may also appoint any person
to be a director by an ordinary resolution. A director may be removed with or without cause by an ordinary resolution of our shareholders
passed at a general meeting.

 

Proceedings of Board of Directors

 

Our amended and restated memorandum and
articles of association provide that our business is to be managed and conducted by our board of directors. The quorum necessary
for the board meeting may be fixed by the board and, unless so fixed at another number, will be two or more directors.

 

Our amended and restated memorandum and
articles of association provide that the board may from time to time at its discretion exercise all powers of our company to borrow
money and to mortgage or charge our company's undertaking, property and uncalled capital or any part thereof, to issue debentures,
debenture stock and other securities whenever money is borrowed or as security for any debt, liability or obligation of our company
or of any third party.

 

    2

     

    

 

Shareholders’ Suits

 

In principle, we will normally be the proper
plaintiff to sue for a wrong done to us as a company and a derivative action may ordinarily not be brought by a minority shareholder.
However, based on English authority, which would in all likelihood be of persuasive authority in the Cayman Islands, the Cayman
Islands courts can be expected (and have had occasion) to follow and apply the common law principles (namely the rule in Foss v.
Harbottle and the exceptions thereto) so that a non-controlling shareholder may be permitted to commence a class action against
or derivative actions in the name of the company to challenge:

 

	 	(a)	an act which is ultra vires the company or illegal and is therefore incapable of ratification by the shareholders,
	 	(b)	an act which constitutes a fraud against the minority where the wrongdoers are themselves in control of the company, or
	 	(c)	an act which requires a resolution with a qualified (or special) majority (i.e. more than a simple majority) which has not been obtained.

 

Indemnification

 

Our amended and restated memorandum and
articles of association provide each Director, agent or officer of the Company shall be indemnified out of assets of the Company
against any liability incurred by him as a result of any act or failure to act in carrying out his functions other than such liability
(if any) that he may incur by his own fraud or willful default. No such Director, agent or officer shall be liable to the Company
for any loss or damage in carrying out his functions unless that liability arises through the fraud or willful default of such
Director, agent or officer.

 

We have entered into indemnification agreements
with each of our directors and executive officers and certain other key employees providing for indemnification to the fullest
extent permitted by Cayman Islands law and, in certain respects, the indemnification agreements may provide greater protection
than that specifically provided for by Cayman Islands law.

 

Insofar as indemnification for liabilities
arising under the Securities Act of 1933, as amended (the “Securities Act”), may be permitted with respect to our directors
or officers or persons controlling us under the foregoing provisions, the Company has been informed that in the opinion of the
SEC such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.

 

Directors’ Power to Issue Shares

 

Our board of directors is empowered to issue
or allot shares or grant options and warrants with or without preferred, deferred, qualified or other special rights or restrictions.

 

 

3juvf_Ex10_4

		
			Exhibit 10.4
		

		
			 
		

		
			 
		

		
			
		

		
			 
		

		
			 
		

		
			Employee Annual Incentive Plan
		

		
			Plan Document
		

		
			 
		

		
			 
		

		
			Plan Effective: January 1, 2004
		

		
			 
		

		
			Revised/Approved: February 7, 2020
		

		
			 
		

		
			 
		

		
			

		 

		

			 

		

			

					

						 

					

					

						 

				
	

					

						Last Amendment: June 19, 2012

					

					

						 

				
	

					

						Last Schedule A revision and approval: February 7, 2019

					

					

						 

				

		

			 

		

		

			

		

		

		
			 
		

		
			Employee Annual Incentive Plan
		

		
			 
		

		
			 
		

		
			I. Introduction/Purpose
		

		
			 
		

		
			This Employee Annual Incentive Plan has been developed as a meaningful compensation tool for employees at all levels, who through high levels of performance, contribute to the success and profitability of Juniata Valley Financial Corp (Company). The Plan is designed to support organizational objectives, financial goals, and the best interests of the shareholders as defined in the Bank’s Strategic Plan, by making available additional, variable, and contingent at-risk compensation, in the form of cash awards.
		

		
			 
		

		
			The Employee Annual Incentive Plan is based upon the achievement of required financial targets and other defined objectives consistent with those contained in the Strategic Plan. The formulas and awards have been carefully constructed to integrate the interests of the shareholder as well as enable the Bank to attract, retain, and motivate high quality personnel and support the continued growth and profitability of the Company.
		

		
			 
		

		
			The Plan is not meant to be a substitute for salary increases, but supplemental to base salary and a reward for performance that contributes to outstanding levels of long-term achievement.
		

		
			 
		

		
			While risk is an inherent aspect of business, this compensation plan is designed to reward executives for certain levels of performance without encouraging undue risk taking which could materially threaten the safety and soundness of the organization or business unit.
		

		
			 
		

		
			II. Plan Year
		

		
			 
		

		
			The Plan year for this program will be the calendar year. The effective date of the Plan is January 1, 2004. The performance measures for this will be determined, calculated and approved annually.
		

		
			 
		

		
			III. Participation
		

		
			 
		

		
			In order to be eligible, an individual must meet the following criteria:
		

		
			 
		

			
	
			
				 ·
			

			
	
			
			Must have been employed prior to July 1 of the Plan year;

			
	
			
				 ·
			

			
	
			
			Must be employed in a full-time or part-time position; and

			
	
			
				 ·
			

			
	
			
			Must receive an overall rating of “Good” or better on his/her most recent individual performance evaluation prior to the Plan year award.

		
			 
		

		
			
		

		
			

		 

		

			 

		

			

					

						 

					

					

						 

				
	

					

						Last Amendment: June 19, 2012

					

					

						Page 2 of 7

				
	

					

						Last Schedule A revision and approval: February 7, 2019

					

					

						 

				

		

			 

		

		

			

		

		

		
			 
		

		
			A participant's eligibility ceases at termination of employment (other than retirement, death or disability), and the participant will not receive any awards under the Plan for the year of termination. Termination as a result of retirement (as defined in the company’s retirement plans), death, or disability will provide pro-rated awards in the Plan through the last working date for the year in which termination occurred. If the participant dies during the Plan year, his/her designated beneficiary shall receive a pro-rated share of any award for which he/she would have been eligible.
		

		
			 
		

		
			Due to the various levels of responsibility of the positions within the Bank, the Board of Directors has selected the following Tiers of participation for the Employee Annual Incentive Plan. These tiers will generally be based upon position responsibility and grade level.
		

		
			 
		

		
			Tier 1 – President and Chief Executive Officer
		

		
			 
		

		
			Tier 2 – Executive Vice President/Chief Financial Officer
		

		
			 
		

		
			
		

		
			 
		

		
			IV. Performance Factors
		

		
			 
		

		
			The annual portion of the Plan is based upon company financial performance factors which may change from year to year. In general, these factors may be measures such as return on assets, return on equity, net income, earnings per share or similar indicators. The factors and weighing of the factors are determined at the beginning of each Plan year. Each factor has quantifiable objectives consisting of threshold, target and optimum goals. The Company’s financial performance factors for the current year can be found in Exhibit A.
		

		
			 
		

		
			V. Award Calculation and Distribution
		

		
			 
		

		
			Awards under the Plan are calculated according to determination of the established performance factors at year end. Company performance between the threshold and target, and target and optimum is interpolated. Awards are determined by taking the determined award percentage times eligible compensation.
		

		
			 
		

		
			
		

		
			

		 

		

			 

		

			

					

						 

					

					

						 

				
	

					

						Last Amendment: June 19, 2012

					

					

						Page 3 of 7

				
	

					

						Last Schedule A revision and approval: February 7, 2019

					

					

						 

				

		

			 

		

		

			

		

		

		
			 
		

		
			With regard to discretionary changes to award amounts relative to individual performance, please reference the following:
		

		
			 
		

		
			
		

		
			 
		

			
	
			
				 ·
			

			
	
			
			Tier 2 (Executive Vice President/Chief Financial Officer) – After the award is calculated according to the financial performance factors, the President and Chief Executive Officer may increase or decrease the award up to 10%* (of the calculated award amount) based on the participant’s individual performance for the year.

		
			 
		

			
	
			
				 ·
			

			
	
			
			Tier 1 (President and Chief Executive Officer) – After the award is calculated according to the financial performance factors, the Board may increase or decrease the award up to 10% (of the calculated award amount) based on the participant’s individual performance for the year.

		
			 
		

		
			*All discretionary adjustments within the 10% (of the calculated award amount) being made by the President and Chief Executive Officer will be reviewed and approved by the Board of Directors.
		

		
			 
		

		
			Bank performance below threshold will result in no awards being paid under the Plan. In the event this occurs, the President and Chief Executive Officer will have discretion to grant individual awards, with approval by the Board of Directors, for performance bonuses to those individuals who have achieved a high level of individual performance within their divisions.
		

		
			 
		

		
			Annual awards are paid in cash less normal payroll tax withholding. Awards will be paid within
		

		
			75 days following the end of the plan year. Any participant terminating employment (except retirement, death, or disability) prior to the actual payment of the award will forfeit that award.
		

		
			 
		

		
			While every effort has been made to ensure that this incentive plan does not motivate or reward undue risk taking, any results deemed to have been the result of inappropriate risk will be backed out of incentive payments. The Board of Directors has the discretion to lever incentive payments down by as much as 100% if it is determined that excessive risk has been taken. This can be done on an individual or overall basis, as appropriate.
		

		
			 
		

		
			
		

		
			

		 

		

			 

		

			

					

						 

					

					

						 

				
	

					

						Last Amendment: June 19, 2012

					

					

						Page 4 of 7

				
	

					

						Last Schedule A revision and approval: February 7, 2019

					

					

						 

				

		

			 

		

		

			

		

		

		
			 
		

		
			VI. Clawback
		

		
			 
		

		
			Awards will be recalculated if the relevant company performance measures upon which they are based are restated or otherwise adjusted within the 36-month period following the public release of the financial information. Any material overpayments or adjustments required by law will be owed back to the company.
		

		
			 
		

		
			VII. Administration
		

		
			 
		

		
			Eligible Compensation for purpose of this Plan is defined as a participant’s W-2 gross wages net of any option activity results, taxable retirement earnings, prior year commissions and bonuses and any other imputed income resulting from employee benefits.
		

		
			 
		

		
			The Board of Directors of the Bank may amend the Plan at any time.
		

		
			 
		

		
			Once established, performance factors will remain in place for the year, unless the Board of
		

		
			Directors decides otherwise.
		

		
			 
		

		
			Participation, performance factors, thresholds, targets and any other participation features are established each Plan year and may change from year to year according to the strategic objectives of the bank.
		

		
			 
		

		
			At least annually, the Chief Financial Officer acting as the highest ranking risk officer will review this Plan and provide a detailed report including a detailed assessment regarding any risk issues inherent in the Plan. This risk report and the plan document in full will be reviewed by the Personnel and Compensation Committee of the Board of Directors to ensure that the plan design is consistent with the compensation philosophy of Juniata Valley Bank and that the plan does not motivate undue risk taking. The annual review will also include the market competitiveness of the plan, the plan’s alignment with the Bank’s strategic plan, an assessment of how the plan meets the objectives in the Introduction of this document, plus the plan’s impact on the overall safety and soundness of the Bank. The Committee will then provide a report and recommendations to the full Board of Directors who are responsible to approve the Plan. The Board of Directors of the Bank may amend the Plan at any time.
		

		
			 
		

		
			The Plan does not constitute a contract of employment, and participation in the Plan does not give any employee the right to be retained by the Bank or any right or claim to an award under the Plan unless specifically accrued under the terms of this Plan.
		

		
			 
		

		
			Any right of a participant or his or her beneficiary to the payment of an award under this Plan may not be assigned, transferred, pledged or encumbered.
		

		
			 
		

		
			Any adjustments to the financial performance results utilized in this Plan because of extraordinary gains or losses or other items must be approved by the Board of Directors.
		

		
			 
		

		
			
		

		
			

		 

		

			 

		

			

					

						 

					

					

						 

				
	

					

						Last Amendment: June 19, 2012

					

					

						Page 5 of 7

				
	

					

						Last Schedule A revision and approval: February 7, 2019

					

					

						 

				

		

			 

		

		

			

		

		

		
			 
		

		
			VIII. Plan Approval
		

		
			 
		

		
			This Plan has been amended and approved by the Board of Directors of Juniata Valley Financial
		

		
			Corp on
		

		
			 
		

			
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						By

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Board of Directors

					
					
						 

				
	
					
						Juniata Valley Financial Corp

					
					
						 

				

		
			 
		

		
			
		

		
			

		 

		

			 

		

			

					

						 

					

					

						 

				
	

					

						Last Amendment: June 19, 2012

					

					

						Page 6 of 7

				
	

					

						Last Schedule A revision and approval: February 7, 2019

					

					

						 

				

		

			 

		

		

			

		

		

		
			 
		

		
			Exhibit A: Bank Performance Factors and Award Schedule Plan Year 2020
		

		
			 
		

		
			2020 Goals
		

		
			 
		

			
					
						Performance Measures
(Basic) Earnings Per Share (75%)

				
	
					
						Threshold

					
						$1.01

					
					
						Target

					
						$1.06

					
					
						Optimum

					
						$1.17

				
	
					
						Return on Average Equity (25%)

				
	
					
						Threshold

					
						7.03%

					
					
						Target

					
						7.40%

					
					
						Optimum

					
						8.14%

				

		
			 
		

		
			2020 Award Schedule
		

		
			 
		

		
			
		

		
			 
		

		
			NOTE: Awards will be interpolated for performance levels between threshold and target and target and maximum.
		

		
			 
		

		
			*Please see additional notes for these Tiers:
		

		
			 
		

		
			
		

		
			 
		

		
			Tier 2 (Executive Vice President/Chief Financial Officer) – After the award is calculated according to the financial performance factors, the President and Chief Executive Officer may increase or decrease the award up to 10%* (of the calculated award amount) based on the participant’s individual performance for the year.
		

		
			 
		

		
			Tier 1 (President and Chief Executive Officer) – After the award is calculated according to the financial performance factors, the Board may increase or decrease the award up to 10% (of the calculated award amount) based on the participant’s individual performance for the year.
		

		
			 
		

		
			*All discretionary adjustments within the 10% (of the calculated award amount) being made by the President and Chief Executive Officer will be reviewed and approved by the Board of Directors.
		

		
			 
		

		 

		

			 

		

			

					

						 

					

					

						 

				
	

					

						Last Amendment: June 19, 2012

					

					

						Page 7 of 7

				
	

					

						Last Schedule A revision and approval: February 7, 2019

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